ATOK BIG-WEDGE MINING COMPANY, petitioner, vs. HON.

INTERMEDIATE APPELLATE COURT and

TUKTUKAN SAINGAN, respondents. ATOK BIG-WEDGE MINING COMPANY, petitioner, vs. HON.
INTERMEDIATE APPELLATE COURT and TUKTUKAN SAINGAN, respondents.

Facts: Subject Land-41,296 square meters situated in the barrio of Lucnab, Itogon, Benguet.
Parties: A. ATOK BIG-WEDGE MINING COMPANY (claiming that the said parcel of land is a
mineral land.) B. TUKTUKAN SAINGAN (claiming that the said parcel of land is agricultural.)
Contentions: Atok- they contended that the said parcel of land was being registered in the
office of Mining Recorder in 1921 and 1931 pursuant to Philippine Bill of 1902. It is about
sixteen years before TUKTUKAN declared the land in question for taxation purposes and thirty
four (34) years before private respondent filed the land registration proceedings in 1965.
They also showed the payment of annual assessment fees for the said land since 1931.
Tuktukan- who was 70 years old at the time he testified shows that he acquired the land
from his father-in-law, Dongail, when he married his daughter; that he was then 18 years
old; that at the time of his acquisition, it was planted with camotes, casava, langka, gabi,
coffee and avocados; that he lived on the land since his marriage up to the present; that
he has been paying the taxes during the Japanese occupation and even before it; that he was
never disturbed in his possession. Supporting his oral testimony, applicant [Tuktukan]
submitted tax declarations x x x both dated March 20, 1948, the former for a rural land and
the latter for urban land and improvement therein.

Issue: Whether or not the said parcel of land is a mineral land or an agricultural land.
History of mining Act 1. Spanish Mining Law of 1867 2. Philippine Bill Of 1902 (American
time) when the subject land had been registered 3. Commonwealth Act No. 137 (under the 1935
Constitution) 4. Executive Order 141 (Pres. Marcos 1968) 5. President Decree No. 1214 (1977)
All of the mining acts have a common provision which is the annual performance of labor or
undertaking of improvements on the mine.

Held: The SC ruled in favor of the Tuktukan in the reasons that: A. Tuktukan have proven
that he had in possession of the said land in a concept of an owner, continuously, open and
uninterrupted for a period of more than 30 years. B. He had improve almost 90% of the said
parcel of land. C. He had paid tax declaration of the said land since 1948 up to present.
It is evident that Atok had registered the land prior than Tuktukan but still the SC ruled
in favor of Tuktukan for the reasons: A. Payment of annual assessment fee is not enough
proof. There must be an annual performance of labor or undertaking of improvements in the
mine. B. When an ocular survey was made, it was evident that there was No improvements being
made in the said land and there is any sign of mining had happened in the land. Hence, the
petition is DENIED.
Republic v. Court of Appeals, G.R. No. L-43938 (April 15, 1988) Case Digest

Facts: Jose dela Rosa filed an application for registration of a parcel of land on his own
behalf and on behalf of his children. This application was separately opposed by Benguet
Consolidated, Inc. (Benguet) and Atok Big Wedge Corporation (Atok). The petitioners claimed
that they have acquired the land from their parents and that they have been in possession
of the land ever since. Benguet and Atok opposed on the ground that they have mineral
claims covering the property and had been in actual, continuous and exclusive possession of
the land in concept of owner.

The trial court denied the application while the Court of Appeals reversed the decision of
the trial court and recognized the claims of the applicant but subject to the rights of
Benguet and Atok respecting their mining claims. In other words, the Court of Appeals
affirmed the surface rights of the de la Rosas over the land while at the same time reserving
the sub-surface rights of Benguet and Atok by virtue of their mining claims.

Issue: Whether or not the CA's ruling was correct.

Held: No, the CA was incorrect.

Art. 437. The owner of a parcel of land is the owner of its surface and of everything under
it, and he can construct thereon any works or make any plantations and excavations which he
may deem proper, without detriment to servitudes and subject to special laws and ordinances.
He cannot complain of the reasonable requirements of aerial navigation.

Under the theory of the respondent court, the surface owner will be planting on the land
while the mining locator will be boring tunnels underneath. The farmer cannot dig a well
because he may interfere with the operations below and the miner cannot blast a tunnel lest
he destroy the crops above. How deep can the farmer, and how high can the miner, go without
encroaching on each other's rights? Where is the dividing line between the surface and the
sub-surface rights?

It is a well-known principle that the owner of piece of land has rights not only to its
surface but also to everything underneath and the airspace above it up to a reasonable
height. The rights over the land are indivisible and that the land itself cannot be half
agricultural and half mineral. The classification must be categorical; the land must be
either completely mineral or completely agricultural. In the instant case, as already
observed, the land which was originally classified as forest land ceased to be so and became
mineral and completely mineral once the mining claims were perfected. As long as mining
operations were being undertaken thereon, or underneath, it did not cease to be so and
become agricultural, even if only partly so, because it was enclosed with a fence and was
cultivated by those who were unlawfully occupying the surface.
SOUTHEAST MINDANAO GOLDMINING CORP. vs. BALITE PORTALMINING COOP., et al.[G.R. No. 135190,
April 3, 2002]

FACTS:
O n M a rc h 10 , 19 8 8 , M a r co p p er M i n i ng C or p o ra t i on ( Ma r c o ppe r ) w as g ra n t ed E x pl
o r a t i on P e rm i t N o. 133 ( EP No. 133) ov e r 4 ,4 9 1 h ec t ar e s of l an d , w hi c h
i n c l u de d the Diwalwal area. On June 27, 2991, Congress enacted Republic Act No.
7076, or the People's Small-
Scale Mining Act. The law established a People's Small-
S c a l e M i n i n g P r o g r a m t o b e implemented by the Secretary of the DENR and created the
Provincial Mining Regulatory Board (PMRB) under the DENR Secretary's direct supervision and
control. S u b s e q u en t l y, a p e tit i o n f o r t h e c a n ce l l at i o n o f E P No . 13 3 a n d t h e
a d m i s si o n of a Mineral Production Sharing Arrangement (MPSA) proposal over Diwalwal was
filed before the DENR Regional Executive Director, docketed as RED Mines Case. On February
16, 1994, while the RED Mines case was pending, Marcopper assigned its EP No. 133 to
petitioner Southeast Mindanao Gold Mining Corporation (SEM), which in turn applied
for an integrated MPSA over the land covered by the permit. In due time, the Mines and
Geosciences Bureau Regional Office No. XI in Davao City (MGB-XI) accepted and
registered the integrated MPSA application of petitioner and thereafter, several MAC cases
were filed. On March 3, 1995, Republic Act No. 7942, the Philippine Mining Act, was
enacted. Pursuant to this statute, the MAC cases were referred to a Regional Panel of
Arbitrators (RPA) tasked to resolve disputes involving conflicting mining rights. The
RPA subsequently took cognizance of the RED Mines case, which was consolidated with the
MAC cases. On June 24, 1997, the DENR Secretary issued Memorandum Order No. 97 -03
which p r o v i de d th a t th e D EN R s h a l l s t u dy t h or o u gh l y an d e x h a u st i v el y t he o p
t i o n of d i re t s ta t e utilization of the mineral resources in the Diwalwal Gold-Rush Area.
On July 16, 1997, petitione r filed a special civil action for certiorari,
prohibition and mandamus before the Court of Appeals against PMRB-Davao, the DENR Secretary
and Balite Communal Portal Mining Cooperative (BCPMC). It prayed for the nullification of
the above-quoted Memorandum Order No. 97-03 on the ground that the "direct state utilization"
espoused therein would effectively impair its vested rights under EP No. 133; and
that the memorandum order arbitrarily imposed the unwarranted condition that certain
studies be conducted before mining and environmental laws are enforced by the DENR.

