1st batch cases Environmental Law

1. Minors Oposa et al v Secretary of DENR et al 224 SCRA 792 (GR 1013083, July 30 1993)
2. Resident Marine Mammals of the protected Seascape Tanon Strait, e.g. toothed whales,
dolphins, porpoises and other cetacean species, joined in and represented herein by human
beings Gloria Estenzo Ramos, et al vs Sec. Angelo Reyes et al (G.R. No. 180771 April 24 2012)
3. MMDA v Concerned Citizens of Manila Bay (G.R. No. 171947 & 948 December 2008)
4. Prince Hotel v GSIS 67 SCRA 40 (February 3 1997)
5. West tower Condominum Corp v First Philippine Industrial Corp (G.R. No. 194239 May 31 2011
& Nov. 21 2011)
6. New Energy in Asean by Amb. Tolentino

Contents
1st batch cases Environmental Law ............................................................................................................... 1
1. Minors Oposa et al v Secretary of DENR et al 224 SCRA 792 (GR 1013083, July 30 1993)................... 2
2. Resident Marine Mammals of the protected Seascape Tanon Strait, e.g. toothed whales, dolphins,
porpoises and other cetacean species, joined in and represented herein by human beings Gloria
Estenzo Ramos, et al vs Sec. Angelo Reyes et al (G.R. No. 180771 April 24 2012) ................................. 14
3. MMDA v Concerned Citizens of Manila Bay (G.R. No. 171947 & 948 December 2008) .................... 41
4. Prince Hotel v GSIS 67 SCRA 40 (February 3 1997) ............................................................................. 68
5. West tower Condominum Corp v First Philippine Industrial Corp (G.R. No. 194239 May 31 2011 &
Nov. 21 2011) .......................................................................................................................................... 84
6. New Energy in Asean by Amb. Tolentino .......................................................................................... 103
"Sustainable development is development that meets the needs of the present, without compromising
the ability of future generations to meet their own needs."

Minors Oposa et al v Secretary of DENR et al 224 SCRA 792 (GR 1013083, July
30 1993)

DAVIDE, JR., J.:

In a broader sense, this petition bears upon the right of Filipinos to a balanced and healthful ecology
which the petitioners dramatically associate with the twin concepts of "inter-generational
responsibility" and "inter-generational justice." Specifically, it touches on the issue of whether the
said petitioners have a cause of action to "prevent the misappropriation or impairment" of Philippine
rainforests and "arrest the unabated hemorrhage of the country's vital life support systems and
continued rape of Mother Earth."

The controversy has its genesis in Civil Case No. 90-77 which was filed before Branch 66 (Makati,
Metro Manila) of the Regional Trial Court (RTC), National Capital Judicial Region. The principal
plaintiffs therein, now the principal petitioners, are all minors duly represented and joined by their
respective parents. Impleaded as an additional plaintiff is the Philippine Ecological Network, Inc.
(PENI), a domestic, non-stock and non-profit corporation organized for the purpose of, inter alia,
engaging in concerted action geared for the protection of our environment and natural resources.
The original defendant was the Honorable Fulgencio S. Factoran, Jr., then Secretary of the
Department of Environment and Natural Resources (DENR). His substitution in this petition by the
new Secretary, the Honorable Angel C. Alcala, was subsequently ordered upon proper motion by the
petitioners.1 The complaint2 was instituted as a taxpayers' class suit3 and alleges that the plaintiffs
"are all citizens of the Republic of the Philippines, taxpayers, and entitled to the full benefit, use and
enjoyment of the natural resource treasure that is the country's virgin tropical forests." The same was
filed for themselves and others who are equally concerned about the preservation of said resource
but are "so numerous that it is impracticable to bring them all before the Court." The minors further
asseverate that they "represent their generation as well as generations yet unborn."4 Consequently,
it is prayed for that judgment be rendered:

. . . ordering defendant, his agents, representatives and other persons acting in his
behalf to —

(1) Cancel all existing timber license agreements in the country;

(2) Cease and desist from receiving, accepting, processing, renewing or approving
new timber license agreements.

and granting the plaintiffs ". . . such other reliefs just and equitable under the premises."5

The complaint starts off with the general averments that the Philippine archipelago of 7,100 islands
has a land area of thirty million (30,000,000) hectares and is endowed with rich, lush and verdant
rainforests in which varied, rare and unique species of flora and fauna may be found; these
rainforests contain a genetic, biological and chemical pool which is irreplaceable; they are also the
habitat of indigenous Philippine cultures which have existed, endured and flourished since time
immemorial; scientific evidence reveals that in order to maintain a balanced and healthful ecology,
the country's land area should be utilized on the basis of a ratio of fifty-four per cent (54%) for forest
cover and forty-six per cent (46%) for agricultural, residential, industrial, commercial and other uses;
the distortion and disturbance of this balance as a consequence of deforestation have resulted in a
host of environmental tragedies, such as (a) water shortages resulting from drying up of the water
table, otherwise known as the "aquifer," as well as of rivers, brooks and streams, (b) salinization of
the water table as a result of the intrusion therein of salt water, incontrovertible examples of which
may be found in the island of Cebu and the Municipality of Bacoor, Cavite, (c) massive erosion and
the consequential loss of soil fertility and agricultural productivity, with the volume of soil eroded
estimated at one billion (1,000,000,000) cubic meters per annum — approximately the size of the
entire island of Catanduanes, (d) the endangering and extinction of the country's unique, rare and
varied flora and fauna, (e) the disturbance and dislocation of cultural communities, including the
disappearance of the Filipino's indigenous cultures, (f) the siltation of rivers and seabeds and
consequential destruction of corals and other aquatic life leading to a critical reduction in marine
resource productivity, (g) recurrent spells of drought as is presently experienced by the entire
country, (h) increasing velocity of typhoon winds which result from the absence of windbreakers, (i)
the floodings of lowlands and agricultural plains arising from the absence of the absorbent
mechanism of forests, (j) the siltation and shortening of the lifespan of multi-billion peso dams
constructed and operated for the purpose of supplying water for domestic uses, irrigation and the
generation of electric power, and (k) the reduction of the earth's capacity to process carbon dioxide
gases which has led to perplexing and catastrophic climatic changes such as the phenomenon of
global warming, otherwise known as the "greenhouse effect."

Plaintiffs further assert that the adverse and detrimental consequences of continued and
deforestation are so capable of unquestionable demonstration that the same may be submitted as a
matter of judicial notice. This notwithstanding, they expressed their intention to present expert
witnesses as well as documentary, photographic and film evidence in the course of the trial.

As their cause of action, they specifically allege that:

CAUSE OF ACTION

7. Plaintiffs replead by reference the foregoing allegations.

8. Twenty-five (25) years ago, the Philippines had some sixteen (16) million hectares
of rainforests constituting roughly 53% of the country's land mass.

9. Satellite images taken in 1987 reveal that there remained no more than 1.2 million
hectares of said rainforests or four per cent (4.0%) of the country's land area.

10. More recent surveys reveal that a mere 850,000 hectares of virgin old-growth
rainforests are left, barely 2.8% of the entire land mass of the Philippine archipelago
and about 3.0 million hectares of immature and uneconomical secondary growth
forests.

11. Public records reveal that the defendant's, predecessors have granted timber
license agreements ('TLA's') to various corporations to cut the aggregate area of 3.89
million hectares for commercial logging purposes.
A copy of the TLA holders and the corresponding areas covered is hereto attached
as Annex "A".

12. At the present rate of deforestation, i.e. about 200,000 hectares per annum or 25
hectares per hour — nighttime, Saturdays, Sundays and holidays included — the
Philippines will be bereft of forest resources after the end of this ensuing decade, if
not earlier.

13. The adverse effects, disastrous consequences, serious injury and irreparable
damage of this continued trend of deforestation to the plaintiff minor's generation and
to generations yet unborn are evident and incontrovertible. As a matter of fact, the
environmental damages enumerated in paragraph 6 hereof are already being felt,
experienced and suffered by the generation of plaintiff adults.

14. The continued allowance by defendant of TLA holders to cut and deforest the
remaining forest stands will work great damage and irreparable injury to plaintiffs —
especially plaintiff minors and their successors — who may never see, use, benefit
from and enjoy this rare and unique natural resource treasure.

This act of defendant constitutes a misappropriation and/or impairment of the natural

resource property he holds in trust for the benefit of plaintiff minors and succeeding
generations.

15. Plaintiffs have a clear and constitutional right to a balanced and healthful ecology
and are entitled to protection by the State in its capacity as the parens patriae.

16. Plaintiff have exhausted all administrative remedies with the defendant's office.
On March 2, 1990, plaintiffs served upon defendant a final demand to cancel all
logging permits in the country.

A copy of the plaintiffs' letter dated March 1, 1990 is hereto attached as Annex "B".

17. Defendant, however, fails and refuses to cancel the existing TLA's to the
continuing serious damage and extreme prejudice of plaintiffs.

18. The continued failure and refusal by defendant to cancel the TLA's is an act
violative of the rights of plaintiffs, especially plaintiff minors who may be left with a
country that is desertified (sic), bare, barren and devoid of the wonderful flora, fauna
and indigenous cultures which the Philippines had been abundantly blessed with.

19. Defendant's refusal to cancel the aforementioned TLA's is manifestly contrary to

the public policy enunciated in the Philippine Environmental Policy which, in pertinent
part, states that it is the policy of the State —

(a) to create, develop, maintain and improve conditions under which man and nature
can thrive in productive and enjoyable harmony with each other;

(b) to fulfill the social, economic and other requirements of present and future
generations of Filipinos and;
 (c) to ensure the attainment of an environmental quality that is conductive to a life of
dignity and well-being. (P.D. 1151, 6 June 1977)

20. Furthermore, defendant's continued refusal to cancel the aforementioned TLA's

is contradictory to the Constitutional policy of the State to —

a. effect "a more equitable distribution of opportunities, income and wealth" and
"make full and efficient use of natural resources (sic)." (Section 1, Article XII of the
Constitution);

b. "protect the nation's marine wealth." (Section 2, ibid);

c. "conserve and promote the nation's cultural heritage and resources (sic)" (Section
14, Article XIV, id.);

d. "protect and advance the right of the people to a balanced and healthful ecology in
accord with the rhythm and harmony of nature." (Section 16, Article II, id.)

21. Finally, defendant's act is contrary to the highest law of humankind — the natural
law — and violative of plaintiffs' right to self-preservation and perpetuation.

22. There is no other plain, speedy and adequate remedy in law other than the
instant action to arrest the unabated hemorrhage of the country's vital life support
systems and continued rape of Mother Earth. 6

On 22 June 1990, the original defendant, Secretary Factoran, Jr., filed a Motion to Dismiss the
complaint based on two (2) grounds, namely: (1) the plaintiffs have no cause of action against him
and (2) the issue raised by the plaintiffs is a political question which properly pertains to the
legislative or executive branches of Government. In their 12 July 1990 Opposition to the Motion, the
petitioners maintain that (1) the complaint shows a clear and unmistakable cause of action, (2) the
motion is dilatory and (3) the action presents a justiciable question as it involves the defendant's
abuse of discretion.

On 18 July 1991, respondent Judge issued an order granting the aforementioned motion to
dismiss.7 In the said order, not only was the defendant's claim — that the complaint states no cause
of action against him and that it raises a political question — sustained, the respondent Judge further
ruled that the granting of the relief prayed for would result in the impairment of contracts which is
prohibited by the fundamental law of the land.

Plaintiffs thus filed the instant special civil action for certiorari under Rule 65 of the Revised Rules of
Court and ask this Court to rescind and set aside the dismissal order on the ground that the
respondent Judge gravely abused his discretion in dismissing the action. Again, the parents of the
plaintiffs-minors not only represent their children, but have also joined the latter in this case.8

On 14 May 1992, We resolved to give due course to the petition and required the parties to submit
their respective Memoranda after the Office of the Solicitor General (OSG) filed a Comment in behalf
of the respondents and the petitioners filed a reply thereto.

Petitioners contend that the complaint clearly and unmistakably states a cause of action as it
contains sufficient allegations concerning their right to a sound environment based on Articles 19, 20
and 21 of the Civil Code (Human Relations), Section 4 of Executive Order (E.O.) No. 192 creating
the DENR, Section 3 of Presidential Decree (P.D.) No. 1151 (Philippine Environmental Policy),
Section 16, Article II of the 1987 Constitution recognizing the right of the people to a balanced and
healthful ecology, the concept of generational genocide in Criminal Law and the concept of man's
inalienable right to self-preservation and self-perpetuation embodied in natural law. Petitioners
likewise rely on the respondent's correlative obligation per Section 4 of E.O. No. 192, to safeguard
the people's right to a healthful environment.

It is further claimed that the issue of the respondent Secretary's alleged grave abuse of discretion in
granting Timber License Agreements (TLAs) to cover more areas for logging than what is available
involves a judicial question.

Anent the invocation by the respondent Judge of the Constitution's non-impairment clause,
petitioners maintain that the same does not apply in this case because TLAs are not contracts. They
likewise submit that even if TLAs may be considered protected by the said clause, it is well settled
that they may still be revoked by the State when the public interest so requires.

On the other hand, the respondents aver that the petitioners failed to allege in their complaint a
specific legal right violated by the respondent Secretary for which any relief is provided by law. They
see nothing in the complaint but vague and nebulous allegations concerning an "environmental right"
which supposedly entitles the petitioners to the "protection by the state in its capacity as parens
patriae." Such allegations, according to them, do not reveal a valid cause of action. They then
reiterate the theory that the question of whether logging should be permitted in the country is a
political question which should be properly addressed to the executive or legislative branches of
Government. They therefore assert that the petitioners' resources is not to file an action to court, but
to lobby before Congress for the passage of a bill that would ban logging totally.

As to the matter of the cancellation of the TLAs, respondents submit that the same cannot be done
by the State without due process of law. Once issued, a TLA remains effective for a certain period of
time — usually for twenty-five (25) years. During its effectivity, the same can neither be revised nor
cancelled unless the holder has been found, after due notice and hearing, to have violated the terms
of the agreement or other forestry laws and regulations. Petitioners' proposition to have all the TLAs
indiscriminately cancelled without the requisite hearing would be violative of the requirements of due
process.

Before going any further, We must first focus on some procedural matters. Petitioners instituted Civil
Case No. 90-777 as a class suit. The original defendant and the present respondents did not take
issue with this matter. Nevertheless, We hereby rule that the said civil case is indeed a class suit.
The subject matter of the complaint is of common and general interest not just to several, but to all
citizens of the Philippines. Consequently, since the parties are so numerous, it, becomes
impracticable, if not totally impossible, to bring all of them before the court. We likewise declare that
the plaintiffs therein are numerous and representative enough to ensure the full protection of all
concerned interests. Hence, all the requisites for the filing of a valid class suit under Section 12, Rule
3 of the Revised Rules of Court are present both in the said civil case and in the instant petition, the
latter being but an incident to the former.

This case, however, has a special and novel element. Petitioners minors assert that they represent
their generation as well as generations yet unborn. We find no difficulty in ruling that they can, for
themselves, for others of their generation and for the succeeding generations, file a class suit. Their
personality to sue in behalf of the succeeding generations can only be based on the concept of
intergenerational responsibility insofar as the right to a balanced and healthful ecology is concerned.
Such a right, as hereinafter expounded, considers
the "rhythm and harmony of nature." Nature means the created world in its entirety.9 Such rhythm
and harmony indispensably include, inter alia, 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 to the end that their exploration, development and utilization be
equitably accessible to the present as well as future generations. 10Needless to say, every generation
has a responsibility to the next to preserve that rhythm and harmony for the full enjoyment of a
balanced and healthful ecology. Put a little differently, the minors' assertion of their right to a sound
environment constitutes, at the same time, the performance of their obligation to ensure the
protection of that right for the generations to come.

The locus standi of the petitioners having thus been addressed, We shall now proceed to the merits
of the petition.

After a careful perusal of the complaint in question and a meticulous consideration and evaluation of
the issues raised and arguments adduced by the parties, We do not hesitate to find for the
petitioners and rule against the respondent Judge's challenged order for having been issued with
grave abuse of discretion amounting to lack of jurisdiction. The pertinent portions of the said order
reads as follows:

xxx xxx xxx

After a careful and circumspect evaluation of the Complaint, the Court cannot help
but agree with the defendant. For although we believe that plaintiffs have but the
noblest of all intentions, it (sic) fell short of alleging, with sufficient definiteness, a
specific legal right they are seeking to enforce and protect, or a specific legal wrong
they are seeking to prevent and redress (Sec. 1, Rule 2, RRC). Furthermore, the
Court notes that the Complaint is replete with vague assumptions and vague
conclusions based on unverified data. In fine, plaintiffs fail to state a cause of action
in its Complaint against the herein defendant.

Furthermore, the Court firmly believes that the matter before it, being impressed with
political color and involving a matter of public policy, may not be taken cognizance of
by this Court without doing violence to the sacred principle of "Separation of Powers"
of the three (3) co-equal branches of the Government.

The Court is likewise of the impression that it cannot, no matter how we stretch our
jurisdiction, grant the reliefs prayed for by the plaintiffs, i.e., to cancel all existing
timber license agreements in the country and to cease and desist from receiving,
accepting, processing, renewing or approving new timber license agreements. For to
do otherwise would amount to "impairment of contracts" abhored (sic) by the
fundamental law. 11

We do not agree with the trial court's conclusions that the plaintiffs failed to allege with sufficient
definiteness a specific legal right involved or a specific legal wrong committed, and that the
complaint is replete with vague assumptions and conclusions based on unverified data. A reading of
the complaint itself belies these conclusions.

The complaint focuses on one specific fundamental legal right — the right to a balanced and
healthful ecology which, for the first time in our nation's constitutional history, is solemnly
incorporated in the fundamental law. Section 16, Article II of the 1987 Constitution explicitly provides:

Sec. 16. The State shall protect and advance the right of the people to a balanced
and healthful ecology in accord with the rhythm and harmony of nature.
 This right unites with the right to health which is provided for in the preceding section
of the same article:

Sec. 15. The State shall protect and promote the right to health of the people and
instill health consciousness among them.

While the right to a balanced and healthful ecology is to be found under the Declaration of Principles
and State Policies and not under the Bill of Rights, it does not follow that it is less important than any
of the civil and political rights enumerated in the latter. Such a right belongs to a different category of
rights altogether for it concerns nothing less than self-preservation and self-perpetuation — aptly and
fittingly stressed by the petitioners — the advancement of which may even be said to predate all
governments and constitutions. As a matter of fact, these basic rights need not even be written in the
Constitution for they are assumed to exist from the inception of humankind. If they are now explicitly
mentioned in the fundamental charter, it is because of the well-founded fear of its framers that
unless the rights to a balanced and healthful ecology and to health are mandated as state policies by
the Constitution itself, thereby highlighting their continuing importance and imposing upon the state a
solemn obligation to preserve the first and protect and advance the second, the day would not be too
far when all else would be lost not only for the present generation, but also for those to come —
generations which stand to inherit nothing but parched earth incapable of sustaining life.

The right to a balanced and healthful ecology carries with it the correlative duty to refrain from
impairing the environment. During the debates on this right in one of the plenary sessions of the
1986 Constitutional Commission, the following exchange transpired between Commissioner Wilfrido
Villacorta and Commissioner Adolfo Azcuna who sponsored the section in question:

MR. VILLACORTA:

Does this section mandate the State to provide sanctions against all
forms of pollution — air, water and noise pollution?

MR. AZCUNA:

Yes, Madam President. The right to healthful (sic) environment

necessarily carries with it the correlative duty of not impairing the
same and, therefore, sanctions may be provided for impairment of
environmental balance. 12

The said right implies, among many other things, the judicious management and conservation of the
country's forests.

Without such forests, the ecological or environmental balance would be irreversiby disrupted.

Conformably with the enunciated right to a balanced and healthful ecology and the right to health, as
well as the other related provisions of the Constitution concerning the conservation, development
and utilization of the country's natural resources, 13 then President Corazon C. Aquino promulgated
on 10 June 1987 E.O. No. 192, 14 Section 4 of which expressly mandates that the Department of
Environment and Natural Resources "shall be the primary government agency responsible for the
conservation, management, development and proper use of the country's environment and natural
resources, specifically forest and grazing lands, mineral, resources, including those in reservation
and watershed areas, and lands of the public domain, as well as the licensing and regulation of all
natural resources as may be provided for by law in order to ensure equitable sharing of the benefits
derived therefrom for the welfare of the present and future generations of Filipinos." Section 3
thereof makes the following statement of policy:

Sec. 3. Declaration of Policy. — It is hereby declared the policy of the State to ensure
the sustainable use, development, management, renewal, and conservation of the
country's forest, mineral, land, off-shore areas and other natural resources, including
the protection and enhancement of the quality of the environment, and equitable
access of the different segments of the population to the development and the use of
the country's natural resources, not only for the present generation but for future
generations as well. It is also the policy of the state to recognize and apply a true
value system including social and environmental cost implications relative to their
utilization, development and conservation of our natural resources.

This policy declaration is substantially re-stated it Title XIV, Book IV of the Administrative Code of
1987,15 specifically in Section 1 thereof which reads:

Sec. 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, consistent with the necessity of maintaining a sound ecological balance
and protecting and enhancing the quality of the environment and the objective of
making the exploration, development and utilization of such natural resources
equitably accessible to the different segments of the present as well as future
generations.

(2) The State shall likewise recognize and apply a true value system that takes into
account social and environmental cost implications relative to the utilization,
development and conservation of our natural resources.

The above provision stresses "the necessity of maintaining a sound ecological balance and
protecting and enhancing the quality of the environment." Section 2 of the same Title, on the other
hand, specifically speaks of the mandate of the DENR; however, it makes particular reference to the
fact of the agency's being subject to law and higher authority. Said section provides:

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.

Both E.O. NO. 192 and the Administrative Code of 1987 have set the objectives which will serve as
the bases for policy formulation, and have defined the powers and functions of the DENR.

It may, however, be recalled that even before the ratification of the 1987 Constitution, specific
statutes already paid special attention to the "environmental right" of the present and future
generations. On 6 June 1977, P.D. No. 1151 (Philippine Environmental Policy) and P.D. No. 1152
(Philippine Environment Code) were issued. The former "declared a continuing policy of the State (a)
to create, develop, maintain and improve conditions under which man and nature can thrive in
productive and enjoyable harmony with each other, (b) to fulfill the social, economic and other
requirements of present and future generations of Filipinos, and (c) to insure the attainment of an
environmental quality that is conducive to a life of dignity and well-being." 16 As its goal, it speaks of
the "responsibilities of each generation as trustee and guardian of the environment for succeeding
generations." 17 The latter statute, on the other hand, gave flesh to the said policy.

Thus, the right of the petitioners (and all those they represent) to a balanced and healthful ecology is
as clear as the DENR's duty — under its mandate and by virtue of its powers and functions under
E.O. No. 192 and the Administrative Code of 1987 — to protect and advance the said right.

A denial or violation of that right by the other who has the corelative duty or obligation to respect or
protect the same gives rise to a cause of action. Petitioners maintain that the granting of the TLAs,
which they claim was done with grave abuse of discretion, violated their right to a balanced and
healthful ecology; hence, the full protection thereof requires that no further TLAs should be renewed
or granted.

A cause of action is defined as:

. . . an act or omission of one party in violation of the legal right or rights of the other;
and its essential elements are legal right of the plaintiff, correlative obligation of the
defendant, and act or omission of the defendant in violation of said legal right. 18

It is settled in this jurisdiction that in a motion to dismiss based on the ground that the complaint fails
to state a cause of action, 19 the question submitted to the court for resolution involves the sufficiency
of the facts alleged in the complaint itself. No other matter should be considered; furthermore, the
truth of falsity of the said allegations is beside the point for the truth thereof is deemed hypothetically
admitted. The only issue to be resolved in such a case is: admitting such alleged facts to be true,
may the court render a valid judgment in accordance with the prayer in the complaint? 20 In Militante
vs. Edrosolano, 21 this Court laid down the rule that the judiciary should "exercise the utmost care
and circumspection in passing upon a motion to dismiss on the ground of the absence thereof
[cause of action] lest, by its failure to manifest a correct appreciation of the facts alleged and
deemed hypothetically admitted, what the law grants or recognizes is effectively nullified. If that
happens, there is a blot on the legal order. The law itself stands in disrepute."

After careful examination of the petitioners' complaint, We find the statements under the introductory
affirmative allegations, as well as the specific averments under the sub-heading CAUSE OF
ACTION, to be adequate enough to show, prima facie, the claimed violation of their rights. On the
basis thereof, they may thus be granted, wholly or partly, the reliefs prayed for. It bears stressing,
however, that insofar as the cancellation of the TLAs is concerned, there is the need to implead, as
party defendants, the grantees thereof for they are indispensable parties.

The foregoing considered, Civil Case No. 90-777 be said to raise a political question. Policy
formulation or determination by the executive or legislative branches of Government is not squarely
put in issue. What is principally involved is the enforcement of a right vis-a-vis policies already
formulated and expressed in legislation. It must, nonetheless, be emphasized that the political
question doctrine is no longer, the insurmountable obstacle to the exercise of judicial power or the
impenetrable shield that protects executive and legislative actions from judicial inquiry or review. The
second paragraph of section 1, Article VIII of the Constitution states that:

Judicial power includes the duty of the courts of justice to settle actual controversies
involving rights which are legally demandable and enforceable, and to determine
whether or not there has been a grave abuse of discretion amounting to lack or
excess of jurisdiction on the part of any branch or instrumentality of the Government.
Commenting on this provision in his book, Philippine Political Law, 22 Mr. Justice Isagani A. Cruz, a
distinguished member of this Court, says:

The first part of the authority represents the traditional concept of judicial power,
involving the settlement of conflicting rights as conferred as law. The second part of
the authority represents a broadening of judicial power to enable the courts of justice
to review what was before forbidden territory, to wit, the discretion of the political
departments of the government.

As worded, the new provision vests in the judiciary, and particularly the Supreme
Court, the power to rule upon even the wisdom of the decisions of the executive and
the legislature and to declare their acts invalid for lack or excess of jurisdiction
because tainted with grave abuse of discretion. The catch, of course, is the meaning
of "grave abuse of discretion," which is a very elastic phrase that can expand or
contract according to the disposition of the judiciary.

In Daza vs. Singson, 23 Mr. Justice Cruz, now speaking for this Court, noted:

In the case now before us, the jurisdictional objection becomes even less tenable
and decisive. The reason is that, even if we were to assume that the issue presented
before us was political in nature, we would still not be precluded from revolving it
under the expanded jurisdiction conferred upon us that now covers, in proper cases,
even the political question. Article VII, Section 1, of the Constitution clearly provides:
...

The last ground invoked by the trial court in dismissing the complaint is the non-impairment of
contracts clause found in the Constitution. The court a quo declared that:

The Court is likewise of the impression that it cannot, no matter how we stretch our
jurisdiction, grant the reliefs prayed for by the plaintiffs, i.e., to cancel all existing
timber license agreements in the country and to cease and desist from receiving,
accepting, processing, renewing or approving new timber license agreements. For to
do otherwise would amount to "impairment of contracts" abhored (sic) by the
fundamental law. 24

We are not persuaded at all; on the contrary, We are amazed, if not shocked, by such a sweeping
pronouncement. In the first place, the respondent Secretary did not, for obvious reasons, even
invoke in his motion to dismiss the non-impairment clause. If he had done so, he would have acted
with utmost infidelity to the Government by providing undue and unwarranted benefits and
advantages to the timber license holders because he would have forever bound the Government to
strictly respect the said licenses according to their terms and conditions regardless of changes in
policy and the demands of public interest and welfare. He was aware that as correctly pointed out by
the petitioners, into every timber license must be read Section 20 of the Forestry Reform Code (P.D.
No. 705) which provides:

. . . Provided, That when the national interest so requires, the President may amend,
modify, replace or rescind any contract, concession, permit, licenses or any other
form of privilege granted herein . . .

Needless to say, all licenses may thus be revoked or rescinded by executive action. It is not
a contract, property or a property right protested by the due process clause of the
Constitution. In Tan vs. Director of Forestry, 25 this Court held:
 . . . A timber license is an instrument by which the State regulates the utilization and
disposition of forest resources to the end that public welfare is promoted. A timber
license is not a contract within the purview of the due process clause; it is only a
license or privilege, which can be validly withdrawn whenever dictated by public
interest or public welfare as in this case.

A license is merely a permit or privilege to do what otherwise would be unlawful, and

is not a contract between the authority, federal, state, or municipal, granting it and
the person to whom it is granted; neither is it property or a property right, nor does it
create a vested right; nor is it taxation (37 C.J. 168). Thus, this Court held that the
granting of license does not create irrevocable rights, neither is it property or property
rights (People vs. Ong Tin, 54 O.G. 7576).

We reiterated this pronouncement in Felipe Ysmael, Jr. & Co., Inc. vs. Deputy Executive Secretary: 26

. . . Timber licenses, permits and license agreements are the principal instruments by
which the State regulates the utilization and disposition of forest resources to the end
that public welfare is promoted. And it can hardly be gainsaid that they merely
evidence a privilege granted by the State to qualified entities, and do not vest in the
latter a permanent or irrevocable right to the particular concession area and the
forest products therein. They may be validly amended, modified, replaced or
rescinded by the Chief Executive when national interests so require. Thus, they are
not deemed contracts within the purview of the due process of law clause
[See Sections 3(ee) and 20 of Pres. Decree No. 705, as amended. Also, Tan v.
Director of Forestry, G.R. No. L-24548, October 27, 1983, 125 SCRA 302].

Since timber licenses are not contracts, the non-impairment clause, which reads:

Sec. 10. No law impairing, the obligation of contracts shall be passed. 27

cannot be invoked.

