[G.R. NO.

122855 : March 31, 2005]

METRO ILOILO WATER DISTRICT v. CA

DECISION

TINGA, J.:

Before this Court is a Petition 1 dated November 9, 1995 filed by the Metro Iloilo
Water District assailing the Decision2 of the Court of appeals dated June 19,
1995 which affirmed the trial court's Order3dismissing the petitions for injunction
filed by petitioner against private respondents.

Petitioner is a water district organized under the provisions of Presidential Decree

No. 198 (P.D. 198), as amended. It was granted by the Local Water Utilities
Administration Conditional Certificate of Conformance No. 714 on January 12,
1979. Its service areas encompass the entire territorial areas of Iloilo City and
the Municipalities of Ma-asin, Cabanatuan, Santa Barbara and Pavia.

Sometime between April and May of 1993, petitioner filed nine (9) individual yet
identical petitions for injunction with prayer for preliminary injunction and / or
temporary restraining order5 against herein private respondents the pertinent
portions of which read:

4. 'That pursuant to the provisions of section 31 (a) of P.D. 198, as amended,

the petitioner as a Water District was authorized to adopt laws and regulations
governing the drilling, maintenance and operation of wells within its boundaries
for purposes other than single family domestic use on overlying land, with then
provision that any well operated in violation of such regulations shall be deemed
an interference with the waters of the district;

5. 'That by virtue of said authorization, the Board of Directors for the petitioner
promulgated its "Rules Governing Ground Water Pumping and spring
Development Within the Territorial Jurisdiction of the Metro Iloilo Water District,"
Section 3 of which provides as follows:

"Ground Water Pumping and Spring Development. Except when the use of
water is for single family domestic use, no person, natural or juridical shall
abstract or withdraw ground water and appropriate the waters from springs
within the jurisdiction of the District without first securing a water permit from
the Council and no person shall engage in the business of drilling wells either as
test wells or production wells for the purpose of abstracting or withdrawing
ground water without first registering as well as driller with the Council;
Provided, that the person drilling his own well or through the services of a
qualified well driller shall comply with the standards and requirements
established herein in addition to those established by the Council for the
exploitation of ground water resources."

6. 'That the respondent has abstracted or withdrawn ground water within the
territorial jurisdiction of the petitioner at _________________________ Iloilo
City, without first securing a Water Permit from the National Water Resources
Council nor had its well driller registered as such with said council, and sold said
water so extracted to commercial and other consumers in Iloilo City, within
petitioner's service area;

7. 'That the unauthorized extraction or withdrawal of ground water by the

respondent without the necessary permit therefore is in violation of the rules and
regulations prescribed by the Board of Directors of the petitioner as above-
mentioned duly approved by the National Water Resources Council and
constitutes interference with or deterioration of water quality or the natural flow
of surface or ground water supply which maybe used or useful for any purpose of
the petitioner for which the petitioner as a Water District may commence,
maintain, intervene in, defend and compromise actions or proceedings under
Section 31 (a) of P.D. 198, as amended;

8. 'That the act of the respondent in continuing to extract or withdraw ground

water without a Water Permit therefor, is in violation of Art. XIII of P.D. 1067 of
the Water Code of the Philippines, and unless such act is restrained, will
definitely cause great loss upon the petitioner as a Water District'.6

In their respective answers, private respondents uniformly invoked the lack of

jurisdiction of the trial court, contending that the cases were within the original
and exclusive jurisdiction of the National Water Resources Council (Water
Council) under Presidential Decree No. 1067, otherwise known as the Water
Code of the Philippines (Water Code). In addition, private respondents Emma
Nava7 and Rebecca Berlin8denied having extracted or withdrawn water from the
ground, much less sold the same.9 Private respondent Carmen Pangantihon
likewise denied having constructed any waterworks system in her area but
admitted that she had constructed her own deep well, unaware that she needed
to get a permit to do the same.10 Private respondent Rufino Sitaca maintained
the petitioner's source of water are reservoirs from rivers and are thus not
affected by his well. Moreover, he claimed that his water permit application was
deemed approved, and thus he is entitled to use the water from his well.11

Private respondent Benito Go admitted that he extracted water from the ground,
which he claimed to be his private property, and used the water for his
lumberyard and domestic purposes.12 Additionally, he alleged the petitioner's
rules and regulations were not published in the Official Gazette and hence
petitioner had no cause of action.13 Private respondent Charles Kana-an asserted
that he had complied with the requirements for the approval of his water permit
application. He claimed that he was extracting and selling water with petitioner's
knowledge, and without damage and injury to the latter.14 Meanwhile, private
respondent Gerry Luzuriaga claimed that he was not the real party in interest,
but Shoemart, Inc. which has the control and possession of the property where
the alleged withdrawal of ground water was taking place.15

The trial court dismissed the petitions in its Order16 dated March 17, 1994, ruling
that the controversy was within the original jurisdiction of the Water Council,
involving, as it did, the appropriation, exploitation, and utilization of water, and
factual issues which were within the Water Council's competence. In addition,
the trial court held that petitioner failed to exhaust administrative remedies
under the doctrine of "primary administrative jurisdiction." Petitioner's Motion for
Reconsideration17 was thereafter denied on April 29, 1994.18

A petition19 dated May 27, 1994 seeking a review of the trial court's order of
dismissal was filed before this Court but the same was referred to the Court of
Appeals for consideration and adjudication on the merits in
the Resolution20 dated July 11, 1994.