ISSUE: Whether or not the "direct state utilization scheme" espoused in MO 97-
03 divested petitioner of its vested right to the gold rush area under its EP No. 133.

HELD: No. M O 9 7 - 0 3 d id n o t co nc l u s i ve l y ad o p t "d i r ec t s t ate u t i l iz a t io n " a s a

policy in resolving the Diwalwal dispute. The terms of the memorandum clearly
indicate that what was directed hereunder was merely a study of this option and nothing
else. Contrary to petitioner's contention, it did not grant any management/operating or
profit-sharing agreement to small-scale miners or to any party, for that matter, but
simply instructed the DENR officials concerned to undertake studies to determine its
feasibility. As to the alleged "vested rights" claimed by petitioner, it is well to note
that the same is invariably based on EP No. 133, whose validity is still being disputed in
the Consolidated Mines cases. A reading of the appealed MAB decision reveals that the
continued efficacy of EP No. 133 is one of the issues raised in said cases, with
respondents therein asserting that Marcopper cannot legally assign the permit which
purportedly had expired. In other words, whether or not petitioner actually has a vested
right over Diwalwal under EP No. 133 is still an indefinite and unsettled matter. And
until a positive pronouncement is made by the appellate court in the Consolidated
Mines cases, EP No. 133 cannot be deemed as a source of any conclusive rights that can be
impaired by the issuance of MO 97-03. It must likewise be pointed out that under no
circumstances may petitioner's rights under EP No. 133 be regarded as total and absolute. As
correctly held by the Court of Appeals EP No.133 merely evidences a privilege granted
by the State, which may be amended, modified or rescinded when the national interest
so requires. This is necessarily so since the exploration, development and utilization
of the country's natural mineral resources are matters impressed with great public
interest. Like timber permits, mining exploration permits do not vest in the grantee any
permanent or irrevocable right within the purview of the non-impairment of contract and
due process clauses of the Constitution, since the State, under its all-encompassing
police power, may alter, modify or amend the same, in accordance with the demands of
the general welfare. A d d i t i o na l l y , t he r e c an be no v a l id o p p o s it i o n ra i s ed
a g a i n s t a m er e st u d y o f a n alternative which the State, through the DENR, is authorized
to undertake in the first place. Worth noting is Article XII, Section 2, of the
1987 Constitution and Section 4, Chapter II of the Philippine Mining Act of 1995. Thus, the
State may pursue the constitutional policy of full control and supervision of
theexploration, development and utilization of the country's natural mineral
resources, by either directly undertaking the same or by entering into agreements with
qualified entities. The DENR Secretary acted within his authority when he ordered a
study of the first option, which may be undertaken consistently in accordance with
the constitutional policy enunciated above. Obviously, the State may not be
precluded from considering a direct takeover of the mines, if it is the only
plausible remedy in sight to the gnawing complexities generated by the gold rush.
L-24757

MIA
La Bugal-BLaan v. Ramos G.R. No. 127882, January 27, 2004, 421 SCRA 148

Syllabus: In any case, the constitutional provision, which allows the President to enter
into FTAAs with foreign-owned corporations, is an exception to the rule that participation
in the nations natural resources is reserved exclusively to Filipinos. Accordingly, the
provision must be construed strictly against their enjoyment by non-Filipinos. As
Commissioner Villegas emphasized, the provision is very restrictive. Commissioner Nolledo
also remarked that entering into service contracts is an exception to the rule on protection
of natural resources for the interest of the nation and, therefore, being an exception, it
should be subject, whenever possible, to stringent rules. Indeed, exceptions should be
strictly but reasonably construed; they extend only so far as their language fairly warrants
and all doubts should be resolved in favor of the general provision rather than the
exception.

Facts: Former President Aquino issued EO No. 279 which authorized the DENR Secretary to
accept and consider proposals from foreign-owned corporations or foreign investors for
contracts or agreements involving either technical or financial assistance for large-scale
exploration, development, and utilization of minerals, which, upon appropriate
recommendation, the President may execute with the foreign proponent. Subsequently, the
Philippine Mining Act was approved by Former President Ramos. The said law is to govern
the exploration, development, utilization, and processing of all mineral resources. It
also provides for (1) the procedure for the filing and approval, assignment/transfer and
withdrawal, and terms of mineral agreements; (2) financial or technical assistance
agreements (FTAA); and (3) that surface owners, occupants, or concessionaires are forbidden
from preventing holders of mining rights from entering private lands and concession areas.
Before the effectivity of the Philippine Mining Act, an FTAA was entered into by the
President and WMC Philippines covering land in South Cotabato, Sultan Kudarat, Davao del
Sur, and North Cotabato. Afterwards, DAO No. 96-40 was enacted providing for the Implementing
Rules and Regulations (IRR) of the Philippine Mining Act. Petitioners demanded in a letter
sent to the DENR Secretary the cessation of the implementation of both the Philippine Mining
Act and its IRR. Petitioners later filed a petition alleging that 100 FTAA applications had
already been filed by fully foreign-owned corporations and mining companies. Petitioners
alleged that the FTAA between RP and WMCP is illegal and unconstitutional. Petitioners
submit that, in accordance with the text of Section 2, Article XII of the Constitution,
FTAAs should be limited to technical or assistance only. However, the WMCP FTAA allows
WMCP, a fully foreign-owned mining corporation, to extend more than mere financial or
technical assistance to the State, for it permits WMCP to manage and operate every aspect
of the mining activity.

Issue: Whether the Philippine Mining Act is constitutional.

Ruling: Yes. The Philippine Mining Act is constitutional except for the following
provisions: Section 3 (aq), Section 23, Section 33 to 41, Section 56, The second and third
paragraphs of Section 81, and Section 90. The Philippine Mining Act is invalid insofar as
it authorizes service contracts. By the use of the phrase financial and technical
agreements, the same is actually treated as a service contract in violation of the
Constitution. This is because the FTAAs under the said Act grants beneficial ownership to
foreign contractors contrary to fundamental law. The Supreme Court held that: The phrase
management or other forms of assistance in the 1973 Constitution was deleted in the 1987
Constitution, which allows only technical or financial assistance. Casus omisus pro omisso
habendus est. A person, object or thing omitted from an enumeration must be held to have
been omitted intentionally. The management or operation of mining activities by foreign
contractors, which is the primary feature of service contracts, was precisely the evil that
the drafters of the 1987 Constitution sought to eradicate. Service contracts were eradicated
because it allowed for the circumvention of the constitutionally required 60 percent-40
percent capitalization for corporations or associations engaged in the exploitation,
development, and utilization of Philippine natural resources. Under the new Constitution,
foreign investors (fully alien-owned) can NOT participate in Filipino enterprises except to
provide: (1) Technical Assistance for highly technical enterprises; and (2) Financial
Assistance for large-scale enterprises. There can be little doubt that the WMCP FTAA itself
is a service contract. The contractual stipulations in WMCP FTAA grant WMCP beneficial
ownership over natural resources that properly belong to the state.
Miners Association of the Philippines vs Factoran Jr.