In the second place, even if it is to be assumed that the same are contracts, the instant case does
not involve a law or even an executive issuance declaring the cancellation or modification of existing
timber licenses. Hence, the non-impairment clause cannot as yet be invoked. Nevertheless, granting
further that a law has actually been passed mandating cancellations or modifications, the same
cannot still be stigmatized as a violation of the non-impairment clause. This is because by its very
nature and purpose, such as law could have only been passed in the exercise of the police power of
the state for the purpose of advancing the right of the people to a balanced and healthful ecology,
promoting their health and enhancing the general welfare. In Abe vs. Foster Wheeler
Corp. 28 this Court stated:

The freedom of contract, under our system of government, is not meant to be

absolute. The same is understood to be subject to reasonable legislative regulation
aimed at the promotion of public health, moral, safety and welfare. In other words,
the constitutional guaranty of non-impairment of obligations of contract is limited by
the exercise of the police power of the State, in the interest of public health, safety,
moral and general welfare.

The reason for this is emphatically set forth in Nebia vs. New York, 29 quoted in Philippine American
Life Insurance Co. vs. Auditor General,30 to wit:
 Under our form of government the use of property and the making of contracts are
normally matters of private and not of public concern. The general rule is that both
shall be free of governmental interference. But neither property rights nor contract
rights are absolute; for government cannot exist if the citizen may at will use his
property to the detriment of his fellows, or exercise his freedom of contract to work
them harm. Equally fundamental with the private right is that of the public to regulate
it in the common interest.

In short, the non-impairment clause must yield to the police power of the state . 31

Finally, it is difficult to imagine, as the trial court did, how the non-impairment clause could apply with
respect to the prayer to enjoin the respondent Secretary from receiving, accepting, processing,
renewing or approving new timber licenses for, save in cases of renewal, no contract would have as
of yet existed in the other instances. Moreover, with respect to renewal, the holder is not entitled to it
as a matter of right.

WHEREFORE, being impressed with merit, the instant Petition is hereby GRANTED, and the
challenged Order of respondent Judge of 18 July 1991 dismissing Civil Case No. 90-777 is hereby
set aside. The petitioners may therefore amend their complaint to implead as defendants the holders
or grantees of the questioned timber license agreements.

No pronouncement as to costs.

SO ORDERED.

Cruz, Padilla, Bidin, Griño-Aquino, Regalado, Romero, Nocon, Bellosillo, Melo and Quiason, JJ.,
concur.

Narvasa, C.J., Puno and Vitug, JJ., took no part.

2
Resident Marine Mammals of the protected Seascape Tanon Strait, e.g. toothed
whales, dolphins, porpoises and other cetacean species, joined in and
represented herein by human beings Gloria Estenzo Ramos, et al vs Sec.
Angelo Reyes et al (G.R. No. 180771 April 24 2012)

LEONARDO-DE CASTRO, J.:

Before Us are two consolidated Petitions filed under Rule 65 of the 1997 Rules of
Court, concerning Service Contract No. 46 (SC-46), which allowed the
exploration, development, and exploitation of petroleum resources within Tañon
Strait, a narrow passage of water situated between the islands of Negros and
Cebu.2

The Petition docketed as G.R. No. 180771 is an original Petition

for Certiorari, Mandamus, and Injunction, which seeks to enjoin respondents from
implementing SC-46 and to have it nullified for willful and gross violation of the
1987 Constitution and certain international and municipal laws.3

Likewise, the Petition docketed as G.R. No. 181527 is an original Petition

for Certiorari, Prohibition, and Mandamus, which seeks to nullify the Environmental
Compliance Certificate (ECC) issued by the Environmental Management Bureau
(EMB) of the Department of Environment and Natural Resources (DENR), Region
VII in connection with SC-46; to prohibit respondents from implementing SC-46;
and to compel public respondents to provide petitioners access to the pertinent
documents involving the Tañon Strait Oil Exploration Project.4

ANTECEDENT FACTS AND PROCEEDINGS

Petitioners in G.R. No. 180771, collectively referred to as the "Resident Marine

Mammals" in the petition, are the toothed whales, dolphins, porpoises, and other
cetacean species, which inhabit the waters in and around the Tañon Strait. They are
joined by Gloria Estenzo Ramos (Ramos) and Rose-Liza Eisma-Osorio (Eisma-
Osorio) as their legal guardians and as friends (to be collectively known as "the
Stewards") who allegedly empathize with, and seek the protection of, the
aforementioned marine species. Also impleaded as an unwilling co-petitioner is
former President Gloria Macapagal-Arroyo, for her express declaration and
undertaking in the ASEAN Charter to protect the Tañon Strait, among others.5

Petitioners in G.R. No. 181527 are the Central Visayas Fisherfolk Development
Center (FIDEC), a non-stock, non-profit, non-governmental organization,
established for the welfare of the marginal fisherfolk in Region VII; and Cerilo D.
Engarcial (Engarcial), Ramon Yanong (Yanong) and Francisco Labid (Labid), in their
personal capacities and as representatives of the subsistence fisherfolk of the
municipalities of Aloguinsan and Pinamungajan, Cebu.
Named as respondents in both petitions are the late Angelo T. Reyes, as then
Secretary of the Department of Energy (DOE); Jose L. Atienza, as then Secretary of
the DENR; Leonardo R. Sibbaluca, as then DENR-Regional Director for Region VII
and Chairman of the Tañon Strait Protected Seascape Management Board; Japan
Petroleum Exploration Co., Ltd. (JAPEX), a company organized and existing under
the laws of Japan with a Philippine branch office; and Supply Oilfield Services, Inc.
(SOS), as the alleged Philippine agent of JAPEX.

In G.R. No. 181527, the following were impleaded as additional public respondents:
Alan C. Arranguez (Arranguez) and Antonio Labios (Labios), in their capacities as
then Director of the EMB, Region VII and then Regional Director of the DOE, Region
VII, respectively.6

On June 13, 2002, the Government of the Philippines, acting through the DOE,
entered into a Geophysical Survey and Exploration Contract-102 (GSEC-102) with
JAPEX. This contract involved geological and geophysical studies of the Tañon
Strait. The studies included surface geology, sample analysis, and reprocessing of
seismic and magnetic data. JAPEX, assisted by DOE, also conducted geophysical
and satellite surveys, as well as oil and gas sampling in Tañon Strait.7

On December 21, 2004, DOE and JAPEX formally converted GSEC-102 into SC-46
for the exploration, development, and production of petroleum resources in a block
covering approximately 2,850 square kilometers offshore the Tañon Strait.8

From May 9 to 18, 2005, JAPEX conducted seismic surveys in and around the Tañon
Strait. A multi-channel sub-bottom profiling covering approximately 751 kilometers
was also done to determine the area's underwater composition.9

JAPEX committed to drill one exploration well during the second sub-phase of the
project. Since the well was to be drilled in the marine waters of Aloguinsan and
Pinamungajan, where the Tañon Strait was declared a protected seascape in
1988,10 JAPEX agreed to comply with the Environmental Impact Assessment
requirements pursuant to Presidential Decree No. 1586, entitled "Establishing An
Environmental Impact Statement System, Including Other Environmental
Management Related Measures And For Other Purposes."11

On January 31, 2007, the Protected Area Management Board12 of the Tañon Strait
(PAMB-Tañon Strait) issued Resolution No. 2007-001,13 wherein it adopted the
Initial Environmental Examination (IEE) commissioned by JAPEX, and favorably
recommended the approval of JAPEX's application for an ECC.

On March 6, 2007, the EMB of DENR Region VII granted an ECC to the DOE and
JAPEX for the offshore oil and gas exploration project in Tañon Strait.14 Months
later, on November 16, 2007, JAPEX began to drill an exploratory well, with a depth
of 3,150 meters, near Pinamungajan town in the western Cebu Province.15 This
drilling lasted until February 8, 2008.16

It was in view of the foregoing state of affairs that petitioners applied to this Court
for redress, via two separate original petitions both dated December 17, 2007,
wherein they commonly seek that respondents be enjoined from implementing SC-
46 for, among others, violation of the 1987 Constitution.

On March 31, 2008, SOS filed a Motion to Strike17 its name as a respondent on the
ground that it is not the Philippine agent of JAPEX. In support of its motion, it
submitted the branch office application of JAPEX,18 wherein the latter's resident
agent was clearly identified. SOS claimed that it had acted as a mere logistics
contractor for JAPEX in its oil and gas exploration activities in the Philippines.

Petitioners Resident Marine Mammals and Stewards opposed SOS's motion on the
ground that it was premature, it was pro-forma, and it was patently dilatory. They
claimed that SOS admitted that "it is in law a (sic) privy to JAPEX" since it did the
drilling and other exploration activities in Tañon Strait under the instructions of its
principal, JAPEX. They argued that it would be premature to drop SOS as a party as
JAPEX had not yet been joined in the case; and that it was "convenient" for SOS to
ask the Court to simply drop its name from the parties when what it should have
done was to either notify or ask JAPEX to join it in its motion to enable proper
substitution. At this juncture, petitioners Resident Marine Mammals and Stewards
also asked the Court to implead JAPEX Philippines as a corespondent or as a
substitute for its parent company, JAPEX.19

On April 8, 2008, the Court resolved to consolidate G.R. No. 180771 and G.R. No.
181527.

On May 26, 2008, the FIDEC manifested20 that they were adopting in toto the
Opposition to Strike with Motion to Implead filed by petitioners Resident Marine
Mammals and Stewards in G.R. No. 180771.

On June 19, 2008, public respondents filed their Manifestation21 that they were not
objecting to SOS's Motion to Strike as it was not JAPEX's resident agent. JAPEX
during all this time, did not file any comment at all.

Thus, on February 7, 2012, this Court, in an effort to ensure that all the parties
were given ample chance and opportunity to answer the issues herein, issued a
Resolution directing the Court's process servicing unit to again serve the parties
with a copy of the September 23, 2008 Resolution of the Court, which gave due
course to the petitions in G.R. Nos. 180771 and 181527, and which required the
parties to submit their respective memoranda. The February 7, 2012
Resolution22 reads as follows:chanroblesvirtuallawlibrary

G.R. No. 180771 (Resident Marine Mammals of the Protected Seascape Tañon
Strait, e.g., Toothed Whales, Dolphins, Porpoises and Other Cetacean Species, et
al. vs. Hon. Angelo Reyes, in his capacity as Secretary of the Department of
Energy, et al.) and G.R. No. 181527 (Central Visayas Fisherfolk Development
Center, et al. vs. Hon. Angelo Reyes, et al.). - The Court Resolved to direct the
Process Servicing Unit to RE-SEND the resolution dated September 23, 2008 to the
following parties and counsel, together with this resolution:chanroblesvirtuallawlibrary
 20th Floor Pearlbank Centre

Atty. Aristeo O.
Cariño
Counsel for
Respondent 146 Valero Street
Supply
Oilfield Services,
Salcedo Village, Makati City
Inc.

JAPEX
20th Floor Pearlbank Centre
Philippines Ltd.
146 Valero Street
Salcedo Village, Makati City

JAPEX
19th Floor Pearlbank Centre
Philippines Ltd.
c/o Atty. Maria
146 Valero Street
Farah Z.G.
Nicolas-Suchianco Salcedo Village, Makati City

Atty. Maria
Suite 2404 Discovery Centre
Farah Z.G.
Nicolas-
25 ADB Avenue
Suchianco
Resident Agent of
Ortigas Center, Pasig City
JAPEX
Philippines Ltd.
This Resolution was personally served to the above parties, at the above addresses
on February 23, 2012. On March 20, 2012, JAPEX Philippines, Ltd. (JAPEX PH), by
way of special appearance, filed a Motion to Admit23 its Motion for
Clarification,24 wherein JAPEX PH requested to be clarified as to whether or not it
should deem the February 7, 2012 Resolution as this Court's Order of its inclusion
in the case, as it has not been impleaded. It also alleged that JAPEX PH had already
stopped exploration activities in the Tañon Strait way back in 2008, rendering this
case moot.

On March 22, 2012, JAPEX PH, also by special appearance, filed a Motion for
Extension of Time25 to file its Memorandum. It stated that since it received the
February 7, 2012 Resolution on February 23, 2012, it had until March 22, 2012 to
file its Memorandum. JAPEX PH then asked for an additional thirty days, supposedly
to give this Court some time to consider its Motion for Clarification.

On April 24, 2012, this Court issued a Resolution26 granting JAPEX PH's Motion to
Admit its Motion for Clarification. This Court, addressing JAPEX PH's Motion for
Clarification, held:chanroblesvirtuallawlibrary

With regard to its Motion for Clarification (By Special Appearance) dated March 19,
2012, this Court considers JAPEX Philippines. Ltd. as a real party-in-interest in
these cases. Under Section 2, Rule 3 of the 1997 Rules of Court, a real party-in-
interest is 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. Contrary to JAPEX Philippines,
Ltd.'s allegation that it is a completely distinct corporation, which should not be
confused with JAPEX Company, Ltd., JAPEX Philippines, Ltd. is a mere branch office,
established by JAPEX Company, Ltd. for the purpose of carrying out the latter's
business transactions here in the Philippines. Thus, JAPEX Philippines, Ltd., has no
separate personality from its mother foreign corporation, the party impleaded in
this case.

Moreover, Section 128 of the Corporation Code provides for the responsibilities and
duties of a resident agent of a foreign corporation:
chanroblesvirtuallawlibrary

SECTION 128. Resident agent; service of process. — The Securities and Exchange
Commission shall require as a condition precedent to the issuance of the license to
transact business in the Philippines by any foreign corporation that such corporation
file with the Securities and Exchange Commission a written power of attorney
designating some person who must be a resident of the Philippines, on whom any
summons and other legal processes may be served in all actions or other legal
proceedings against such corporation, and consenting that service upon such
resident agent shall be admitted and held as valid as if served upon the duly
authorized officers of the foreign corporation at its home office. Any such foreign
corporation shall likewise execute and file with the Securities and Exchange
Commission an agreement or stipulation, executed by the proper authorities of said
corporation, in form and substance as follows:

"The (name of foreign corporation) does hereby stipulate and agree, in

consideration of its being granted by the Securities and Exchange Commission a
license to transact business in the Philippines, that if at any time said corporation
shall cease to transact business in the Philippines, or shall be without any resident
agent in the Philippines on whom any summons or other legal processes may be
served, then in any action or proceeding arising out of any business or transaction
which occurred in the Philippines, service of any summons or other legal process
may be made upon the Securities and Exchange Commission and that such service
shall have the same force and effect as if made upon the duly-authorized officers of
the corporation at its home office."

Whenever such service of summons or other process shall be made upon the
Securities and Exchange Commission, the Commission shall, within ten (10) days
thereafter, transmit by mail a copy of such summons or other legal process to the
corporation at its home or principal office. The sending of such copy by the
Commission shall be a necessary part of and shall complete such service. All
expenses incurred by the Commission for such service shall be paid in advance by
the party at whose instance the service is made.

In case of a change of address of the resident agent, it shall be his or its duty to
immediately notify in writing the Securities and Exchange Commission of the new
address.
It is clear from the foregoing provision that the function of a resident agent is to
receive summons or legal processes that may be served in all actions or other legal
proceedings against the foreign corporation. These cases have been prosecuted in
the name of JAPEX Company, Ltd., and JAPEX Philippines Ltd., as its branch office
and resident agent, had been receiving the various resolutions from this Court, as
evidenced by Registry Return Cards signed by its representatives.
And in the interest of justice, this Court resolved to grant JAPEX PH's motion for
extension of time to file its memorandum, and was given until April 21, 2012, as
prayed for, within which to comply with the submission.27

Without filing its Memorandum, JAPEX PH, on May 14, 2012, filed a motion, asking
this Court for an additional thirty days to file its Memorandum, to be counted from
May 8, 2012. It justified its request by claiming that this Court's April 24, 2012
Resolution was issued past its requested deadline for filing, which was on April 21,
2012.28

On June 19, 2012, this Court denied JAPEX PH's second request for additional time
to file its Memorandum and dispensed with such filing.

Since petitioners had already filed their respective memoranda,29 and public
respondents had earlier filed a Manifestation30 that they were adopting their
Comment dated March 31, 2008 as their memorandum, this Court submitted the
case for decision.
chanRoblesvirtualLawlibrary

Petitioners' Allegations

Protesting the adverse ecological impact of JAPEX's oil exploration activities in the
Tañon Strait, petitioners Resident Marine Mammals and Stewards aver that a study
made after the seismic survey showed that the fish catch was reduced drastically
by 50 to 70 percent. They claim that before the seismic survey, the average
harvest per day would be from 15 to 20 kilos; but after the activity, the fisherfolk
could only catch an average of 1 to 2 kilos a day. They attribute this "reduced fish
catch" to the destruction of the "payao" also known as the "fish aggregating device"
or "artificial reef."31 Petitioners Resident Marine Mammals and Stewards also impute
the incidences of "fish kill"32 observed by some of the local fisherfolk to the seismic
survey. And they further allege that the ECC obtained by private respondent JAPEX
is invalid because public consultations and discussions with the affected
stakeholders, a pre-requisite to the issuance of the ECC, were not held prior to the
ECC's issuance.

In its separate petition, petitioner FIDEC confirms petitioners Resident Marine

Mammals and Stewards' allegations of reduced fish catch and lack of public
consultations or discussions with the fisherfolk and other stakeholders prior to the
issuance of the ECC. Moreover, it alleges that during the seismic surveys and
drilling, it was barred from entering and fishing within a 7-kilometer radius from the
point where the oilrig was located, an area greater than the 1.5-kilometer radius
"exclusion zone" stated in the IEE.33 It also agrees in the allegation that public
respondents DENR and EMB abused their discretion when they issued an ECC to
public respondent DOE and private respondent JAPEX without ensuring the strict
compliance with the procedural and substantive requirements under the
Environmental Impact Assessment system, the Fisheries Code, and their
implementing rules and regulations.34 It further claims that despite several requests
for copies of all the documents pertaining to the project in Taflon Strait, only copies
of the PAMB-Tañon Strait Resolution and the ECC were given to the fisherfolk.35

Public Respondents' Counter-Allegations

Public respondents, through the Solicitor General, contend that petitioners Resident
Marine Mammals and Stewards have no legal standing to file the present petition;
that SC-46 does not violate the 1987 Constitution and the various laws cited in the
petitions; that the ECC was issued in accordance with existing laws and regulations;
that public respondents may not be compelled by mandamus to furnish petitioners
copies of all documents relating to SC-46; and that all the petitioners failed to show
that they are entitled to injunctive relief. They further contend that the issues
raised in these petitions have been rendered moot and academic by the fact that
SC-46 had been mutually terminated by the parties thereto effective June 21,
2008.36

ISSUES

The following are the issues posited by petitioners Resident Marine Mammals and
Stewards in G.R. No. 180771: chanroblesvirtuallawlibrary

I. WHETHER OR NOT PETITIONERS HAVE LOCUS STANDI TO FILE THE

INSTANT PETITION;

II. WHETHER OR NOT SERVICE CONTRACT NO. 46 IS VIOLAT[IVE] OF THE 1987

PHILIPPINE CONSTITUTION AND STATUTES;

III. WHETHER OR NOT THE ON-GOING EXPLORATION AND PROPOSED

EXPLOITATION FOR OIL AND NATURAL GAS AT, AROUND, AND UNDERNEATH
THE MARINE WATERS OF THE TANON STRAIT PROTECTED SEASCAPE IS
INCONSISTENT WITH THE PHILIPPINE COMMITMENTS TO INTERNATIONAL
ENVIRONMENTAL LAWS AND INSTRUMENTS; AND

IV. WHETHER OR NOT THE ISSUANCE OF THE ENVIRONMENTAL COMPLIANCE

CERTIFICATE (ECC) IN ENVIRONMENTALLY CRITICAL AREAS AND HABITATS
OF MARINE WILDLIFE AND ENDANGERED SPECIES IS LEGAL AND PROPER.37

Meanwhile, in G.R. No. 181527, petitioner FIDEC presented the following issues for
our consideration:chanroblesvirtuallawlibrary

I. WHETHER OR NOT SERVICE CONTRACT NO. 46 EXECUTED BETWEEN

RESPONDENTS DOE AND JAPEX SHOULD BE NULLIFIED AND SET ASIDE FOR
BEING IN DIRECT VIOLATION OF SPECIFIC PROVISIONS OF THE 1987
PHILIPPINE CONSTITUTION AND APPLICABLE LAWS;

II. WHETHER OR NOT THE OFF-SHORE OIL EXPLORATION CONTEMPLATED

UNDER SERVICE CONTRACT NO. 46 IS LEGALLY PERMISSIBLE WITHOUT A
LAW BEING DULY PASSED EXPRESSLY FOR THE PURPOSE;
III. WHETHER OR NOT THE OIL EXPLORATION BEING CONDUCTED WITHIN THE
TANON STRAIT PROTECTED SEASCAPE VIOLATES THE RIGHTS AND LEGAL
PROTECTION GRANTED TO PETITIONERS UNDER THE CONSTITUTION AND
APPLICABLE LAWS.

IV. WHETHER OR NOT THE ISSUANCE OF THE ENVIRONMENTAL COMPLIANCE

CERTIFICATE (ECC) FOR SUCH AN ENVIRONMENTALLY CRITICAL PROJECT
INSIDE AN ENVIRONMENTALLY CRITICAL AREA SUCH AS THE TANON STRAIT
PROTECTED SEASCAPE CONFORMED TO LAW AND EXISTING RULES AND
REGULATIONS ON THE MATTER.

V. WHETHER OR NOT THE RESPONDENTS MAY BE COMPELLED BY MANDAMUS

TO FURNISH PETITIONERS WITH COPIES OF THE DOCUMENTS PERTAINING
TO THE TANON STRAIT OIL EXPLORATION PROJECT.38

In these consolidated petitions, this Court has determined that the various issues
raised by the petitioners may be condensed into two primary issues:

I. Procedural Issue: Locus Standi of the Resident Marine Mammals and

Stewards, petitioners in G.R. No. 180771; and

II. Main Issue: Legality of Service Contract No. 46.

DISCUSSION

At the outset, this Court makes clear that the '"moot and academic principle' is not
a magical formula that can automatically dissuade the courts in resolving a case."
Courts have decided cases otherwise moot and academic under the following
exceptions:

1) There is a grave violation of the Constitution;

2) The exceptional character of the situation and the paramount public interest is
involved;

3) The constitutional issue raised requires formulation of controlling principles to

guide the bench, the bar, and the public; and

4) The case is capable of repetition yet evading review.39

In this case, despite the termination of SC-46, this Court deems it necessary to
resolve these consolidated petitions as almost all of the foregoing exceptions are
present in this case. Both petitioners allege that SC-46 is violative of the
Constitution, the environmental and livelihood issues raised undoubtedly affect the
public's interest, and the respondents' contested actions are capable of
repetition.
chanRoblesvirtualLawlibrary
 Procedural Issues

Locus Standi of Petitioners Resident Marine Mammals and Stewards

The Resident Marine Mammals, through the Stewards, "claim" that they have the
legal standing to file this action since they stand to be benefited or injured by the
judgment in this suit.40 Citing Oposa v. Factoran, Jr.,41 they also assert their right
to sue for the faithful performance of international and municipal environmental
laws created in their favor and for their benefit. In this regard, they propound that
they have the right to demand that they be accorded the benefits granted to them
in multilateral international instruments that the Philippine Government had signed,
under the concept of stipulation pour autrui.42

For their part, the Stewards contend that there should be no question of their right
to represent the Resident Marine Mammals as they have stakes in the case as
forerunners of a campaign to build awareness among the affected residents of
Tañon Strait and as stewards of the environment since the primary steward, the
Government, had failed in its duty to protect the environment pursuant to the
public trust doctrine.43

Petitioners Resident Marine Mammals and Stewards also aver that this Court may
lower the benchmark in locus standi as an exercise of epistolary jurisdiction.44

In opposition, public respondents argue that the Resident Marine Mammals have no
standing because Section 1, Rule 3 of the Rules of Court requires parties to an
action to be either natural or juridical persons, viz.:
chanroblesvirtuallawlibrary

Section 1. Who may be parties; plaintiff and defendant. - Only natural or juridical
persons, or entities authorized by law may be parties in a civil action. The term
"plaintiff may refer to the claiming party, the counter-claimant, the cross-claimant,
or the third (fourth, etc.)-party plaintiff. The term "defendant" may refer to the
original defending party, the defendant in a counterclaim, the cross-defendant, or
the third (fourth, etc.)-party defendant.
The public respondents also contest the applicability of Oposa, pointing out that the
petitioners therein were all natural persons, albeit some of them were still unborn.45

As regards the Stewards, the public respondents likewise challenge their claim of
legal standing on the ground that they are representing animals, which cannot be
parties to an action. Moreover, the public respondents argue that the Stewards are
not the real parties-in-interest for their failure to show how they stand to be
benefited or injured by the decision in this case.46

Invoking the alter ego principle in political law, the public respondents claim that
absent any proof that former President Arroyo had disapproved of their acts in
entering into and implementing SC-46, such acts remain to be her own.47

The public respondents contend that since petitioners Resident Marine Mammals
and Stewards' petition was not brought in the name of a real party-in-interest, it
should be dismissed for failure to state a cause of action.48
The issue of whether or not animals or even inanimate objects should be given legal
standing in actions before courts of law is not new in the field of animal rights and
environmental law. Petitioners Resident Marine Mammals and Stewards cited the
1972 United States case Sierra Club v. Rogers C.B. Morton,49wherein Justice
William O. Douglas, dissenting to the conventional thought on legal standing,
opined:chanroblesvirtuallawlibrary

The critical question of "standing" would be simplified and also put neatly in focus if
we fashioned a federal rule that allowed environmental issues to be litigated before
federal agencies or federal courts in the name of the inanimate object about to be
despoiled, defaced, or invaded by roads and bulldozers and where injury is the
subject of public outrage, x x x.

Inanimate objects are sometimes parties in litigation. A ship has a legal personality,
a fiction found useful for maritime purposes. The corporation sole - a creature of
ecclesiastical law - is an acceptable adversary and large fortunes ride on its cases.
The ordinary corporation is a "person" for purposes of the adjudicatory processes,
whether it represents proprietary, spiritual, aesthetic, or charitable causes.

So it should be as respects valleys, alpine meadows, rivers, lakes, estuaries,

beaches, ridges, groves of trees, swampland, or even air that feels the destructive
pressures of modern technology and modem life. The river, for example, is the
living symbol of all the life it sustains or nourishes—fish, aquatic insects, water
ouzels, otter, fisher, deer, elk, bear, and all other animals, including man, who are
dependent on it or who enjoy it for its sight, its sound, or its life. The river as
plaintiff speaks for the ecological unit of life that is part of it. Those people who
have a meaningful relation to that body of water—whether it be a fisherman, a
canoeist, a zoologist, or a logger—must be able to speak for the values which the
river represents and which are threatened with destruction.50 (Citations omitted.)
The primary reason animal rights advocates and environmentalists seek to give
animals and inanimate objects standing is due to the need to comply with the strict
requirements in bringing a suit to court. Our own 1997 Rules of Court demand that
parties to a suit be either natural or juridical persons, or entities authorized by law.
It further necessitates the action to be brought in the name of the real party-in-
interest, even if filed by a representative, viz.:
chanroblesvirtuallawlibrary

Rule 3
Parties to Civil Actions

Section 1. Who may be parties; plaintiff and defendant. - Only natural or juridical
persons, or entities authorized by law may be parties in a civil action. The term
"plaintiff may refer to the claiming party, the counter-claimant, the cross-claimant,
or the third (fourth, etc.)-party plaintiff. The term "defendant" may refer to the
original defending party, the defendant in a counterclaim, the cross-defendant, or
the third (fourth, etc.)-party defendant.

Sec. 2. Parties in interest. - A real party in interest is 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. Unless otherwise authorized by law or these Rules, every action must be
prosecuted or defended in the name of the real party in interest.

Sec. 3. Representatives as parties. - Where the action is allowed to be prosecuted

or defended by a representative or someone acting in a fiduciary capacity, the
beneficiary shall be included in the title of the case and shall be deemed to be the
real party in interest. A representative may be a trustee of an express trust, a
guardian, an executor or administrator, or a party authorized by law or these Rules.
An agent acting in his own name and for the benefit of an undisclosed principal may
sue or be sued without joining the principal except when the contract involves
things belonging to the principal.
It had been suggested by animal rights advocates and environmentalists that not
only natural and juridical persons should be given legal standing because of the
difficulty for persons, who cannot show that they by themselves are real parties-in-
interests, to bring actions in representation of these animals or inanimate objects.
For this reason, many environmental cases have been dismissed for failure of the
petitioner to show that he/she would be directly injured or affected by the outcome
of the case. However, in our jurisdiction, locus standi in environmental cases has
been given a more liberalized approach. While developments in Philippine legal
theory and jurisprudence have not progressed as far as Justice Douglas's paradigm
of legal standing for inanimate objects, the current trend moves towards
simplification of procedures and facilitating court access in environmental cases.

Recently, the Court passed the landmark Rules of Procedure for Environmental
Cases,51 which allow for a "citizen suit," and permit any Filipino citizen to file an
action before our courts for violations of our environmental laws: chanroblesvirtuallawlibrary

SEC. 5. Citizen suit. - Any Filipino citizen in representation of others,

including minors or generations yet unborn, may file an action to enforce
rights or obligations under environmental laws. Upon the filing of a citizen
suit, the court shall issue an order which shall contain a brief description of the
cause of action and the reliefs prayed for, requiring all interested parties to
manifest their interest to intervene in the case within fifteen (15) days from notice
thereof. The plaintiff may publish the order once in a newspaper of a general
circulation in the Philippines or furnish all affected barangays copies of said order.