Petitioner sought the review of the order of the trial court dismissing the
petitions and denying its motion for reconsideration, on the ground that the trial
court failed to adhere to this Court's rulings in Amistoso v. Ong21 and Santos v.
Court of Appeals,22 which upheld the regular court's jurisdiction over disputes
which involve not the settlement of water rights but the enjoyment of the right
to water use for which a permit had already been granted.

The Court of Appeals denied the petition, holding that the trial court did not err
in dismissing the case for want of jurisdiction as it was the Water Council which
had jurisdiction over the case. The appellate court ratiocinated:

The controversy in this case arose from the fact that the petitioner Iloilo Water
District was granted water rights in Iloilo City and the respondents also extracted
or withdrew ground water within the same jurisdiction.

While at first impression this case involves a violation of the petitioner's

enjoyment of a right to water use, the fact is that it actually involves also a
dispute over the appropriation, utilization, exploitation development, control,
conversation and protection of waters because the respondents have allegedly
engaged in the extraction or withdrawal of ground water without a permit from
the NWRC within the territorial jurisdiction of the petitioner. Therefore, Art. 88 of
P.D. No. 1067 giving the NWRC original jurisdiction over the cases is applicable.

The NWRC has jurisdiction to hear and decide disputes relating to appropriation,
utilization and control of water while the Regional Trial Court only has appellate
jurisdiction over the case. This was the ruling of the Supreme Court in Abe-abe
v. Manta, 90 SCRA 524which was reiterated in Tanjay Water District v.
Gabanton, 172 SCRA 253.

The cases of Santos v. Court of Appeals, 214 SCRA 170 and Amistoso v.
Ong, 130 SCRA 288 are not applicable to the case at bar for here, what is
involved is not only the alleged violation of the grantee's right but a question of
whether or not the respondents have equal right to the appropriation, utilization
and exploitation of water rights."23

The Court of Appeals denied petitioner's Motion for Reconsideration24 dated July
11, 1995 in its Resolution of September 29, 1995.25

Petitioner now contends that the extraction or withdrawal of ground water as

well as the sale thereof within its territorial jurisdiction is a violation of its rights
as a water district.26 Being a violation thereof, the regular courts have
jurisdiction over the dispute. On the other hand, private respondents
unanimously maintain that it is the Water Council which has jurisdiction over the
subject matter of this case. Thus, the sole issue in this petition, as presented by
petitioner, is:

DID THE REGIONAL TRIAL COURT OF ILOILO HAVE JURISDICTION OVER THE
SUBJECT MATTER OF THE PETITIONS?27

Petitioner anchors its claim on Section 31 (now 32) of PD 198, as amended,

which reads:

Sec. 32. Protection of waters and Facilities of District. - A district shall have the
right to :

(a) Commence, maintain, intervene in, defend and compromise actions

or proceedings to prevent interference with or deterioration of water
quality or the natural flow of any surface, stream or ground water supply
which may be used or useful for any purpose of the district or be a common
benefit to the lands or its inhabitants. The ground water within a district is
necessary to the performance of the district's powers and such districts hereby
authorized to adopt rules and regulations subject to the approval of the National
Water Resources Council governing the drilling, maintenance and operation of
wells within its boundaries for purposes other than a singled family domestic use
on overlying land. Any well operated on violation of such regulations shall be
deemed in interference with the waters of the district.

(c) Prohibit any person, firm or corporation from vending, selling, or otherwise
disposing of water for public purposes within the service area of the district
where district facilities are available to provide such service, or fix terms and
conditions by permit for such sale or disposition of water.
By virtue of the above provisions, petitioner states that as a water district, it has
the right to prevent interference with the water of the district; and to enforce
such right, it is given remedies of commencing, maintaining, or intervening in,
defending or entering into appropriate actions or proceedings.

In asserting the jurisdiction of the regular courts over its petitions and the
propriety of its filing of the petitions before the trial court, petitioner invokes the
ruling of the Court in Amistoso v. Ong,28 as reiterated in Santos v. Court of
Appeals,29 that where the issue involved is not the settlement of a water rights
dispute, but the enjoyment of a right to water use for which a permit was
already granted, the regular court has jurisdiction and not the Water Council.

Petitioner insists that there is no occasion to invoke the original jurisdiction of

the Water Council in this case since there is no question of appropriation,
exploitation, utilization, development, control, conservation, and protection of
water. The only dispute, according to petitioner, pertains to the act of private
respondents in extracting ground water from the territory of petitioner as a
water district and selling the same within its service area, or more succinctly,
private respondents' interference with the granted right of petitioner over ground
water within its territorial jurisdiction.30

Private respondents, for their part, staunchly invoke Article 88 of the Water
Code, which grants original jurisdiction over all disputes relating to the
appropriation, utilization, exploitation, development, control, conservation and
protection of waters to the Water Council.31

Relying on the cases of Abe-abe v. Manta32 and Tanjay Water District v.

Gabaton,33 private respondents maintain that the Water Council is exclusively
vested with original jurisdiction to settle water disputes under the Water Code.
They claim that the Amistoso and Santos cases do not apply to the instant case
since in Amistoso, the issue was the prevention of the flow of water through an
irrigation canal, and in Santos, the issue referred to the prevention of the
enjoyment of a water right. In contrast, the issue in the instant case is the right
to appropriate water which petitioner and some of the private respondents
profess to have.