Facts: The petition seeks a ruling from this court on the validity of two Administrative
Orders 57 and 82 issued by the Secretary of the Department of Environment and Natural
Resources to carry out the provisions of Executive Orders 279 and 211. This
petitionarose from the fact that the 1987 Constitution provided for a different system of
exploration, development and utilization of the countrys natural resources. Unlike the1935
and 1973 Constitutions that allow the utilization of inalienable lands of public domain
through license, concession or lease, the 1987 Constitution provides for the full control
and supervision by the state of the exploration, development and utilization of the countrys
natural resources. Pres. Cory Aquino promulgated EO 211, which prescribes the interim
procedures in the processing and approval of applications for the exploration,
development and utilization of minerals in accordance to the 1987 Constitution. In addition,
Pres. Aquino also promulgated EO 279 authorizing the DENR Secretary to negotiate and conclude
joint venture, co-production or production-sharing agreements for the exploration,
development and utilization of mineral resources and prescribing the guidelines for such
agreements and those agreements involving technical or financial assistance by foreign-
owned corporations for large-scale exploration, development,
andutilization of minerals. In line with EO 279, the DENR Secretary issued AO 57Guidelin
es of Mineral Production Sharing Agreement under EO 279 and AO 82Procedural Guidelines on
the Award of Mineral Production Sharing Agreement (MPSA) through negotiation. Petitioner,
Miners Association of the Philippines, mainly contend that the DENR Secretary issued both
AOs 57 and 82 in excess of his rule-making power because these are inconsistent with the
provisions of EO 279.

Issue: whether AO Nos. 57 and 82, which are promulgated by the DENR, are valid and
constitutional.

Held: AO Nos. 57 and 82 are both constitutional and valid. This is due to the fact that
EO279, in effect, gave the Secretary of Natural Resources the authority to conclude
jointventure, co-production, or production sharing agreements for the exploration,
development and utilization of mineral resources. Furthermore, the constitutionality
of these administrative orders goes to show that the utilization of inalienable lands of
public domain is not merely done through license, concession or lease since the options
are now also open to the State through direct undertaking or by entering into co-
production, joint venture, or production sharing agreements.
Republic v. Rosemoor
G.R. No. 149927, March 30, 2004, 426 SCRA 517

Syllabus: A mining license that contravenes a mandatory provision of the law under which it
is granted is void. Being a mere privilege, a license does not vest absolute rights in the
holder. Thus, without offending the due process and the non-impairment clauses of the
Constitution, it can be revoked by the State on grounds of public interest.
Facts: The private respondents were granted permission to prospect for marble deposits in
Biak-na-Bato. The private respondents were able to discover high quality marble deposits in
commercial quantities. Thus, they applied with the Mines and Geosciences Bureau for a
license to exploit the said marble deposits in Mount Mabio at the Biak-na-Bato mountain
range. The Bureau granted the application and issued a license.
Minister Maceda cancelled the license after he was appointed. Rosemoor filed a petition
with a prayer for injunctive relief as a result of such cancellation. This was granted by
the court. Subsequently, the trial court ruled that the license of the private respondents
had already ripened into a property right which was protected by the due process clause of
the Constitution. It further held that the cancellation without notice and hearing violated
the private respondents right to due process, and Proclamation No. 84 which confirmed the
cancellation of the license, was an ex post facto law. The Court of Appeals affirmed the
decision.

Issues: (1) Whether the license of the respondents was issued in blatant contravention of
Section 69 of PD No. 463.

(2) Whether Proclamation No. 84 issued by then President Corazon Aquino is valid.

Ruling:(1) Yes. The license violates PD No. 463.

The license is subject to the terms and conditions of PD No. 463. Proclamation No. 2204,
awarding to Rosemoor the right to develop, exploit and utilize the mineral site, was subject
to existing laws, rules and regulations. Presidential Decree No. 463 is clear in mandating
that a quarry license, like that of respondents, should cover a maximum of 100 hectares in
any given province. There is no exception or reference to the number of applications for a
license.

(2) Yes. Proclamation No. 84 is valid.

Respondents license may be revoked or rescinded by executive action when the national
interest so requires. It is not a contract, property or a property right protected by the
due process clause of the Constitution. Moreover, under the Regalian doctrine, the State
can validly revoke the license of the respondents in the exercise of its police power. The
exercise of such power through Proclamation No. 84 is clearly in accord with jura regalia,
which reserves to the State ownership of all natural resources. This Regalian doctrine is
an exercise of its sovereign power as owner of lands of the public domain and of the
patrimony of the nation, the mineral deposits of which are a valuable asset.
Proclamation No. 84 cannot be stigmatized as a violation of the non-impairment clause
because the license is not a contract. It is also not a bill of attainder because the
declaration that the license is a patent nullity is certainly not a declaration of guilt.
Neither is the cancellation of the license a punishment within the purview of the
constitutional proscription against bills of attainder. Lastly, it is also not an ex post
facto law since it does not fall under any of the six instances which is considered such.
Proclamation No. 84 restored the area excluded from the Biak-na-Bato national park by
canceling respondents license, is clearly not penal in character.
SOUTHEAST MINDANAO GOLD MINING CORPORATION, petitioner, vs. BALITE PORTAL MINING COOPERATIVE
and others similarly situated; and THE HONORABLE ANTONIO CERILLES, in his capacity as
Secretary of the Department of Environment and Natural Resources (DENR), PROVINCIAL MINING
REGULATORY BOARD OF DAVAO (PMRB-Davao), respondents.

FACTS: The instant case involves a rich tract of mineral land situated in the Agusan-Davao-
Surigao Forest Reserve known as the Diwalwal Gold Rush Area. Located at Mt. Diwata in the
municipalities of Monkayo and Cateel in Davao Del Norte, the land has been embroiled in
controversy since the mid-80s due to the scramble over gold deposits found within its
bowels. On March 10, 1988, Marcopper Mining Corporation (Marcopper) was granted Exploration
Permit No. 133 (EP No. 133) over 4,491 hectares of land, which included the hotly-contested
Diwalwal area. Not long thereafter, Congress enacted on June 27, 1991 Republic Act No. 7076,
or the Peoples Small-Scale Mining Act. The law established a Peoples Small-Scale Mining
Program to be implemented by the Secretary of the DENR and created the Provincial Mining
Regulatory Board (PMRB) under the DENR Secretarys direct supervision and control. The
statute also authorized the PMRB to declare and set aside small-scale mining areas subject
to review by the DENR Secretary and award mining contracts to small-scale miners under
certain conditions. On December 21, 1991, DENR Secretary Fulgencio S. Factoran issued
Department Administrative Order (DAO) No. 66, declaring 729 hectares of the Diwalwal area
as non-forest land open to small-scale mining. The issuance was made pursuant to the powers
vested in the DENR Secretary by Proclamation No. 369, which established the Agusan-Davao-
Surigao Forest Reserve.

On June 24, 1997, the DENR Secretary issued Memorandum Order No. 97-03 which directs the
DENR to study thoroughly and exhaustively the option of direct state utilization of the
mineral resources in the Diwalwal Gold-Rush Area. Such study shall include, but shall not
be limited to, studying and weighing the feasibility of entering into management agreements
or operating agreements, or both, with the appropriate government instrumentalities or
private entities, or both, in carrying out the declared policy of rationalizing the mining
operations in the Diwalwal Gold Rush Area; such agreements shall include provisions for
profit-sharing between the state and the said parties, including profit-sharing arrangements
with small-scale miners, as well as the payment of royalties to indigenous cultural
communities, among others. The Undersecretary for Field Operations, as well as the
Undersecretary for Legal and Legislative Affairs and Attached Agencies, and the Director of
the Mines and Geosciences Bureau are hereby ordered to undertake such studies. x x x

Petitioner filed a special civil action for certiorari, prohibition and mandamus before the
Court of Appeals against PMRB-Davao, the DENR Secretary and Balite Communal Portal Mining
Cooperative (BCPMC), which represented all the OTP grantees. It prayed for the nullification
of the above-quoted Memorandum Order No. 97-03 on the ground that the direct state
utilization espoused therein would effectively impair its vested rights under EP No. 133.
The Court of Appeals dismissed the petition. It ruled that the DENR Secretary did not abuse
his discretion in issuing Memorandum Order No. 97-03 since the same was merely a directive
to conduct studies on the various options available to the government for solving the
Diwalwal conflict.