Citizen suits filed under R.A. No. 8749 and R.A. No. 9003 shall be governed by their
respective provisions.52 (Emphasis ours.)
Explaining the rationale for this rule, the Court, in the Annotations to the Rules of
Procedure for Environmental Cases, commented: chanroblesvirtuallawlibrary

Citizen suit. To further encourage the protection of the environment, the Rules
enable litigants enforcing environmental rights to file their cases as citizen suits.
This provision liberalizes standing for all cases filed enforcing environmental laws
and collapses the traditional rule on personal and direct interest, on the principle
that humans are stewards of nature. The terminology of the text reflects the
doctrine first enunciated in Oposa v. Factoran, insofar as it refers to minors and
generations yet unborn.53 (Emphasis supplied, citation omitted.)
Although this petition was filed in 2007, years before the effectivity of the Rules of
Procedure for Environmental Cases, it has been consistently held that rules of
procedure "may be retroactively applied to actions pending and undetermined at
the time of their passage and will not violate any right of a person who may feel
that he is adversely affected, inasmuch as there is no vested rights in rules of
procedure."54

Elucidating on this doctrine, the Court, in Systems Factors Corporation v. National

Labor Relations Commission55 held that: chanroblesvirtuallawlibrary

Remedial statutes or statutes relating to remedies or modes of procedure, which do

not create new or take away vested rights, but only operate in furtherance of the
remedy or confirmation of rights already existing, do not come within the legal
conception of a retroactive law, or the general rule against retroactive operation of
statutes. Statutes regulating the procedure of the courts will be construed as
applicable to actions pending and undetermined at the time of their passage.
Procedural laws are retroactive in that sense and to that extent, x x x.
Moreover, even before the Rules of Procedure for Environmental Cases became
effective, this Court had already taken a permissive position on the issue of locus
standi in environmental cases. In Oposa, we allowed the suit to be brought in the
name of generations yet unborn "based on the concept of intergenerational
responsibility insofar as the right to a balanced and healthful ecology is
concerned."56Furthermore, we said that the right to a balanced and healthful
ecology, a right that does not even need to be stated in our Constitution as it is
assumed to exist from the inception of humankind, carries with it the correlative
duty to refrain from impairing the environment.57

In light of the foregoing, the need to give the Resident Marine Mammals legal
standing has been eliminated by our Rules, which allow any Filipino citizen, as a
steward of nature, to bring a suit to enforce our environmental laws. It is worth
noting here that the Stewards are joined as real parties in the Petition and not just
in representation of the named cetacean species. The Stewards, Ramos and Eisma-
Osorio, having shown in their petition that there may be possible violations of laws
concerning the habitat of the Resident Marine Mammals, are therefore declared to
possess the legal standing to file this petition. chanRoblesvirtualLawlibrary

Impleading Former President Gloria Macapagal-Arroyo as an Unwilling Co-

Petitioner

Petitioners Stewards in G.R. No. 180771 impleaded as an unwilling co-petitioner

former President Gloria Macapagal-Arroyo for the following reasons, which we
quote: chanroblesvirtuallawlibrary

Her Excellency Gloria Macapagal-Arroyo, also of legal age, Filipino and resident
of Malacañang Palace, Manila Philippines. Steward Gloria Macapagal-Arroyo
happens to be the incumbent President of the Philippine Islands. She is personally
impleaded in this suit as an unwilling co-petitioner by reason of her express
declaration and undertaking under the recently signed ASEAN Charter to protect
Your Petitioners' habitat, among others. She is meantime dominated as an unwilling
co-petitioner due to lack of material time in seeking her signature and imprimatur
hereof and due to possible legal complications that may hereafter arise by reason of
her official relations with public respondents under the alter ego principle in political
law.58
cralawlawlibrary
This is incorrect.

Section 10, Rule 3 of the Rules of Court provides: chanroblesvirtuallawlibrary

Sec. 10. Unwilling co-plaintiff. - If the consent of any party who should be joined as
plaintiff can not be obtained, he may be made a defendant and the reason therefor
shall be stated in the complaint.
Under the foregoing rule, when the consent of a party who should be joined as a
plaintiff cannot be obtained, he or she may be made a party defendant to the case.
This will put the unwilling party under the jurisdiction of the Court, which can
properly implead him or her through its processes. The unwilling party's name
cannot be simply included in a petition, without his or her knowledge and consent,
as such would be a denial of due process.

Moreover, the reason cited by the petitioners Stewards for including former
President Macapagal-Arroyo in their petition, is not sufficient to implead her as an
unwilling co-petitioner. Impleading the former President as an unwilling co-
petitioner, for an act she made in the performance of the functions of her office, is
contrary to the public policy against embroiling the President in suits, "to assure the
exercise of Presidential duties and functions free from any hindrance or distraction,
considering that being the Chief Executive of the Government is a job that, aside
from requiring all of the office holder's time, also demands undivided attention."59

Therefore, former President Macapagal-Arroyo cannot be impleaded as one of the

petitioners in this suit. Thus, her name is stricken off the title of this case. chanRoblesvirtualLawlibrary

Main Issue:
Legality of Service Contract No. 46

Service Contract No. 46 vis-a-vis

Section 2, Article XII of the
1987 Constitution

Petitioners maintain that SC-46 transgresses the Jura Regalia Provision or

paragraph 1, Section 2, Article XII of the 1987 Constitution because JAPEX is 100%
Japanese-owned.60 Furthermore, the FIDEC asserts that SC-46 cannot be
considered as a technical and financial assistance agreement validly executed under
paragraph 4 of the same provision.61 The petitioners claim that La Bugal-B'laan
Tribal Association, Inc. v. Ramos62 laid down the guidelines for a valid service
contract, one of which is that there must exist a general law for oil exploration
before a service contract may be entered into by the Government. The petitioners
posit that the service contract in La Bugal is presumed to have complied with the
requisites of (a) legislative enactment of a general law after the effectivity of the
1987 Constitution (such as Republic Act No. 7942, or the Philippine Mining Law of
1995, governing mining contracts) and (b) presidential notification. The petitioners
thus allege that the ruling in La Bugal, which involved mining contracts under
Republic Act No. 7942, does not apply in this case.63 The petitioners also argue that
Presidential Decree No. 87 or the Oil Exploration and Development Act of 1972
cannot legally justify SC-46 as it is deemed to have been repealed by the 1987
Constitution and subsequent laws, which enunciate new policies concerning the
environment.64 In addition, petitioners in G.R. No. 180771 claim that paragraphs 2
and 3 of Section 2, Article XII of the 1987 Constitution mandate the exclusive use
and enjoyment by the Filipinos of our natural resources,65 and paragraph 4 does not
speak of service contracts but of FTAAs or Financial Technical Assistance
Agreements.66

The public respondents again controvert the petitioners' claims and asseverate that
SC-46 does not violate Section 2, Article XII of the 1987 Constitution. They hold
that SC-46 does not fall under the coverage of paragraph 1 but instead, under
paragraph 4 of Section 2, Article XII of the 1987 Constitution on FTAAs. They also
insist that paragraphs 2 and 3, which refer to the grant of exclusive fishing right to
Filipinos, are not applicable to SC-46 as the contract does not grant exclusive
fishing rights to JAPEX nor does it otherwise impinge on the FIDEC's right to
preferential use of communal marine and fishing resources.67

Ruling of the Court

On the legality of Service Contract No. 46
vis-a-vis Section 2, Article XII of the 1987 Constitution

The petitioners insist that SC-46 is null and void for having violated Section 2,
Article XII of the 1987 Constitution, which reads as follows: chanroblesvirtuallawlibrary

Section 2. All lands of the public domain, waters, minerals, coal, petroleum, and
other mineral oils, all forces of potential energy, fisheries, forests or timber,
wildlife, flora and fauna, and other natural resources are owned by the State. With
the exception of agricultural lands, all other natural resources shall not be
alienated. The exploration, development, and utilization of natural resources shall
be under the full control and supervision of the State. The State may directly
undertake such activities, or it may enter into co-production, joint venture, or
production-sharing agreements with Filipino citizens, or corporations or associations
at least sixty per centum of whose capital is owned by such citizens. Such
agreements may be for a period not exceeding twenty-five years, renewable for not
more than twenty-five years, and under such terms and conditions as may be
provided by law. In cases of water rights for irrigation, water supply, fisheries, or
industrial uses other than the development of water power, beneficial use may be
the measure and limit of the grant.

The State shall protect the nation's marine wealth in its archipelagic waters,
territorial sea, and exclusive economic zone, and reserve its use and enjoyment
exclusively to Filipino citizens.

The Congress may, by law, allow small-scale utilization of natural resources by

Filipino citizens, as well as cooperative fish farming, with priority to subsistence
fishermen and fishworkers in rivers, lakes, bays, and lagoons.

The President may enter into agreements with foreign-owned corporations

involving either technical or financial assistance for large-scale
exploration, development, and utilization of minerals, petroleum, and other
mineral oils according to the general terms and conditions provided by law,
based on real contributions to the economic growth and general welfare of
the country. In such agreements, the State shall promote the development and
use of local scientific and technical resources.

The President shall notify the Congress of every contract entered into in
accordance with this provision, within thirty days from its
execution. (Emphases ours.)
This Court has previously settled the issue of whether service contracts are still
allowed under the 1987 Constitution. In La Bugal, we held that the deletion of the
words "service contracts" in the 1987 Constitution did not amount to a ban on
them per se. In fact, in that decision, we quoted in length, portions of the
deliberations of the members of the Constitutional Commission (ConCom) to show
that in deliberating on paragraph 4, Section 2, Article XII, they were actually
referring to service contracts as understood in the 1973 Constitution, albeit with
safety measures to eliminate or minimize the abuses prevalent during the martial
law regime, to wit:chanroblesvirtuallawlibrary

Summation of the ConCom Deliberations

At this point, we sum up the matters established, based on a careful reading of the
ConCom deliberations, as follows:

In their deliberations on what was to become paragraph 4, the framers used the
term service contracts in referring to agreements x x x involving either technical or
financial assistance.

They spoke of service contracts as the concept was understood in the 1973
Constitution.

It was obvious from their discussions that they were not about to ban or
eradicate service contracts.

Instead, they were plainly crafting provisions to put in place safeguards that would
eliminate or minimize the abuses prevalent during the marital law regime. In brief,
they were going to permit service contracts with foreign corporations as
contractors, but with safety measures to prevent abuses, as an exception to the
general norm established in the first paragraph of Section 2 of Article XII. This
provision reserves or limits to Filipino citizens and corporations at least 60 percent
of which is owned by such citizens — the exploration, development and utilization
of natural resources.

This provision was prompted by the perceived insufficiency of Filipino capital and
the felt need for foreign investments in the EDU of minerals and petroleum
resources.

The framers for the most part debated about the sort of safeguards that would be
considered adequate and reasonable. But some of them, having more "radical"
leanings, wanted to ban service contracts altogether; for them, the provision would
permit aliens to exploit and benefit from the nation's natural resources, which they
felt should be reserved only for Filipinos.

In the explanation of their votes, the individual commissioners were heard by the
entire body. They sounded off their individual opinions, openly enunciated their
philosophies, and supported or attacked the provisions with fervor. Everyone's
viewpoint was heard.

In the final voting, the Article on the National Economy and Patrimony — including
paragraph 4 allowing service contracts with foreign corporations as an exception to
the general norm in paragraph 1 of Section 2 of the same article — was
resoundingly approved by a vote of 32 to 7, with 2 abstentions.

Agreements Involving Technical Or Financial Assistance Are Service

Contracts with Safeguards

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.68 cralawlawlibrary

In summarizing the matters discussed in the ConCom, we established that

paragraph 4, with the safeguards in place, is the exception to paragraph 1,
Section 2 of Article XII. The following are the safeguards this Court enumerated
in La Bugal:chanroblesvirtuallawlibrary

Such service contracts may be entered into only with respect to minerals,
petroleum and other mineral oils. The grant thereof is subject to several
safeguards, among which are these requirements:

(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
vetted 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.69 cralawlawlibrary

Adhering to the aforementioned guidelines, this Court finds that SC-46 is indeed
null and void for noncompliance with the requirements of the 1987 Constitution.
1. The General Law on Oil Exploration

The disposition, exploration, development, exploitation, and utilization of

indigenous petroleum in the Philippines are governed by Presidential Decree No. 87
or the Oil Exploration and Development Act of 1972. This was enacted by then
President Ferdinand Marcos to promote the discovery and production of indigenous
petroleum through the utilization of government and/or local or foreign private
resources to yield the maximum benefit to the Filipino people and the revenues to
the Philippine Government.70

Contrary to the petitioners' argument, Presidential Decree No. 87, although enacted
in 1972, before the adoption of the 1987 Constitution, remains to be a valid law
unless otherwise repealed, to wit:chanroblesvirtuallawlibrary

ARTICLE XVIII - TRANSITORY PROVISIONS

Section 3. All existing laws, decrees, executive orders, proclamations, letters of

instructions, and other executive issuances not inconsistent with this Constitution
shall remain operative until amended, repealed, or revoked.
If there were any intention to repeal Presidential Decree No. 87, it would have been
done expressly by Congress. For instance, Republic Act No. 7160, more popularly
known as the Local Government Code of 1991, expressly repealed a number of
laws, including a specific provision in Presidential Decree No. 87, viz.:
chanroblesvirtuallawlibrary

SECTION 534. Repealing Clause. — (a) Batas Pambansa Blg. 337, otherwise known
as the "Local Government Code," Executive Order No. 112 (1987), and Executive
Order No. 319 (1988) are hereby repealed.

(b) Presidential Decree Nos. 684, 1191, 1508 and such other decrees, orders,
instructions, memoranda and issuances related to or concerning the barangay are
hereby repealed.

(c) The provisions of Sections 2, 3, and 4 of Republic Act No. 1939 regarding
hospital fund; Section 3, a (3) and b (2) of Republic Act No. 5447 regarding the
Special Education Fund; Presidential Decree No. 144 as amended by Presidential
Decree Nos. 559 and 1741; Presidential Decree No. 231 as amended; Presidential
Decree No. 436 as amended by Presidential Decree No. 558; and Presidential
Decree Nos. 381, 436, 464, 477, 526, 632, 752, and 1136 are hereby repealed and
rendered of no force and effect.

(d) Presidential Decree No. 1594 is hereby repealed insofar as it governs locally-
funded projects.

(e) The following provisions are hereby repealed or amended insofar as they are
inconsistent with the provisions of this Code: Sections 2, 16 and 29 of Presidential
Decree No. 704; Section 12 of Presidential Decree No. 87, as amended;
Sections 52, 53, 66, 67, 68, 69, 70, 71, 72, 73, and 74 of Presidential Decree No.
463, as amended; and Section 16 of Presidential Decree No. 972, as amended, and
(f) All general and special laws, acts, city charters, decrees, executive orders,
proclamations and administrative regulations, or part or parts thereof which are
inconsistent with any of the provisions of this Code are hereby repealed or modified
accordingly. (Emphasis supplied.)
This Court could not simply assume that while Presidential Decree No. 87 had not
yet been expressly repealed, it had been impliedly repealed. As we held in Villareña
v. The Commission on Audit,71 "[i]mplied repeals are not lightly presumed." It is a
settled rule that when laws are in conflict with one another, every effort must be
exerted to reconcile them. In Republic of the Philippines v. Marcopper Mining
Corporation,72 we said:chanroblesvirtuallawlibrary

The two laws must be absolutely incompatible, and a clear finding thereof must
surface, before the inference of implied repeal may be drawn. The rule is expressed
in the maxim, interpretare et concordare leqibus est optimus interpretendi, i.e.,
every statute must be so interpreted and brought into accord with other laws as to
form a uniform system of jurisprudence. The fundament is that the legislature
should be presumed to have known the existing laws on the subject and not have
enacted conflicting statutes. Hence, all doubts must be resolved against any implied
repeal, and all efforts should be exerted in order to harmonize and give effect to all
laws on the subject. (Citation omitted.)
Moreover, in cases where the statute seems to be in conflict with the Constitution,
but a construction that it is in harmony with the Constitution is also possible, that
construction should be preferred.73 This Court, in Pangandaman v. Commission on
Elections74 expounding on this point, pronounced: chanroblesvirtuallawlibrary

It is a basic precept in statutory construction that a statute should be interpreted in

harmony with the Constitution and that the spirit, rather than the letter of the law
determines its construction; for that reason, a statute must be read according to its
spirit and intent, x x x. (Citation omitted.)
Consequently, we find no merit in petitioners' contention that SC-46 is prohibited
on the ground that there is no general law prescribing the standard or uniform
terms, conditions, and requirements for service contracts involving oil exploration
and extraction.

But note must be made at this point that while Presidential Decree No. 87 may
serve as the general law upon which a service contract for petroleum exploration
and extraction may be authorized, as will be discussed below, the exploitation and
utilization of this energy resource in the present case may be allowed only through
a law passed by Congress, since the Tañon Strait is a NIPAS75 area.

2. President was not the signatory to SC-46 and the same was not
submitted to Congress

While the Court finds that Presidential Decree No. 87 is sufficient to satisfy the
requirement of a general law, the absence of the two other conditions, that the
President be a signatory to SC-46, and that Congress be notified of such contract,
renders it null and void.

As SC-46 was executed in 2004, its terms should have conformed not only to the
provisions of Presidential Decree No. 87, but also to those of the 1987 Constitution.
The Civil Code provides: chanroblesvirtuallawlibrary

ARTICLE 1306. The contracting parties may establish such stipulations, clauses,
terms and conditions as they may deem convenient, provided they are not contrary
to law, morals, good customs, public order, or public policy. (Italics ours.)
In Heirs of San Miguel v. Court of Appeals,76 this Court held that: chanroblesvirtuallawlibrary

It is basic that the law is deemed written into every contract. Although a contract is
the law between the parties, the provisions of positive law which regulate contracts
are deemed written therein and shall limit and govern the relations between the
parties, x x x. (Citations omitted.)
Paragraph 4, Section 2, Article XII of the 1987 Constitution requires that the
President himself enter into any service contract for the exploration of petroleum.
SC-46 appeared to have been entered into and signed only by the DOE through its
then Secretary, Vicente S. Perez, Jr., contrary to the said constitutional
requirement. Moreover, public respondents have neither shown nor alleged that
Congress was subsequently notified of the execution of such contract.

Public respondents' implied argument that based on the "alter ego principle," their
acts are also that of then President Macapagal-Arroyo's, cannot apply in this case.
In Joson v. Torres,77 we explained the concept of the alter ego principle or the
doctrine of qualified political agency and its limit in this wise: chanroblesvirtuallawlibrary

Under this doctrine, which recognizes the establishment of a single executive, all
executive and administrative organizations are adjuncts of the Executive
Department, the heads of the various executive departments are assistants and
agents of the Chief Executive, and, except in cases where the Chief Executive
is required by the Constitution or law to act in person or the exigencies of
the situation demand that he act personally, the multifarious executive and
administrative functions of the Chief Executive are performed by and through the
executive departments, and the acts of the Secretaries of such departments,
performed and promulgated in the regular course of business, are, unless
disapproved or reprobated by the Chief Executive presumptively the acts of the
Chief Executive. (Emphasis ours, citation omitted.)
While the requirements in executing service contracts in paragraph 4, Section 2 of
Article XII of the 1987 Constitution seem like mere formalities, they, in reality, take
on a much bigger role. As we have explained in La Bugal, they are the safeguards
put in place by the framers of the Constitution to "eliminate or minimize the abuses
prevalent during the martial law regime."78 Thus, they are not just mere formalities,
which will only render a contract unenforceable but not void, if not complied with.
They are requirements placed, not just in an ordinary statute, but in the
fundamental law, the non-observance of which will nullify the contract. Elucidating
on the concept of a "constitution," this Court, in Manila Prince Hotel v. Government
Service Insurance System,79 held: chanroblesvirtuallawlibrary

A constitution is a system of fundamental laws for the governance and

administration of a nation. It is supreme, imperious, absolute and unalterable
except by the authority from which it emanates. It has been defined as the
fundamental and paramount law of the nation. It prescribes the permanent
framework of a system of government, assigns to the different departments their
respective powers and duties, and establishes certain fixed principles on which
government is founded. The fundamental conception in other words is that it is a
supreme law to which all other laws must conform and in accordance with which all
private rights must be determined and all public authority administered. Under the
doctrine of constitutional supremacy, if a law or contract violates any norm
of the constitution that law or contract whether promulgated by the
legislative or by the executive branch or entered into by private persons
for private purposes is null and void and without any force and effect.
Thus, since the Constitution is the fundamental, paramount and supreme law of the
nation, it is deemed written in every statute and contract. (Emphasis ours.)
As this Court has held in La Bugal, our Constitution requires that the President
himself be the signatory of service agreements with foreign-owned corporations
involving the exploration, development, and utilization of our minerals, petroleum,
and other mineral oils. This power cannot be taken lightly.

In this case, the public respondents have failed to show that the President had any
participation in SC-46. Their argument that their acts are actually the acts of then
President Macapagal-Arroyo, absent proof of her disapproval, must fail as the
requirement that the President herself enter into these kinds of contracts is
embodied not just in any ordinary statute, but in the Constitution itself. These
service contracts involving the exploitation, development, and utilization of our
natural resources are of paramount interest to the present and future generations.
Hence, safeguards were put in place to insure that the guidelines set by law are
meticulously observed and likewise to eradicate the corruption that may easily
penetrate departments and agencies by ensuring that the President has authorized
or approved of these service contracts herself.

Even under the provisions of Presidential Decree No. 87, it is required that the
Petroleum Board, now the DOE, obtain the President's approval for the execution of
any contract under said statute, as shown in the following provision:chanroblesvirtuallawlibrary

SECTION 5. Execution of contract authorized in this Act. - Every contract herein

authorized shall, subject to the approval of the President, be executed by the
Petroleum Board created in this Act, after due public notice pre-qualification and
public bidding or concluded through negotiations. In case bids are requested or if
requested no bid is submitted or the bids submitted are rejected by the Petroleum
Board for being disadvantageous to the Government, the contract may be
concluded through negotiation.

In opening contract areas and in selecting the best offer for petroleum operations,
any of the following alternative procedures may be resorted to by the Petroleum
Board, subject to prior approval of the President [.]
Even if we were inclined to relax the requirement in La Bugal to harmonize the
1987 Constitution with the aforementioned provision of Presidential Decree No. 87,
it must be shown that the government agency or subordinate official has been
authorized by the President to enter into such service contract for the government.
Otherwise, it should be at least shown that the President subsequently approved of
such contract explicitly. None of these circumstances is evident in the case at
bar.chanRoblesvirtualLawlibrary
 Service Contract No. 46 vis-a-vis Other Laws

Petitioners in G.R. No. 180771 claim that SC-46 violates Section 27 of Republic Act.
No. 9147 or the Wildlife Resources Conservation and Protection Act, which bans all
marine exploration and exploitation of oil and gas deposits. They also aver that
Section 14 of Republic Act No. 7586 or the National Integrated Protected Areas
System Act of 1992 (NIPAS Act), which allows the exploration of protected areas for
the purpose of information-gathering, has been repealed by Section 27 of Republic
Act No. 9147. The said petitioners further claim that SC-46 is anathema to Republic
Act No. 8550 or the Philippine Fisheries Code of 1998, which protects the rights of
the fisherfolk in the preferential use of municipal waters, with the exception being
limited only to research and survey activities.80

The FIDEC, for its part, argues that to avail of the exceptions under Section 14 of
the NIPAS Act, the gathering of information must be in accordance with a DENR-
approved program, and the exploitation and utilization of energy resources must be
pursuant to a general law passed by Congress expressly for that purpose. Since
there is neither a DENR-approved program nor a general law passed by Congress,
the seismic surveys and oil drilling operations were all done illegally.81 The FIDEC
likewise contends that SC-46 infringes on its right to the preferential use of the
communal fishing waters as it is denied free access within the prohibited zone, in
violation not only of the Fisheries Code but also of the 1987 Constitutional
provisions on subsistence fisherfolk and social justice.82 Furthermore, the FIDEC
believes that the provisions in Presidential Decree No. 87, which allow offshore
drilling even in municipal waters, should be deemed to have been rendered
inoperative by the provisions of Republic Act No. 8550 and Republic Act No. 7160,
which reiterate the social justice provisions of the Constitution.83

The public respondents invoke the rules on statutory construction and argue that
Section 14 of the NIPAS Act is a more particular provision and cannot be deemed to
have been repealed by the more general prohibition in Section 27 of Republic Act
No. 9147. They aver that Section 14, under which SC-46 falls, should instead be
regarded as an exemption to Section 27.84

Addressing the claim of petitioners in G.R. No. 180771 that there was a violation of
Section 27 of Republic Act No. 9147, the public respondents assert that what the
section prohibits is the exploration of minerals, which as defined in the Philippine
Mining Act of 1995, exclude energy materials such as coal, petroleum, natural gas,
radioactive materials and geothermal energy. Thus, since SC-46 involves oil and
gas exploration, Section 27 does not apply.85

The public respondents defend the validity of SC-46 and insist that it does not grant
exclusive fishing rights to JAPEX; hence, it does not violate the rule on preferential
use of municipal waters. Moreover, they allege that JAPEX has not banned fishing in
the project area, contrary to the FIDEC's claim. The public respondents also contest
the attribution of the declining fish catch to the seismic surveys and aver that the
allegation is unfounded. They claim that according to the Bureau of Fisheries and
Aquatic Resources' fish catch data, the reduced fish catch started in the 1970s due
to destructive fishing practices.86

Ruling of the Court

On the legality of Service Contract No. 46 vis-a-vis Other Laws

Although we have already established above that SC-46 is null and void for being
violative of the 1987 Constitution, it is our duty to still rule on the legality of SC-
46 vis-a-vis other pertinent laws, to serve as a guide for the Government when
executing service contracts involving not only the Tañon Strait, but also other
similar areas. While the petitioners allege that SC-46 is in violation of several laws,
including international ones, their arguments focus primarily on the protected
status of the Tañon Strait, thus this Court will concentrate on those laws that
pertain particularly to the Tañon Strait as a protected seascape.

The Tañon Strait is a narrow passage of water bounded by the islands of Cebu in
the East and Negros in the West. It harbors a rich biodiversity of marine life,
including endangered species of dolphins and whales. For this reason, former
President Fidel V. Ramos declared the Tañon Strait as a protected seascape in 1998
by virtue of Proclamation No. 1234 - Declaring the Tañon Strait situated in the
Provinces of Cebu, Negros Occidental and Negros Oriental as a Protected Area
pursuant to the NIP AS Act and shall be known as Tañon Strait Protected Seascape.
During former President Joseph E. Estrada's time, he also constituted the Tañon
Strait Commission via Executive Order No. 76 to ensure the optimum and sustained
use of the resources in that area without threatening its marine life. He followed
this with Executive Order No. 177,87 wherein he included the mayor of Negros
Occidental Municipality/City as a member of the Tañon Strait Commission, to
represent the LGUs concerned. This Commission, however, was subsequently
abolished in 2002 by then President Gloria Macapagal-Arroyo, via Executive Order
No. 72.88

True to the constitutional policy that the "State shall protect and advance the right
of the people to a balanced and healthful ecology in accord with the rhythm and
harmony of nature,"89 Congress enacted the NIPAS Act to secure the perpetual
existence of all native plants and animals through the establishment of a
comprehensive system of integrated protected areas. These areas possess common
ecological values that were incorporated into a holistic plan representative of our
natural heritage. The system encompasses outstandingly remarkable areas and
biologically important public lands that are habitats of rare and endangered species
of plants and animals, biogeographic zones and related ecosystems, whether
terrestrial, wetland, or marine.90 It classifies and administers all the designated
protected areas to maintain essential ecological processes and life-support systems,
to preserve genetic diversity, to ensure sustainable use of resources found therein,
and to maintain their natural conditions to the greatest extent possible.91 The
following categories of protected areas were established under the NIPAS
Act:chanroblesvirtuallawlibrary

a. Strict nature reserve;

 b. Natural park;

c. Natural monument;

d. Wildlife sanctuary;

e. Protected landscapes and seascapes;

f. Resource reserve;

g. Natural biotic areas; and

h. Other categories established by law, conventions or international agreements

which the Philippine Government is a signatory.92

Under Section 4 of the NIPAS Act, a protected area refers to portions of land and
water, set aside due to their unique physical and biological significance, managed to
enhance biological diversity and protected against human exploitation.

The Tañon Strait, pursuant to Proclamation No. 1234, was set aside and declared a
protected area under the category of Protected Seascape. The NIPAS Act defines a
Protected Seascape to be an area of national significance characterized by the
harmonious interaction of man and land while providing opportunities for public
enjoyment through recreation and tourism within the normal lifestyle and economic
activity of this areas;93 thus a management plan for each area must be designed to
protect and enhance the permanent preservation of its natural
conditions.94 Consistent with this endeavor is the requirement that an
Environmental Impact Assessment (EIA) be made prior to undertaking any activity
outside the scope of the management plan. Unless an ECC under the EIA system is
obtained, no activity inconsistent with the goals of the NIPAS Act shall be
implemented.95

The Environmental Impact Statement System (EISS) was established in 1978 under
Presidential Decree No. 1586. It prohibits any person, partnership or corporation
from undertaking or operating any declared environmentally critical project or areas
without first securing an ECC issued by the President or his duly authorized
representative.96 Pursuant to the EISS, which called for the proper management of
environmentally critical areas,97 Proclamation No. 214698 was enacted, identifying
the areas and types of projects to be considered as environmentally critical and
within the scope of the EISS, while DENR Administrative Order No. 2003-30
provided for its Implementing Rules and Regulations (IRR).

DENR Administrative Order No. 2003-30 defines an environmentally critical area as

"an area delineated as environmentally sensitive such that significant
environmental impacts are expected if certain types of proposed projects or
programs are located, developed, or implemented in it";99 thus, before a project,
which is "any activity, regardless of scale or magnitude, which may have significant
impact on the environment,"100 is undertaken in it, such project must undergo an
 EIA to evaluate and predict the likely impacts of all its stages on the
environment.101 An EIA is described in detail as follows: chanroblesvirtuallawlibrary

h. Environmental Impact Assessment (EIA) - process that involves evaluating and

predicting the likely impacts of a project (including cumulative impacts) on the
environment during construction, commissioning, operation and abandonment.
It also includes designing appropriate preventive, mitigating and enhancement
measures addressing these consequences to protect the environment and the
community's welfare. The process is undertaken by, among others, the project
proponent and/or EIA Consultant, EMB, a Review Committee, affected
communities and other stakeholders.102

Under Proclamation No. 2146, the Tañon Strait is an environmentally critical area,
having been declared as a protected area in 1998; therefore, any activity outside
the scope of its management plan may only be implemented pursuant to an ECC
secured after undergoing an EIA to determine the effects of such activity on its
ecological system.

