SR Metals, Inc. v.

Reyes

Facts:

Each of the petitioners was awarded a 2-year Small- Scale Mining Permit (SSMP) by the Provincial
Mining Regulatory Board of Agusan del Norte; they were allowed to extract Nickel and Cobalt (Ni-Co) in
a 20-hectare mining site in Sitio Bugnang, Brgy. La Fraternidad, Tubay, Agusan del Norte. The EMB sent
the mining corporations a Notice of Violation informing them that they had exceeded the allowed
annual volume of 150,000 MTs combined production as their stockpile inventory of Nickeliferous ore
had already total 177,297 dry metric tons (DMT). Then, DENR Secretary Angelo T. Reyes issued a Cease
and Desist Order (CDO) against the mining corporations suspending their operations for their operations
for the following reasons:

1. The excess in 1) annual production of SR Metals, Inc., 2) maximum capitalization, and, 3) labor cost to
equipment utilization of 1:1 is, by itself, a violation of existing laws.

2. The ECCs issued in favor of San R Construction Corporation and Galeo Equipment Corporation have no
legal basis and [are] therefore considered null and void from the beginning. Similarly, the small scale
mining permits that were issued by reason of such ECCs are likewise null and void.

DOJ categorically concluded that the term 'ore' should be confined only to Ni-Co, that is, excluding soil
and other materials that are of no economic value to the mining corporations. This is considering that
their ECCs explicitly specified '50,000 MTs of Ni-Co ore.' The mining corporations then filed before the
CA a Petition for Certiorari with prayer for Temporary Restraining Order and/or Preliminary Injunction,
imputing grave abuse of discretion on the part of DENR in issuing the CDO but was denied the mining
corporations' petition, not only because the ECCs have been mooted by their expiration, but also due to
its recognition of the power of the DENR to issue the CDO as the agency reposed with the duty of
managing and conserving the country's resources under Executive Order 192.

Issue:

Whether or not there is a correct interpretation of the 50,000 MT limit.

Held:

No. There are two different laws governing small-scale mining: PD 1899 and RA 7076. According to
Section 1 of PD 1899:
Small-scale mining refers to any single unit mining operation having an annual production of not more
than 50,000 metric tons of ore and satisfying the following requisites:

1. The working is artisanal, whether open cast or shallow underground mining, without the use of
sophisticated mining equipment;

2. Minimal investment on infrastructures and processing plant;

3. Heavy reliance on manual labor; and

4. Owned, managed or controlled by an individual or entity qualified under existing mining laws, rules
and regulations.

While under Section 3(b) of RA 7076, small-scale mining refers to 'mining activities which rely heavily on
manual labor using simple implements and methods and do not use explosives or heavy mining
equipment.' Significantly, this definition does not provide for annual extraction limit unlike in PD 1899.

DOJ Opinion No. 74, Series of 2006 concluded that as nothing from RA 7076 speaks of an annual
production limit, Section 1 of PD 1899 should be considered impliedly repealed by RA 7076, the later
law. However, while these two laws tackle the definition of what small-scale mining is, both have
different objects upon which the laws shall be applied to. PD 1899 applies to individuals, partnerships
and corporations while RA 7076 applies to cooperatives.

The DENR, being the agency mandated to protect the environment and the country's natural resources,
is authoritative on interpreting the 50,000- MT limit. MAO No. MRD-41 specifies measuring the 'run-of-
mine ore,' meaning the ore as it emerges from the mine, i.e., before treatment. This definition is
congruent with RA 7942 or The Philippine Mining Act of 1995.

LEAGUE OF PROVINCES OF THE PHILIPPINES v. DENR and Secretary

GR. No. 175368 April 11, 2013

Petitioner

: League of Provinces - a duly organized league of local governments incorporated

under the Local Government Code; it is composed of 81 provincial governments, including the

Province of Bulacan

Respondent:

DENR and DENR Secretary Angelo Reyes

Other parties:

Golden Falcon Mineral Exploration Corporation (Golden Falcon)

applicant for a

Financial and Technical Assistance Agreement (FTAA); filed before

Mines and Geosciences

Bureau, Regional Office No. III (MGB-RO)

; application was denied twice

Mercado, Cruz, Cruz and Sembrano (MCCS)

applicants for Quarry Permit; filed before the

Provincial Environment and Natural Resources Office (PENRO) of Bulacan

Atlantic Mines and Trading Corporation (AMTC)

applicant for Exploration Permit; filed

before the PENRO of Bulacan

FACTS

Golden Falcon applied for

FTAA

before the MGB-RO. On April 29, 1998, MGB-RO denied Golden

Falcon’s

application for FTAA on for failure to secure the required area clearances from the

Forest Management Sector and Lands Management Sector of the DENR-RO. Golden Falcon

appealed the denial with the Mines and Geosciences Bureau-Central Office (MGB-CO).

On February 10, 2004, pending Golden Falcon's appeal to the MGB-CO, MCCS filed with the

PENRO of Bulacan their

applications for quarry permit

covering the same area subject of

Golden Falcon's FTAA application. MGB-CO finally denied Golden Falcon

’s appeal

on July 16,

2004.