We find merit in the petition.

The petitions file before the trial court were for the issuance of an injunction
order for respondents to cease and desist from extracting or withdrawing water
from petitioner's well and from selling the same within its service areas.34 The
petitions contained factual allegations in support of the prayer for injunction, to
wit:
1. the grant to petitioner of a Conditional Certificate of Conformance by the Local
Water Utilities Administration over areas from which water was allegedly
extracted or withdrawn by private respondents, by virtue of which its Board of
Directors promulgated rules governing ground water pumping within its service
areas;

2. abstraction or withdrawal of water within the territorial jurisdiction of

petitioner by private respondents without first securing a permit from the Water
Council, or registering their well drillers, and sale of said water so extracted to
commercial and other consumers within petitioner's service areas;

3. that the unauthorized extraction or withdrawal of ground water by private

respondents without the necessary permit was in violation of petitioner's
prescribed rules, and constitutes interference for which petitioner may
commence, maintain, intervene in, defend and compromise actions or
proceedings under Sec. 31 of P.D. No. 198;

4. that the extraction or withdrawal of ground water without the corresponding

permit was a violation of Art. 13 of the Water Code; andcralawlibrary

5. that great damage and prejudice will be suffered by petitioner if private

respondents' extraction and withdrawal of ground water, as well as the selling
thereof be allowed to continue.

In essence, the petitions focus on the violations incurred by private respondents

by virtue of their alleged unauthorized extraction and withdrawal of ground
water within petitioner's service area, visa-a-vispetitioner's vested rights as a
water district. At issue is whether or not private respondents' extraction and sale
of ground water within petitioner's service area violated petitioner's rights as a
water district. It is at once obvious that the petitions raise a judicial question.

A judicial question is raised when the determination of the questions involves the
exercise of a judicial function, i.e., the question involves the determination of
what the law is and what the legal rights of the parties are with respect to the
matter in controversy. As opposed to a moot question or one properly decided by
the executive or legislative branch, a judicial question is properly addressed to
the courts.35

The instant case certainly calls for the application and interpretation of pertinent
laws and jurisprudence in order to determine whether private respondents'
actions violate petitioner's rights as a water district and justify an injunction. This
issue does not so much provide occasion to invoke the special knowledge and
expertise of the Water Council as it necessitates judicial intervention. While
initially it may appear that there is a dimension to the petitions which pertains to
the sphere of the Water Council, i.e., the appropriation of water which the Water
Code defines as "the acquisition of rights over the use of waters or the taking or
diverting of waters from a natural source in the manner and for any purpose
allowed by law," in reality the matter is at most merely collateral to the main
thrust of the petitions.

The petitions having raised a judicial question, it follows that the doctrine of
exhaustion of administrative remedies, on the basis of which the petitions were
dismissed by the trial court and the Court of Appeals, does not even come to
play.36

Notably too, private respondents themselves do not dispute petitioner's rights as

a water district. The cases of Abe-Abe v. Manta37 and Tanjay Water District v.
Gabaton38 invoked by private respondents are thus inapplicable. In Abe-Abe v.
Manta, both petitioners and respondent had no established right emanating from
any grant by any governmental agency to the use, appropriation and exploitation
of water, while in Tanjay Water District v. Gabaton, petitioner Tanjay sought to
enjoin the Municipality of Pamplona and its officials from interfering in the
management of the Tanjay Waterworks System.

On the other hand, in the analogous case of Amistoso v. Ong39, petitioner had an
approved Water Rights Grant from the Department of Public Works,
Transportation and Communications. The trial court was not asked to grant
petitioner the right to use but to compel private respondents to recognize that
right. Thus, we declared that the trial court's jurisdiction must be upheld where
the issue involved is not the settlement of a water rights dispute, but the
enjoyment of a right to water use for which a permit was already granted.40

In like manner, the present petition calls for the issuance of an injunction order
to prevent private respondents from extracting and selling ground water within
petitioner's service area in violation of the latter's water permit. There is no
dispute regarding petitioner's right to ground water within its service area. It is
petitioner's enjoyment of its rights as a water district which it seeks to assert
against private respondents.

WHEREFORE, the Decision of the Court of Appeals dated June 19, 1995 is SET
ASIDE and the case is ordered REMANDED to the trial court for further
proceedings, with costs against respondents. SO ORDERED.
 [G.R. No. L-72370. May 29, 1987.]

BF NORTHWEST HOMEOWNERS ASSOCIATION, INC., Petitioner, v.

INTERMEDIATE APPELLATE COURT and BF HOMES, INC. respondents.

DECISION

MELENCIO-HERRERA, J.:

The core issue for resolution is: which Court has jurisdiction over actions to
annul Orders, Resolutions and/or Decisions of the National Water Resources
Council (NWRC) relative to water rates — the Regional Trial Court or the Court of
Appeals?

The antecedent facts have been succinctly stated in the Solicitor General’s
Comment as follows:

"Respondent BF Homes, Inc. is a subdivision owner and developer in Parañaque,

Metro Manila. In 1973, BF Homes, Inc. filed a petition for a certificate of public
convenience and for authority to charge water rates before the then Board of
Power and Waterworks (See records of Civil Case No. 6307, RTC, Makati, Branch
143). In 1977, the Board of Power and Waterworks was abolished and its powers
and functions relative to waterworks were transferred to the National Water
Resources Council (NWRC) (Sec. 11 [e], PD No. 1206).