The public respondents argue that they had complied with the procedures in
obtaining an ECC103 and that SC-46 falls under the exceptions in Section 14 of the
NIPAS Act, due to the following reasons:

1) The Tañon Strait is not a strict nature reserve or natural park;

2) Exploration is only for the purpose of gathering information on possible energy

resources; and

3) Measures are undertaken to ensure that the exploration is being done with the
least damage to surrounding areas.104

We do not agree with the arguments raised by the public respondents.

Sections 12 and 14 of the NIPAS Act read: chanroblesvirtuallawlibrary

SECTION 12. Environmental Impact Assessment. - Proposals for activities which

are outside the scope of the management plan for protected areas shall be subject
to an environmental impact assessment as required by law before they are
adopted, and the results thereof shall be taken into consideration in the decision-
making process.

No actual implementation of such activities shall be allowed without the required

Environmental Compliance Certificate (ECC) under the Philippine Environmental
Impact Assessment (EIA) system. In instances where such activities are allowed to
be undertaken, the proponent shall plan and carry them out in such manner as will
minimize any adverse effects and take preventive and remedial action when
appropriate. The proponent shall be liable for any damage due to lack of caution or
indiscretion.

SECTION 14. Survey for Energy Resources. - Consistent with the policies declared
in Section 2 hereof, protected areas, except strict nature reserves and natural
parks, may be subjected to exploration only for the purpose of gathering
information on energy resources and only if such activity is carried out with the
least damage to surrounding areas. Surveys shall be conducted only in accordance
with a program approved by the DENR, and the result of such surveys shall be
made available to the public and submitted to the President for recommendation to
Congress. Any exploitation and utilization of energy resources found within NIPAS
areas shall be allowed only through a law passed by Congress.
It is true that the restrictions found under the NIPAS Act are not without
exceptions. However, while an exploration done for the purpose of surveying
for energy resources is allowed under Section 14 of the NIPAS Act, this
does not mean that it is exempt from the requirement to undergo an EIA
under Section 12. In Sotto v. Sotto,105 this Court explained why a statute should
be construed as a whole: chanroblesvirtuallawlibrary

A statute is passed as a whole and not in parts or sections and is animated by one
general purpose and intent. Consequently each part or section should be construed
in connection with every other part or section and so as to produce a harmonious
whole. It is not proper to confine the attention to the one section to be construed.
It is always an unsafe way of construing a statute or contract to divide it by a
process of etymological dissection, into separate words, and then apply to each,
thus separated from its context, some particular definition given by lexicographers,
and then reconstruct the instrument upon the basis of these definitions. An
instrument must always be construed as a whole, and the particular meaning to be
attached to any word or phrase is usually to be ascertained from the context, the
nature of the subject treated of and the purpose or intention of the parties who
executed the contract, or of the body which enacted or framed the statute or
constitution, x x x.
Surveying for energy resources under Section 14 is not an exemption from
complying with the EIA requirement in Section 12; instead, Section 14
provides for additional requisites before any exploration for energy
resources may be done in protected areas.

The rationale for such additional requirements are incorporated in Section 2 of the
NIPAS Act, to wit: chanroblesvirtuallawlibrary

SECTION 2. Declaration of Policy - Cognizant of the profound impact of man's

activities on all components of the natural environment particularly the effect of
increasing population, resource exploitation and industrial advancement amd
recognizing the critical importance of protecting and maintaining the natural
biological and physical diversities of the environment notably on areas with
biologically unique features to sustain human life and development, as well as plant
and animal life, it is hereby declared the policy of the State to secure for the Filipino
people of present and future generations the perpetual existence of all native plants
and animals through the establishment of a comprehensive system of integrated
protected areas within the classification of national park as provided for in the
Constitution.

It is hereby recognized that these areas, although distinct in features, possess

common ecological values that may be incorporated into a holistic plan
representative of our natural heritage; that effective administration of this area is
possible only through cooperation among national government, local government
and concerned private organizations; that the use and enjoyment of these
protected areas must be consistent with the principles of biological diversity and
sustainable development.

To this end, there is hereby established a National Integrated Protected Areas

System (NIPAS), which shall encompass outstandingly remarkable areas and
biologically important public lands that are habitats of rare and endangered species
of plants and animals, biogeographic zones and related ecosystems, whether
terrestrial, wetland or marine, all of which shall be designated as "protected areas."
The public respondents themselves admitted that JAPEX only started to secure an
ECC prior to the second sub-phase of SC-46, which required the drilling of an oil
exploration well. This means that when the seismic surveys were done in the Tañon
Strait, no such environmental impact evaluation was done. Unless seismic surveys
are part of the management plan of the Tañon Strait, such surveys were dona in
violation of Section 12 of the NIPAS Act and Section 4 of Presidential Decree No.
1586, which provides: chanroblesvirtuallawlibrary

Section 4. Presidential Proclamation of Environmentally Critical Areas and Projects.

- The President of the Philippines may, on his own initiative or upon
recommendation of the National Environmental Protection Council, by proclamation
declare certain projects, undertakings or areas in the country as environmentally
critical. No person, partnership or corporation shall undertake or operate any such
declared environmentally critical project or area without first securing an
Environmental Compliance Certificate issued by the President or his duly authorized
representative. For the proper management of said critical project or area, the
President may by his proclamation reorganize such government offices, agencies,
institutions, corporations or instrumentalities including the re-alignment of
government personnel, and their specific functions and responsibilities.

For the same purpose as above, the Ministry of Human Settlements shall: (a)
prepare the proper land or water use pattern for said critical project(s) or area(s);
(b) establish ambient environmental quality standards; (c) develop a program of
environmental enhancement or protective measures against calamitous factors
such as earthquakes, floods, water erosion and others, and (d) perform such other
functions as may be directed by the President from time to time.
The respondents' subsequent compliance with the EISS for the second sub-phase of
SC-46 cannot and will not cure this violation. The following penalties are provided
for under Presidential Decree No. 1586 and the NIPAS Act.

Section 9 of Presidential Decree No. 1586 provides for the penalty involving
violations of the ECC requirement: chanroblesvirtuallawlibrary

Section 9. Penalty for Violation. - Any person, corporation or partnership found

violating Section 4 of this Decree, or the terms and conditions in the issuance of the
Environmental Compliance Certificate, or of the standards, rules and regulations
issued by the National Environmental Protection Council pursuant to this Decree
shall be punished by the suspension or cancellation of his/its certificates
and/or a fine in an amount not to exceed Fifty Thousand Pesos
(P50,000.00) for every violation thereof, at the discretion of the National
Environmental Protection Council. (Emphasis supplied.)
Violations of the NIPAS Act entails the following fines and/or imprisonment under
Section 21:chanroblesvirtuallawlibrary

SECTION 21. Penalties. - Whoever violates this Act or any rules and regulations
issued by the Department pursuant to this Act or whoever is found guilty by a
competent court of justice of any of the offenses in the preceding section shall
be fined in the amount of not less than Five thousand pesos (P5,000) nor
more than Five hundred thousand pesos (P500,000), exclusive of the value
of the thing damaged or imprisonment for not less than one (1) year but
not more than six (6) years, or both, as determined by the court: Provided,
that, if the area requires rehabilitation or restoration as determined by the
court, the offender shall be required to restore or compensate for the
restoration to the damages: Provided, further, that court shall order the
eviction of the offender from the land and the forfeiture in favor of the
Government of all minerals, timber or any species collected or removed
including all equipment, devices and firearms used in connection
therewith, and any construction or improvement made thereon by the
offender. If the offender is an association or corporation, the president or manager
shall be directly responsible for the act of his employees and laborers: Provided,
finally, that the DENR may impose administrative fines and penalties
consistent with this Act. (Emphases supplied.)
Moreover, SC-46 was not executed for the mere purpose of gathering information
on the possible energy resources in the Tañon Strait as it also provides for the
parties' rights and obligations relating to extraction and petroleum production
should oil in commercial quantities be found to exist in the area. While
Presidential Decree No. 87 may serve as the general law upon which a
service contract for petroleum exploration and extraction may be
authorized, the exploitation and utilization of this energy resource in the
present case may be allowed only through a law passed by Congress, since
the Tañon Strait is a NIPAS area.106Since there is no such law specifically
allowing oil exploration and/or extraction in the Tañon Strait, no energy
resource exploitation and utilization may be done in said protected
seascape.

In view of the foregoing premises and conclusions, it is no longer necessary to

discuss the other issues raised in these consolidated petitions.
cralawred

WHEREFORE, the Petitions in G.R. Nos. 180771 and 181527 are GRANTED,
Service Contract No. 46 is hereby declared NULL AND VOID for violating the 1987
Constitution, Republic Act No. 7586, and Presidential Decree No. 1586.

SO ORDERED. chanroblesvirtuallawlibrary
3

MMDA v Concerned Citizens of Manila Bay (G.R. No. 171947 & 948 December
2008)

VELASCO, JR., J.:

The need to address environmental pollution, as a cause of climate change,

has of late gained the attention of the international community. Media have finally
trained their sights on the ill effects of pollution, the destruction of forests and
other critical habitats, oil spills, and the unabated improper disposal of garbage.
And rightly so, for the magnitude of environmental destruction is now on a scale
few ever foresaw and the wound no longer simply heals by itself.[2] But amidst
hard evidence and clear signs of a climate crisis that need bold action, the voice of
cynicism, naysayers, and procrastinators can still be heard.

This case turns on government agencies and their officers who, by the nature
of their respective offices or by direct statutory command, are tasked to protect and
preserve, at the first instance, our internal waters, rivers, shores, and seas polluted
by human activities. To most of these agencies and their official complement, the
pollution menace does not seem to carry the high national priority it deserves, if
their track records are to be the norm. Their cavalier attitude towards solving, if not
mitigating, the environmental pollution problem, is a sad commentary on
bureaucratic efficiency and commitment.

At the core of the case is the Manila Bay, a place with a proud historic past,
once brimming with marine life and, for so many decades in the past, a spot for
different contact recreation activities, but now a dirty and slowly dying expanse
mainly because of the abject official indifference of people and institutions that
could have otherwise made a difference.

This case started when, on January 29, 1999, respondents Concerned

Residents of Manila Bay filed a complaint before the Regional Trial Court (RTC)
in Imus, Cavite against several government agencies, among them the petitioners,
for the cleanup, rehabilitation, and protection of the Manila Bay. Raffled to Branch
20 and docketed as Civil Case No. 1851-99 of the RTC, the complaint alleged that
the water quality of the Manila Bay had fallen way below the allowable standards
set by law, specifically Presidential Decree No. (PD) 1152 or the Philippine
Environment Code. This environmental aberration, the complaint stated, stemmed
from:

x x x [The] reckless, wholesale, accumulated and ongoing acts of

omission or commission [of the defendants] resulting in the clear and
present danger to public health and in the depletion and contamination of
the marine life of Manila Bay, [for which reason] ALL defendants must
be held jointly and/or solidarily liable and be collectively ordered to
clean up Manila Bay and to restore its water quality to class B waters fit
for swimming, skin-diving, and other forms of contact recreation.[3]

In their individual causes of action, respondents alleged that the continued

neglect of petitioners in abating the pollution of the Manila Bay constitutes a
violation of, among others:

(1) Respondents constitutional right to life, health, and a balanced ecology;

(2) The Environment Code (PD 1152);
(3) The Pollution Control Law (PD 984);
(4) The Water Code (PD 1067);
(5) The Sanitation Code (PD 856);
(6) The Illegal Disposal of Wastes Decree (PD 825);
(7) The Marine Pollution Law (PD 979);
(8) Executive Order No. 192;
(9) The Toxic and Hazardous Wastes Law (Republic Act No. 6969);
(10) Civil Code provisions on nuisance and human relations;
(11) The Trust Doctrine and the Principle of Guardianship; and
(12) International Law

Inter alia, respondents, as plaintiffs a quo, prayed that petitioners be ordered

to clean the Manila Bay and submit to the RTC a concerted concrete plan of action
for the purpose.
 The trial of the case started off with a hearing at the Manila Yacht Club
followed by an ocular inspection of the Manila Bay. Renato T. Cruz, the Chief of
the Water Quality Management Section, Environmental Management Bureau,
Department of Environment and Natural Resources (DENR), testifying for
petitioners, stated that water samples collected from different beaches around the
Manila Bay showed that the amount of fecal coliform content ranged from 50,000
to 80,000 most probable number (MPN)/ml when what DENR Administrative
Order No. 34-90 prescribed as a safe level for bathing and other forms of contact
recreational activities, or the SB level, is one not exceeding 200 MPN/100 ml.[4]

Rebecca de Vera, for Metropolitan Waterworks and Sewerage System

(MWSS) and in behalf of other petitioners, testified about the MWSS efforts to
reduce pollution along the Manila Bay through the Manila Second Sewerage
Project. For its part, the Philippine Ports Authority (PPA) presented, as part of its
evidence, its memorandum circulars on the study being conducted on ship-
generated waste treatment and disposal, and its Linis Dagat (Clean the Ocean)
project for the cleaning of wastes accumulated or washed to shore.

The RTC Ordered Petitioners to Clean Up and Rehabilitate Manila Bay

On September 13, 2002, the RTC rendered a Decision[5] in favor of

respondents. The dispositive portion reads:

WHEREFORE, finding merit in the complaint, judgment is hereby

rendered ordering the abovenamed defendant-government agencies,
jointly and solidarily, to clean up and rehabilitate Manila Bay and restore
its waters to SB classification to make it fit for swimming, skin-diving
and other forms of contact recreation. To attain this, defendant-agencies,
with defendant DENR as the lead agency, are directed, within six (6)
months from receipt hereof, to act and perform their respective duties by
devising a consolidated, coordinated and concerted scheme of action for
the rehabilitation and restoration of the bay.
In particular:

Defendant MWSS is directed to install, operate and maintain adequate

[sewerage] treatment facilities in strategic places under its jurisdiction
and increase their capacities.
Defendant LWUA, to see to it that the water districts under its wings,
provide, construct and operate sewage facilities for the proper disposal
of waste.

Defendant DENR, which is the lead agency in cleaning up Manila Bay,

to install, operate and maintain waste facilities to rid the bay of toxic and
hazardous substances.

Defendant PPA, to prevent and also to treat the discharge not only of
ship-generated wastes but also of other solid and liquid wastes from
docking vessels that contribute to the pollution of the bay.

Defendant MMDA, to establish, operate and maintain an adequate and

appropriate sanitary landfill and/or adequate solid waste and liquid
disposal as well as other alternative garbage disposal system such as re-
use or recycling of wastes.

Defendant DA, through the Bureau of Fisheries and Aquatic Resources,

to revitalize the marine life in Manila Bay and restock its waters with
indigenous fish and other aquatic animals.

Defendant DBM, to provide and set aside an adequate budget solely for
the purpose of cleaning up and rehabilitation of Manila Bay.

Defendant DPWH, to remove and demolish structures and other

nuisances that obstruct the free flow of waters to the bay. These
nuisances discharge solid and liquid wastes which eventually end up
in Manila Bay. As the construction and engineering arm of the
government, DPWH is ordered to actively participate in removing
debris, such as carcass of sunken vessels, and other non-biodegradable
garbage in the bay.

Defendant DOH, to closely supervise and monitor the operations of

septic and sludge companies and require them to have proper facilities
for the treatment and disposal of fecal sludge and sewage coming from
septic tanks.

Defendant DECS, to inculcate in the minds and hearts of the people

through education the importance of preserving and protecting the
environment.
 Defendant Philippine Coast Guard and the PNP Maritime Group, to
protect at all costs the Manila Bay from all forms of illegal fishing.

No pronouncement as to damages and costs.

SO ORDERED.
The MWSS, Local Water Utilities Administration (LWUA), and PPA filed before
the Court of Appeals (CA) individual Notices of Appeal which were eventually
consolidated and docketed as CA-G.R. CV No. 76528.

On the other hand, the DENR, Department of Public Works and Highways
(DPWH), Metropolitan Manila Development Authority (MMDA), Philippine
Coast Guard (PCG), Philippine National Police (PNP) Maritime Group, and five
other executive departments and agencies filed directly with this Court a petition
for review under Rule 45. The Court, in a Resolution of December 9, 2002, sent
the said petition to the CA for consolidation with the consolidated appeals of
MWSS, LWUA, and PPA, docketed as CA-G.R. SP No. 74944.

Petitioners, before the CA, were one in arguing in the main that the pertinent
provisions of the Environment Code (PD 1152) relate only to the cleaning of
specific pollution incidents and do not cover cleaning in general. And apart from
raising concerns about the lack of funds appropriated for cleaning purposes,
petitioners also asserted that the cleaning of the Manila Bay is not a ministerial act
which can be compelled by mandamus.

The CA Sustained the RTC

By a Decision[6] of September 28, 2005, the CA denied petitioners appeal
and affirmed the Decision of the RTC in toto, stressing that the trial courts decision
did not require petitioners to do tasks outside of their usual basic functions under
existing laws.[7]

Petitioners are now before this Court praying for the allowance of their Rule
45 petition on the following ground and supporting arguments:
 THE [CA] DECIDED A QUESTION OF SUBSTANCE NOT
HERETOFORE PASSED UPON BY THE HONORABLE COURT,
I.E., IT AFFIRMED THE TRIAL COURTS DECISION DECLARING
THAT SECTION 20 OF [PD] 1152 REQUIRES CONCERNED
GOVERNMENT AGENCIES TO REMOVE ALL POLLUTANTS
SPILLED AND DISCHARGED IN THE WATER SUCH AS FECAL
COLIFORMS.

ARGUMENTS

I
[SECTIONS] 17 AND 20 OF [PD] 1152 RELATE ONLY TO
THE CLEANING OF SPECIFIC POLLUTION INCIDENTS AND
[DO] NOT COVER CLEANING IN GENERAL

II
THE CLEANING OR REHABILITATION OF
THE MANILA BAY IS NOT A MINISTERIAL ACT OF
PETITIONERS THAT CAN BE COMPELLED BY MANDAMUS.

The issues before us are two-fold. First, do Sections 17 and 20 of PD 1152

under the headings, Upgrading of Water Quality and Clean-up Operations,
envisage a cleanup in general or are they limited only to the cleanup of specific
pollution incidents? And second, can petitioners be compelled by mandamus to
clean up and rehabilitate the ManilaBay?

On August 12, 2008, the Court conducted and heard the parties on oral
arguments.

Our Ruling

We shall first dwell on the propriety of the issuance of mandamus under the
premises.

The Cleaning or Rehabilitation of Manila Bay

Can be Compelled by Mandamus
Generally, the writ of mandamus lies to require the execution of a ministerial
duty.[8] A ministerial duty is one that requires neither the exercise of official
discretion nor judgment.[9] It connotes an act in which nothing is left to the
discretion of the person executing it. It is a simple, definite duty arising under
conditions admitted or proved to exist and imposed by law. [10] Mandamus is
available to compel action, when refused, on matters involving discretion, but not
to direct the exercise of judgment or discretion one way or the other.

Petitioners maintain that the MMDAs duty to take measures and maintain
adequate solid waste and liquid disposal systems necessarily involves policy
evaluation and the exercise of judgment on the part of the agency concerned. They
argue that the MMDA, in carrying out its mandate, has to make decisions,
including choosing where a landfill should be located by undertaking feasibility
studies and cost estimates, all of which entail the exercise of discretion.

Respondents, on the other hand, counter that the statutory command is clear
and that petitioners duty to comply with and act according to the clear mandate of
the law does not require the exercise of discretion. According to respondents,
petitioners, the MMDA in particular, are without discretion, for example, to choose
which bodies of water they are to clean up, or which discharge or spill they are to
contain. By the same token, respondents maintain that petitioners are bereft of
discretion on whether or not to alleviate the problem of solid and liquid waste
disposal; in other words, it is the MMDAs ministerial duty to attend to such
services.

We agree with respondents.

First off, we wish to state that petitioners obligation to perform their duties
as defined by law, on one hand, and how they are to carry out such duties, on the
other, are two different concepts. While the implementation of the MMDAs
mandated tasks may entail a decision-making process, the enforcement of the law
or the very act of doing what the law exacts to be done is ministerial in nature and
may be compelled by mandamus. We said so in Social Justice Society v.
Atienza[11] in which the Court directed the City of Manila to enforce, as a matter of
ministerial duty, its Ordinance No. 8027 directing the three big local oil players to
cease and desist from operating their business in the so-called Pandacan Terminals
within six months from the effectivity of the ordinance. But to illustrate with
respect to the instant case, the MMDAs duty to put up an adequate and appropriate
sanitary landfill and solid waste and liquid disposal as well as other alternative
garbage disposal systems is ministerial, its duty being a statutory imposition. The
MMDAs duty in this regard is spelled out in Sec. 3(c) of Republic Act No. (RA)
7924 creating the MMDA. This section defines and delineates the scope of the
MMDAs waste disposal services to include:

Solid waste disposal and management which include formulation

and implementation of policies, standards, programs and projects for
proper and sanitary waste disposal. It shall likewise include
the establishment and operation of sanitary land fill and related
facilities and the implementation of other alternative programs intended
to reduce, reuse and recycle solid waste. (Emphasis added.)

The MMDA is duty-bound to comply with Sec. 41 of the Ecological Solid

Waste Management Act (RA 9003) which prescribes the minimum criteria for the
establishment of sanitary landfills and Sec. 42 which provides the minimum
operating requirements that each site operator shall maintain in the operation of a
sanitary landfill. Complementing Sec. 41 are Secs. 36 and 37 of RA
9003,[12] enjoining the MMDA and local government units, among others, after the
effectivity of the law on February 15, 2001, from using and operating open dumps
for solid waste and disallowing, five years after such effectivity, the use of
controlled dumps.

The MMDAs duty in the area of solid waste disposal, as may be noted, is set
forth not only in the Environment Code (PD 1152) and RA 9003, but in its charter
as well. This duty of putting up a proper waste disposal system cannot be
characterized as discretionary, for, as earlier stated, discretion presupposes the
power or right given by law to public functionaries to act officially according to
their judgment or conscience.[13] A discretionary duty is one that allows a person to
exercise judgment and choose to perform or not to perform.[14] Any suggestion that
the MMDA has the option whether or not to perform its solid waste disposal-
related duties ought to be dismissed for want of legal basis.
A perusal of other petitioners respective charters or like enabling statutes and
pertinent laws would yield this conclusion: these government agencies are
enjoined, as a matter of statutory obligation, to perform certain functions relating
directly or indirectly to the cleanup, rehabilitation, protection, and preservation of
the Manila Bay. They are precluded from choosing not to perform these duties.
Consider:

(1) The DENR, under Executive Order No. (EO) 192,[15] is the primary agency
responsible for the conservation, management, development, and proper use of the
countrys environment and natural resources. Sec. 19 of the Philippine Clean Water
Act of 2004 (RA 9275), on the other hand, designates the DENR as the primary
government agency responsible for its enforcement and implementation, more
particularly over all aspects of water quality management. On water pollution, the
DENR, under the Acts Sec. 19(k), exercises jurisdiction over all aspects of water
pollution, determine[s] its location, magnitude, extent, severity, causes and effects
and other pertinent information on pollution, and [takes] measures, using available
methods and technologies, to prevent and abate such pollution.
The DENR, under RA 9275, is also tasked to prepare a National Water Quality
Status Report, an Integrated Water Quality Management Framework, and a 10-year
Water Quality Management Area Action Plan which is nationwide in scope
covering the Manila Bay and adjoining areas. Sec. 19 of RA 9275 provides:

Sec. 19 Lead Agency.The [DENR] shall be the primary government

agency responsible for the implementation and enforcement of this Act x
x x unless otherwise provided herein. As such, it shall have the following
functions, powers and responsibilities:
a) Prepare a National Water Quality Status report within twenty-four
(24) months from the effectivity of this Act: Provided, That the
Department shall thereafter review or revise and publish annually, or
as the need arises, said report;

b) Prepare an Integrated Water Quality Management Framework within

twelve (12) months following the completion of the status report;

c) Prepare a ten (10) year Water Quality Management Area Action Plan
within 12 months following the completion of the framework for
 each designated water management area. Such action plan shall be
reviewed by the water quality management area governing board
every five (5) years or as need arises.

The DENR has prepared the status report for the period 2001 to 2005 and is in the
process of completing the preparation of the Integrated Water Quality Management
Framework.[16] Within twelve (12) months thereafter, it has to submit a final Water
Quality Management Area Action Plan.[17] Again, like the MMDA, the DENR
should be made to accomplish the tasks assigned to it under RA 9275.
Parenthetically, during the oral arguments, the DENR Secretary manifested that the
DENR, with the assistance of and in partnership with various government agencies
and non-government organizations, has completed, as of December 2005, the final
draft of a comprehensive action plan with estimated budget and time frame,
denominated as Operation Plan for the Manila Bay Coastal Strategy, for the
rehabilitation, restoration, and rehabilitation of the Manila Bay.

The completion of the said action plan and even the implementation of some of its
phases should more than ever prod the concerned agencies to fast track what are
assigned them under existing laws.

(2) The MWSS, under Sec. 3 of RA 6234,[18] is vested with jurisdiction,

supervision, and control over all waterworks and sewerage systems in the territory
comprising what is now the cities of Metro Manila and several towns of the
provinces of Rizal and Cavite, and charged with the duty:
(g) To construct, maintain, and operate such sanitary sewerages as may
be necessary for the proper sanitation and other uses of the cities and
towns comprising the System; x x x

(3) The LWUA under PD 198 has the power of supervision and control over
local water districts. It can prescribe the minimum standards and regulations for the
operations of these districts and shall monitor and evaluate local water standards.
The LWUA can direct these districts to construct, operate, and furnish facilities
and services for the collection, treatment, and disposal of sewerage, waste, and
storm water. Additionally, under RA 9275, the LWUA, as attached agency of the
DPWH, is tasked with providing sewerage and sanitation facilities, inclusive of the
setting up of efficient and safe collection, treatment, and sewage disposal system in
the different parts of the country.[19] In relation to the instant petition, the LWUA is
mandated to provide sewerage and sanitation facilities in Laguna, Cavite, Bulacan,
Pampanga, and Bataan to prevent pollution in the Manila Bay.
(4) The Department of Agriculture (DA), pursuant to the Administrative Code of
1987 (EO 292),[20] is designated as the agency tasked to promulgate and enforce all
laws and issuances respecting the conservation and proper utilization of
agricultural and fishery resources. Furthermore, the DA, under the Philippine
Fisheries Code of 1998 (RA 8550), is, in coordination with local government units
(LGUs) and other concerned sectors, in charge of establishing a monitoring,
control, and surveillance system to ensure that fisheries and aquatic resources in
Philippine waters are judiciously utilized and managed on a sustainable
basis.[21] Likewise under RA 9275, the DA is charged with coordinating with the
PCG and DENR for the enforcement of water quality standards in marine
waters.[22] More specifically, its Bureau of Fisheries and Aquatic
Resources(BFAR) under Sec. 22(c) of RA 9275 shall primarily be responsible for
the prevention and control of water pollution for the development, management,
and conservation of the fisheries and aquatic resources.

(5) The DPWH, as the engineering and construction arm of the national
government, is tasked under EO 292[23] to provide integrated planning, design, and
construction services for, among others, flood control and water resource
development systems in accordance with national development objectives and
approved government plans and specifications.

In Metro Manila, however, the MMDA is authorized by Sec. 3(d), RA 7924 to

perform metro-wide services relating to flood control and sewerage management
which include the formulation and implementation of policies, standards, programs
and projects for an integrated flood control, drainage and sewerage system.

On July 9, 2002, a Memorandum of Agreement was entered into between the

DPWH and MMDA, whereby MMDA was made the agency primarily responsible
for flood control in Metro Manila. For the rest of the country, DPWH shall remain
as the implementing agency for flood control services. The mandate of the MMDA
and DPWH on flood control and drainage services shall include the removal of
structures, constructions, and encroachments built along rivers, waterways,
and esteros (drainages) in violation of RA 7279, PD 1067, and other pertinent
laws.

(6) The PCG, in accordance with Sec. 5(p) of PD 601, or the Revised Coast
Guard Law of 1974, and Sec. 6 of PD 979,[24] or the Marine Pollution Decree of
1976, shall have the primary responsibility of enforcing laws, rules, and
regulations governing marine pollution within the territorial waters of
the Philippines. It shall promulgate its own rules and regulations in accordance
with the national rules and policies set by the National Pollution Control
Commission upon consultation with the latter for the effective implementation and
enforcement of PD 979. It shall, under Sec. 4 of the law, apprehend violators who:

a. discharge, dump x x x harmful substances from or out of any ship,

vessel, barge, or any other floating craft, or other man-made structures at
sea, by any method, means or manner, into or upon the territorial and
inland navigable waters of the Philippines;

b. throw, discharge or deposit, dump, or cause, suffer or procure to be

thrown, discharged, or deposited either from or out of any ship, barge, or
other floating craft or vessel of any kind, or from the shore, wharf,
manufacturing establishment, or mill of any kind, any refuse matter of
any kind or description whatever other than that flowing from streets and
sewers and passing therefrom in a liquid state into tributary of any
navigable water from which the same shall float or be washed into such
navigable water; and

c. deposit x x x material of any kind in any place on the bank of any

navigable water or on the bank of any tributary of any navigable water,
where the same shall be liable to be washed into such navigable water,
either by ordinary or high tides, or by storms or floods, or otherwise,
whereby navigation shall or may be impeded or obstructed or increase
the level of pollution of such water.