AMTC filed with the PENRO of Bulacan an

application for exploration permit

covering the

same subject area on September 13, 2004. Confusion of rights resulted from the overlapping

applications of AMTC and the persons applying for quarry permits

the contention was the date

the area of Golden Falcon’s applicati

on became open to other permit applications from other

parties

On October 19, 2004, upon query by MGB-RO Director Cabantog, DENR-MGB Director Ramos

stated that the denial of Golden

Falcon’s application became final

on August 11, 2004, or fifteen

days after Golden Falcon received the order of denial of its application

. Hence, the area of

Golden Falcon’s application became open to permit applications only on that date.

Subsequently, the Provincial Legal Officer of Bulacan issued a legal opinion on the issue, stating

that the

subject area became open for new applications on the date of the first denial

on April 29, 1998 (MGB-

RO’s order of denial)

, as MGB-

CO’s

order of denial on July 16,

2004 was a mere reaffirmation of the MGB-

RO’s

April 29 order; hence, the reckoning period

should be April 29.

Based on this legal opinion, MGB-RO Director Cabantog endorsed the

applications for quarry

permit, now apparently converted to applications for small-scale mining permit

, to

the Governor of Bulacan. PENRO of Bulacan recommended to the Governor the approval of said

applications. Eventually, the Governor issued the small-scale mining permits. AMTC appealed to

the DENR Secretary.

The DENR Secretary decided in favor of the AMTC

and nullified and cancelled the governor’s

issuance of small-scale mining permits. It agreed with DENR-MGB Director Ramos that the area

was open to mining location only on August 11, 2004 (15 days after the MGB-CO denial). Hence,

the applications for quarry permit filed on February 10, 2004 were null as these were filed when

the area was still closed to mining location. On the other hand, AMTC filed its application when

the area was already open to other mining applicants, hence, its application was valid. The

small-scale mining permits were also issued in violation of Section 4 of R.A. No. 7076 and

beyond the authority of the Governor pursuant to Sec. 43 of RA 7942 because the area was

never proclaimed to be under the small-scale mining program.

The petitioner League of the Provinces of the Philippines filed this petition saying that that this is

not an action of one province alone, but the collective action of all provinces through the

League, as a favorable ruling will not only benefit one province, but all provinces and all local

governments.
ISSUES

1.

Whether DENR’s act of nullifying the small

-scale mining permits amounts to executive control,

not merely supervision and usurps the devolved powers of all provinces, as the DENR Secretary

substituted the judgment of the Provincial Governor of Bulacan.

2. Whether or not Section 17, b(3)(III) of the Local Government Code and Section 24 of the

Small-Scale Mining Act,

which confer upon DENR and the DENR Secretary the power of control

are unconstitutional, as the Constitution states that the President (and Exec Depts) has the

power of supervision only, not control over acts of LGUs

RULING

[The Court finds that petitioner has legal standing to file this petition because it is tasked under

Section 504 of the Local Government Code of 1991 to promote local autonomy at the provincial

level; adopt measures for the promotion of the welfare of all provinces and its officials and

employees; and exercise such other powers and perform such other duties and functions as the

league may prescribe for the welfare of the provinces.]

DENR Sec’s act was valid and authorized pursuant to its power of review under

the

RA 7076 and its IRR; Assailed statutes did not overcome the presumption of

constitutionality, hence, are not unconstitutional.

Control of the DENR/DENR Secretary over small-scale mining in the provinces is granted by

three statutes: (1) R.A. 7061 or

The Local
Government Code of 1991

; (2) R.A. 7076 or the

People's Small Scale

Mining Act of 1991

; and (3) R.A. No. 7942 or the

Philippine Mining Act of

1995

Control is the power of an officer to alter or modify or set aside what a subordinate officer had

done in the performance of his/her duties and to substitute the judgment of the former for the

latter. Supervision is the power of a superior officer to see to it that lower officers perform their

function in accordance with law.

The Constitutional guarantee of local autonomy in the Article X, Sec. 2 of the Constitution refers

to the

administrative autonomy

of the LGUs or the decentralization of government authority.

It does not make local governments within the State. Administrative autonomy may involve

devolution of powers, but it is still subject to limitations, like following national policies or

standards and those provided by the Local Government Code, as the structuring of LGUs and

the allocation of powers/responsibilities/resources among the LGUs and local officials are placed

by the Constitution to Congress under Article X Section 3.

MONCAYO INTEGRATED SMALL-SCALE MINERS ASSOCIATION, INC. [MISSMA], Petitioner,

vs. SOUTHEAST MINDANAO GOLD MINING CORP., JB. MGT. MINING CORP., PICOP RESOURCES, INC.,
MT. DIWATA UPPER ULIP MANDAYA TRIBAL COUNCIL, INC. AND BALITE INTEGRATED SMALL-SCALE
MINING CORP., (BISSMICO),

G.R. No. 149638 December 10, 2014

On February 16, 1994, Marcopper assigned EP 133 to Southeast Mindanao Gold Mining Corporation
(SMGMC).