ISSUE: Whether or not the Court of Appeals erred when it concluded that the assailed
memorandum order did not adopt the direct state utilization scheme in resolving the
Diwalwal dispute.

Held: We agree with the Court of Appeals ruling that the challenged MO 97-03 did not
conclusively adopt direct state utilization as a policy in resolving the Diwalwal dispute.
The terms of the memorandum clearly indicate that what was directed thereunder was merely
a study of this option and nothing else. Contrary to petitioners contention, it did not
grant any management/operating or profit-sharing agreement to small-scale miners or to any
party, for that matter, but simply instructed the DENR officials concerned to undertake
studies to determine its feasibility.
ISAGANI CRUZ and CESAR EUROPA, petitioners, vs. SECRETARY OF ENVIRONMENT AND NATURAL
RESOURCES, SECRETARY OF BUDGET AND MANAGEMENT and CHAIRMAN and COMMISSIONERS OF THE NATIONAL
COMMISSION ON INDIGENOUS PEOPLES, respondents.

FACTS: Cruz, a noted constitutionalist, assailed the validity of the RA 8371 or the
Indigenous Peoples Rights Act on the ground that the law amount to an unlawful deprivation
of the States ownership over lands of the public domain as well as minerals and other
natural resources therein, in violation of the regalian doctrine embodied in Section 2,
Article XII of the Constitution. The IPRA law basically enumerates the rights of the
indigenous peoples over ancestral domains which may include natural resources. Cruz et al
contend that, by providing for an all-encompassing definition of ancestral domains and
ancestral lands which might even include private lands found within said areas, Sections
3(a) and 3(b) of said law violate the rights of private landowners.

ISSUE: Whether or not the IPRA law is unconstitutional.

HELD: The SC deliberated upon the matter. After deliberation they voted and reached a 7-7
vote. They deliberated again and the same result transpired. Since there was no majority
vote, Cruzs petition was dismissed and the IPRA law was sustained. Hence, ancestral domains
may include public domain somehow against the regalian doctrine.

(Thus, the separate opinions are more important in this case).

Most important issue: WoN Sections 3(a) and (b), 5, 6, 7, 8, and 57, and 58 of RA
8371/IPRA and its IRR are unconstitutional for unlawfully depriving the State of its
ownership over lands of the public domain, minerals, and other natural resources
therein, violating the regalian doctrine enshrined in Section 2, Article XII of the
Constitution
o Justice Kapunan: NO.
Said provisions affirming the ownership by indigenous peoples of their
ancestral lands and domains by virtue of native title (definition: lands
held in private ownership since time immemorial) do not diminish the
States ownership of lands within the public domain, because said
ancestral lands and domains are considered as private land, and never to
have been part of the public domain, following the doctrine laid down in
Cario v. Insular Government.
Section 3(a) does not confer or recognize any right of ownership over the
natural resources to the ICCs/IPs. Its purpose is definitional and not
declarative of a right or title.
Section 57 only grants priority rights to ICCs/IPs in the utilization
of natural resources and not absolute ownership thereof. The State retains
full control over the exploration, development and utilization of natural
resources through the imposition of requirements and conditions for the
 utilization of natural resources under existing laws, such as the Small-
Scale Mining Act of 1991 and the Philippine Mining Act of 1995. Neither
does the grant of said rights exclude non-indigenous peoples from
undertaking the same activities within the ancestral domains upon
authority granted by the proper governmental agency.
o Justice Puno: NO.
Ancestral lands and ancestral domains are not part of the lands of the
public domain. They are private and belong to the ICCs/IPs. The
classification of lands in the public domain under Section 3, Article XII
of the Constitution does not include ancestral lands nor ancestral
domains. The rights of ICCs/IPs to their ancestral domains and ancestral
lands may be acquired in two modes: (1) by native title over both ancestral
lands and domains; or (2) by torrens title under the Public Land Act and
the Land Registration Act with respect to ancestral lands only. Both modes
presume or recognize the land as private and not public.
The right of ownership to ancestral domain under Section 7(a) involves
lands, bodies of water traditionally and actually occupied by ICCs/IPs,
sacred places, traditional hunting and fishing grounds, and all
improvements made by them at any time within the domains, not waters,
minerals, coal, petroleum, and other mineral oils, all forces of potential
energy, fisheries, forests or timber, wildlife, flora and fauna, and other
natural resources enumerated in Section 2, Article XII of the
Constitution. Ownership therefore of natural resources remain with the
State.
Small-scale utilization of resources in Section 7(b) is also allowed under
paragraph 3, section 2, Article XII of the Constitution.
Finally, the large-scale utilization of natural resources in Section 57
of RA 8371/IPRA is allowed under paragraphs 1 and 4, section 2, Article
XII of the Constitution since only priority rights (which does not
necessarily mean ownership rights) are given to ICCs/IPs.
However, by including natural resources, Section 1, Part II, Rule III
of the Implementing Rules goes beyond Section 7(a) and therefore
unconstitutional.
o Justice Panganiban: YES.
Section 3(a) [whose definition of ancestral domain encompasses natural
resources found therein], and 3(b) [defines ancestral lands as those
possessed by ICCs/IPs since time immemorial] contravene Section 2, Article
XII of the Constitution, which declares that the State owns all lands of
the public domain, minerals, and natural resources none of which, except
agricultural lands, can be alienated. In addition, mere possession or
utilization of land, however long, does not automatically convert them
into private properties.
 IPRA/RA 8371 does not specify limits to ancestral lands and domains.
IPRA/RA 8371 relinquishes the States power under Section 2, Article XII
of the Constitution of full control of natural resources in ancestral
lands and ancestral domains in favor of ICCs/IPs, who may exercise these
rights without any time limit. In addition, they are also given the right
to negotiate directly the terms and conditions for the exploration of
natural resources under Section 7(b), a right vested by the Constitution
only to the State.
o Justice Vitug: YES. Sections 7 and 57 go beyond the context of the fundamental
law and virtually amount to an undue delegation, if not an unacceptable
abdication, of State authority over a significant area of the country and its
patrimony
WoN Sections 51 to 53, 59, 52(i), 63, 65, and 66 of RA 8371/IPRA, defining the powers
and jurisdiction of the NCIP and making customary law applicable to the settlement of
disputes involving ancestral domains and ancestral lands, violate the due process
clause of the Constitution
o Justice Kapunan: NO. The fact the NCIP is composed wholly of indigenous peoples
does not mean that it is incapable of being impartial. Moreover, the use of
customary laws is sanctioned by paragraph 2, Section 5 of Article XII of the
Constitution.
o Justice Puno: Not discussed.
o Justice Panganiban: Not discussed. It is best to await specific cases filed by
those whose rights may have been injured by these provisions.
o Justice Vitug: YES, but only on making customary law applicable to the
settlement of disputes involving ancestral domains and ancestral lands. The
second paragraph of Section 5 of Article XII of the Constitution allows Congress
to provide for the applicability of customary laws governing property rights or
relations in determining the ownership and extent of ancestral domains. I do
not see this statement as saying that Congress may enact a law that would simply
express that customary laws shall govern and end it there. No discussion on the
powers and jurisdiction of the NCIP.
WoN Rule VII, Part II, Section 1 of the NCIP Administrative Order No. 1, series of
1998, which provides that the administrative relationship of the NCIP to the Office
of the President is characterized as a lateral but autonomous relationship for
purposes of policy and program coordination, infringes upon the Presidents power of
control over executive departments under Section 17, Article VII of the Constitution
o Justice Kapunan: NO, since said provision as well as Section 40 of the IPRA
expressly places the NCIP under the Office of the President, and therefore under
the Presidents control and supervision with respect to its administrative
functions. However, insofar as the decisions of the NCIP in the exercise of its
quasi-judicial powers are concerned, the same are reviewable by the Court of
Appeals, like those of the NLRC and the SEC.
 o Justice Puno: Not discussed.
o Justice Panganiban: Not discussed. It is best to await specific cases filed by
those whose rights may have been injured by these provisions.
o Justice Vitug: Not discussed.