(7) When RA 6975 or the Department of the Interior and Local Government
(DILG) Act of 1990 was signed into law on December 13, 1990, the PNP Maritime
Group was tasked to perform all police functions over the Philippine territorial
waters and rivers. Under Sec. 86, RA 6975, the police functions of the PCG shall
be taken over by the PNP when the latter acquires the capability to perform such
functions. Since the PNP Maritime Group has not yet attained the capability to
assume and perform the police functions of PCG over marine pollution, the PCG
and PNP Maritime Group shall coordinate with regard to the enforcement of laws,
rules, and regulations governing marine pollution within the territorial waters of
the Philippines. This was made clear in Sec. 124, RA 8550 or the Philippine
Fisheries Code of 1998, in which both the PCG and PNP Maritime Group were
authorized to enforce said law and other fishery laws, rules, and regulations.[25]

(8) In accordance with Sec. 2 of EO 513, the PPA is mandated to establish,

develop, regulate, manage and operate a rationalized national port system in
support of trade and national development.[26] Moreover, Sec. 6-c of EO 513 states
that the PPA has police authority within the

ports administered by it as may be necessary to carry out its powers and

functions and attain its purposes and objectives, without prejudice to the
exercise of the functions of the Bureau of Customs and other law
enforcement bodies within the area. Such police authority shall include
the following:
xxxx

b) To regulate the entry to, exit from, and movement within the port, of
persons and vehicles, as well as movement within the port of
watercraft.[27]

Lastly, as a member of the International Marine Organization and a

signatory to the International Convention for the Prevention of Pollution from
Ships, as amended by MARPOL 73/78,[28] the Philippines, through the PPA, must
ensure the provision of adequate reception facilities at ports and terminals for the
reception of sewage from the ships docking in Philippine ports. Thus, the PPA is
tasked to adopt such measures as are necessary to prevent the discharge and
dumping of solid and liquid wastes and other ship-generated wastes into
the Manila Bay waters from vessels docked at ports and apprehend the violators.
When the vessels are not docked at ports but within Philippine territorial waters, it
is the PCG and PNP Maritime Group that have jurisdiction over said vessels.
(9) The MMDA, as earlier indicated, is duty-bound to put up and maintain
adequate sanitary landfill and solid waste and liquid disposal system as well as
other alternative garbage disposal systems. It is primarily responsible for the
implementation and enforcement of the provisions of RA 9003, which would
necessary include its penal provisions, within its area of jurisdiction.[29]

Among the prohibited acts under Sec. 48, Chapter VI of RA 9003 that are
frequently violated are dumping of waste matters in public places, such as roads,
canals or esteros, open burning of solid waste, squatting in open dumps and
landfills, open dumping, burying of biodegradable or non- biodegradable materials
in flood-prone areas, establishment or operation of open dumps as enjoined in RA
9003, and operation of waste management facilities without an environmental
compliance certificate.

Under Sec. 28 of the Urban Development and Housing Act of 1992 (RA 7279),
eviction or demolition may be allowed when persons or entities occupy danger
areas such asesteros, railroad tracks, garbage dumps, riverbanks, shorelines,
waterways, and other public places such as sidewalks, roads, parks and
playgrounds. The MMDA, as lead agency, in coordination with the DPWH, LGUs,
and concerned agencies, can dismantle and remove all structures, constructions,
and other encroachments built in breach of RA 7279 and other pertinent laws along
the rivers, waterways, and esteros in Metro Manila. With respect to rivers,
waterways, and esteros in Bulacan, Bataan, Pampanga, Cavite, and Laguna that
discharge wastewater directly or eventually into the Manila Bay, the DILG shall
direct the concerned LGUs to implement the demolition and removal of such
structures, constructions, and other encroachments built in violation of RA 7279
and other applicable laws in coordination with the DPWH and concerned agencies.

(10) The Department of Health (DOH), under Article 76 of PD 1067 (the

Water Code), is tasked to promulgate rules and regulations for the establishment of
waste disposal areas that affect the source of a water supply or a reservoir for
domestic or municipal use. And under Sec. 8 of RA 9275, the DOH, in
coordination with the DENR, DPWH, and other concerned agencies, shall
formulate guidelines and standards for the collection, treatment, and disposal of
sewage and the establishment and operation of a centralized sewage treatment
system. In areas not considered as highly urbanized cities, septage or a mix
sewerage-septage management system shall be employed.

In accordance with Sec. 72[30] of PD 856, the Code of Sanitation of

the Philippines, and Sec. 5.1.1[31] of Chapter XVII of its implementing rules, the
DOH is also ordered to ensure the regulation and monitoring of the proper disposal
of wastes by private sludge companies through the strict enforcement of the
requirement to obtain an environmental sanitation clearance of sludge collection
treatment and disposal before these companies are issued their environmental
sanitation permit.

(11) The Department of Education (DepEd), under the Philippine

Environment Code (PD 1152), is mandated to integrate subjects on environmental
education in its school curricula at all levels.[32] Under Sec. 118 of RA 8550, the
DepEd, in collaboration with the DA, Commission on Higher Education, and
Philippine Information Agency, shall launch and pursue a nationwide educational
campaign to promote the development, management, conservation, and proper use
of the environment. Under the Ecological Solid Waste Management Act (RA
9003), on the other hand, it is directed to strengthen the integration of
environmental concerns in school curricula at all levels, with an emphasis on waste
management principles.[33]
(12) The Department of Budget and Management (DBM) is tasked under Sec. 2,
Title XVII of the Administrative Code of 1987 to ensure the efficient and sound
utilization of government funds and revenues so as to effectively achieve the
countrys development objectives.[34]

One of the countrys development objectives is enshrined in RA 9275 or the

Philippine Clean Water Act of 2004. This law stresses that the State shall pursue a
policy of economic growth in a manner consistent with the protection,
preservation, and revival of the quality of our fresh, brackish, and marine waters. It
also provides that it is the policy of the government, among others, to streamline
processes and procedures in the prevention, control, and abatement of pollution
mechanisms for the protection of water resources; to promote environmental
strategies and use of appropriate economic instruments and of control mechanisms
for the protection of water resources; to formulate a holistic national program of
water quality management that recognizes that issues related to this management
cannot be separated from concerns about water sources and ecological protection,
water supply, public health, and quality of life; and to provide a comprehensive
management program for water pollution focusing on pollution prevention.

Thus, the DBM shall then endeavor to provide an adequate budget to attain the
noble objectives of RA 9275 in line with the countrys development objectives.

All told, the aforementioned enabling laws and issuances are in themselves
clear, categorical, and complete as to what are the obligations and mandate of each
agency/petitioner under the law. We need not belabor the issue that their tasks
include the cleanup of the Manila Bay.

Now, as to the crux of the petition. Do Secs. 17 and 20 of the Environment

Code encompass the cleanup of water pollution in general, not just specific
pollution incidents?

Secs. 17 and 20 of the Environment Code

Include Cleaning in General

The disputed sections are quoted as follows:

Section 17. Upgrading of Water Quality.Where the quality of water has deteriorated to a degree
where its state will adversely affect its best usage, the government agencies concerned shall take
such measures as may be necessary to upgrade the quality of such water to meet the prescribed
water quality standards.

Section 20. Clean-up Operations.It shall be the responsibility of the polluter to contain, remove
and clean-up water pollution incidents at his own expense. In case of his failure to do so, the
government agencies concerned shall undertake containment, removal and clean-up operations
and expenses incurred in said operations shall be charged against the persons and/or entities
responsible for such pollution.

When the Clean Water Act (RA 9275) took effect, its Sec. 16 on the
subject, Cleanup Operations, amended the counterpart provision (Sec. 20) of the
Environment Code (PD 1152). Sec. 17 of PD 1152 continues, however, to be
operational.
 The amendatory Sec. 16 of RA 9275 reads:

SEC. 16. Cleanup Operations.Notwithstanding the provisions of

Sections 15 and 26 hereof, any person who causes pollution in or
pollutes water bodies in excess of the applicable and prevailing standards
shall be responsible to contain, remove and clean up any pollution
incident at his own expense to the extent that the same water bodies have
been rendered unfit for utilization and beneficial use: Provided, That in
the event emergency cleanup operations are necessary and the polluter
fails to immediately undertake the same, the [DENR] in coordination
with other government agencies concerned, shall undertake containment,
removal and cleanup operations. Expenses incurred in said operations
shall be reimbursed by the persons found to have caused such pollution
under proper administrative determination x x x. Reimbursements of the
cost incurred shall be made to the Water Quality Management Fund or to
such other funds where said disbursements were sourced.

As may be noted, the amendment to Sec. 20 of the Environment Code is more

apparent than real since the amendment, insofar as it is relevant to this case, merely
consists in the designation of the DENR as lead agency in the cleanup operations.

Petitioners contend at every turn that Secs. 17 and 20 of the Environment

Code concern themselves only with the matter of cleaning up in specific pollution
incidents, as opposed to cleanup in general. They aver that the twin provisions
would have to be read alongside the succeeding Sec. 62(g) and (h), which defines
the terms cleanup operations and accidental spills, as follows:
g. Clean-up Operations [refer] to activities conducted in removing the pollutants discharged or
spilled in water to restore it to pre-spill condition.

h. Accidental Spills [refer] to spills of oil or other hazardous substances in water that result
from accidents such as collisions and groundings.

Petitioners proffer the argument that Secs. 17 and 20 of PD 1152 merely

direct the government agencies concerned to undertake containment, removal, and
cleaning operations of a specific polluted portion or portions of the body of water
concerned. They maintain that the application of said Sec. 20 is limited only to
water pollution incidents, which are situations that presuppose the occurrence of
specific, isolated pollution events requiring the corresponding containment,
removal, and cleaning operations. Pushing the point further, they argue that the
aforequoted Sec. 62(g) requires cleanup operations to restore the body of water to
pre-spill condition, which means that there must have been a specific incident of
either intentional or accidental spillage of oil or other hazardous substances, as
mentioned in Sec. 62(h).

As a counterpoint, respondents argue that petitioners erroneously read Sec. 62(g)

as delimiting the application of Sec. 20 to the containment, removal, and cleanup
operations for accidental spills only. Contrary to petitioners posture, respondents
assert that Sec. 62(g), in fact, even expanded the coverage of Sec. 20. Respondents
explain that without its Sec. 62(g), PD 1152 may have indeed covered only
pollution accumulating from the day-to-day operations of businesses around
the Manila Bay and other sources of pollution that slowly accumulated in the bay.
Respondents, however, emphasize that Sec. 62(g), far from being a delimiting
provision, in fact even enlarged the operational scope of Sec. 20, by including
accidental spills as among the water pollution incidents contemplated in Sec. 17 in
relation to Sec. 20 of PD 1152.

To respondents, petitioners parochial view on environmental issues, coupled

with their narrow reading of their respective mandated roles, has contributed to the
worsening water quality of the Manila Bay. Assuming, respondents assert, that
petitioners are correct in saying that the cleanup coverage of Sec. 20 of PD 1152 is
constricted by the definition of the phrase cleanup operations embodied in Sec.
62(g), Sec. 17 is not hobbled by such limiting definition. As pointed out, the
phrases cleanup operations and accidental spills do not appear in said Sec. 17, not
even in the chapter where said section is found.

Respondents are correct. For one thing, said Sec. 17 does not in any way
state that the government agencies concerned ought to confine themselves to the
containment, removal, and cleaning operations when a specific pollution incident
occurs. On the contrary, Sec. 17 requires them to act even in the absence of a
specific pollution incident, as long as water quality has deteriorated to a degree
where its state will adversely affect its best usage. This section, to stress,
commands concerned government agencies, when appropriate, to take such
measures as may be necessary to meet the prescribed water quality standards. In
fine, the underlying duty to upgrade the quality of water is not conditional on the
occurrence of any pollution incident.

For another, a perusal of Sec. 20 of the Environment Code, as couched,

indicates that it is properly applicable to a specific situation in which the pollution
is caused by polluters who fail to clean up the mess they left behind. In such
instance, the concerned government agencies shall undertake the cleanup work for
the polluters account. Petitioners assertion, that they have to perform cleanup
operations in the Manila Bay only when there is a water pollution incident and the
erring polluters do not undertake the containment, removal, and cleanup
operations, is quite off mark. As earlier discussed, the complementary Sec. 17 of
the Environment Code comes into play and the specific duties of the agencies to
clean up come in even if there are no pollution incidents staring at
them. Petitioners, thus, cannot plausibly invoke and hide behind Sec. 20 of PD
1152 or Sec. 16 of RA 9275 on the pretext that their cleanup mandate depends on
the happening of a specific pollution incident. In this regard, what the CA said with
respect to the impasse over Secs. 17 and 20 of PD 1152 is at once valid as it is
practical. The appellate court wrote: PD 1152 aims to introduce a comprehensive
program of environmental protection and management. This is better served by
making Secs. 17 & 20 of general application rather than limiting them to specific
pollution incidents.[35]

Granting arguendo that petitioners position thus described vis--vis the

implementation of Sec. 20 is correct, they seem to have overlooked the fact that the
pollution of the Manila Bay is of such magnitude and scope that it is well-nigh
impossible to draw the line between a specific and a general pollution incident.
And such impossibility extends to pinpointing with reasonable certainty who the
polluters are. We note that Sec. 20 of PD 1152 mentions water pollution incidents
which may be caused by polluters in the waters of the Manila Bay itself or by
polluters in adjoining lands and in water bodies or waterways that empty into the
bay. Sec. 16 of RA 9275, on the other hand, specifically adverts to any person who
causes pollution in or pollutes water bodies, which may refer to an individual or an
establishment that pollutes the land mass near the Manila Bay or the waterways,
such that the contaminants eventually end up in the bay. In this situation, the water
pollution incidents are so numerous and involve nameless and faceless polluters
that they can validly be categorized as beyond the specific pollution incident level.
Not to be ignored of course is the reality that the government agencies
concerned are so undermanned that it would be almost impossible to apprehend the
numerous polluters of the Manila Bay. It may perhaps not be amiss to say that the
apprehension, if any, of the Manila Bay polluters has been few and far between.
Hence, practically nobody has been required to contain, remove, or clean up a
given water pollution incident. In this kind of setting, it behooves the Government
to step in and undertake cleanup operations. Thus, Sec. 16 of RA 9275, previously
Sec. 20 of PD 1152, covers for all intents and purposes a general cleanup situation.

The cleanup and/or restoration of the Manila Bay is only an aspect and the initial
stage of the long-term solution. The preservation of the water quality of the bay
after the rehabilitation process is as important as the cleaning phase. It is
imperative then that the wastes and contaminants found in the rivers, inland bays,
and other bodies of water be stopped from reaching the Manila Bay. Otherwise,
any cleanup effort would just be a futile, cosmetic exercise, for, in no time at all,
the Manila Bay water quality would again deteriorate below the ideal minimum
standards set by PD 1152, RA 9275, and other relevant laws. It thus behooves the
Court to put the heads of the petitioner-department-agencies and the bureaus and
offices under them on continuing notice about, and to enjoin them to perform, their
mandates and duties towards cleaning up the Manila Bay and preserving the
quality of its water to the ideal level. Under what other judicial discipline describes
as continuing mandamus,[36] the Court may, under extraordinary circumstances,
issue directives with the end in view of ensuring that its decision would not be set
to naught by administrative inaction or indifference. In India, the doctrine of
continuing mandamus was used to enforce directives of the court to clean up the
length of the Ganges River from industrial and municipal pollution.[37]
The Court can take judicial notice of the presence of shanties and other
unauthorized structures which do not have septic tanks along the Pasig-Marikina-
San Juan Rivers, the National Capital Region (NCR) (Paraaque-Zapote, Las Pias)
Rivers, the Navotas-Malabon-Tullahan-Tenejeros Rivers, the Meycuayan-Marilao-
Obando (Bulacan) Rivers, the Talisay (Bataan) River, the Imus (Cavite) River, the
Laguna De Bay, and other minor rivers and connecting waterways, river banks,
and esteros which discharge their waters, with all the accompanying filth, dirt, and
garbage, into the major rivers and eventually the Manila Bay. If there is one factor
responsible for the pollution of the major river systems and the Manila Bay, these
unauthorized structures would be on top of the list. And if the issue of illegal or
unauthorized structures is not seriously addressed with sustained resolve, then
practically all efforts to cleanse these important bodies of water would be for
naught. The DENR Secretary said as much.[38]

Giving urgent dimension to the necessity of removing these illegal structures is

Art. 51 of PD 1067 or the Water Code,[39] which prohibits the building of structures
within a given length along banks of rivers and other waterways. Art. 51 reads:

The banks of rivers and streams and the shores of the seas and
lakes throughout their entire length and within a zone of three (3)
meters in urban areas, twenty (20) meters in agricultural areas and
forty (40) meters in forest areas, along their margins, are subject to the
easement of public use in the interest of recreation, navigation,
floatage, fishing and salvage.No person shall be allowed to stay in
this zone longer than what is necessary for recreation, navigation,
floatage, fishing or salvage or to build structures of any
kind. (Emphasis added.)

Judicial notice may likewise be taken of factories and other industrial

establishments standing along or near the banks of the Pasig River, other major
rivers, and connecting waterways. But while they may not be treated as
unauthorized constructions, some of these establishments undoubtedly contribute
to the pollution of the Pasig River and waterways. The DILG and the concerned
LGUs, have, accordingly, the duty to see to it that non-complying industrial
establishments set up, within a reasonable period, the necessary waste water
treatment facilities and infrastructure to prevent their industrial discharge,
including their sewage waters, from flowing into the Pasig River, other major
rivers, and connecting waterways. After such period, non-complying
establishments shall be shut down or asked to transfer their operations.
At this juncture, and if only to dramatize the urgency of the need for petitioners-
agencies to comply with their statutory tasks, we cite the Asian Development
Bank-commissioned study on the garbage problem in Metro Manila, the results of
which are embodied in the The Garbage Book. As there reported, the garbage crisis
in the metropolitan area is as alarming as it is shocking. Some highlights of the
report:

1. As early as 2003, three land-filled dumpsites in Metro Manila -

the Payatas, Catmon and Rodriquez dumpsites - generate an alarming
quantity of lead and leachate or liquid run-off. Leachate are toxic liquids
that flow along the surface and seep into the earth and poison the surface
and groundwater that are used for drinking, aquatic life, and the
environment.

2. The high level of fecal coliform confirms the presence of a

large amount of human waste in the dump sites and surrounding areas,
which is presumably generated by households that lack alternatives to
sanitation. To say that Manila Bay needs rehabilitation is an
understatement.

3. Most of the deadly leachate, lead and other dangerous

contaminants and possibly strains of pathogens seeps untreated into
ground water and runs into the Marikina and Pasig Riversystems
and Manila Bay.[40]

Given the above perspective, sufficient sanitary landfills should now more
than ever be established as prescribed by the Ecological Solid Waste Management
Act (RA 9003). Particular note should be taken of the blatant violations by some
LGUs and possibly the MMDA of Sec. 37, reproduced below:
Sec. 37. Prohibition against the Use of Open Dumps for Solid
Waste.No open dumps shall be established and operated, nor any
practice or disposal of solid waste by any person, including LGUs which
[constitute] the use of open dumps for solid waste, be allowed after the
effectivity of this Act: Provided, further that no controlled dumps shall
be allowed (5) years following the effectivity of this Act. (Emphasis
added.)
 RA 9003 took effect on February 15, 2001 and the adverted grace period of
five (5) years which ended on February 21, 2006 has come and gone, but no single
sanitary landfill which strictly complies with the prescribed standards under RA
9003 has yet been set up.

In addition, there are rampant and repeated violations of Sec. 48 of RA

9003, like littering, dumping of waste matters in roads, canals, esteros, and other
public places, operation of open dumps, open burning of solid waste, and the
like. Some sludge companies which do not have proper disposal facilities simply
discharge sludge into the Metro Manila sewerage system that ends up in
the Manila Bay. Equally unabated are violations of Sec. 27 of RA 9275, which
enjoins the pollution of water bodies, groundwater pollution, disposal of infectious
wastes from vessels, and unauthorized transport or dumping into sea waters of
sewage or solid waste and of Secs. 4 and 102 of RA 8550 which proscribes the
introduction by human or machine of substances to the aquatic environment
including dumping/disposal of waste and other marine litters, discharge of
petroleum or residual products of petroleum of carbonaceous materials/substances
[and other] radioactive, noxious or harmful liquid, gaseous or solid substances,
from any water, land or air transport or other human-made structure.

In the light of the ongoing environmental degradation, the Court wishes to

emphasize the extreme necessity for all concerned executive departments and
agencies to immediately act and discharge their respective official duties and
obligations. Indeed, time is of the essence; hence, there is a need to set timetables
for the performance and completion of the tasks, some of them as defined for them
by law and the nature of their respective offices and mandates.

The importance of the Manila Bay as a sea resource, playground, and as a

historical landmark cannot be over-emphasized. It is not yet too late in the day to
restore the Manila Bay to its former splendor and bring back the plants and sea life
that once thrived in its blue waters. But the tasks ahead, daunting as they may be,
could only be accomplished if those mandated, with the help and cooperation of all
civic-minded individuals, would put their minds to these tasks and take
responsibility. This means that the State, through petitioners, has to take the lead in
the preservation and protection of the Manila Bay.
 The era of delays, procrastination, and ad hoc measures is over. Petitioners
must transcend their limitations, real or imaginary, and buckle down to work
before the problem at hand becomes unmanageable. Thus, we must reiterate that
different government agencies and instrumentalities cannot shirk from their
mandates; they must perform their basic functions in cleaning up and rehabilitating
the Manila Bay. We are disturbed by petitioners hiding behind two untenable
claims: (1) that there ought to be a specific pollution incident before they are
required to act; and (2) that the cleanup of the bay is a discretionary duty.

RA 9003 is a sweeping piece of legislation enacted to radically transform

and improve waste management. It implements Sec. 16, Art. II of the 1987
Constitution, which explicitly provides that the State shall protect and advance the
right of the people to a balanced and healthful ecology in accord with the rhythm
and harmony of nature.

So it was that in Oposa v. Factoran, Jr. the Court stated that the right to a
balanced and healthful ecology need not even be written in the Constitution for it is
assumed, like other civil and political rights guaranteed in the Bill of Rights, to
exist from the inception of mankind and it is an issue of transcendental importance
with intergenerational implications.[41] Even assuming the absence of a categorical
legal provision specifically prodding petitioners to clean up the bay, they and the
men and women representing them cannot escape their obligation to future
generations of Filipinos to keep the waters of the Manila Bay clean and clear as
humanly as possible. Anything less would be a betrayal of the trust reposed in
them.

WHEREFORE, the petition is DENIED. The September 28, 2005 Decision of the
CA in CA-G.R. CV No. 76528 and SP No. 74944 and the September 13, 2002
Decision of the RTC in Civil Case No. 1851-99 are AFFIRMED but
with MODIFICATIONS in view of subsequent developments or supervening
events in the case. The fallo of the RTC Decision shall now read:
WHEREFORE, judgment is hereby rendered ordering the abovenamed
defendant-government agencies to clean up, rehabilitate, and
preserve Manila Bay, and restore and maintain its waters to SB level
 (Class B sea waters per Water Classification Tables under DENR
Administrative Order No. 34 [1990]) to make them fit for swimming,
skin-diving, and other forms of contact recreation.

In particular:

(1) Pursuant to Sec. 4 of EO 192, assigning the DENR as the primary agency
responsible for the conservation, management, development, and proper use of the
countrys environment and natural resources, and Sec. 19 of RA 9275, designating
the DENR as the primary government agency responsible for its enforcement and
implementation, the DENR is directed to fully implement its Operational Plan for
the Manila Bay Coastal Strategy for the rehabilitation, restoration, and
conservation of the Manila Bay at the earliest possible time. It is ordered to call
regular coordination meetings with concerned government departments and
agencies to ensure the successful implementation of the aforesaid plan of action in
accordance with its indicated completion schedules.

(2) Pursuant to Title XII (Local Government) of the Administrative Code of 1987
and Sec. 25 of the Local Government Code of 1991,[42] the DILG, in exercising the
Presidents power of general supervision and its duty to promulgate guidelines in
establishing waste management programs under Sec. 43 of the Philippine
Environment Code (PD 1152), shall direct all LGUs in Metro Manila, Rizal,
Laguna, Cavite, Bulacan, Pampanga, and Bataan to inspect all factories,
commercial establishments, and private homes along the banks of the major river
systems in their respective areas of jurisdiction, such as but not limited to the
Pasig-Marikina-San Juan Rivers, the NCR (Paraaque-Zapote, Las Pias) Rivers, the
Navotas-Malabon-Tullahan-Tenejeros Rivers, the Meycauayan-Marilao-Obando
(Bulacan) Rivers, the Talisay (Bataan) River, the Imus (Cavite) River, the Laguna
De Bay, and other minor rivers and waterways that eventually discharge water into
the Manila Bay; and the lands abutting the bay, to determine whether they have
wastewater treatment facilities or hygienic septic tanks as prescribed by existing
laws, ordinances, and rules and regulations. If none be found, these LGUs shall be
ordered to require non-complying establishments and homes to set up said facilities
or septic tanks within a reasonable time to prevent industrial wastes, sewage water,
and human wastes from flowing into these rivers, waterways, esteros, and the
Manila Bay, under pain of closure or imposition of fines and other sanctions.

(3) As mandated by Sec. 8 of RA 9275,[43] the MWSS is directed to provide,

install, operate, and maintain the necessary adequate waste water treatment
facilities in Metro Manila, Rizal, and Cavite where needed at the earliest possible
time.

(4) Pursuant to RA 9275,[44] the LWUA, through the local water districts and
in coordination with the DENR, is ordered to provide, install, operate, and
maintain sewerage and sanitation facilities and the efficient and safe collection,
treatment, and disposal of sewage in the provinces of Laguna, Cavite, Bulacan,
Pampanga, and Bataan where needed at the earliest possible time.
(5) Pursuant to Sec. 65 of RA 8550,[45] the DA, through the BFAR, is ordered to
improve and restore the marine life of the Manila Bay. It is also directed to assist
the LGUs in Metro Manila, Rizal, Cavite, Laguna, Bulacan, Pampanga, and Bataan
in developing, using recognized methods, the fisheries and aquatic resources in
the Manila Bay.

(6) The PCG, pursuant to Secs. 4 and 6 of PD 979, and the PNP Maritime Group,
in accordance with Sec. 124 of RA 8550, in coordination with each other, shall
apprehend violators of PD 979, RA 8550, and other existing laws and regulations
designed to prevent marine pollution in the Manila Bay.

(7) Pursuant to Secs. 2 and 6-c of EO 513[46] and the International

Convention for the Prevention of Pollution from Ships, the PPA is ordered to
immediately adopt such measures to prevent the discharge and dumping of solid
and liquid wastes and other ship-generated wastes into the Manila Bay waters from
vessels docked at ports and apprehend the violators.

(8) The MMDA, as the lead agency and implementor of programs and
projects for flood control projects and drainage services in Metro Manila, in
coordination with the DPWH, DILG, affected LGUs, PNP Maritime Group,
Housing and Urban Development Coordinating Council (HUDCC), and other
agencies, shall dismantle and remove allstructures, constructions, and other
encroachments established or built in violation of RA 7279, and other applicable
laws along the Pasig-Marikina-San Juan Rivers, the NCR (Paraaque-Zapote, Las
Pias) Rivers, the Navotas-Malabon-Tullahan-Tenejeros Rivers, and connecting
waterways and esteros in Metro Manila. The DPWH, as the principal implementor
of programs and projects for flood control services in the rest of the country more
particularly in Bulacan, Bataan, Pampanga, Cavite, and Laguna, in coordination
with the DILG, affected LGUs, PNP Maritime Group, HUDCC, and other
concerned government agencies, shall remove and demolish all structures,
constructions, and other encroachments built in breach of RA 7279 and other
applicable laws along the Meycauayan-Marilao-Obando (Bulacan) Rivers, the
Talisay (Bataan) River, the Imus (Cavite) River, the Laguna De Bay, and other
rivers, connecting waterways, and esteros that discharge wastewater into the
Manila Bay.

In addition, the MMDA is ordered to establish, operate, and maintain a sanitary

landfill, as prescribed by RA 9003, within a period of one (1) year from finality of
this Decision.On matters within its territorial jurisdiction and in connection with
the discharge of its duties on the maintenance of sanitary landfills and like
undertakings, it is also ordered to cause the apprehension and filing of the
appropriate criminal cases against violators of the respective penal provisions of
RA 9003,[47] Sec. 27 of RA 9275 (the Clean Water Act), and other existing laws on
pollution.
(9) The DOH shall, as directed by Art. 76 of PD 1067 and Sec. 8 of RA 9275,
within one (1) year from finality of this Decision, determine if all licensed septic
and sludge companies have the proper facilities for the treatment and disposal of
fecal sludge and sewage coming from septic tanks. The DOH shall give the
companies, if found to be non-complying, a reasonable time within which to set up
the necessary facilities under pain of cancellation of its environmental sanitation
clearance.

(10) Pursuant to Sec. 53 of PD 1152,[48] Sec. 118 of RA 8550, and Sec. 56 of RA

9003,[49] the DepEd shall integrate lessons on pollution prevention, waste
management, environmental protection, and like subjects in the school curricula of
all levels to inculcate in the minds and hearts of students and, through them, their
parents and friends, the importance of their duty toward achieving and maintaining
a balanced and healthful ecosystem in the Manila Bay and the entire Philippine
archipelago.

(11) The DBM shall consider incorporating an adequate budget in the General
Appropriations Act of 2010 and succeeding years to cover the expenses relating to
the cleanup, restoration, and preservation of the water quality of the Manila Bay, in
line with the countrys development objective to attain economic growth in a
manner consistent with the protection, preservation, and revival of our marine
waters.
(12) The heads of petitioners-agencies MMDA, DENR, DepEd, DOH, DA,
DPWH, DBM, PCG, PNP Maritime Group, DILG, and also of MWSS, LWUA,
and PPA, in line with the principle of continuing mandamus, shall, from finality of
this Decision, each submit to the Court a quarterly progressive report of the
activities undertaken in accordance with this Decision.

No costs.

SO ORDERED.