"On October 24, 1983, NWRC in its Resolution No. 22-A, series of 1983, granted
a Certificate of Public Convenience to respondent BF Homes, Inc., for the
operation and maintenance of waterworks system at the BF Homes Subdivision
in Parañaque, Metro Manila. In the same resolution, NWRC approved the
Compromise Agreement dated May 24, 1983 entered into between BF Homes,
Inc. and BF Parañaque Homeowners Association, Inc., in NWRC Case No. 78-
037, embodying the water rates chargeable to customers.

On November 21, 1983 and December 16, 1983, NWRC issued two other orders
increasing the water rates in view of the increase in the costs of electricity. . . ."
(Solicitor General’s Comment, pp. 84-85, Rollo).

It is the foregoing Resolution, Orders and Compromise Agreement that triggered

the institution of three separate cases set out herein below mainly by petitioner
BF Northwest Homeowners Association, Inc.
The First Suit

BF Northwest Homeowners Association

Inc. v. BF Homes, Inc.

Civil Case No. 6307 below

AC-G.R. No. 02778

On February 1, 1984, petitioner BF Northwest Homeowners Association, Inc.,

(the ASSOCIATION, for brevity), filed a Petition for Certiorari, Prohibition and
Mandamus before the Regional Trial Court in Makati, Rizal, Branch 143 (docketed
as Civil Case No. 6307), to enjoin BF Homes, Inc. (HOMES, for short) from
collecting from ASSOCIATION members the adjusted water rates for being
arbitrary and unreasonable and praying that HOMES be ordered to refund
monies it had collected from consumers over and above the old water rates.

Regional Trial Court Judge Zoilo Aguinaldo denied the Motion to Dismiss filed by
HOMES and upheld his jurisdiction to entertain the suit. However, on Certiorari,
Prohibition and Mandamus filed by HOMES before respondent Appellate Court
(BF HOMES, Inc. & NWRC v. Hon. Zoilo Aguinaldo, etc., Northwest BF
Homeowners Association, Executive Villager’s Society and 5-H Club, Inc." AC-
G.R. No. SP-02778), 1 the latter Court, on March 27, 1984, reversed and held
that the Regional Trial Court was without jurisdiction to entertain the case since
NWRC, which took over the functions of the Public Service Commission, has the
rank of a Regional Trial Court, hence, an NWRC decision on water rates may only
be reviewed by the Supreme Court (as then provided by CA No. 146, [section
35] as amended), 2 and now by the Court of Appeals, pursuant to BP 129,
Section 9 (3). 3 Said Appellate Court Decision shall hereinafter be referred to as
the "SP 02778 Decision."

The Second Case

Antonio Pedro v. B.F. Homes, Inc.

Civil Case No. 7546 below

G.R. No. 68387

On June 13, 1984, suit was filed by one Antonio Pedro, President of the
ASSOCIATION, before the Regional Trial Court of Makati, Branch 148 (Civil Case
No. 7546) against HOMES "to declare the Decision of the NWRC (increasing the
rates chargeable by HOMES) null and void because it was rendered without
hearing and, therefore, without due process of law," and to enjoin the
enforcement by HOMES of those "exhorbitant, confiscatory and discriminatory
water rates."

On August 6, 1984, Trial Judge Jesus F. Guerrero dismissed the Complaint on

the ground of lack of jurisdiction guided by the "persuasive force and effect" of
the pronouncement of the Appellate Court in the "SP 02778 Decision."

Antonio Pedro challenged the Order of dismissal in a Petition for Review with
Mandamus & Preliminary Writ of Injunction filed before this Court on August 23,
1984. Originally, the case was referred by this Court (Second Division) to the
Appellate Court on September 3, 1984, but the latter Court, in AC-G.R. No. SP
04197 4 on September 27, 1985, returned the case to this Court, on the Found
that what is involved is a "purely legal question, particularly, the issue of
jurisdiction."

On July 7, 1986, this Court (Second Division), dismissed the petition for lack of
merit. Antonio Pedro’s Motion for Reconsideration was also denied, with the
denial being declared final on August 25, 1986.

The Third Suit and Present Petition

BF Northwest Homeowners’ Association Inc.

vs. BF Homes, Inc.

Civil Case No. 7584 below

AC-G.R. CV No. 04912

On June 18, 1984, or five (5) days after the Second Case was filed, petitioner
ASSOCIATION instituted another ordinary civil suit (Civil Case No. 7584) with the
Regional Trial Court (RTC), National Capital Region, in Makati, Branch 143,
against private respondent HOMES geared towards the same objective of
annulling the Decision/Orders of the NWRC which granted HOMES authority to
charge the increased water rates on the ground that it was rendered without
procedural due process and without or in excess of jurisdiction and with grave
abuse of discretion; and that it is not bound by the Compromise Agreement since
it was not a party thereto.

The Trial Court, with Judge Zoilo Aguinaldo again presiding, dismissed the suit,
on the ground of lack of jurisdiction. On appeal, respondent Appellate Court, in
its Decision promulgated on August 16, 1985 in AC-G.R. CV No. 04912, 5
sustained the dismissal (1) because of the non-inclusion of the NWRC as an
indispensable party defendant, and (2) on the ground of res judicata, the same
issues raised having been previously litigated and decided by the Appellate Court
in the "SP 02778 Decision."