NOTES:

Seven Justices voted to dismiss the petitions

o Justice Kapunan filed an opinion, which the Chief Justice and Justices
Bellosillo, Quisumbing, and Santiago join, sustaining the validity of the
challenged provisions of R.A. 8371.
o Justice Puno also filed a separate opinion sustaining all challenged provisions
of the law with the exception of Section 1, Part II, Rule III of NCIP
Administrative Order No. 1, series of 1998, the Rules and Regulations
Implementing the IPRA, and Section 57 of the IPRA which he contends should be
interpreted as dealing with the large-scale exploitation of natural resources
and should be read in conjunction with Section 2, Article XII of the 1987
Constitution.
o Justice Mendoza voted to dismiss the petition solely on the ground that it does
not raise a justiciable controversy and petitioners do not have standing to
question the constitutionality of R.A. 8371.
Seven Justices voted to grant the petition
o Justice Panganiban filed a separate opinion expressing the view that Sections
3 (a)(b), 5, 6, 7 (a)(b), 8, and related provisions of R.A. 8371 are
unconstitutional. He reserves judgment on the constitutionality of Sections 58,
59, 65, and 66 of the law, which he believes must await the filing of specific
cases by those whose rights may have been violated by the IPRA.
o Justice Vitug also filed a separate opinion expressing the view that Sections
3(a), 7, and 57 of R.A. 8371 are unconstitutional. Justice Vitug also mentioned
that the petitioners have standing to raise the issue, as it is of transcendental
importance.
o Justices Melo, Pardo, Buena, Gonzaga-Reyes, and De Leon join in the separate
opinions of Justices Panganiban and Vitug.
La Bugal-BLaan v. Ramos G.R. No. 127882, December 1, 2004, 445 SCRA 1

Syllabus: Note that in all the three foregoing mining activities exploration, development
and utilization the State may undertake such EDU activities by itself or in tandem with
Filipinos or Filipino corporations, except in two instances: first, in small-scale
utilization of natural resources, which only Filipinos may be allowed by law to undertake;
and second, in large-scale EDU of minerals, petroleum and mineral oils, which may be
undertaken by the State via agreements with foreign-owned corporations involving either
technical or financial assistance as provided by law. From the foregoing, we are impelled
to conclude that the phrase agreements involving either technical or financial assistance,
referred to in paragraph 4, are in fact service contracts. But unlike those of the 1973
variety, the new ones are between foreign corporations acting as contractors on the one
hand; and on the other, the government as principal or owner of the works. In the new
service contracts, the foreign contractors provide capital, technology and technical know-
how, and managerial expertise in the creation and operation of large-scale mining/extractive
enterprises; and the government, through its agencies (DENR, MGB), actively exercises
control and supervision over the entire operation. Such service contracts may be entered
into only with respect to minerals, petroleum and other mineral oils. While the Constitution
mandates the State to exercise full control and supervision over the exploitation of mineral
resources, nowhere does it require the government to hold all exploration permits and
similar authorizations. In fact, there is no prohibition at all against foreign or local
corporations or contractors holding exploration permits. Pursuant to Section 20 of RA No.
7942, an exploration permit merely grants to a qualified person the right to conduct
exploration for all minerals in specified areas. Such a permit does not amount to an
authorization to extract and carry off the mineral resources that may be discovered. x x x
In short, the exploration permit is an authorization for the grantee to spend its own funds
on exploration programs that are pre-approved by the government, without any right to
recover anything should no minerals in commercial quantities be discovered. The State risks
nothing and loses nothing by granting these permits to local or foreign firms; in fact, it
stands to gain in the form of data generated by the exploration activities. Thus, the permit
grantee may apply for an MPSA, a joint venture agreement, a co-production agreement, or an
FTAA over the permit area, and the application shall be approved if the permit grantee meets
the necessary qualifications and the terms and conditions of any such agreement. Therefore,
the contractor will be in a position to extract minerals and earn revenues only when the
MPSA or another mineral agreement, or an FTAA, is granted. At that point, the contractors
rights and obligations will be covered by an FTAA or a mineral agreement. 217 ACCESS TO
ENVIRONMENTAL JUSTICE: A SOURCEBOOK ON ENVIRONMENTAL RIGHTS AND LEGAL REMEDIES But prior to
the issuance of such FTAA or mineral agreement, the exploration permit grantee (or
prospective contractor) cannot yet be deemed to have entered into any contract or agreement
with the State, and the grantee would definitely need to have some document or instrument
as evidence of its right to conduct exploration works within the specified area. This need
is met by the exploration permit issued pursuant to Sections 3(aq), 20 and 23 of RA No.
7942.
Facts: This case is a Motion for Reconsideration of the case of the same title, wherein the
Supreme Court declared several provisions of the Philippine Mining Act, and the WMCP FTAA
unconstitutional.

Issue: Whether the Philippine Mining Act and its Implementing Rules enable the government
to exercise that degree of control sufficient to direct and regulate the conduct of affairs
of individual enterprises and restrain undesirable activities.

Ruling: Yes, except Sections 7.8 and 7.9 of the FTAA which are invalidated for being contrary
to public policy and for being grossly disadvantageous to the government. The Supreme Court
held that the phrase agreements involving either technical or financial assistance are
service contracts but with proper safeguards. These safeguards are the following: (1) The
service contract shall be crafted in accordance with a general law that will set standard
or uniform terms, conditions and requirements, presumably to attain a certain uniformity in
provisions and avoid the possible insertion of terms disadvantageous to the country. (2)
The President shall be the signatory for the government because, supposedly before an
agreement is presented to the President for signature, it will have been studied several
times over at different levels to ensure that it conforms to law and can withstand public
scrutiny. (3) Within thirty days of the executed agreement, the President shall report it
to Congress to give that branch of government an opportunity to look over the agreement and
interpose timely objections, if any. The Philippine Mining Act provides for the States
control and supervision over mining operations. Sections 8, 9 and 66 provide for the
mechanism of inspection and visitorial rights over mining operations as well as reportorial
requirements. It is readily apparent that the requirements, regulations, restrictions and
limitations do not relegate the State as a passive regulator of the countrys natural
resources. On the contrary, the government agencies concerned are empowered to approve or
disapprove hence, to influence, direct and change the various work programs and the
corresponding minimum expenditure commitments for each of the exploration, development and
utilization phases of the mining enterprise. The Philippine Mining Act and its Implementing
Rules and Regulations grant the government with sufficient control and supervision on the
conduct of mining operations. The contractor is mandated to make its books of account and
records available in order to determine if the government share has 218 ANNEX A: SUMMARY OF
SUPREME COURT CASES been fully paid. The State is also empowered to compel the contractor
to provide mine safety, health and environmental protection, and the use of anti-pollution
technology and facilities. Moreover, the contractor is also obligated to assist in the
development of the mining community and to pay royalties to the indigenous peoples
concerned. The FTAA may also be cancelled as penalty for violation of its terms and
conditions, or noncompliance with statutes or regulations. The SC found that the FTAA
contractor is not free to do whatever it pleases and get away with it; on the contrary, it
will have to follow the government line if it wants to stay in the enterprise. Ineluctably
then, [the Philippine Mining Act] and DAO 96-40 vest in the government more than a sufficient
degree of control and supervision over the conduct of mining operations. There is also no
prohibition against foreign or local corporations or contractors holding exploration
permits. The exploration permit protects and preserves the rights of the grantee (would-be
contractor), whether foreign or local, during the period where the grantee incurs
expenditures on exploration works, without yet being able to earn revenues to cover its
investments and expenses.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-17597 February 7, 1922