Prince Hotel v GSIS 67 SCRA 40 (February 3 1997)

BELLOSILLO, J.:

The Filipino First Policy enshrined in the 1987 Constitution, i.e., in the
grant of rights, privileges, and concessions covering the national economy
and patrimony, the State shall give preference to qualified Filipinos, is [1]

invoked by petitioner in its bid to acquire 51% of the shares of the Manila
Hotel Corporation (MHC) which owns the historic Manila Hotel. Opposing,
respondents maintain that the provision is not self-executing but requires an
implementing legislation for its enforcement. Corollarily, they ask whether the
51% shares form part of the national economy and patrimony covered by the
protective mantle of the Constitution.
The controversy arose when respondent Government Service Insurance
System (GSIS), pursuant to the privatization program of the Philippine
Government under Proclamation No. 50 dated 8 December 1986, decided to
sell through public bidding 30% to 51% of the issued and outstanding shares
of respondent MHC. The winning bidder, or the eventual strategic partner,
is to provide management expertise and/or an international
marketing/reservation system, and financial support to strengthen the
profitability and performance of the Manila Hotel. In a close bidding held on
[2]

18 September 1995 only two (2) bidders participated: petitioner Manila Prince
Hotel Corporation, a Filipino corporation, which offered to buy 51% of the
MHC or 15,300,000 shares at P41.58 per share, and Renong Berhad, a
Malaysian firm, with ITT-Sheraton as its hotel operator, which bid for the same
number of shares at P44.00 per share, or P2.42 more than the bid of
petitioner.
Pertinent provisions of the bidding rules prepared by respondent GSIS
state -

I. EXECUTION OF THE NECESSARY CONTRACTS WITH GSIS/MHC -

1. The Highest Bidder must comply with the conditions set forth below by October
23, 1995 (reset to November 3, 1995) or the Highest Bidder will lose the right to
purchase the Block of Shares and GSIS will instead offer the Block of Shares to the
other Qualified Bidders:

a. The Highest Bidder must negotiate and execute with the GSIS/MHC the
Management Contract, International Marketing/Reservation System Contract or other
type of contract specified by the Highest Bidder in its strategic plan for the Manila
Hotel x x x x

b. The Highest Bidder must execute the Stock Purchase and Sale Agreement with
GSIS x x x x

K. DECLARATION OF THE WINNING BIDDER/STRATEGIC PARTNER -

The Highest Bidder will be declared the Winning Bidder/Strategic Partner after the
following conditions are met:

a. Execution of the necessary contracts with GSIS/MHC not later than October 23,
1995 (reset to November 3, 1995); and

b. Requisite approvals from the GSIS/MHC and COP (Committee on Privatization)/

OGCC (Office of the Government Corporate Counsel) are obtained. [3]

Pending the declaration of Renong Berhard as the winning bidder/strategic

partner and the execution of the necessary contracts, petitioner in a letter to
respondent GSIS dated 28 September 1995 matched the bid price of P44.00
per share tendered by Renong Berhad. In a subsequent letter dated 10
[4]

October 1995 petitioner sent a managers check issued by Philtrust Bank for
Thirty-three Million Pesos (P33,000,000.00) as Bid Security to match the bid
of the Malaysian Group, Messrs. Renong Berhad x x x x which respondent
[5]

GSIS refused to accept.

On 17 October 1995, perhaps apprehensive that respondent GSIS has
disregarded the tender of the matching bid and that the sale of 51% of the
MHC may be hastened by respondent GSIS and consummated with Renong
Berhad, petitioner came to this Court on prohibition and mandamus. On 18
October 1995 the Court issued a temporary restraining order enjoining
respondents from perfecting and consummating the sale to the Malaysian
firm.
On 10 September 1996 the instant case was accepted by the Court En
Banc after it was referred to it by the First Division. The case was then set for
oral arguments with former Chief Justice Enrique M. Fernando and Fr.
Joaquin G. Bernas, S.J., as amici curiae.
In the main, petitioner invokes Sec. 10, second par., Art. XII, of the 1987
Constitution and submits that the Manila Hotel has been identified with the
Filipino nation and has practically become a historical monument which
reflects the vibrancy of Philippine heritage and culture. It is a proud legacy of
an earlier generation of Filipinos who believed in the nobility and sacredness
of independence and its power and capacity to release the full potential of the
Filipino people. To all intents and purposes, it has become a part of the
national patrimony. Petitioner also argues that since 51% of the shares of the
[6]

MHC carries with it the ownership of the business of the hotel which is owned
by respondent GSIS, a government-owned and controlled corporation, the
hotel business of respondent GSIS being a part of the tourism industry is
unquestionably a part of the national economy. Thus, any transaction
involving 51% of the shares of stock of the MHC is clearly covered by the term
national economy, to which Sec. 10, second par., Art. XII, 1987 Constitution,
applies.[7]

It is also the thesis of petitioner that since Manila Hotel is part of the
national patrimony and its business also unquestionably part of the national
economy petitioner should be preferred after it has matched the bid offer of
the Malaysian firm. For the bidding rules mandate that if for any reason, the
Highest Bidder cannot be awarded the Block of Shares, GSIS may offer this to
the other Qualified Bidders that have validly submitted bids provided that
these Qualified Bidders are willing to match the highest bid in terms of price
per share. [8]
 Respondents except. They maintain that: First, Sec. 10, second par., Art.
XII, of the 1987 Constitution is merely a statement of principle and policy since
it is not a self-executing provision and requires implementing legislation(s) x x
x x Thus, for the said provision to operate, there must be existing laws to lay
down conditions under which business may be done. [9]

Second, granting that this provision is self-executing, Manila Hotel does

not fall under the term national patrimony which only refers to lands of the
public domain, waters, minerals, coal, petroleum and other mineral oils, all
forces of potential energy, fisheries, forests or timber, wildlife, flora and fauna
and all marine wealth in its territorial sea, and exclusive marine zone as cited
in the first and second paragraphs of Sec. 2, Art. XII, 1987
Constitution. According to respondents, while petitioner speaks of the guests
who have slept in the hotel and the events that have transpired therein which
make the hotel historic, these alone do not make the hotel fall under
the patrimony of the nation. What is more, the mandate of the Constitution is
addressed to the State, not to respondent GSIS which possesses a
personality of its own separate and distinct from the Philippines as a State.
Third, granting that the Manila Hotel forms part of the national patrimony,
the constitutional provision invoked is still inapplicable since what is being sold
is only 51% of the outstanding shares of the corporation, not the hotel building
nor the land upon which the building stands. Certainly, 51% of the equity of
the MHC cannot be considered part of the national patrimony.Moreover, if the
disposition of the shares of the MHC is really contrary to the Constitution,
petitioner should have questioned it right from the beginning and not after it
had lost in the bidding.
Fourth, the reliance by petitioner on par. V., subpar. J. 1., of the bidding
rules which provides that if for any reason, the Highest Bidder cannot be
awarded the Block of Shares, GSIS may offer this to the other Qualified
Bidders that have validly submitted bids provided that these Qualified Bidders
are willing to match the highest bid in terms of price per share, is
misplaced. Respondents postulate that the privilege of submitting a matching
bid has not yet arisen since it only takes place if for any reason, the Highest
Bidder cannot be awarded the Block of Shares. Thus the submission by
petitioner of a matching bid is premature since Renong Berhad could still very
well be awarded the block of shares and the condition giving rise to the
exercise of the privilege to submit a matching bid had not yet taken place.
Finally, the prayer for prohibition grounded on grave abuse of discretion
should fail since respondent GSIS did not exercise its discretion in a
capricious, whimsical manner, and if ever it did abuse its discretion it was not
so patent and gross as to amount to an evasion of a positive duty or a virtual
refusal to perform a duty enjoined by law. Similarly, the petition for mandamus
should fail as petitioner has no clear legal right to what it demands and
respondents do not have an imperative duty to perform the act required of
them by petitioner.
We now resolve. A constitution is a system of fundamental laws for the
governance and administration of a nation. It is supreme, imperious, absolute
and unalterable except by the authority from which it emanates. It has been
defined as the fundamental and paramount law of the nation. It prescribes
[10]

the permanent framework of a system of government, assigns to the different

departments their respective powers and duties, and establishes certain fixed
principles on which government is founded. The fundamental conception in
other words is that it is a supreme law to which all other laws must conform
and in accordance with which all private rights must be determined and all
public authority administered. Under the doctrine of constitutional
[11]

supremacy, if a law or contract violates any norm of the constitution that law
or contract whether promulgated by the legislative or by the executive branch
or entered into by private persons for private purposes is null and void and
without any force and effect. Thus, since the Constitution is the fundamental,
paramount and supreme law of the nation, it is deemed written in every
statute and contract.
Admittedly, some constitutions are merely declarations of policies and
principles. Their provisions command the legislature to enact laws and carry
out the purposes of the framers who merely establish an outline of
government providing for the different departments of the governmental
machinery and securing certain fundamental and inalienable rights of
citizens. A provision which lays down a general principle, such as those
[12]

found in Art. II of the 1987 Constitution, is usually not self-executing. But a

provision which is complete in itself and becomes operative without the aid of
supplementary or enabling legislation, or that which supplies sufficient rule by
means of which the right it grants may be enjoyed or protected, is self-
executing.Thus a constitutional provision is self-executing if the nature and
extent of the right conferred and the liability imposed are fixed by the
constitution itself, so that they can be determined by an examination and
construction of its terms, and there is no language indicating that the subject
is referred to the legislature for action.
[13]

As against constitutions of the past, modern constitutions have been

generally drafted upon a different principle and have often become in effect
extensive codes of laws intended to operate directly upon the people in a
manner similar to that of statutory enactments, and the function of
constitutional conventions has evolved into one more like that of a legislative
body.Hence, unless it is expressly provided that a legislative act is necessary
to enforce a constitutional mandate, the presumption now is that all provisions
of the constitution are self-executing.If the constitutional provisions are treated
as requiring legislation instead of self-executing, the legislature would have
the power to ignore and practically nullify the mandate of the fundamental
law. This can be cataclysmic. That is why the prevailing view is, as it has
[14]

always been, that -

x x x x in case of doubt, the Constitution should be considered self-executing rather

than non-self-executing x x x x Unless the contrary is clearly intended, the provisions
of the Constitution should be considered self-executing, as a contrary rule would give
the legislature discretion to determine when, or whether, they shall be effective. These
provisions would be subordinated to the will of the lawmaking body, which could
make them entirely meaningless by simply refusing to pass the needed implementing
statute. [15]

Respondents argue that Sec. 10, second par., Art. XII, of the 1987
Constitution is clearly not self-executing, as they quote from discussions on
the floor of the 1986 Constitutional Commission -
MR. RODRIGO. Madam President, I am asking this question as the Chairman of the
Committee on Style. If the wording of PREFERENCE is given to QUALIFIED
FILIPINOS, can it be understood as a preference to qualified Filipinos vis-a-
vis Filipinos who are not qualified. So, why do we not make it clear? To qualified
Filipinos as against aliens?
THE PRESIDENT. What is the question of Commissioner Rodrigo? Is it to remove the
word QUALIFIED?
MR. RODRIGO. No, no, but say definitely TO QUALIFIED FILIPINOS as against
whom? As against aliens or over aliens ?
MR. NOLLEDO. Madam President, I think that is understood. We use the word
QUALIFIED because the existing laws or prospective laws will always lay down
conditions under which business may be done. For example, qualifications on
capital, qualifications on the setting up of other financial structures, et
cetera (underscoring supplied by respondents).
MR. RODRIGO. It is just a matter of style.
MR. NOLLEDO. Yes.[16]

Quite apparently, Sec. 10, second par., of Art XII is couched in such a way
as not to make it appear that it is non-self-executing but simply for purposes of
style. But, certainly, the legislature is not precluded from enacting further laws
to enforce the constitutional provision so long as the contemplated statute
squares with the Constitution. Minor details may be left to the legislature
without impairing the self-executing nature of constitutional provisions.
In self-executing constitutional provisions, the legislature may still enact
legislation to facilitate the exercise of powers directly granted by the
constitution, further the operation of such a provision, prescribe a practice to
be used for its enforcement, provide a convenient remedy for the protection of
the rights secured or the determination thereof, or place reasonable
safeguards around the exercise of the right. The mere fact that legislation may
supplement and add to or prescribe a penalty for the violation of a self-
executing constitutional provision does not render such a provision ineffective
in the absence of such legislation. The omission from a constitution of any
express provision for a remedy for enforcing a right or liability is not
necessarily an indication that it was not intended to be self-executing. The rule
is that a self-executing provision of the constitution does not necessarily
exhaust legislative power on the subject, but any legislation must be in
harmony with the constitution, further the exercise of constitutional right and
make it more available. Subsequent legislation however does not
[17]

necessarily mean that the subject constitutional provision is not, by itself, fully
enforceable.
Respondents also argue that the non-self-executing nature of Sec. 10,
second par., of Art. XII is implied from the tenor of the first and third
paragraphs of the same section which undoubtedly are not self-
executing. The argument is flawed. If the first and third paragraphs are not
[18]

self-executing because Congress is still to enact measures to encourage the

formation and operation of enterprises fully owned by Filipinos, as in the first
paragraph, and the State still needs legislation to regulate and exercise
authority over foreign investments within its national jurisdiction, as in the third
paragraph, then a fortiori, by the same logic, the second paragraph can only
be self-executing as it does not by its language require any legislation in order
to give preference to qualified Filipinos in the grant of rights, privileges and
concessions covering the national economy and patrimony. A constitutional
provision may be self-executing in one part and non-self-executing in
another.[19]

Even the cases cited by respondents holding that certain constitutional

provisions are merely statements of principles and policies, which are
basically not self-executing and only placed in the Constitution as moral
incentives to legislation, not as judicially enforceable rights - are simply not in
point. Basco v. Philippine Amusements and Gaming Corporation speaks of [20]

constitutional provisions on personal dignity, the sanctity of family life, the

[21] [22]

vital role of the youth in nation-building, the promotion of social justice, and
[23] [24]
the values of education. Tolentino v. Secretary of Finance refers to
[25] [26]

constitutional provisions on social justice and human rights and on [27]

education. Lastly, Kilosbayan, Inc. v. Morato cites provisions on the

[28] [29]

promotion of general welfare, the sanctity of family life, the vital role of the
[30] [31]

youth in nation-building and the promotion of total human liberation and

[32]

development. A reading of these provisions indeed clearly shows that they

[33]

are not judicially enforceable constitutional rights but merely guidelines for
legislation. The very terms of the provisions manifest that they are only
principles upon which legislations must be based. Res ipsa loquitur.
On the other hand, Sec. 10, second par., Art. XII of the 1987 Constitution
is a mandatory, positive command which is complete in itself and which needs
no further guidelines or implementing laws or rules for its enforcement. From
its very words the provision does not require any legislation to put it in
operation. It is per se judicially enforceable. When our Constitution mandates
that [i]n the grant of rights, privileges, and concessions covering national
economy and patrimony, the State shall give preference to qualified
Filipinos, it means just that - qualified Filipinos shall be preferred. And when
our Constitution declares that a right exists in certain specified circumstances
an action may be maintained to enforce such right notwithstanding the
absence of any legislation on the subject; consequently, if there is no statute
especially enacted to enforce such constitutional right, such right enforces
itself by its own inherent potency and puissance, and from which all
legislations must take their bearings. Where there is a right there is a
remedy. Ubi jus ibi remedium.
As regards our national patrimony, a member of the 1986 Constitutional
Commission explains -
[34]

The patrimony of the Nation that should be conserved and developed refers
not only to our rich natural resources but also to the cultural heritage of our
race. It also refers to our intelligence in arts, sciences and letters. Therefore,
we should develop not only our lands, forests, mines and other natural
resources but also the mental ability or faculty of our people.

We agree. In its plain and ordinary meaning, the term patrimony pertains
to heritage. When the Constitution speaks of national patrimony, it refers not
[35]

only to the natural resources of the Philippines, as the Constitution could have
very well used the term natural resources, but also to the cultural heritage of
the Filipinos.
Manila Hotel has become a landmark - a living testimonial of Philippine
heritage. While it was restrictively an American hotel when it first opened in
1912, it immediately evolved to be truly Filipino. Formerly a concourse for the
elite, it has since then become the venue of various significant events which
have shaped Philippine history. It was called the Cultural Center of the
1930s. It was the site of the festivities during the inauguration of the Philippine
Commonwealth. Dubbed as the Official Guest House of the Philippine
Government it plays host to dignitaries and official visitors who are accorded
the traditional Philippine hospitality.
[36]

The history of the hotel has been chronicled in the book The Manila Hotel:
The Heart and Memory of a City. During World War II the hotel was
[37]

converted by the Japanese Military Administration into a military

headquarters. When the American forces returned to recapture Manila the
hotel was selected by the Japanese together with Intramuros as the two (2)
places for their final stand. Thereafter, in the 1950s and 1960s, the hotel
became the center of political activities, playing host to almost every political
convention. In 1970 the hotel reopened after a renovation and reaped
numerous international recognitions, an acknowledgment of the Filipino talent
and ingenuity. In 1986 the hotel was the site of a failed coup d etat where an
aspirant for vice-president was proclaimed President of the Philippine
Republic.
For more than eight (8) decades Manila Hotel has bore mute witness to
the triumphs and failures, loves and frustrations of the Filipinos; its existence
is impressed with public interest; its own historicity associated with our
struggle for sovereignty, independence and nationhood. Verily, Manila Hotel
has become part of our national economy and patrimony. For sure, 51% of the
equity of the MHC comes within the purview of the constitutional shelter for it
comprises the majority and controlling stock, so that anyone who acquires or
owns the 51% will have actual control and management of the hotel. In this
instance, 51% of the MHC cannot be disassociated from the hotel and the
land on which the hotel edifice stands. Consequently, we cannot sustain
respondents claim that the Filipino First Policy provision is not
applicable since what is being sold is only 51% of the outstanding shares of
the corporation, not the Hotel building nor the land upon which the building
stands.[38]

The argument is pure sophistry. The term qualified Filipinos as used in our
Constitution also includes corporations at least 60% of which is owned by
Filipinos. This is very clear from the proceedings of the 1986 Constitutional
Commission -
THE PRESIDENT. Commissioner Davide is recognized.
MR. DAVIDE. I would like to introduce an amendment to the Nolledo amendment. And
the amendment would consist in substituting the words QUALIFIED FILIPINOS
with the following: CITIZENS OF THE PHILIPPINES OR CORPORATIONS OR
ASSOCIATIONS WHOSE CAPITAL OR CONTROLLING STOCK IS WHOLLY
OWNED BY SUCH CITIZENS.

xxxx
MR. MONSOD. Madam President, apparently the proponent is agreeable, but we have
to raise a question. Suppose it is a corporation that is 80-percent Filipino, do we
not give it preference?
MR. DAVIDE. The Nolledo amendment would refer to an individual Filipino. What
about a corporation wholly owned by Filipino citizens?
MR. MONSOD. At least 60 percent, Madam President.
MR. DAVIDE. Is that the intention?
MR. MONSOD. Yes, because, in fact, we would be limiting it if we say that the
preference should only be 100-percent Filipino.
MR. DAVIDE. I want to get that meaning clear because QUALIFIED FILIPINOS may
refer only to individuals and not to juridical personalities or entities.
MR. MONSOD. We agree, Madam President.[39]
xxxx
MR. RODRIGO. Before we vote, may I request that the amendment be read again.
MR. NOLLEDO. The amendment will read: IN THE GRANT OF RIGHTS, PRIVILEGES
AND CONCESSIONS COVERING THE NATIONAL ECONOMY AND
PATRIMONY, THE STATE SHALL GIVE PREFERENCE TO QUALIFIED
FILIPINOS. And the word Filipinos here, as intended by the proponents, will
include not only individual Filipinos but also Filipino-controlled entities or entities
fully-controlled by Filipinos.[40]

The phrase preference to qualified Filipinos was explained thus -

MR. FOZ. Madam President, I would like to request Commissioner Nolledo to please
restate his amendment so that I can ask a question.
MR. NOLLEDO. IN THE GRANT OF RIGHTS, PRIVILEGES AND CONCESSIONS
COVERING THE NATIONAL ECONOMY AND PATRIMONY, THE STATE SHALL
GIVE PREFERENCE TO QUALIFIED FILIPINOS.
MR. FOZ. In connection with that amendment, if a foreign enterprise is qualified and a
Filipino enterprise is also qualified, will the Filipino enterprise still be given a
preference?
MR. NOLLEDO. Obviously.
MR. FOZ. If the foreigner is more qualified in some aspects than the Filipino enterprise,
will the Filipino still be preferred?
MR. NOLLEDO. The answer is yes.
 MR. FOZ. Thank you.[41]

Expounding further on the Filipino First Policy provision Commissioner

Nolledo continues
MR. NOLLEDO. Yes, Madam President. Instead of MUST, it will be SHALL - THE
STATE SHALL GIVE PREFERENCE TO QUALIFIED FILIPINOS. This embodies
the so-called Filipino First policy.That means that Filipinos should be given
preference in the grant of concessions, privileges and rights covering the national
patrimony.[42]
The exchange of views in the sessions of the Constitutional Commission
regarding the subject provision was still further clarified by Commissioner
Nolledo - [43]

Paragraph 2 of Section 10 explicitly mandates the Pro-Filipino bias in all economic

concerns. It is better known as the FILIPINO FIRST Policy x x x x This provision
was never found in previous Constitutions x x x x

The term qualified Filipinos simply means that preference shall be given to those
citizens who can make a viable contribution to the common good, because of credible
competence and efficiency. It certainly does NOT mandate the pampering and
preferential treatment to Filipino citizens or organizations that are incompetent or
inefficient, since such an indiscriminate preference would be counterproductive and
inimical to the common good.

In the granting of economic rights, privileges, and concessions, when a choice has to
be made between a qualified foreigner and a qualified Filipino, the latter shall be
chosen over the former.

Lastly, the word qualified is also determinable. Petitioner was so

considered by respondent GSIS and selected as one of the qualified
bidders. It was pre-qualified by respondent GSIS in accordance with its own
guidelines so that the sole inference here is that petitioner has been found to
be possessed of proven management expertise in the hotel industry, or it has
significant equity ownership in another hotel company, or it has an overall
management and marketing proficiency to successfully operate the Manila
Hotel.[44]

The penchant to try to whittle away the mandate of the Constitution by

arguing that the subject provision is not self-executory and requires
implementing legislation is quite disturbing.The attempt to violate a clear
constitutional provision - by the government itself - is only too distressing. To
adopt such a line of reasoning is to renounce the duty to ensure faithfulness to
the Constitution. For, even some of the provisions of the Constitution which
evidently need implementing legislation have juridical life of their own and can
be the source of a judicial remedy. We cannot simply afford the government a
defense that arises out of the failure to enact further enabling, implementing or
guiding legislation. In fine, the discourse of Fr. Joaquin G. Bernas, S.J., on
constitutional government is apt -

The executive department has a constitutional duty to implement laws, including the
Constitution, even before Congress acts - provided that there are discoverable legal
standards for executive action. When the executive acts, it must be guided by its own
understanding of the constitutional command and of applicable laws. The
responsibility for reading and understanding the Constitution and the laws is not the
sole prerogative of Congress. If it were, the executive would have to ask Congress, or
perhaps the Court, for an interpretation every time the executive is confronted by a
constitutional command. That is not how constitutional government operates. [45]

Respondents further argue that the constitutional provision is addressed to

the State, not to respondent GSIS which by itself possesses a separate and
distinct personality. This argument again is at best specious. It is undisputed
that the sale of 51% of the MHC could only be carried out with the prior
approval of the State acting through respondent Committee on
Privatization. As correctly pointed out by Fr. Joaquin G. Bernas, S.J., this fact
alone makes the sale of the assets of respondents GSIS and MHC a state
action. In constitutional jurisprudence, the acts of persons distinct from the
government are considered state action covered by the Constitution (1) when
the activity it engages in is a public function; (2) when the government is so
significantly involved with the private actor as to make the government
responsible for his action; and, (3) when the government has approved or
authorized the action. It is evident that the act of respondent GSIS in selling
51% of its share in respondent MHC comes under the second and third
categories of state action. Without doubt therefore the transaction, although
entered into by respondent GSIS, is in fact a transaction of the State and
therefore subject to the constitutional command. [46]

When the Constitution addresses the State it refers not only to the people
but also to the government as elements of the State. After all, government is
composed of three (3) divisions of power - legislative, executive and
judicial. Accordingly, a constitutional mandate directed to the State is
correspondingly directed to the three (3) branches of government. It is
undeniable that in this case the subject constitutional injunction is addressed
among others to the Executive Department and respondent GSIS, a
government instrumentality deriving its authority from the State.
 It should be stressed that while the Malaysian firm offered the higher bid it
is not yet the winning bidder. The bidding rules expressly provide that the
highest bidder shall only be declared the winning bidder after it has negotiated
and executed the necessary contracts, and secured the requisite
approvals. Since the Filipino First Policy provision of the Constitution bestows
preference on qualified Filipinos the mere tending of the highest bid is not an
assurance that the highest bidder will be declared the winning
bidder. Resultantly, respondents are not bound to make the award yet, nor are
they under obligation to enter into one with the highest bidder. For in choosing
the awardee respondents are mandated to abide by the dictates of the 1987
Constitution the provisions of which are presumed to be known to all the
bidders and other interested parties.
Adhering to the doctrine of constitutional supremacy, the subject
constitutional provision is, as it should be, impliedly written in the bidding rules
issued by respondent GSIS, lest the bidding rules be nullified for being
violative of the Constitution. It is a basic principle in constitutional law that all
laws and contracts must conform with the fundamental law of the land.Those
which violate the Constitution lose their reason for being.
Paragraph V. J. 1 of the bidding rules provides that [i]f for any reason the
Highest Bidder cannot be awarded the Block of Shares, GSIS may offer this to
other Qualified Bidders that have validly submitted bids provided that these
Qualified Bidders are willing to match the highest bid in terms of price per
share. Certainly, the constitutional mandate itself is reason enough not to
[47]

award the block of shares immediately to the foreign bidder notwithstanding

its submission of a higher, or even the highest, bid. In fact, we cannot
conceive of a strongerreason than the constitutional injunction itself.
In the instant case, where a foreign firm submits the highest bid in a public
bidding concerning the grant of rights, privileges and concessions covering
the national economy and patrimony, thereby exceeding the bid of a Filipino,
there is no question that the Filipino will have to be allowed to match the bid of
the foreign entity. And if the Filipino matches the bid of a foreign firm the
award should go to the Filipino. It must be so if we are to give life and
meaning to the Filipino First Policy provision of the 1987 Constitution. For,
while this may neither be expressly stated nor contemplated in the bidding
rules, the constitutional fiat is omnipresent to be simply disregarded. To ignore
it would be to sanction a perilous skirting of the basic law.
This Court does not discount the apprehension that this policy may
discourage foreign investors. But the Constitution and laws of the Philippines
are understood to be always open to public scrutiny. These are given factors
which investors must consider when venturing into business in a foreign
jurisdiction. Any person therefore desiring to do business in the Philippines or
with any of its agencies or instrumentalities is presumed to know his rights
and obligations under the Constitution and the laws of the forum.
The argument of respondents that petitioner is now estopped from
questioning the sale to Renong Berhad since petitioner was well aware from
the beginning that a foreigner could participate in the bidding is
meritless. Undoubtedly, Filipinos and foreigners alike were invited to the
bidding. But foreigners may be awarded the sale only if no Filipino qualifies, or
if the qualified Filipino fails to match the highest bid tendered by the foreign
entity. In the case before us, while petitioner was already preferred at the
inception of the bidding because of the constitutional mandate, petitioner had
not yet matched the bid offered by Renong Berhad. Thus it did not have the
right or personality then to compel respondent GSIS to accept its earlier
bid. Rightly, only after it had matched the bid of the foreign firm and the
apparent disregard by respondent GSIS of petitioners matching bid did the
latter have a cause of action.
Besides, there is no time frame for invoking the constitutional safeguard
unless perhaps the award has been finally made. To insist on selling the
Manila Hotel to foreigners when there is a Filipino group willing to match the
bid of the foreign group is to insist that government be treated as any other
ordinary market player, and bound by its mistakes or gross errors of judgment,
regardless of the consequences to the Filipino people. The miscomprehension
of the Constitution is regrettable. Thus we would rather remedy the
indiscretion while there is still an opportunity to do so than let the government
develop the habit of forgetting that the Constitution lays down the basic
conditions and parameters for its actions.
Since petitioner has already matched the bid price tendered by Renong
Berhad pursuant to the bidding rules, respondent GSIS is left with no
alternative but to award to petitioner the block of shares of MHC and to
execute the necessary agreements and documents to effect the sale in
accordance not only with the bidding guidelines and procedures but with the
Constitution as well. The refusal of respondent GSIS to execute the
corresponding documents with petitioner as provided in the bidding rules after
the latter has matched the bid of the Malaysian firm clearly constitutes grave
abuse of discretion.
The Filipino First Policy is a product of Philippine nationalism. It is
embodied in the 1987 Constitution not merely to be used as a guideline for
future legislation but primarily to be enforced; so must it be enforced. This
Court as the ultimate guardian of the Constitution will never shun, under any
reasonable circumstance, the duty of upholding the majesty of the
Constitution which it is tasked to defend. It is worth emphasizing that it is not
the intention of this Court to impede and diminish, much less undermine, the
influx of foreign investments. Far from it, the Court encourages and welcomes
more business opportunities but avowedly sanctions the preference for
Filipinos whenever such preference is ordained by the Constitution.The
position of the Court on this matter could have not been more appropriately
articulated by Chief Justice Narvasa -

As scrupulously as it has tried to observe that it is not its function to substitute its
judgment for that of the legislature or the executive about the wisdom and feasibility
of legislation economic in nature, the Supreme Court has not been spared criticism for
decisions perceived as obstacles to economic progress and development x x x x in
connection with a temporary injunction issued by the Courts First Division against the
sale of the Manila Hotel to a Malaysian Firm and its partner, certain statements were
published in a major daily to the effect that that injunction again demonstrates that the
Philippine legal system can be a major obstacle to doing business here.