Hence, this Petition, with the ASSOCIATION assailing the foregoing grounds of
dismissal and seeking a re-examination of the pronouncement in the "SP 02778
Decision" that:

"since the National Water Resources Council was invested with the same powers
and functions of the former Public Service Commission in so far as waterworks is
concerned it is reasonable to conclude that the Commission and the Council that
substituted it are identical, hence, the Council is on equal footing with the
Regional Trial Court."

The re-examination sought is impressed with merit.

The National Water Resources Council (NWRC) was created by P.D. No. 424 on
March 28, 1974 and was vested with the general power to coordinate and
integrate water resources development, and among others, to formulate and
promulgate rules and regulations for the exploitation and optimum utilization of
water resources, including the imposition on water appropriators of such fees or
charges as may be deemed necessary by the Council for water resources
development.

P.D. No. 1067, which enacted the Water Code of the Philippines, identified the
NWRC as the administrative agency for the enforcement of its provisions and
was "authorized to impose and collect reasonable fees or charges for water
resources development from water appropriators" (Art. 83). The provisions of
said statute pertinent to this case read:

"Art. 87. The Council or its duly authorized representatives, in the exercise of its
power to investigate and decide cases brought to its cognizance, shall have the
power to administer oaths, compel the attendance of witnesses by subpoena and
the production of relevant documents by subpoena duces tecum.

"Non-compliance or violation of such orders of subpoena and subpoena duces

tecum shall be punished in the same manner as indirect contempt of an inferior
court upon application by the aggrieved party with the proper Court of First
Instance in accordance with the provision of Rule 71 of the Rules of Court."

"Art. 89. The decisions of the Council on water rights controversies may be
appealed to the Court of First Instance of the province where the subject matter
of the controversy is situated within fifteen (15) days from the date the party
appealing receives a copy of the decision, on any of the following grounds: (1)
grave abuse of discretion; (2) question of law; and (3) questions of fact and
law." (all Emphasis ours).

Plainly, the NWRC is ranked with "inferior courts," which, under the Interim
Rules and Guidelines promulgated by this Court on January 11, 1983, are listed
as the Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial
Courts. Explicit as well is the proviso that NWRC decisions on water rights
controversies are appealable to the Court of First Instance. In the light of those
specific provisions, we find no room for the pronouncement of the Appellate
Court in the "SP 02778 Decision" that the NWRC is at par with the Regional Trial
Court.

Nor is there basis for the conclusion in the SP "02778 Decision" that because the
NWRC, which substituted the Public Service Commission, is vested with the same
powers and functions as said Commission in so far as waterworks are concerned,
they are identical. The Public Service Commission was abolished and replaced by
several specialized regulatory boards, namely, the Board of Transportation, the
Board of Communications, and the Board of Power and Waterworks (P.D. No. 1
[Integrated Reorganization Plan; Letter of Implementation No. 1]. Rulings and
decisions of the Boards were appealable in the same manner as the rulings and
decisions of the Public Service Commission, that is, to the Supreme Court. It is
those Boards therefore, which may be considered at par with the Public Service
Commission.

Pursuant to P.D. No. 1206 creating the Department of Energy, the Board of
Power and Waterworks was abolished and its functions relative to waterworks
were transferred to the NWRC. The NWRC was not given the stature of the Public
Service Commission. On the contrary, its inferior status, vis-a-vis the Public
Service Commission, is further shown by the following considerations: 1) the
Commissioners of the Public Service Commission were expressly conferred the
rank and privileges of Judges of Courts of First Instance (Sec. 2, CA No. 146, as
amended by R.A. Nos. 178 and 2677). On the other hand, the NWRC is not
composed of Commissioners. Its membership is confined to specified officials
headed by the Secretary of Public Works, Transportation and Communications
(Sec. 3, P.D. No. 424). 2) While the Commission may summarily punish for
contempt (Sec. 29, CA No. 146), the NWRC is not empowered to do so. The
aggrieved party must file an application with the proper Regional Trial Court (Art.
87, P.D. No. 1067). 3) It was the Supreme Court which was vested with
jurisdiction to review, modify or set aside any order, ruling, or decision of the
Commission (Sec. 35, CA No. 146). In contrast, decisions of the NWRC on water
rights controversies are appealable to the proper Regional Trial Court (Art. 89,
P.D. No. 1067).

The logical conclusion, therefore, is that jurisdiction over actions for annulment
of NWRC decisions lies with the Regional Trial Courts, particularly, when we take
note of the fact that the appellate jurisdiction of the Regional Trial Court over
NWRC decisions covers such broad and all embracing grounds as grave abuse of
discretion, questions of law, and questions of fact and law (Art. 89, P.D. No.
1067. This conclusion is also in keeping with the Judiciary Reorganization Act of
1980, which vests Regional Trial Courts with original jurisdiction to issue writs
of certiorari, prohibition, mandamus, etc. (Sec. 21 [1], B.P. Blg. 129) relating to
acts or omissions of an inferior Court (Sec. 4, Rule 65, Rules of Court).

Considering the specificity with which P.D. No. 1067, a special law, treats
appeals from the NWRC there is no room to apply Section 9[3] of B.P. Blg. 129,
(supra), a general law, which confers exclusive appellate jurisdiction to the Court
of Appeals over decisions of quasi-judicial agencies. The fact that one is special
and the other is general creates a presumption that the special (P.D. No. 1067)
is to be considered as remaining an exception to the general (B.P. Blg. 129,
section 9[3]), one as a general law of the land, the other as the law of a
particular case. 6 Neither would Section 9[2] of the same law 7 giving the Court
of Appeals exclusive original jurisdiction over actions for annulment of judgments
of Regional Trial Courts find applicability since the NWRC is not on equal footing
with the Regional Trial Court.