E. W. McDANIEL, petitioner,
vs.
Honorable GALICANO APACIBLE, Secretary of Agriculture and Natural Resources of the
Philippine Islands, and
JUAN CUISIA, respondents.

Ross & Lawrence for petitioner.

Acting Attorney-General Tuason for respondents.

JOHNSON, J.:

This is an original action commenced in the Supreme Court for the writ of prohibition. Its
purpose is to prohibit the respondent Honorable Galicano Apacible, as Secretary of
Agriculture and Natural Resources, from granting a lease of a parcel of petroleum land
located in the municipality of San Narciso, of the Province of Tayabas, Philippine Islands,
which parcel of land is particularly described in paragraph 6 of the petition. To the
petition the respondent Galicano Apacible demurred. The respondent Juan Cuisia neither
demurred nor answered.

The facts upon which the petition is based are admitted and may be stated as follows:

1. That on or about the 7th day of June, 1916, the petitioner entered upon and located,
in accordance with the provisions of Act of Congress of July 1, 1902, as well as the
provisions of Act No. 624 of the Philippine Commission, three petroleum placer mineral
claims, each of an area of 64 hectares, on an unoccupied public land in the
municipality of San Narciso, Province of Tayabas, Philippine Islands;

2. That on or about the 15th day of July, 1916, the plaintiff recorded in the office
of the mining recorder in the municipality of Lucena, Province of Tayabas, Philippine
Islands, notices of location of the aforesaid three placer claims under the names of
"Maglihi No. 1," "Maglihi No. 2," and "Maglihi No. 3;"

3. That the plaintiff, at all times since the 7th day of June, 1916, has remained in
open and continuous possession of said three mineral placer claims;

4. That plaintiff, in the year 1917 and in each year thereafter, performed not less
than two hundred pesos (P200) worth of labor on each of the said three mineral claims;

5. That in the year 1918 plaintiff drilled five wells on the said three mineral
claims, and by means of such wells in the said year (1918) made discoveries of
petroleum on each of the said three claims;

6. That on or about the 18th day of June, 1921, the respondent Juan Cuisia made
application to the respondent Galicano Apacible, as Secretary of Agriculture and
Natural Resources, under the provisions of Act No. 2932 of the Philippine Legislature,
for a lease of a parcel of petroleum land in the municipality of San Narciso, Province
 of Tayabas, Philippine Islands, which said parcel of land included within its
boundaries the three said mineral claims "Maglihi No. 1," "Maglihi No. 2," and "Maglihi
No. 3," which said three mineral placer claims had therefore been located as above
indicated and held by the plaintiff as above described;

7. That upon the filing of the said application for lease, as described in the
paragraph immediately preceding, by the said Juan Cuisia, the petitioner herein
protested in writing to the respondent Galicano Apacible against the inclusion in the
said lease of the said three mineral claims "Maglihi No. 1," "Maglihi No. 2," and
"Maglihi No. 3," located and held by him as above recited;

8. That the respondent Galicano Apacible, as Secretary of Agriculture and Natural

Resources, did on or about the 9th day of March, 1921, deny petitioner's said protest;
and

9. That the plaintiff is informed and believed, and upon that information and belief
averred, that the respondent Galicano Apacible, as Secretary of Agriculture and
Natural Resources, under and by virtue of the supposed authority of Act No. 2932, is
about to grant the application for the said lease of the respondent Juan Cuisia, and
to place him (Juan Cuisia) in possession of the said three mineral claims located and
held by the petitioner.

Upon the foregoing facts the petitioner contends that said Act No. 2932, in so far as it
purports to declare open to lease, lands containing petroleum oil on which mineral claims
have been validly located and held, and upon which discoveries of petroleum oil have been
made, is void and unconstitutional, in that it deprives the petitioner of his property
without due process of law and without compensation, and that the defendant Galicano
Apacible, as Secretary of Agriculture and Natural Resources, is without jurisdiction to
lease to the respondent Juan Cuisia the following mineral claims "Maglihi No. 1," "Maglihi
No. 2," and "Maglihi No. 3," and prays that the writ of prohibition be issued out of this
court, directing and prohibiting the respondent Galicano Apacible to desist from issuing
the lease of the mineral placer claims herein mentioned.

The respondent Galicano Apacible, as Secretary of Agriculture and Natural Resources, in

support of his demurrer, contends: (a) That the acts complained of are in conformity with
the authority given by Act No. 2932; (b) that the petitioner has no vested right in the
three mineral claims; and (c) that the demurrer puts squarely in issue the constitutionality
of Act No. 2932.

Act No. 2932 was approved on the 31st day of August, 1920. Section 1 provides that "all
public lands containing petroleum or other mineral oils and gas, on which no patent, at the
date this Act takes effect, has been issued, are hereby withdrawn from sale and are declared
to be free and open to exploration, location and lease," etc. Said section further provides,
"that parties having heretofore filed claims for any lands containing said minerals, shall
be given preference to lease their respective claims, provided they file a petition to that
effect within six months from the date of the approval of this Act."

Section 2 provides that "all such lands (public lands) may be leased by the Secretary of
Agriculture and Natural Resources in the manner and subject to the rules prescribed by the
Council of State."

It will be noted from the provisions of said Act No. 2932 that "all public lands containing
petroleum, etc., on which no patent, at the date this Act takes effect (August 31, 1920),
has been issued, are hereby withdrawn from sale and are declared to be free and open to
exploration, location, and lease," with a preference, however, in favor of those who had
therefore filed claims for such lands. It will be further noted, from the provisions of
said Act, that "all public lands containing petroleum, etc., are hereby withdrawn from sale
and are declared to be free and open to exploration, location and lease," without any
preference to any claim or right which citizens of the Philippine Islands or the United
States had therefore acquired in any public lands, and that the only right left to them is
one of "preference," and that even the preference was limited for a period of six months
from the 31st day of August, 1920.

The petitioner contends, that, having located and held, and having discovered petroleum oil
upon the said claims prior to the 31st day of August, 1920, he had acquired a property right
in his three claims; and that said Act No. 2932 had deprived him of that right without due
process of law, in contravention of paragraph 1 of section 3 of Act of Congress of August
29, 1916, and that said Act was therefore unconstitutional and void. In support of the
contention the petitioner cites many authorities.

Mr. Lindlay, one of the highest authorities on Mining Law, has discussed extensively the
question now before us. (Lindlay on Mines, vol. I, sections 322, 539.)