Let it be stated for the record once again that while it is no business of the Court to
intervene in contracts of the kind referred to or set itself up as the judge of whether
they are viable or attainable, it is its bounden duty to make sure that they do not
violate the Constitution or the laws, or are not adopted or implemented with grave
abuse of discretion amounting to lack or excess of jurisdiction. It will never shirk that
duty, no matter how buffeted by winds of unfair and ill-informed criticism. [48]

Privatization of a business asset for purposes of enhancing its business

viability and preventing further losses, regardless of the character of the asset,
should not take precedence over non-material values. A commercial, nay
even a budgetary, objective should not be pursued at the expense of national
pride and dignity. For the Constitution enshrines higher and nobler non-
material values. Indeed, the Court will always defer to the Constitution in the
proper governance of a free society; after all, there is nothing so sacrosanct in
any economic policy as to draw itself beyond judicial review when the
Constitution is involved. [49]

Nationalism is inherent in the very concept of the Philippines being a

democratic and republican state, with sovereignty residing in the Filipino
people and from whom all government authority emanates. In nationalism, the
happiness and welfare of the people must be the goal. The nation-state can
have no higher purpose. Any interpretation of any constitutional provision
must adhere to such basic concept. Protection of foreign investments, while
laudible, is merely a policy. It cannot override the demands of nationalism. [50]

The Manila Hotel or, for that matter, 51% of the MHC, is not just any
commodity to be sold to the highest bidder solely for the sake of
privatization. We are not talking about an ordinary piece of property in a
commercial district. We are talking about a historic relic that has hosted many
of the most important events in the short history of the Philippines as a
nation. We are talking about a hotel where heads of states would prefer to be
housed as a strong manifestation of their desire to cloak the dignity of the
highest state function to their official visits to the Philippines. Thus the Manila
Hotel has played and continues to play a significant role as an authentic
repository of twentieth century Philippine history and culture. In this sense, it
has become truly a reflection of the Filipino soul - a place with a history of
grandeur; a most historical setting that has played a part in the shaping of a
country.[51]

This Court cannot extract rhyme nor reason from the determined efforts of
respondents to sell the historical landmark - this Grand Old Dame of hotels in
Asia - to a total stranger. For, indeed, the conveyance of this epic exponent of
the Filipino psyche to alien hands cannot be less than mephistophelian for it
is, in whatever manner viewed, a veritable alienation of a nations soul for
some pieces of foreign silver. And so we ask: What advantage, which cannot
be equally drawn from a qualified Filipino, can be gained by the Filipinos if
Manila Hotel - and all that it stands for - is sold to a non-Filipino? How much of
national pride will vanish if the nations cultural heritage is entrusted to a
foreign entity? On the other hand, how much dignity will be preserved and
realized if the national patrimony is safekept in the hands of
a qualified, zealous and well-meaning Filipino? This is the plain and simple
meaning of the Filipino First Policy provision of the Philippine
Constitution. And this Court, heeding the clarion call of the Constitution and
accepting the duty of being the elderly watchman of the nation, will continue to
respect and protect the sanctity of the Constitution.
WHEREFORE, respondents GOVERNMENT SERVICE INSURANCE
SYSTEM, MANILA HOTEL CORPORATION, COMMITTEE ON
PRIVATIZATION and OFFICE OF THE GOVERNMENT CORPORATE
COUNSEL are directed to CEASE and DESIST from selling 51% of the
shares of the Manila Hotel Corporation to RENONG BERHAD, and to
ACCEPT the matching bid of petitioner MANILA PRINCE HOTEL
CORPORATION to purchase the subject 51% of the shares of the Manila
Hotel Corporation at P44.00 per share and thereafter to execute the
necessary agreements and documents to effect the sale, to issue the
necessary clearances and to do such other acts and deeds as may be
necessary for the purpose.
SO ORDERED.

West tower Condominum Corp v First Philippine Industrial Corp (G.R. No.
194239 May 31 2011 & Nov. 21 2011)

G.R. No. 194239 June 16, 2015

WEST TOWER CONDOMINIUM CORPORATION, on behalf of the Residents of West Tower

Condominium and in representation of Barangay Bangkal, and others, including minors and
generations yet unborn,Petitioners,
vs.
FIRST PHILIPPINE INDUSTRIAL CORPORATION, FIRST GEN CORPORATION and their
RESPECTIVE BOARD OF DIRECTORS AND OFFICERS, JOHN DOES, and RICHARD
DOES, Respondents.

DECISION

VELASCO, JR., J.:

Nature of the Case

Before the Court is the Petition for the Issuance of a Writ of Kalikasan filed following the leak in the
oil pipeline owned by First Philippine Industrial Corporation (FPIC) in Makati City. The Facts

Respondent FPI C operates two pipelines since 1969, viz: ( 1) the White Oil Pipeline (WOPL)
System, which covers a 117-kilometer stretch from Batangas to the Pandacan Terminal in Manila
and transports diesel, gasoline, jet fuel and kerosene; and (b) the Black Oil Pipeline (BOPL) System
which extends 105 kilometers and transports bunker fuel from Batangas to a depot in Sucat,
Parañaque. These systems transport nearly 60% of the petroleum requirements of Metro Manila and
parts of the provinces of Bulacan, Laguna, and Rizal.

The two pipelines were supposedly designed to provide more than double the standard safety
allowance against leakage, considering that they are made out of heavy duty steel that can
withstand more than twice the current operating pressure and are buried at a minimum depth of 1.5
meters, which is deeper than the US Department of Transportation standard of 0.9 meters. In May
2010, however, a leakage from one of the pipelines was suspected after the residents of West
Tower Condominium (West Tower) started to smell gas within the condominium. A search made on
July 10, 2010 within the condominium premises led to the discovery of a fuel leak from the wall of its
Basement 2. Owing to its inability to control the flow, West Tower's management reported the matter
to the Police Department of Makati City, which in turn called the city's Bureau of Fire Protection.

What started as a two-drum leak at the initial stages became a 15-20 drum a day affair. Eventually,
the sump pit of the condominium was ordered shut down by the City of Makati to prevent the
discharge of contaminated water into the drainage system of Barangay Bangkal. Eventually, the
fumes compelled the residents of West Tower to abandon their respective units on July 23, 2010
and the condo's power was shut down.

Petitioner FPIC initially disowned any leak from its oil pipeline. Thus, the residents of West Tower
shouldered the expenses of hauling the waste water from its basement, which eventually required
the setting up of a treatment plant in the area to separate fuel from the waste water. On October 28,
2010, the University of the Philippines-National Institute of Geological Sciences (UP-NIGS), which
the City of Makati invited to determine the source of the fuel, found a leak in FPIC's WOPL about 86
meters from West Tower.

A day after, or on October 29, 2010, FPIC admitted that indeed the source of the fuel leak is the
WOPL, which was already closed since October 24, 2010, but denied liability by placing blame on
the construction activities on the roads surrounding West Tower.

On November 15, 2010, West Tower Condominium Corporation (West Tower Corp.) interposed the
present Petition for the Issuance of a Writ of Kalikasan on behalf of the residents of West Tower and
in representation of the surrounding communities in Barangay Bangkal, Makati City. West Tower
Corp. also alleged that it is joined by the civil society and several people's organizations, non-
governmental organizations and public interest groups who have expressed their intent to join the
suit because of the magnitude of the environmental issues involved.1

In their petition, petitioners prayed that respondents FPIC and its board of directors and officers, and
First Gen Corporation (FGC) and its board of directors and officers be directed to: (1) permanently
cease and desist from committing acts of negligence in the performance of their functions as a
common carrier; (2) continue to check the structural integrity of the whole 117-kilometer pipeline and
to replace the same; (3) make periodic reports on their findings with regard to the 117-kilometer
pipeline and their replacement of the same; (4) rehabilitate and restore the environment, especially
Barangay Bangkal and West Tower, at least to what it was before the signs of the leak became
manifest; and (5) to open a special trust fund to answer for similar and future contingencies in the
future. Furthermore, petitioners pray that respondents be prohibited from opening the pipeline and
allowing the use thereof until the same has been thoroughly checked and replaced, and be
temporarily restrained from operating the pipeline until the final resolution of the case.

To bolster their petition, petitioners argued that FPIC's omission or failure to timely replace. its
pipelines and to observe extraordinary diligence caused the petroleum spill in the City of Makati.
Thus, for petitioners, the continued use of the now 4 7-year old pipeline would not only be a hazard
or a threat to the lives, health, and property of those who live or sojourn in all the municipalities in
which the pipeline is laid, but would also affect the rights of the generations yet unborn to live in a
balanced and "healthful ecology," guaranteed under Section 16, Article II of the 1987 Constitution.

On November 19, 2010, the Court issued the Writ of Kalikasan2 with a Temporary Environmental
Protection Order (TEPO) requiring respondents FPIC, FGC, and the members of their Boards of
Directors to file their respective verified returns. The TEPO enjoined FPIC and FGC to: (a) cease
and desist from operating the WOPL until further orders; (b) check the structural integrity of the
whole span of the 11 7-kilometer WOPL while implementing sufficient measures to prevent and avert
any untoward incident that may result from any leak of the pipeline; and ( c) make a report thereon
within 60 days from receipt thereof.

In compliance with the writ, FPIC directors Edgar Chua, Dennis Javier, Dennis Gamab and Willie
Sarmiento submitted a Joint Return3 praying for the dismissal of the petition and the denial of the
privilege of the Writ of Kalikasan. They alleged that: petitioners had no legal capacity to institute the
petition; there is no allegation that the environmental damage affected the inhabitants of two (2) or
more cities or provinces; and the continued operation of the pipeline should be allowed in the
interest of maintaining adequate petroleum supply to the public.

Respondents FPIC and its directors and officers, other than the aforementioned four ( 4) directors,
also filed a Verified Return4 claiming that not all requirements for the issuance of the Writ of
Kalikasan are present and there is no showing that West Tower Corp. was authorized by all those it
claimed to represent. They further averred that the petition contains no allegation that respondents
FPIC directors and officers acted in such a manner as to allow the piercing of the corporate veil.

Meanwhile, on January 18, 201-1, FGC and the members of its Board of Directors and Officers filed
a Joint Compliance5 submitting the report required by the Writ of Kalikasan/TEPO. They contended
that they neither own nor operate the pipelines, adding that it is impossible for them to report on the
structural integrity of the pipelines, much less to cease and desist from operating them as they have
no capability, power, control or responsibility over the pipelines. They, thus, prayed that the
directives of the Writ of Kalikasan/TEPO be considered as sufficiently performed, as to them.

On January 21, 2011, FPIC, in compliance with the writ, submitted its 4-page "Report on Pipeline
Integrity Check and Preventive Maintenance Program."6 In gist, FPIC reported the following: (I) For
the structural integrity of the 117-kilometer pipeline, (a) the DOE engaged the services of UP-NIGS
to do borehole testing on 81 pre-identified critical areas of the WQPL in eight cities and
municipalities-all the boreholes showed negative presence of petroleum vapors; (b) pressure tests
were conducted after the repair of the leak and results showed negative leaks and the DOE's
pipeline expert, Societe General de Surveillance, New Zealand, has developed a pressure test
protocol requiring a 24-hour operation of running a scraper pig through the pipeline to eliminate air
gap; (c) In-Line Inspection Test, was conducted by NDT through MFL and ultrasonic. The NDT later
cleared the WOPL from any damage or corrosion.

(II) For preventive maintenance measures, (a) Cathodic Protection Systems are installed involving
the use of anode materials and the introduction of electric current in the pipeline to enhance
prevention of corrosion; (b) Regular Scraper Runs through the pipeline to maintain cleanliness and
integrity of the pipelines' internal surface; (c) Daily Patrols every two hours of the pipeline route to
deter unauthorized diggings in the vicinity of the pipeline segments; ( d) Regular coordination
meetings with DPWH, MMDA and utility companies to monitor projects that might involve digging or
excavation in the vicinity of the pipeline segments; (e) Installation of Security Warning Signs along
the pipeline route with toll free number which can be called in the event of an accident or
emergency; (f) Emergency Response Procedure of the ERT is activated by a call-out procedure; (g)
Maintenance of Emergency Equipment and Repair Kit which are always on standby; and, (h)
Remotely controlled Isolation Valves are in place to shut the pipeline when necessary.

On February 9, 2011, petitioners filed, and the Court eventually granted, their Motion to Set the Case
for Preliminary Conference and Hearing7 pursuant to Sec. 11, Rule 7 of the Rules of Procedure for
Environmental Cases.
On April 15, 2011, the Court conducted an ocular inspection of the WOPL in the vicinity of West
Tower to determine the veracity of the claim that there were two (2) additional leaks on FPIC's
pipeline. Results of the ocular inspection belied the claim.

In the meantime, petitioners also filed civil and criminal complaints against respondents arising from
the same incident or leakage from the WOPL.8

Since after the Court's issuance of the Writ of Kalikasan and the TEPO on November 19, 2010, FPIC
has ceased operations on both the WOPL and the BOPL. On May 31, 2011, however, the Court,
answering a query of the DOE, clarified and confirmed that what is covered by the Writ of Kalikasan
and TEPO is only the WOPL System of FPIC; thus, FPIC can resume operation of its BOPL
System.9

On July 7, 2011, petitioners filed an Omnibus Motion10 assailing the Court's May 31, 2011
Resolution, praying for the conduct of oral argument on the issue of reopening the BOPL System.
This was followed, on September 9, 2011, by a Manifestation (Re: Current Developments) with
Omnibus Motion11 wherein petitioners invoked the precautionary principle12 and asserted that the
possibility of a leak in the BOPL System leading to catastrophic environmental damage is enough
reason to order the closure of its operation. They likewise alleged that the entities contracted by
FPIC to clean and remediate the environment are illegally discharging waste water, which had not
undergone proper treatment, into the Parañaque River. Petitioners, thus, prayed that respondents be
directed to comply with environmental laws in rehabilitating the surroundings affected by the oil leak
and to submit a copy of their work plan and monthly reports on the progress thereof. To these
omnibus motions, respondents were directed to file their respective comments.

On September 28, 2011, respondent FPIC filed an Urgent Motion for Leave (To Undertake "Bangkal
Realignment" Project)13 in order to reduce stress on the WOPL System. FPIC sought to construct a
new realigned segment to replace the old pipe segment under the Magallanes Interchange, which
covers the portion that leaked. Petitioners were directed to file their comment on FPIC's motion.

Report and Recommendation of the Court of Appeals

To expedite the resolution of the controversy, the Court remanded the case to the Court of Appeals
(CA). By this Court's Resolution dated November 22, 2011,14 the appellate court was required to
conduct hearings and, thereafter, submit a report and recommendation within 30 days after the
receipt of the parties' memoranda.

On March 21, 2012, the preliminary conference was continued before the CA wherein the parties
made admissions and stipulations of facts and defined the issues for resolution. In view of the
technical nature of the case, the CA also appointed15 several amici curiae,16 but only four (4) filed
their reports.17

On December 26, 2012, the CA Former 11th Division submitted to the Court its well-crafted and
exhaustive 156-page Report and Recommendation18 dated December 21, 2012 (CA Report). Some
highlights of the Report:

1. Anent petitioners' June 28, 2011 Omnibus Motion assailing the reopening of the BOPL
System, the CA directed respondent FPIC to submit the appropriate certification from the
DOE as to the safe commercial operation of the BOPL; otherwise, the operation of the BOPL
must also be enjoined.
2. On petitioners' September 9, 2011 Manifestation (Re: Current Developments) with
Omnibus Motion, the CA directed the Inter-Agency Committee on Health to submit its
evaluation of the remediation plan prepared by CH2M Hill Philippines, Inc. for FPIC. Further,
the appellate court directed FPIC to strictly comply with the stipulations contained in the
permits issued by the Department of Environment and Natural Resources (DENR) for its
remediation activities in Barangay Bangkal, Makati City. The DENR was in turn directed by
the CA to:

(a) monitor compliance by respondent FPIC with applicable environmental laws and
regulations and conditions set forth in the permits issued;

(b) conduct independent analysis of end-products of the Multi-Phase Extraction

System;

(c) conduct regular consultative meetings with the City of Makati, residents of
Barangay Bangkal and other stakeholders concerning the remediation activities; and,

(d) evaluate the viability of the recommendation of amicus Dr. Benjamin R. De Jesus,
Jr. to include the use of surfactants and oxygen-releasing compounds (ORCs) in the
middle and terminal portions of the remediation plan.

3. Respondent's September 27, 2011 Urgent Motion for Leave (To Undertake "Bangkal
Realignment" Project) was denied.

4. With regard to the March 29, 2012 Supplemental Manifestation (Re: List of Amici Curiae
and Recent Possible Leak in the Pipeline) filed by petitioners, the CA found that the
existence of another possible leak alleged by petitioners was not established. Nonetheless,
to prevent such event, the CA ordered FPIC to: (i) review, adopt and strictly observe
appropriate safety and precautionary measures; (ii) closely monitor the conduct of its
maintenance and repair works; and (iii) submit to the DOE regular monthly reports on the
structural integrity and safe commercial operation of the pipeline.

5. As to the merits of the case, the CA submitted the following recommendations:

(a) That the people's organizations, non-governmental organizations, and public

interest groups that indicated their intention to join the petition and submitted proof of
juridical personality (namely: the Catholic Bishop's Conference of the Philippines;
Kilusang Makabansang Ekonomiya, Inc.; Women's Business Council of the
Philippines, Inc.; Junior Chambers International Philippines, Inc. - San Juan Chapter;
Zonta Club of Makati Ayala Foundations; and the Consolidated Mansions
Condominium Corporation) be allowed to be formally impleaded as petitioners.

(b) That respondent FPIC be ordered to submit a certification from the DOE
Secretary that the WOPL is already safe for commercial operation. The certification
should take into consideration the adoption by FPIC of the appropriate leak detection
system to be used in monitoring the entire pipeline's mass input versus mass output.
The certification must also consider the necessity of replacing the pipes with existing
patches and sleeves. In case of failure of respondent FPIC to submit the required
certification from the DOE Secretary within sixty (60) days from notice of the
Honorable Supreme Court's approval of this recommendation, the TEPO must be
made permanent.
 (c) That petitioners' prayer for the creation of a special trust fund to answer for similar
contingencies in the future be denied for lack of sufficient basis.

d) That respondent FGC be not held solidarily liable under the TEPO.

(e) That without prejudice to the outcome of the civil and criminal cases filed against
respondents, the individual directors and officers of FPIC and FGC be not held liable
in their individual capacities.

On January 11, 2013, petitioners filed their Motion for Partial Reconsideration19 of the CA's Report
praying that (a) instead of the DOE, the required certification should be issued by the DOST-Metal
Industry Research and Development Center; (b) a trust fund be created to answer for future
contingencies; and ( c) the directors and officers of FPIC and FGC be held accountable.

On January 25, 2013, FPIC filed its Compliance (Re: Department of Energy Certification on the
Black Oil Pipeline)20and submitted the required DOE Certification21 issued on January 22, 2013 by
DOE Secretary Carlos Jericho L. Petilla (Secretary Petilla). On March 14, 2013, petitioners
countered with a Manifestation with Motion22 asserting that FPIC's certification is not compliant with
the CA's requirement. Hence, petitioners moved that the certification should be disregarded, the 30-
day period be deemed to have lapsed, and FPIC be permanently enjoined from operating the BOPL.

On July 30, 2013, the Court issued a Resolution adopting the recommendation of the CA in its
Report and Recommendation that FPIC be ordered to secure a certification from the DOE Secretary
before the WOPL may resume its operations. The pertinent portion of said Resolution reads:

[FPIC] is hereby ORDERED to submit a certification from the DOE Secretary that the pipeline is
already safe for commercial operation. The certification should take into consideration the adoption
by FPIC of the appropriate leak detection system to be used in monitoring the entire pipeline's mass
input versus mass output. The certification must also consider the necessity of replacing the pipes
with existing patches and sleeves x x x.23

The DOE Secretary is DIRECTED to consult the [DOST] regarding the adoption of the appropriate
leak detection system and the necessity of replacing the pipes with existing patches and sleeves.

On October 2, 2013, petitioners, in a Motion for Reconsideration with Motion for Clarification,
emphasized that the CA found FPIC's tests and maintenance program to be insufficient and
inconclusive to establish the WOPL' s structural integrity for continued commercial
operation.24 Furthermore, petitioners point out that the DOE is biased and incapable of determining
the WOPL's structural integrity.

Respondents, for their part, maintain that the DOE has the technical competence and expertise to
assess the structural integrity of the WOPL and to certify the system's safety for commercial
operation.25 Respondents further allege that the DOE is the agency empowered to regulate the
transportation and distribution of petroleum products, and to regulate and monitor downstream oil
industry activities, including "product distribution" through pipelines.26

In compliance with the Court's July 30, 2013 Resolution, the DOE Secretary issued on October 25,
2013 a Certification,27 attesting that the WOPL is safe to resume commercial operations, subject to
monitoring or inspection requirements, and imposing several conditions that FPIC must comply with.
The Certification, in its entirety, reads:
This is to certify that based on the Pipeline Integrity Management Systems (PIMS) being
implemented by [FPIC] for its [WOPL] facility, the same is safe to resume commercial operations.
This certification is being issued after consultation with the [DOST] and on the basis of the following
considerations, to wit:

1. DOE noted the adoption by FPIC of the appropriate leak detection system to be used in
monitoring the pipeline's mass input versus mass output, as well as the other measures of
leak detection and prevention adopted by the latter;

2. DOE further noted that FPIC has already undertaken realignment and reinforcement
works on the current pipeline to remove majority of the patches. FPIC has likewise presented
substantial and adequate documentation showing that the remaining patches and sleeves
are safe, and that the use of such is recognized by the industry and complies with existing
standards;

3. DOE finally noted the results of various tests and inspections done on the pipeline as
indicated in the Manifestation submitted by ,the DOE on March 31, 2012, in the civil case
docketed as CA GR SP No. 00008 and entitled West Tower Condominium, et al. [v.] First
Philippine Industrial Corporation, et al.

This certification is being issued subject to the condition that FPIC will submit itself to regular
monitoring and validation by the Oil Industry Management Bureau (OIMB) of the implementation of
its PIMS, particularly on the following: (a) mass or volume input versus mass or volume output
loss/gain accounting; (b) results of borehole monitoring, (c) inspection of the pipeline cathodic
protection and (d) pressure test.

Further, FPIC shall submit itself to any test or inspection that the DOE and DOST may deem
appropriate for purposes of monitoring the operations of the WOPL facility.

The Court is fully cognizant of the WOPL' s value in commerce and the adverse effects of a
prolonged closure thereof. Nevertheless, there is a need to balance the necessity of the immediate
reopening of the WOPL with the more important need to ensure that it is sound for continued
operation, since the substances it carries pose a significant hazard to the surrounding population
and to the environment.28 A cursory review of the most recent oil pipeline tragedies around the world
will readily show that extreme caution should be exercised in the monitoring and operation of these
common carriers:

(1) On August 1, 2014, a series of powerful explosions from underground pipeline systems
ripped up the streets of Kaohsiung, Taiwan, killing at least 28 people and injuring 299 more.
Further, 23 ,600, 2,268 and 6,000 households were left without gas, power and water,
respectively, in the 2-3 square kilometer blast area.29

(2) On November 22, 2013, an oil pipeline leaked, caught fire, and exploded in Qingdao,
Shangdao Province in China, killing 55 people and injuring more than a hundred more.30

(3) On September 14, 2011, a fuel pipeline exploded in Kenya's capital city, Nairobi,
reducing bodies to dust and flattening homes. At least 7 5 people died in the explosion, while
more than a hundred people were injured.31

(4) In September 2010, a natural gas pipeline ruptured and set off a fireball, killing eight (8)
people and leveling 3 8 homes in San Bruno, California in the United States.32
 (5) On July 30, 2004, a rupture of an underground natural gas pipeline buried six (6) meters
in Ghislenghien, Belgium resulted in 24 deaths and over 120 injuries.33

On April 29 and 30, 2014, the DOE organized a dialogue between said government agencies and
the FPIC. There it was stated that during the dialogue, "the division heads and a high profile team
from FPIC, both from operation and management made presentations and answered questions on
pipeline pumping operation and product delivery, and a detailed explanation of the FPIC PIMS'
control measures, condition monitoring measures, and emergency measures, as well as its various
activities and projects implemented since 2010 such as pipeline replacement and realignment in
Pandacan and Bangkal, inspection and reinforcement of all patches in the WOPL, inspection and
reinforcement of a number of reported dents in the WOPL, conduct of successful leak tests, and
installation of boreholes that are gas-tested on a weekly basis, and the safety systems that go with
the daily pipeline operation and maintenance and project execution."34

On August 5, 2014, Secretary Carlos Jericho L. Petilla of the DOE submitted a letter35 recommending
activities and timetable for the resumption of the WOPL operations, to wit:

A. Preparatory to the Test Run

I. FPIC Tasks:

a. Continue submission of monitoring charts, data/reading, accomplishment reports, and

project status for all related activities/works. Respond to comments and prepare for site
inspection.

b. Continue gas testing along the right-of-way using the monitoring wells or boreholes.
Prepare for inspection of right-of-way and observation of gas testing activities on monitoring
wells and boreholes.

c. Expound on the selection of borehole location. For example, identify those located in
pipeline bends, bodies of water, residential areas, repaired portions of the pipelines, dents
and welded joints.

d. Continue submitting status report relating to "Project Mojica" (an ongoing pipeline segment
realignment activity undertaken by FPIC to give way to a flood control project of MMDA in the
vicinity of Mojica St. and Pres. Osmeña Highway in Makati City). Prepare for site inspection.

II. Inter-agency undertaking:

a. Conduct onsite inspection of right-of-way

b. Review/check remaining 22 patches that were already inspected and reinforced with
Clockspring sleeves.

i. Determine location of sleeves.

ii. Review of procedures on repair of sleeves.

iii. Random visual inspection of areas easily accessible.

c. Cathodic protection's onsite inspection on rectifier to check readings

 i. Old readings

ii. Current Readings

iii. Segment covered

iv. Criteria for prioritization for corrective action

d. Observe and witness the running/operation of the cleaning pig.

e. Check and validate all calibration certificate of instruments

i. Instrument verification and calibration.

B. Actual Test Run (to be undertaken both by FPIC and inter-agency)

a. Perform Cleaning Pig Run

i. Witness launching and receiving of the cleaning pig.

ii. Handling of the residuals after cleaning.

b. Demonstrate Various Pressure Tests (already being conducted by FPIC)

i. Blocked-in pressure test (Leak Test, not in operation)

ii. In-operation (hourly reading)

c. Continue Current Gas Monitoring (boreholes)

i. Ocular inspection of selected areas

d. Demonstrate mass or volume balance computation during WOPL test run (already being
implemented in the BOPL)

i. 30 days baseline data generation

ii. 30 days computational analysis and monitoring

C. Commissioning or Return to Commercial Operation

I. FPIC Tasks:

a. Continue implementation of the PIMS. Review recommendations from DOE.

b. Continue monthly reporting of operations and maintenance activities with DOE.

c. Continue reporting and coordination with DOE and other government agencies for
implementation of projects.36
Secretary Petilla also recounted to the Court in his August 5, 2014 letter that the DOE, together with
the DPWH and the Metropolitan Manila Development Authority (MMDA), observed the different
milestones of the realignment project being undertaken by FPIC in support of the MMDA Flood
Control Project and stated that the new line segment as laid was coated with corrosion protection
prior to the backfilling of the excavated portion.

On February 3, 2015, the Court required the parties to submit their comment on Sec. Petilla's letter
within ten (10) days from receipt of the Resolution. On various dates, respondents First Gen
Corporation, FPIC, and petitioner West Tower filed their respective comments37 in compliance with
the Court's resolution. The intervenors were unable to comply with the Court's directive; hence, they
are deemed to have waived their right to file their respective comments. The Issues

Having received the October 25, 2013 Certification and the August 5, 2014 Letter from the DOE on
the state of the WOPL, as well as the parties' comments thereon, the following issues defined by the
parties during the March 21, 2012 preliminary conference are now ripe for adjudication:

1. Whether petitioner West Tower Corp. has the legal capacity to represent the other
petitioners and whether the other petitioners, apart from the residents of West Tower and
Barangay Bangkal, are real parties-in-interest;

2. Whether a Permanent Environmental Protection Order should be issued to direct the

respondents to perform or to desist from performing acts in order to protect, preserve, and
rehabilitate the affected environment;

3. Whether a special trust fund should be opened by respondents to answer for future similar
contingencies; and

4. Whether FGC and the directors and officers of respondents FPIC and FGC may be held
liable under the environmental protection order.38

The Court's Ruling

We adopt, with modifications, the recommendations of the CA and discuss the foregoing issues in
seriatim.

I.
Petitioners as Real Parties-in-Interest

On the procedural aspect, We agree with the CA that petitioners who are affected residents of West
Tower and Barangay Bangkal have the requisite concern to be real parties-in-interest to pursue the
instant petition.

Residents of West Tower and Barangay Bangkal

As defined, a real party-in-interest is 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.39 Generally, every action must be prosecuted
or defended in the name of the real parties-in-interest.40 In other words, the action must be brought
by the person who, by substantive law, possesses the right sought to be enforced.41 Alternatively,
one who has no right or interest to protect cannot invoke the jurisdiction of the court as party-plaintiff-
in-action for it is jurisprudentially ordained that every action must be prosecuted or defended in the
name of the real party-in-interest.42
In the case at bar, there can be no quibble that the oil leak from the WOPL affected all the
condominium unit owners and residents of West Tower as, in fact, all had to evacuate their units at
the wee hours in the morning of July 23, 2010, when the condominium's electrical power was shut
down. Until now, the unit owners and residents of West Tower could still not return to their
condominium units. Thus, there is no gainsaying that the residents of West Tower are real parties-in-
interest.