The distinction made in the "SP 02778 Decision" between "water rights
controversies" which it maintains are appealable to the Regional Trial Courts,
and "water rates disputes" which it says are appealable to the Court of Appeals,
is not, to our minds, well taken. Where the law makes no distinction, Courts
should neither make one. 8 Besides, considering that rate-fixing is merely an
incident to the grant of a certificate of public convenience, it would be lopsided,
indeed, if disputes over water rates, should be held appealable to the Court of
Appeals while controversies over water rights, the latter being the privilege
granted by the government to appropriate and use water (Art. 13, P.D. No.
1067) and, therefore, a primary right, would be appealable only to the Regional
Trial Court. This would also inevitably result in "split-jurisdiction" which is not
favored, and in multiplicity of suits, a situation obnoxious to the orderly
administration of justice. 9

As maintained, however, by the Solicitor General and upheld by respondent

Appellate Court since Decision/Orders of the NWRC are assailed, the latter
agency should be impleaded as an indispensable party defendant in order that
any judgment could be effective and binding on it, and so that complete relief
may be accorded to the parties.

We realize that the Second Division of this Court, in dismissing the Petition in the
Second Case, had affirmed, in effect, the "SP 02778 Decision" and that,
ordinarily, it is a final and executory judgment. Considering, however, that under
governing laws, it is clearly the Regional Trial Court which has jurisdiction over
the subject matter involved herein, and that when the question of jurisdiction is
concerned there is no res judicata nor bar by prior judgment, and the issue can
be raised at any stage of the proceedings, 10 particularly, where as in this case
an indispensable party, the NWRC, has not been impleaded, weightier legal
considerations and the broader interests of justice constrain us to grant the re-
examination prayed for.

WHEREFORE, the Decision of respondent Appellate Court in AC-G.R. No. CV-

04912 is SET ASIDE, and this case remanded to the Regional Trial Court,
National Capital Region, Branch 143, for trial on the merits of Civil Case No.
7584. The National Water Resources Council shall be deemed impleaded as a
party defendant in the said case. No costs.

SO ORDERED.
 G.R. No. L-60219 June 29, 1984

BIENVENIDO AMISTOSO vs. SENECIO ONG, EPIFANIA NERI & HON. PRESIDING
JUDGE, ESTEBAN M. LISING OF THE COURT OF FIRST INSTANCE OF CAMARINES
SUR, BRANCH VI

CUEVAS, J.:

This is a Petition for Review on certiorari of the Order of the defunct Court of First Instance of
Camarines Sur, Branch VI dated January 14, 1981, dismissing its Civil Case No. P-153, for
lack of jurisdiction.

The pertinent antecedents are as follows:

On July 27, 1981, petitioner as plaintiff, filed before the then Court of First Instance of
Camarines Sur, a conplaint for Recognition of Basement with Preliminary Injunction and
Damages. The complaint which was docketed in the a resaid Court as Civil Case No. P-153
among others alleged, that plaintiff (now petitioner) and defendant Epifania Neri, (one of the
herein private respondents) are the owners of adjoining parcels of agricultural land situated
in Cauayanan, Tinambac, Camarines Sur; that an irrigation canal traverses the land of
defendant Neri through which irrigation water from the Silmod River passes and flows to the
land of the petitioner for the latter's beneficial use and that respondent Neri, owner of the
land on which said irrigatrion canal exists and Senecio Ong, the cultivator of the said
property, despite repeated demands refused to recognize the rights and title of the petitioner
to the beneficial use of the water passing through the aforesaid irrigation canal and to have
petitioner's rights and/or claims annotated on the Certificate of Title of respondent Neri . . . .
Hence, the filing of the said complaint.

In their Answer, private respondents denied the existence of any right on the part of the
petitioner to the use of the canal mentioned in the complaint nor any contract, much less any
deed or encumbrance on their property and assert that they have not performed any act
prejudicial to the petitioner that will warrant the filing of the complaint against them. By way of
affirmative and special defenses, private respondents alleged that petitioner's complaint
states no cause of action and that the Court has no jurisdiction over the same.

Issues having been joined, trial was held. After petitioner has rested his case by a formal
offer of his testimonial and documentary evidences, private respondents instead of
presenting their evidence, filed a motion to dismiss. In the said motion, respondents contedn
that the instant case, involving as it does development, exploitation, conservation and
utilization of water resources falls within the exclusive jursidiction of the National Water
Resources Council pursuant to P.D. NO. 424, Section 2(b) and Section 88 thereof. Acting on
private respondent's motion, respondent Judge dismissed petitioner's complaint for lack of
jurisdiction in an Order dated January 14, 1981. The pertinent portion of that Order reads as
follows:
 ... The basis of the motion to dismiss are the provisions of Presidential Decree No. 424
and the Water Code known as Presidential Decree No. 1067. In opposing the motion
to dismiss, plaintiff contends that the present action does not involve water dispute and
that since the present action was filed before the court prior to the effectivity of the
Presidential Decree No. 424, it is the old law on the matter that should be applied.
These contentions of the plaintiff are without merit. The complaint belies the plaintiff's
contention. Allegations in the complaint are explicit regarding the claim of the right of
plaintiff over the water passing through his land. The right over irrigation water not
having been shown as established or vested or that said vested right, if any, has not
been alleged to be registered in accordance with the water code, the provisions of
Presidential Decrees 424 and 1067 shall govern. As stated by the Supreme Court in
the case of Abe-Abe vs. Manta, No. L-4827, May 31, 1979, 90 SCRA 523, to wit: 4

It is incontestable that the petitioner's immediate recourse is to ventilate their

grievance with the National Water Resources Council which, as already noted, is
the administrative agency exclusively vested with original jurisdiction to settle
water rights disputes under the water code under Presidential Decree No. 4 24.