The general rule is that a perfected, valid appropriation of public mineral lands operates as
a withdrawal of the tract from the body of the public domain, and so long as such
appropriation remains valid and subsisting, the land covered thereby is deemed private
property. A mining claim perfected under the law is property in the highest sense, which
may be sold and conveyed and will pass by descent. It has the effect of a grant (patent) by
the United States of the right of present and exclusive possession of the lands located.
And even though the locator may obtain a patent to such lands, his patent adds but little
to his security. (18 Ruling Case Law, p. 1152 and cases cited.)

The owner of a perfected valid appropriation of public mineral lands is entitled to the
exclusive possession and enjoyment against every one, including the Government itself. Where
there is a valid and perfected location of a mining claim, the area becomes segregated from
the public domain and the property of the locator.

It was said by the Supreme Court of the State of Oregon, "The Government itself cannot
abridge the rights of the miner to a perfected valid location of public mineral land.
The Government may not destroy the locator's right by withdrawing the land from entry or
placing it in a state of reservation." (Belk vs. Meagher, 104 U.S., 279; Sullivan vs. Iron
Silver Mining Co., 143 U.S., 431.)

A valid and subsisting location of mineral land, made and kept up in accordance with the
provisions of the statutes of the United States, has the effect of a grant by the United
States of the present and exclusive possession of the lands located, and this exclusive
right of possession and enjoyment continues during the entire life of the location. There
is no provision for, no suggestion of, a prior termination thereof. (Gwillim vs. Donnellan,
115 U.S., 45; Clipper Mining Co. vs. Eli Mining and Land Co., 194 U.S., 220.)

There is no pretense in the present case that the petitioner has not complied with all the
requirements of the law in making the location of the mineral placer claims in question, or
that the claims in question were ever abandoned or forfeited by him. The respondents may
claim, however, that inasmuch as a patent has not been issued to the petitioner, he has
acquired no property right in said mineral claims. But the Supreme Court of the United
States, in the cases of Union Oil Co. vs. Smith (249 U.S., 337), and St. Louis Mining and
Milling Co. vs. Montana Mining Co. (171 U.S., 650), held that even without a patent, the
possessory right of a locator after discovery of minerals upon the claim is a property right
in the fullest sense, unaffected by the fact that the paramount title to the land is in the
United States. There is no conflict in the rulings of the Court upon that question. With
one voice they affirm that when the right to a patent exists, the full equitable title has
passed to the purchaser or to the locator with all the benefits, immunities, and burdens of
ownership, and that no third party can acquire from the Government any interest as against
him. (Manuel vs. Wulff, 152 U.S., 504, and cases cited.)

Even without a patent, the possessory right of a qualified locator after discovery of
minerals upon the claim is a property right in the fullest sense, unaffected by the fact
that the paramount title to the land is in the Government, and it is capable of transfer by
conveyance, inheritance, or devise. (Union Oil Co. vs. Smith, 249 U.S., 337; Forbes vs.
Jarcey, 94 U.S., 762; Belk vs. Meagher, 104 U.S., 279; Del Monte Mining Co. vs. Last Chance
Mining Co., 171 U.S., 55; Elver vs. Wood, 208 U.S., 226, 232.)

Actual and continuous occupation of a valid mining location, based upon discovery, is not
essential to the preservation of the possessory right. The right is lost only by abandonment
as by nonperformance of the annual labor required. (Union Oil Co. vs. Smith, 249 U.S., 337;
Farrell vs. Lockhart, 210 U.S., 142; Bradford vs. Morrison, 212 U.S., 389.)

The discovery of minerals in the ground by one who has a valid mineral location perfects
his claim and his location not only against third person, but also against the Government.
A mining claim perfected under the law is property in the highest sense of that term, which
may be sold and conveyed, and will pass by descent, and is not therefore subject to the
disposal of the Government. (Belk vs. Meagher, 104 U.S., 279, 283; Sullivan vs. Iron Silver
Mining Co., 143 U.S., 431; Consolidated Mutual Oil Co. vs. United States, 245 Fed. Rep.,
521; Van Ness vs. Rooney, 160 Cal., 131, 136, 137.)

The moment the locator discovered a valuable mineral deposit on the lands located, and
perfected his location in accordance with law, the power of the United States Government to
deprive him of the exclusive right to the possession and enjoyment of the located claim was
gone, the lands had become mineral lands and they were exempted from lands that could be
granted to any other person. The reservations of public lands cannot be made so as to
include prior mineral perfected locations; and, of course, if a valid mining location is
made upon public lands afterward included in a reservation, such inclusion or reservation
does not affect the validity of the former location. By such location and perfection, the
land located is segregated from the public domain even as against the Government. (Union
Oil Co. vs. Smith, 249 U.S., 337; Van Ness vs. Rooney, 160 Cal., 131; 27 Cyc., 546.)

From all of the foregoing arguments and authorities we must conclude that, inasmuch as the
petitioner had located, held and perfected his location of the mineral lands in question,
and had actually discovered petroleum oil therein, he had acquired a property right in said
claims; that said Act No. 2932, which deprives him of such right, without due process of
law, is in conflict with section 3 of the Jones Law, and is therefore unconstitutional and
void. Therefore the demurrer herein is hereby overruled, and it is hereby ordered and
decreed that, unless the respondents answer the petition herein within a period of five
days from notice hereof, that a final judgment be entered, granting the remedy prayed for
in the petition. So ordered.

Araullo, C.J., Street, Malcolm, Avancea, Villamor, Ostrand, Johns and Romualdez, JJ.,
concur.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-49143 August 21, 1989

ZAMBALES CHROMITE MINING COMPANY, INC., petitioner,

vs.
HON. MINISTER OF NATURAL RESOURCES JOSE J. LEIDO JR. and DIRECTOR OF MINES JUANITO C.
FERNANDEZ, respondents. PHILEX MINING CORPORATION and REGALIAN MINING EXPLORATION
CORPORATION, intervenors.

PARAS, J.:

This is a petition for certiorari and prohibition with preliminary injunction seeking to
enjoin the Minister (now Secretary) of Natural Resources and the Director of Mines from
enforcing Presidential Decree No. 1214 dated October 14,1977 requiring all locators under
the Act of Congress of July 1, 1902, as amended, to apply for mining lease contracts under
the provision of Presidential Decree No. 463 better known as the Mineral Development
Resources Decree of 1974 and to declare Presidential Decree No. 1214 unconstitutional since
its enforcement would deprive petitioners of its property without due process and without
just compensation.

Petitioner Zambales Chromite Mining Company, Inc. is a mining corporation duly organized
and existing under and by virtue of the laws of the Philippines.