There can also be no denying that West Tower Corp. represents the common interest of its unit
owners and residents, and has the legal standing to file and pursue the instant petition. While a
condominium corporation has limited powers under RA 4 726, otherwise known as The
Condominium Act,43 it is empowered to pursue actions in behalf of its members. In the instant case,
the condominium corporation .is the management body of West Tower and deals with everything
that may affect some or all of the condominium unit owners or users.

It is of no moment that only five residents of West Tower signed their acquiescence to the filing of
the petition for the issuance of the Writ of Kalikasan, as the merits of such petition is, as aptly put by
the CA, not measured by the number of persons who signified their assent thereto, but on the
existence of a prima facie case of a massive environmental disaster.

Moreover, the fact that no board resolution was submitted by West Tower Corp. authorizing Manuel
Dy Chuaunsu, Jr. to sign the Verification and Certification of Non-forum Shopping is irrelevant. The
records show that petitioners submitted a notarized Secretary's Certificate44 attesting that the
authority of Chuaunsu to represent the condominium corporation in filing the petition is from the
resolution of the total membership of West Tower Corp. issued during their November 9, 2010
meeting with the requisite quorum. It is, thus, clear that it was not the Board of West Tower Corp.
which granted Chuaunsu the authority but the full membership of the condominium corporation itself.

As to the residents of Barangay Bangkal, they are similarly situated with the unit owners and
residents of West Tower and are real parties-in-interest to the instant case, i.e., if they so wish to join
the petitioners.

Organizations that indicated their intention to join the petition

and submitted proof of juridical personality

Anent the propriety of including the Catholic Bishops' Conference of the Philippines, Kilusang
Makabansang Ekonomiya, Inc., Women's Business Council of the Philippines, Inc., Junior Chambers
International Philippines, Inc. - San Juan Chapter, Zonta Club of Makati Ayala Foundations, and the
Consolidated Mansions Condominium Corporation, as petitioners in the case, the Court already
granted their intervention in the present controversy in the adverted July 30, 2013 Resolution.

This is so considering that the filing of a petition for the issuance of a writ of kalikasan under Sec. 1,
Rule 745 of the Rules of Procedure for Environmental Cases does not require that a petitioner be
directly affected by an environmental disaster. The rule clearly allows juridical persons to file the
petition on behalf of persons whose constitutional right to a balanced and healthful ecology is
violated, or threatened with violation.

Thus, as parties to the case, they are entitled to be furnished copies of all the submissions to the
Court, including the periodic reports of FPIC and the results of the evaluations and tests conducted
on the WOPL.
Having disposed of the procedural issue, We proceed to the bone of contention in the pending
motions. Suffice it to state in the outset that as regards the substantive issues presented, the Court,
likewise, concurs with the other recommendations of the CA, with a few modifications.

II.
Propriety of Converting the TEPO to PEPO or its Lifting in light of the

DOE Certification of the WOPL's Commercial Viability

To recall, petitioners' persistent plea is for the conversion of the November 19, 2010 TEPO into a
Permanent Environmental Protection Order (PEPO) pursuant to Sec. 3,46 Rule 5 of the Rules of
Procedure for Environmental Cases. For its part, respondent FPIC asserts that regular testing, as
well as the measures that are already in place, will sufficiently address any concern of oil leaks from
the WOPL.

With respect to leak detection, FPIC claims that it has in place the following systems: (a) regular
cleaning scraper runs, which are done quarterly; (b) pipeline integrity gauge (PIG) tests/Intelligent
PIG, now known as in-line inspections (ILI), which is done every five years; (c) pressure monitoring
valves; and ( d) 24-hour patrols. Additionally, FPIC asserted that it also undertook the following: (a)
monitoring of wells and borehole testing/vapor tests; (b) leak tightness test, also known as segment
pressure test; (c) pressure-controlled test; (d) inspection and reinforcement of patches; (e)
inspection and reinforcement of dents; and (f) Pandacan segment replacement.47Furthermore, in
August 2010, with the oil leak hogging the headlines, FPIC hired NDT Middle East FZE (NDT) to
conduct ILI inspections through magnetic flux leakage (MFL) and ultrasonic tests to, respectively,
detect wall thinning of the pipeline and check it for cracks.

The CA, however, observed that all of these tests and measures are inconclusive and insufficient for
purposes of leak detection and pipeline integrity maintenance. Hence, considering the necessary
caution and level of assurance required to ensure that the WOPL system is free from leaks and is
safe for commercial operation, the CA recommended that FPIC obtain from the DOE a certification
that the WOPL is already safe for commercial operation. This certification, according to the CA, was
to be issued with due consideration of the adoption by FPIC of the appropriate leak detection
systems to monitor sufficiently the entire WOPL and the need to replace portions of the pipes with
existing patches and sleeves. Sans the required certification, use of the WOPL shall remain abated.

The Court found this recommendation of the appellate court proper. Hence, We required FPIC to
obtain the adverted DOE Certification in Our July 30, 2013 Resolution. We deemed it proper to
require said certification from the DOE considering that the core issue of this case requires the
specialized knowledge and special expertise of the DOE and various other administrative agencies.
On October 25, 2013, the DOE submitted the certification pursuant to the July 30, 2013 Resolution
of the Court. Later, however, on August 5, 2014, DOE Secretary Carlos Jericho I. Petilla submitted a
letter recommending certain activities and the timetable for the resumption of the WOPL operations
after conducting a dialogue between the concerned government agencies and FPIC.

After a perusal of the recommendations of the DOE and the submissions of the parties, the Court
adopts the activities and measures prescribed in the DOE letter dated August 5, 2014 to be
complied with by FPIC as conditions for the resumption of the commercial operations of the WOPL.
The DOE should, therefore, proceed with the implementation of the tests proposed in the said
August 5, 2014 letter. Thereafter, if it is satisfied that the results warrant the immediate reopening of
the WOPL, the DOE shall issue an order allowing FPIC to resume the operation of the WOPL. On
the other hand, should the probe result in a finding that the pipeline is no longer safe for continued
use and that its condition is irremediable, or that it already exceeded its serviceable life, among
others, the closure of the WOPL may be ordered.

The DOE is specially equipped to consider FPIC's proper implementation and compliance with its
PIMS and to evaluate the result of the various tests conducted on the pipeline. The DOE is
empowered by Sec. 12(b)(l), RA 7638 to formulate and implement policies for the efficient and
economical "distribution, transportation, and storage of petroleum, coal, natural gas."48 Thus, it
cannot be gainsaid that the DOE possesses technical knowledge and special expertise with respect
to practices in the transportation of oil through pipelines.

Moreover, it is notable that the DOE did not only limit itself to the knowledge and proficiency
available within its offices, it has also rallied around the assistance of pertinent bureaus of the other
administrative agencies: the ITDI49of the DOST, which is mandated to undertake technical services
including standards, analytical and calibration services; the MIRDC,50 also of the DOST, which is the
sole government entity directly supporting the metals and engineering industry;51 the EMB52 of the
DENR, the agency mandated to implement, among others, RA 6969 (Toxic Substances and
Hazardous and Nuclear Waste Control Act of 1990) and RA 9275 (Philippine Clean Water Act of
2004); and the BOD of the DPWH, which is mandated to conduct, supervise, and review the
technical design aspects of projects of government agencies.53

The specialized knowledge and expertise of the foregoing agencies must, therefore, be availed of to
arrive at a judicious decision on the propriety of allowing the immediate resumption of the WOPL's
operation. In a host of cases, this Court held that when the adjudication of a controversy requires the
resolution of issues within the expertise of an administrative body, such issues must be investigated
and resolved by the administrative body equipped with the specialized knowledge and the technical
expertise.54 Hence, the courts, although they may have jurisdiction and power to decide cases, can
utilize the findings and recommendations of the administrative agency on questions that demand
"the exercise of sound administrative discretion requiring the special knowledge, experience, and
services of the administrative tribunal to determine technical and intricate matters of fact."55

Justice Leonen, in his dissent, is of the view that the petition should be denied and the TEPO
immediately lifted in light of the DOE's issuance of a certification attesting to the safety of the WOPL
for continued commercial operations, thereby rendering the instant petition moot and academic,
seeking, as it does, the checking of the pipeline's structural integrity. According to his dissent, the
writ of kalikasan issued by the Court has already served its functions and, therefore, is functus
officio. Moreover, he argues that directing the DOE and FPIC to repeat their previous procedures is
tantamount to doubting the agency's performance of its statutorily-mandated tasks, over which they
have the necessary expertise, and implies that said DOE certification is improper, a breach,
allegedly, of the principle of separation of powers.

He also contends that the majority ordered the repetition of the procedures and tests already
conducted on the WOPL because of the fear and uncertainty on its safeness despite the finding of
the DOE in favor of its reopening, taking into consideration the occurrence of numerous pipeline
incidents worldwide. The dissent argues that the precautionary principle should not be so strictly
applied as to unjustifiably deprive the public of the benefits of the activity to be inhibited, and to
unduly create other risks.

The dissent's contentions that the case is already moot and academic, that the writ of kalikasan has
already served its function, and that the delay in the lifting of the TEPO may do more harm than
good are anchored on the mistaken premise that the precautionary principle was applied in order to
justify the order to the DOE and the FPIC for the conduct of the various tests anew. The following
reasons easily debunk these arguments:
 1. The precautionary principle is not applicable to the instant case;

2. The DOE certification is not an absolute attestation as to the WOPL's structural integrity
and in fact imposes several conditions for FPIC's compliance;

3. The DOE itself, in consultation with FPIC and the other concerned agencies, proposed the
activities to be conducted preparatory to the reopening of the pipeline; and

4 . There are no conclusive findings yet on the WOPL's structural integrity.

Section 1, Rule 20 of A.M. No. 09-6-8-SC or the Rules of Procedure for Environmental Cases, on
the Precautionary Principle, provides that "[ w ]hen there is lack of full scientific certainty in
establishing a causal link between human activity and environmental effect, the court shall apply the
precautionary principle in resolving the case before it."

According to the dissent, the directive for the repetition of the tests is based on speculations, justified
by the application of said principle. This, however, is not the case. Nowhere did We apply the
precautionary principle in deciding the issue on the WOPL's structural integrity.

The precautionary principle only applies when the link between the cause, that is the human activity
sought to be inhibited, and the effect, that is the damage to the environment, cannot be established
with full scientific certainty. Here, however, such absence of a link is not an issue. Detecting the
existence of a leak or the presence of defects in the WOPL, which is the issue in the case at bar, is
different from determining whether the spillage of hazardous materials into the surroundings will
cause environmental damage or will harm human health or that of other organisms. As a matter of
fact, the petroleum leak and the harm that it caused to the environment and to the residents of the
affected areas is not even questioned by FPIC.

It must be stressed that what is in issue in the instant petition is the WOPL's compliance with
pipeline structure standards so as to make it fit for its purpose, a question of fact that is to be
determined on the basis of the evidence presented by the parties on the WOPL's actual state.
Hence, Our consideration of the numerous findings and recommendations of the CA, the DOE, and
the amici curiae on the WOPL' s present structure, and not the cited pipeline incidents as the dissent
propounds.

Consider also the fact that it is the DOE itself that imposed several conditions upon FPIC for the
resumption of the operations of the WOPL. This, coupled with the submission by the DOE of its
proposed activities and timetable, is a clear and unequivocal message coming from the DOE that the
WOPL's soundness for resumption of and continued commercial operations is not yet fully
determined. And it is only after an extensive determination by the DOE of the pipeline's actual
physical state through its proposed activities, and not merely through a short-form integrity
audit,56that the factual issue on the WOPL's viability can be settled. The issue, therefore, on the
pipeline's structural integrity has not yet been rendered moot and remains to be subject to this
Court's resolution. Consequently, We cannot say that the DOE's issuance of the certification
adverted to equates to the writ of kalikasan being functus officio at this point.

The dissent is correct in emphasizing that We defer to the findings of fact of administrative agencies
considering their specialized knowledge in their field. And We, as a matter of fact, acceded to the
DOE' s conclusions on the necessity of the conduct of the various activities and tests enumerated in
Sec. Petilla's letter to this Court dated August 5, 2014. Hence, Our directive for the DOE to
immediately commence the activities enumerated in said Letter, to determine the pipeline's reliability,
and to order its reopening should the DOE find that such is proper.
The dissent also loses sight of the fact that the petition not only seeks the checking of the WOPL's
structural integrity, but also prays for the rehabilitation of the areas affected by the leak, the creation
of a special trust fund, the imposition of liability upon the directors of FPIC, among others. These
issues, undoubtedly, are matters that are not addressed by the DOE certification alone.
Furthermore, these are issues that no longer relate to the WOPL' s structure but to its maintenance
and operations, as well as to the residues of the incident. It will, thus, be improper for Us to simply
dismiss the petition on the basis solely of the alleged resolution of only one of several issues, which
purportedly renders the issue on the WOPL' s soundness moot, without disposing of the other issues
presented.

Lastly, any delay in the reopening of the WOPL, if said delay is for the purpose of making sure that
the pipeline is commercially viable, is better than hastily allowing its reopening without an extensive
check on its structural integrity when experience shows that there were and may still be flaws in the
pipeline. Even the DOE, the agency tasked to oversee the supply and distribution of petroleum in the
country, is well aware of this and even recommended the checking of the patched portions of the
pipeline, among others. In this regard, the Court deems it best to take the necessary safeguards,
which are not similar to applying the precautionary principle as previously explained, in order to
prevent a similar incident from happening in the future.

III.
Propriety of the Creation of a Special Trust Fund

Anent petitioners' prayer for the creation of a special trust fund, We note that under Sec. 1, Rule 5 of
the Rules of Procedure for Environmental Cases, a trust fund is limited solely for the purpose of
rehabilitating or restoring the environment. Said proviso pertinently provides:

SEC. 1. Reliefs in a citizen suit. - If warranted, the court may grant to the plaintiff proper reliefs which
shall include the protection, preservation or rehabilitation of the environment and the payment of
attorney's fees, costs of suit and other litigation expenses. It may also require the violator to submit a
program of rehabilitation or restoration of the environment, the costs of which shall be borne by the
violator, or to contribute to a special trust fund for that purpose subject to the control of the court.
(emphasis supplied)

Furthermore, Sec. 15( e ), Rule 7 of the Rules of Procedure for Environmental Cases expressly
prohibits the grant of damages to petitioners in a petition for the issuance of a writ of kalikasan, viz:

Section 15. Judgment. - Within sixty (60) days from the time the petition is submitted for decision,
the court shall render judgment granting or denying the privilege of the writ of kalikasan.

The reliefs that may be granted under the writ are the following:

xxxx

(e) Such other reliefs which relate to the right of the people to a balanced and healthful ecology or to
the protection, preservation, rehabilitation or restoration of the environment, except the award of
damages to individual petitioners.

A reading of the petition and the motion for partial reconsideration readily reveals that the prayer is
for the creation of a trust fund for similar future contingencies. This is clearly outside the limited
purpose of a special trust fund under the Rules of Procedure for Environmental Cases, which is to
rehabilitate or restore the environment that has presumably already suffered. Hence, the Court
affirms with concurrence the observation of the appellate court that the prayer is but a claim for
damages, which is prohibited by the Rules of Procedure for Environmental Cases. As such, the
Court is of the considered view that the creation of a special trust fund is misplaced. The present
ruling on petitioners' prayer for the creation of a special trust fund in the instant recourse, however, is
without prejudice to the judgment/s that may be rendered in the civil and/or criminal cases filed by
petitioners arising from the same incident if the payment of damages is found warranted.

IV.
Liability of FPIC, FGC and their respective Directors and Officers

On the last issue of the liability of FPIC, FGC and their respective directors and officers, the CA
found FGC not liable under the TEPO and, without prejudice to the outcome of the civil case (Civil
Case No. 11-256, RTC, Branch 58 in Makati City) and criminal complaint (Complaint-Affidavit for
Reckless Imprudence, Office of the Provincial Prosecutor of Makati City) filed against them, the
individual directors and officers of FPIC and FGC are not liable in their individual capacities.

The Court will refrain from ruling on the finding of the CA that the individual directors and officers of
FPIC and FGC are not liable due to the explicit rule in the Rules of Procedure for Environmental
cases that in a petition for a writ of kalikasan, the Court cannot grant the award of damages to
individual petitioners under Rule 7, Sec. 15(e) of the Rules of Procedure for Environmental Cases.
As duly noted by the CA, the civil case and criminal complaint filed by petitioners against
respondents are the proper proceedings to ventilate and determine the individual liability of
respondents, if any, on their exercise of corporate powers and the management of FPIC relative to
the dire environmental impact of the dumping of petroleum products stemming from the leak in the
WOPL in Barangay Bangkal, Makati City.

Hence, the Court will not rule on the alleged liability on the part of the FPIC and FGC officials which
can, however, be properly resolved in the civil and criminal cases now pending against them.

Other Matters

The CA's resolution on petitioners' September 9, 2011 Manifestation (Re: Current Developments)
with Omnibus Motion on the remediation plan in Barangay Bangkal by directing the Inter-Agency
Committee on Environmental Health to submit its evaluation of the said plan prepared by CH2M
Philippines, Inc., for FPIC to strictly comply with the stipulations embodied in the permits issued by
the DENR, and to get a certification from the DENR of its compliance thereto is well taken. DENR is
the government agency tasked to implement the state policy of "maintaining a sound ecological
balance and protecting and enhancing the quality of the environment"57 and to "promulgate rules and
regulations for the control of water, air, and land pollution."58 It is indubitable that the DENR has
jurisdiction in overseeing and supervising the environmental remediation of Barangay Bangkal,
which is adversely affected by the leak in the WOPL in 2010.

With regard to petitioners' March 29, 2012 Supplemental Manifestation about a recent possible leak
in the pipeline, the CA appropriately found no additional leak. However, due to the devastating effect
on the environs in Barangay Bangkal due to the 2010 leak, the Court finds it fitting that the pipeline
be closely and regularly monitored to obviate another catastrophic event which will prejudice the
health of the affected people, and to preserve and protect the environment not only for the present
but also for the future generations to come.

Petitioner's January 10, 2013 Motion for Partial Recommendation of the CA' s Report need not be
discussed and given consideration. As the CA' s Report contains but the appellate court's
recommendation on how the issues should be resolved, and not the adjudication by this Court, there
is nothing for the appellate court to reconsider.
As to petitioner's October 2, 2013 Motion for Reconsideration with Motion for Clarification, the
matters contained therein have been considered in the foregoing discussion of the primary issues of
this case. With all these, We need not belabor the other arguments raised by the parties.

IN VIEW OF THE FOREGOING, the Motion for Partial Reconsideration is hereby DENIED. The
Motion for Reconsideration with Motion for Clarification is PARTLY GRANTED. The Court of
Appeals' recommendations, embodied in its December 21, 2012 Report and Recommendation, are
hereby ADOPTED with the following MODIFICATIONS:

I. The Department of Energy (DOE) is hereby ORDERED to oversee the strict implementation of the
following activities:

A. Preparatory to the Test Run of the entire stretch of the WOPL:

1) FPIC shall perform the following:

a. Continue submission of monitoring charts, data/reading, accomplishment

reports, and project status for all related activities/works. Respond to
comments and prepare for site inspection.

b. Continue gas testing along the right-of-way using the monitoring wells or
boreholes. Prepare for inspection of right-of-way and observation of gas
testing activities on monitoring wells and boreholes.

c. Explain the process of the selection of borehole location and identify those
located in pipeline bends, bodies of water, highways, residential areas,
repaired portions of the pipelines, dents and welded joints, as well other
notable factors, circumstances, or exposure to stresses. d. Set up additional
boreholes and monitoring wells sufficient to cover the entire stretch of the
WOPL, the number and location of which shall be determined by the DOE.

e. Continue submitting status report to the concerned government agency/ies

relating to "Project Mojica," or the on-going pipeline segment realignment
activity being undertaken by FPIC to give way to a flood control project of the
MMDA in the vicinity of Mojica St. and Pres. Osmeña Highway, and prepare
for site inspection.

2) The DOE shall perform the following undertakings:

a. Conduct onsite inspection of the pipeline right-of-way, the area around the
WOPL and the equipment installed underground or aboveground.

b. Review and check the condition of the 22 patches reinforced with

Clockspring sleeves by performing the following:

i. Determine the location of the sleeves

ii. Review the procedure for the repair of the sleeves

iii. Inspect the areas where the affected portions of the WOPL are
located and which are easily accessible.
 c. Inspect onsite the cathodic protection rectifier to check the following:

i. old and current readings

ii. the segment/s covered by the cathodic protection system

iii. review the criteria for prioritization of corrective action.

d. Observe and witness the running/operation of the intelligent and cleaning

pigs.

e. Check and calibrate the instruments that will be used for the actual tests
on the pipeline, and validate the calibration certificates of these instruments.

B. During the Actual Test Run:

1) FPIC shall perform the following:

a. Perform Cleaning Pig run and witness the launching and receiving of the
intelligent and cleaning pigs.

b. Demonstrate and observe the various pressure and leakage tests,

including the following:

i. "Blocked-in pressure test" or the pressure test conducted while all

the WOPL's openings are blocked or closed off; and

ii. "In-operation test" or the hourly monitoring of pressure rating after

the pipeline is filled with dyed water and pressurized at a specified
rate.

c. Continue, inspect, and oversee the current gas monitoring system, or the
monitoring of gas flow from the boreholes and monitoring wells of the WOPL.

d. Check the mass or volume balance computation during WOPL test run by
conducting:

i. 30 days baseline data generation

ii. Computational analysis and monitoring of the data generated.

II. After FPIC has undertaken the activities prescribed in the preceding paragraph 1, the DOE shall
determine if the activities and the results of the test run warrant the re-opening of the WOPL. In the
event that the DOE is satisfied that the WOPL is safe for continued commercial operations, it shall
issue an order allowing FPIC to resume the operations of the pipeline.

III. Once the WOPL is re-opened, the DOE shall see to it that FPIC strictly complies with the
following directives:
 a. Continue implementation of its Pipeline Integrity Management System (PIMS), as
reviewed by the DOE, which shall include, but shall not be limited to:

1. the conduct of daily patrols on the entire stretch of the WOPL, every two hours;

2. continued close monitoring of all the boreholes and monitoring wells of the WOPL
pipeline;

3. regular periodic testing and maintenance based on its PIMS; and

4. the auditing of the pipeline's mass input versus mass output;

b. submit to the DOE, within ten (10) days of each succeeding month, monthly reports on its
compliance with the above directives and any other conditions that the DOE may impose, the
results of the monitoring, tests, and audit, as well as any and all activities undertaken on the
WOPL or in connection with its operation. The concerned government agencies, namely: the
Industrial Technology Development Institute (ITDI) and the Metals Industry Research and
Development Center (MIRDC), both under the Department of Science and Technology
(DOST), the Environmental Management Bureau (EMB) of the Department of Environment
and Natural Resources (DENR), the Bureau of Design (BOD) of the Department of Public
Works and Highways (DPWH), the University of the Philippines - National Institute of
Geological Science (UP-NI GS) and University of the Philippines - Institute of Civil
Engineering (UP-ICE), the petitioners, intervenors and this Court shall likewise be furnished
by FPIC with the monthly reports. This shall include, but shall not be limited to: realignment,
repairs, and maintenance works; and

c. continue coordination with the concerned government agencies for the implementation of
its projects.
1âwphi 1

IV. Respondent FPIC is also DIRECTED to undertake and continue the remediation, rehabilitation
and restoration of the affected Barangay Bangkal environment until full restoration of the affected
area to its condition prior to the leakage is achieved. For this purpose, respondent FPIC must strictly
comply with the measures, directives and permits issued by the DENR for its remediation activities in
Barangay Bangkal, including but not limited to, the Wastewater Discharge Permit and Permit to
Operate. The DENR has the authority to oversee and supervise the aforesaid activities on said
affected barangay.

V. The Inter-Agency Committee on Environmental Health under the City Government of Makati shall
SUBMIT to the DENR its evaluation of the Remediation Plan prepared by CH2M Hill Philippines, Inc.
within thirty (30) days from receipt hereof.

VI. Petitioners' prayer for the creation of a special trust fund to answer for similar contingencies in
the future is DENIED.

SO ORDERED.

PRESBITERO J. VELASCO, JR.

Associate Justice

WE CONCUR:
6

New Energy in Asean by Amb. Tolentino

LIKE many countries around the world, the members of the

Association of Southeast Asian Nations (Asean) have realized that
fossil fuels are outdated. They cause many problems, with serious
impacts on economics, global politics and the environment. Indeed,
new approaches need to be taken and the technologies for doing so are
well understood and available.

Asean energy business forum

Asean is on the right track judging from the recent 2017 Asean Energy
Business Forum and the Powertrends international exhibition on
directions for energy, power and electricity annually hosted by our
energy department. Both activities were held in conjunction with
Asean@50 with the objective of strengthening public-private
partnership that could enhance the region’s energy sector towards
common target achievements.

Renewable energy (RE) technologies were tackled by Asean experts

with detailed experiences and best practices to the extent of, among
others, the development and commercial maturity of battery storage
systems as “coupling technology” to variable renewable energy
generations.

Surprising is the availability of Asean member state companies with

flagship projects on power generation, transmission and distribution.
Services offered range from solar streetlights to solar pumping
installation for household water system and irrigation system to off-
grid PV solar systems for areas with no access to a stable power
source.

In short, from connection to grid areas, the lack of access to energy in

off-grid areas is now possible in the region. In the latter instance, offer
is for both hybrid and off-grid systems designed with battery inverters
and an assortment of storage types all designed to match the needs of
the end user. Of all renewable sources available, solar is the most
attractive alternative due to the abundance of sunlight in Southeast
Asia.

Philippine RE projects
In the Philippines alone, RE projects worth a total of P35.4 billion,
expected to help address the power demands of the government’s
“Build Build Build” program, have been approved by the Board of
Investments (BOI). Some of the projects are the Currimao-Talisay
(Camarines Norte) project and the Talim (Rizal)-Calatagan (Batangas)
projects which involve wind power and the San Jose City (Nueva
Ecija) power plant that will use rice husk, a feedstock.

According to data from the BOI, renewable energy plants (geothermal,

hydro, wind, biomass and solar) accounted for 7038 MW of installed
capacity in the country as of June this year, about a third of the
national capacity of 21,621 MW.

Since the ongoing infrastructure program involves construction and

modernization of airports, and the laying out of more roads, railroads
and transport networks all over the country, demand for power
continues to go up.

The Philippine private sector is active too in renewable energy

projects. A progressive Filipino businessman is into an 800 MW
hydropower plant project in Pangil, Laguna. At one time, the solar
farm built by Gregorio Araneta Inc. with partner Soleq, one of
Southeast Asia’s largest solar independent producers, was No. 1 in the
Asean region. SM Supermalls, on the other hand, will install electric
charging stations for electric vehicles with the first outlets in some
malls to go online by February 2018.

RE infrastructure vis-à-vis migratory species and their habitats

The race is on. Which Asean country could be the first to be
completely powered by renewable energy? In the past three years, the
share of renewable energy in the Asean power mix has already risen to
an appreciable degree due mainly to the fast-paced solar and wind
power use. A target of 100 percent is ambitious but the governments
are determined to achieve at least 50 percent sometime after three
decades or so. In fact, the Asean landscape is ever changing with some
inland areas abloom with solar panels and wind turbines in strong
windswept coastal zones.

Be that as it may, the requirement of numerous pylons and cables to

transmit energy from renewable sources should be approached with
caution because of detrimental effects on wildlife habitats and
migration routes of bird species. One solution in use in Spain is the
“shut-off on demand” technique requiring turbines to be deactivated
during the most sensitive time for wildlife, such as the migration
season or during periods with low wind speeds. It was also revealed
that as the turbines are also at their least productive during such times,
the amount of electricity lost is insignificant.

Indeed, designing the location, route and direction of power lines

based on national zoning maps or land use codes avoiding, where
possible, waterbird habitats, protected areas (usually wetlands of
importance to migratory birds, e.g. tidal flats, marshes, etc.) and other
critical areas is now a paramount concern in the management of
migratory species and their habitats.
And what is the significance of renewable energy infrastructure vis-à-
vis migratory species? Expanding infrastructure threatens birds and
their habitats. Migratory species play a major role in the conservation
of resources. They act as pollinators and seed dispensers, helping
safeguard biodiversity which benefits food security for people. They
regulate the balance of ecosystems by hunting their prey along their
migration routes. They are also a source of revenue for many
communities. Yet, fatal collision of birds with electricity power lines
is most common. The magnitude of bird-power grid conflict is still
poorly understood in many countries, including those in the East Asia-
Australasia Flyway.

Due to its location in the Pacific and by the South China Sea, Asean
countries, except for landlocked Laos, have excellent conditions for
solar and wind power generation. With an estimated 350 days of
sunshine and varying year-round wind speeds which, if effectively
harnessed, could very well provide the needed energy, it is safe to
conclude that the target could be reached, taking into account
environmental considerations.

Global alliance to phase out coal

It should also be mentioned that at the UN climate change conference
2017 in Bonn (Germany), an alliance of 27 countries and states
pledged to phase out coal-fired electricity by 2030 and end all
domestic and international investment in coal in favor of renewable
energy use. Called “Powering Past Coal Alliance,” it aims at
accelerating clean growth and achieving rapid phase-out of traditional
coal power.

Among the initial members are Austria, Costa Rica, France, New
Zealand, United Kingdom, Finland, Mexico, El Salvador as well as
five Canadian provinces and the US states of Washington and Oregon.
The alliance also brings together a wide range of businesses and civil
society organizations that have united for climate protection. It intends
to expand to more than 50 members by the next UN climate
conference in Poland in 2018.

According to the International Energy Agency, coal-fired power plants

produce almost 40 percent of global electricity, making carbon
pollution from coal a leading contributor to climate change. All
burning of coal causes severe respiratory disease and has many other
damaging health effects, in addition to being a driver of climate
change.

With all renewable plants—hydro, geothermal, biomass, solar and

wind around—would wave power or underwater current energy not be
far behind in the Asean?