The code assumes that it is more expeditious and pragmatic to entrust to an

administrative agency the settlement of water rights disputes rather than require
the claimants to go directly to the court where the proceedings are subject to
unavoidable delays which are detrimental to the parties ...

That jurisdiction of the Council under Section 2(b) of Presidential Decree No. 424
is reaffirmed in Sec. 88 of the Water Code and in Section 3rd thereof which
provides that 'the utilization, exploitation, development, conservation and
protection of water resources shall be subject to the control and regulation of the
government through Council.

Failing to obtain a favorable reconsideration of the Order of dismissal, petitioner now comes
before Us through the instant petition contending:

(1) That the case at bar is not to settle any water dispute between the parties but a
complaint which calls purely for a determination of the right of the plaintiff to have an
established right amounting to an easement annotated on the certificate of title of the
defendant, hence the question is judicial which may be taken cognizance of by the
respondent court;

(2) That since the case was filed on July 26, 1972. Which was before the effectivity of
PD NO. 424, therefore, even if defendant's contention is correct — that the case
involved water rights dispute — the old law on water applies and not the present water
code otherwise the Court shall lose jurisdiction contrary to the well-settled rule that
once be lost;

(3) That the herein defendant can no longer raise the question of plaintiff's right to the
beneficial use of irrigation water since the right to use had already been determined,
decided and laid to rest when the Department of Public Works, Transportation and
Communications awarded petitioner Water Rights Grant after complying with all the
 legal requirements such as publication, payment of fees, survey, investigation, etc.;
and

(4) That the issue in the case at bar which was erroneously overlooked by the
respondent Judge does not involve a determination of the right of the parties to the
utilizatio conservation and protection of the parties' respective water rights, hence it
does not fan within the competence nor jurisdiction of the National Water Resources
Council.

In a Resolution promulgated on August 11, 1982, we required the respondents to comment

on the petition. Private respondents' COMMENT was filed on March 2, 1984. Petitioner's
REPLY thereto on the other hand was filed on May 10, 1984.

We considered the COMMENT as an Answer and gave due course to the petition.

Private respondents contend that the assailed order of dismissal was in order since a mere
cursory reading of the complaint shows that petitioner claims for the right to use water
coming from the Silmod River and prays that his right to the utilization thereof be respected
and not be disturbed and/or obstructed by the respondents. On its face then, the dispute is
on the use, conservation and protection of the right to water either by the petitioner or by the
private respondents. The annotation of the alleged encumbrance on the title of the private
respondent is merely the relief prayed for on the basis of the claim to the use and protection
of water passing through the land of the respondents. And since the controversy hinges on
the right to use and protect the water from the Silmod River that passes on the land of the
private respondents to the petitioner's property, the proper authority to determine such a
controversy is the National Water Resources Council which is vested with exclusive
jurisdiction over such question pursuant to P.D. NOS. 424 and 1067.

We find the petition impressed with merit.

Private respondents' insistence that what is involved in the instant case is the right to use,
exploit and convey water is controverted by the "STIPULATION OF FACTS" entered into
between them and the petitioner in the court below which was approved in an Order dated
February 20, 1975, the pertinent portion of which reads as follows:

1. That there exists an irrigation canal for the use of the defendants diverting water
coming from the Silmod River, Tinambac, Camarines Sur, passing on the ricelands of
the latter to the plaintiff's land irrigating the land of the latter, although plaintiff claims it
existed since 1952 up to the present, but disputed by the defendants.

2. That the plaintiff has an approved water rights Grant issued by the Department of
Public Works, Transportation and Communications, which plaintiff claims it for
beneficial use to irrigate their land from the Silmod River and defendants dispute said
claim

3. That as of now, defendants have no approved Water Rights Grant issued by the
proper authorities for the use of the water for irrigation purposes from the Silmod River.
 However, defendants have a pending application for Water Rights, the water of which
shall pass thru a different irrigation canal.

4. That one of the defendants' predecessors-in-interest, Abundio Barallas had a written

contract with the plaintiff, which defendants claim easement of aqueduct Defendants
are questioning the legality, enforceability and validity of such contract.

xxx xxx xxx

6. That defendants refused to surrender their Transfer Certificate of Title of her land for
purposes of annotation of the contract, allegedly an easement of aqueduct on the
ground that she questions the validity, enforceability, legality and therefore they are not
bound by the same.

From the foregoing stipulations, private respondents admit that petitioner, then plaintiff, has
an approved Water Rights Grant issued by the Department of Public Works, Transportation
and Communications. Private respondents, however, contend that the said grant does not
pertain to the beneficial use of irrigation water from Silmod River. The records, however, do
not show any other irrigation water going to petitioner's property passing thru respondents'
lot aside from that coming from the Silmod River. Respondents' controversion of petitioner's
right to irrigation water specifically from Silmod River is undoubtedly a lame denial.