On December 19, 1995, the Mines and Geo-Sciences Bureau director ordered the publication of
SMGMC’s application for Mineral Production Sharing Agreement (MPSA No. 128) for the 4,941 hectares
covered by EP 133.

JB Management Mining Corporation, Davao United Miners Cooperative, Balite Integrated Small Scale
Miners Cooperative, MISSMA, PICOP, Rosendo Villaflor, et al., Antonio G. Dacudao, Puting Bato Gold
Miners Cooperative, and Romeo Altamera, et al. filed adverse claims against MPSA No. 128.8

The adverse claims were anchored on DENR Administrative Order No. 669 (DAO No. 66) issued on
December27, 1991, declaring 729 hectares of the Agusan-Davao-Surigao Forest Reserve as forest land
open for smallscale mining purposes, subject to existing and valid private rights.

Issues :

I. Whether the Court of Appeals can set aside the issue of forum shopping and litis pendencia (SMGMC's
petition in G.R. No. 132475), and dwell on the merits;

II. Whether the DENR Secretary’s decision went beyond the PMRB’s decision, otherwise, whether the
DENR Secretary can modify the PMRB’s decision; and

III. Whether the DENR Secretary’s modification to divide the 729 hectares into two areas contravened
the mandate of the MAB decision and the purpose of Republic Act No. 7076. Subsequent developments

Ruling:

I. Moot and academic. Forum shopping and litis pendencia

Litis pendencia exists when the following elements are present: "(a) the identity of parties, or at least
suchas representing the same interests in both actions; (b) the identity of rights asserted and relief
prayed for, the relief being founded on the same facts; and (c) the identity of the two cases such that
judgment in one, regardless of which party is successful, would amount to res judicatain the
other."76The existence of litis pendenciaalso means that the rule against forum shopping was
violated.77

Proclamation No. 297 dated November 25, 2002 excluded an area of 8,100 hectares in Moncayo,
Compostela Valley as a mineral reservation and as an environmentally critical area: PROC. 297. to
address the situation in the Diwalwal gold rush area.

This court denied the motions for reconsiderations, among others, in its 2009 resolution.89 Since this
court declared that EP 133 expired and its transfer to SMGMC is void, respondent SMGMC has no more
basis to claim any right over the disputed 729 hectares in the Diwalwal gold rush area excluded from its
MPSA.

Furthermore, since this court has declared that the DENR Secretary had no authority to issue DAO No.
66 declaring 729 hectares of the Agusan Davao-Surigao Forest Reserve as forest land open for small-
scale mining purposes subject to existing and valid private rights, both the PMRB decision, and the DENR
Secretary’s decision affirming it with modification, are consequently overturned for lack ofbasis in
delineating the 729 hectares from the MPSA.

Indeed, then President Macapagal-Arroyo issued Proclamation No. 297 excluding an area in Moncayo,
Compostela Valley, declaring this as a mineral reservation and as an environmentally critical area. DENR
Administrative Order No. 2002-18 followed, declaring an emergency situation in this gold rush area and
ordering the stoppage of all mining operations. Executive Order No. 217 thereafter created the National
Task Force Diwalwal.

ISSUE II: Provincial Mining Regulatory Board

Section 24. Provincial/ City MiningRegulatory Board. There is hereby created under the direct
supervision and control of the Secretary a provincial/city mining regulatory board, herein called the
Board, which shall be the implementing agency of the Department, and shall exercise the following
powers and functions, subject to review by the Secretary:

Issue III:DENR Secretary

. The Secretary through his representative shall exercise direct supervision and control over the program
and activities of the small-scale miners within the people’s small-scale mining area

This court has distinguished the power of control and the power of supervision as follows:

. . . In administrative law, supervision means overseeing or the power or authority of an officer to see
that subordinate officers perform their duties. If the latter fail or neglect to fulfill them, the former may
take such action or step as prescribed by law to make them perform their duties. Control, on the other
hand, means the power of an officer to alter or modify or nullify or set aside what a subordinate officer
ha[s] donein the performance of his duties and to substitute the judgment of the former for that of the
latter.100 (Emphasis supplied)

League of Provinces v. DENR101 Since the DENR Secretary has power of control as opposed to power of
supervision, he had the power to affirm with modification the PMRB’s decision.

Executive Department

Chapter II, Section 4 of Republic Act No. 7942 known as the Philippine Mining Act of 1995 also provides
as follows:

SEC. 4. Ownership of Mineral Resources. – Mineral resources are owned by the State and the
exploration, development, utilization, and processing thereof shall be under its full control and
supervision. The state may directly undertake such activities or it may enter into mineral agreements
with contractors.The State shall recognize and protect the rights of the indigenous cultural communities
to their ancestral lands as provided for by the Constitution.105

Apex Mining v. SMGMC discussed that "Section 5 of Republic Act No. 7942 is a special provision, as it
specifically treats of the establishment of mineral reservations only.1âwphi1 Said provision grants the
President the power to proclaim a mineral land as a mineral reservation, regardless of whether such
land is also an existing forest reservation."107
WHEREFORE, in view of the foregoing, the petitions are DENIED for being moot and academic.