Petitioner claims that it is the owner and holder of sixty (60) mineral claims which it
acquired through purchase in good faith and for value 43 years ago. Said claims situated at
the Municipality of Sta. Cruz, Zambales, were located and registered in 1934 under the Act
of U.S. Congress of July 1, 1902 (known as the Philippine Bill of 1902). (Petition, p. 2;
Rollo, p. 3); that from 1934 to 1977 it has to its credit a total investment of over
Pl,222,640.00 for the mining exploration, development and operation of its said sixty mining
claims (Petition, p. 3; Rollo, p. 4); that on June 14, 1977 it actually and duly flied its
application for patent for each claim of said sixty (60) mineral claims (Petition, p. 4;
Rollo, p. 5); that respondent Director of Mines issued an order dated July 13,1977 approving
the application of petitioner for availment of rights on said claims under Presidential
Decree No. 463 (Petition, p. 5; Rollo, p. 6); that the aforesaid sixty (60) lode mineral
claims are already private property of petitioner, following the doctrinal rule laid down
in McDaniel v. Apacible and Cuisia (42 Phil. 749; 753-754) and Gold Creek Mining Corporation
v. Rodriguez, et al. (66 Phil. 259) which had already been segregated from the public domain
to which petitioner is entitled to the exclusive possession and enjoyment against everyone;
that the issuance of Presidential Decree No. 1214 on October 14, 1977 which declared open
to lease subsisting and valid patentable mining claims, lode or placer, located under the
provisions of the Act of U.S. Congress of July 1, 1902, as amended, already segregated from
the public domain and owned and held by it for over 43 years and requiring it without fail
and against their will to file a mining lease application with the Mines Regional Office
concerned within a period of one year from October 14, 1977 is a deprivation of petitioner's
rights to the ownership of said claims without due process of law nor or just compensation
and therefore, unconstitutional. The Court in its resolution dated November 3,1978, gave
due course to the petition and required respondents to comment (Rollo, p. 33).lwph1.t The
Solicitor General as counsel for public respondent, flied his comment on March 26,1979
(Rollo, pp. 58-71-A).
On May 10, 1979, petitioner filed a reply (Rollo, p. 83) to the comment in compliance with
the resolution of April 10, 1979. But on May 9, 1979, Baguio Gold Mining Company, Philex
Mining and Regalian Mining Corporation filed with the Court two separate motions for leave
to intervene (Rollo, p. 120).

On February 10, 1981, Baguio Gold Mining Company, Philex Mining Company and Regalian Mining
Corporation filed with the court a Joint Petition for Intervention (Rollo, p. 171) raising
the same issues brought up by petitioner Zambales Chromite Mining Company regarding the
constitutionality of P.D. No. 1214 based on the doctrinal mandates of the ruling cases
of McDaniel v. Apacible, 42 Phil. 749 [1922] and Gold Creek Mining Corporation v. Rodriguez,
66 Phil. 259 (1939); Salazar Mining Co. v. Rodriguez, et al., 67 Phil. 97, insofar as it
invests inter alia, private ownership in patentable mining claims to have survived to date
due to a faithful compliance with the various requirements of applicable mining laws to
include the land surface of said mining claims. Petitionees memorandum was adopted by
intervenors as to the factual and legal showing of the unconstitutionality of Presidential
Decree No. 1214 (Rollo, pp. 455-456).

The Solicitor General as counsel for public respondent submitted his memorandum on February
12,1982 (Rollo, pp. 468499) while petitioner filed its reply to said memorandum on April 3,
1982 (Rollo, pp. 505-560).

Counsel for petitioner on August 20, 1982 filed a motion to refer this case to the Court En
Bane for action and decision (Rollo, p. 536) and on September 8,1982, the Court resolved to
issue a temporary restraining order, effective as of said date and continuing until otherwise
ordered by the Court (Rollo, p. 562).

On February 11, 1988 the Court acting on the motion for intervention filed by counsel for
intervenor Francisco N. Calinisan dated January 6,1988, and considering that this case has
long been submitted for decision, resolved to deny the aforesaid motion for having been
filed late (Reno, p. 597).

The principal issue raised by the petitioner and by the erstwhile intervenors, is: whether
or not under the provision of P.D. No. 1214 there was deprivation of property without due
process of law and just compensation which makes said decree unconstitutional.

Their contention that a perfected and valid appropriation of public mineral lands operates
as a withdrawal of the tract of land from the public domain and is deemed to be already
private property, is without basis in fact and in law (Comment, Rollo, p. 61)

This issue has been resolved in a recent decision of this Court in Sta. Rosa Mining Co.,
Inc. vs. Leido Jr. (156 SCRA 1 [1987]) where it was held that while rulings in McDaniel v.
Apacible (42 Phil. 749 [1922]). and Gold Creek Mining Corp. v. Rodriguez (66 Phil. 259
[1938]) cited by the petitioner, true enough, recognize the right of a locator of a mining
claim as a property right; such right is not absolute. It is merely a possessory right more
so if petitioner's claims are still unpatented. It can be lost through abandonment or
forfeiture or they may be revoked on valid legal grounds.

In the case at bar, there is no showing that petitioner has complied with all the terms and
conditions prescribed by law prior to November 1, 1935; that there should be not only a
valid and subsisting location of the mineral land but that there should be, thereafter,
continuous compliance with all the requirements of law such as the performance of annual
assessment works and payment of real estate taxes. In fact, petitioner filed its application
only in 1977 for a patent, or 43 years after it allegedly located and registered the mining
claims (Rollo, p. 63).lwph1.t
As to the issue of constitutionality, the Court categorically stated that P.D. No. 1214 is
constitutional. The Court ruled:

...It is a valid exercise of the sovereign power of the State, as owner, over
lands of the public domain, of which petitioner's mining claims still form a
part, and over the patrimony of the nation, of which mineral deposits are a
valuable asset. It may be underscored, in this connection, that the Decree does
not cover all mining claims located under the Phil. Bill of 1902, but only those
claims over which their locators had failed to obtain a patent. And even then,
such locators may still avail of the renewable twenty-five year (25) lease
prescribed by Pres. Decree No. 463, the Mineral Development Resources Decree of
1974.

Mere location does not mean absolute ownership over the affected land or the
mining claim. It merely segregates the located land or area from the public
domain by barring other would be locators from locating the same and appropriate
for themselves the minerals found therein. To rule otherwise would imply that
location is all that is needed to acquire and maintain rights over a located
mining claim. This, we cannot approve or sanction because it is contrary to the
intention of the lawmaker that the locator should faithfully and consistently
comply with the requirements for annual work and improvements in the located
mining claim. (Santa Rosa Mining Co., Inc. vs. Leido Jr., supra, pp. 8-9)

P.D. No. 1214 is in accord with Section 8, Article XIV of the 1973 Constitution and presently
in Section 2, Article XII of the 1987 Constitution where the same constitutional mandate is
restated.

On June 2,1988, the Court granted a motion filed by counsel for petitioner dated May 20,1988
to admit a manifestation and motion wherein petitioner prayed that the "Court allow the
petitioner to change the original prayer in its petition dated October 10, 1978 with a new
prayer directing public respondents to dispose of petitioner's application on its own merit
unaffected and without regard to the provision of P.D. 1214 . . ." (p. 631, Rollo)

Records show that petitioner Zambales Chromite filed its patent application over its 60
mining claims on June 14,1977 and to order such disposal of said "application on its own
merit" is not within the scope of the jurisdiction of the Court. For, even assuming claimant
to be a holder of a subsisting and valid patentable mining claim, this Court has held that
it can no longer proceed with the acquisition of a mining patent in view of P.D. No. 1214,
issued on October 14, 1977, directing holder of subsisting and patentable mining claims, lode
or placer, located under the provisions of the Act of Congress on July 1, 1902, as amended, to
file a mining lease application . . . within one year from the approval of the Decree and
upon the filing thereof, holders of said claims shall be considered to have waived their
rights to the issuance of mining patents therefor: Provided, however, that the non-filing
of the application for mining lease by the holders thereby within the period herein
prescribed shall cause the forfeiture of all his rights to the claim." (Director of Lands
v. Kalahi Investments, Inc., G.R. No. L-48066, January 31, 1989). (Emphasis supplied)

PREMISES CONSIDERED, the instant petition is DENIED for lack of merit.

SO ORDERED

Fernan, C.J., Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Feliciano, Gancayco, Padilla,
Bidin, Sarmiento, Cortes, Gri;o-Aquino, Medialdea and Regalado, JJ., concur.