Aside from this admission, the record clearly discloses an approved Water Rights Grant in
favor of petitioner. Dr. Bienvenido V. Amistoso, which was approved on November 13, the
Acting Secretary of Public Works and Commission David M. Consunji. (Exh. 1) The grant
was made three (3) years before the promulgation of P.D. 1067 on December 31, 1976,
known as the Water Code of the Philippines, which revised and consolidated the laws
governing ownership, appropriation, option exploitation, development, conservation and
protection of water resources thereby repealing among others, the provisions of the Spanish
Law of Water of August 3, 1866, the Civil Code of Spain of 1889, and the Civil Code of the
Philippines on ownership of water, easement relating to water and of public water and
acquisitive prescription on the use of water which are inconsistent with the provisions of said
Code (Art. 10, P.D. 1067).lwphl@itç

The water rights grant partakes the nature of a document known as a water
permit recognized under Article 13 of P.D. 1067, which provides:

Article 13. Except as otherwise herein provided, no person, including Government

instrumentalities or government-owned or controlled corporations, shall appropriate
water without a water right, which shall be evidenced by a document known as a water
permit.

Water right is the 7 granted by the government to appropriate and use water.

As to the validity of the WATER RIGHTS GRANT of Amistoso upon the promulgation of P.D.
1067 on December 31, 1976, the governing provision of law is found in the Transitory and
Final Provisions of P.D. 1067. It fans under "acts and contracts under the regime of old
laws". Article 97 provides, thus:
 Article 97. Acts and contracts under the regime of old laws, ff they are valid in
accordance therewith, shag be respected, subject to the stations established in this
Code. Any modification or extension of these acts and contracts after the promulgation
of this Code, shall be subject to the provisions hereof.

It may be observed that the WATER RIGHTS GRANT of Amistoso does not fall under
"claims for a right to use water existing on or before December 31, 1974" which under P.D.
1067 are required to be registered with the National Water Resources Council within two (2)
years from promulgation of P.D. 1067, otherwise it is deemed waived and the use thereof
deemed abandoned. It is no longer a mere "claim" inasmuch as there was already a GRANT
by the Secretary of Public Works, Transportation and Communications (the official then
authorized to issue said grant) on November 13, 1973 after complying with all the
requirements then prescribed by law for such grant.

The grant contradicts the erroneous findings of the respondent Judge, and incontrovertibly
entitles petitioner to the beneficial use of water from Silmod River. That right is now a. vested
one and may no longer be litigated as to bring petitioner's case within the jurisdiction of the
National Water Resources Council. To resurrect that issue — right to the use of invistigation
water from Silmod River — will be violative of the rule on res judicata which also applies with
equal vigor and effect to quasi judicial tribunal (Brillantes vs. Castro, 99 Phils. 497, Ipekdjian
Merchandising, Inc. vs. Court of Tax Appeals, 9 SCRA 72, September 30,1963).

As correctly postulated by the petitioner, the court a quo is not being asked to grant
petitioner the right to use but to compel private respondents to recognize that right and have
the same annotated on respondent Neri's Torrens Certificate of Title. Resort to judicial
intervention becomes necessary because of the closure made by the respondents of the
irrigation canal thus depriving the petitioner to continue enjoying irrigation water coming from
Silmod River through respondents' property. The interruption of the free flow of water caused
by the refusal to re-open the closed irrigation canal constituted petitioner's cause of action in
the court below, which decidedly do not fall within the domain of the authority of the National
Water Resources Council

Respondents, however, rely very heavily on the dictum laid down in the Abe-Abe vs.
Manta, No. L-4827, May 31, 1979, 90 SCRA 524, wherein it was held that —

It is incontestable that the petitioner's immediate recourse is to ventilate their grievance

with the National Water Resources Council which, as already noted, is the
administrative agency exclusively vested with original jurisdiction to settle water rights
disputes under the water code and under Presidential Decree No. 424.

The Code assumes that it is more expeditious and pragmatic to entrust to an

administrative agency the settlement of water rights disputes rather than require the
claimants to go directly to the court where the proceedings are subject to unavoidable
delays which are detrimental to the parties ...

That jurisdiction of the Council under Section 2(b) of Presidential Decree No. 424 is
reaffirmed in Section 88 of the Water Code and in Section 3rd thereof which provides
that 'the utlization exploitation, development, conservation and protection of water
 resources shall be subject to the control and regulation of the government through the
Council

The said pronouncement, however, finds no application to the instant case for in there, both
petitioners and respondent have no established right emanating from any grant by any
governmental agency to the use, appropriation and exploitation of water. In the case at bar,
however, a grant indubitably exists in favor of the petitioner. It is the enjoyment of the right
emanating from that grant that is in litigation. Violation of the grantee's right, who in this case
is the petitioner, by the closure of the irrigation canal, does not bring the case anew within
the jurisdiction of the National Water Resources Council.

WHEREFORE, the Order of the Honorable respondent Judge of January 14, 1981, is hereby
SET ASIDE. Private respondents are hereby ordered to RECOGNIZE petitioner's
BASEMENT of water and to surrender to the Register of Deeds of Camarines Sur the
owner's duplicate Transfer Certificate of Title No. 14216 covering respondent Epifania Neri's
property so that petitioner's right to the beneficial use of said irrigation canal and water
passing through the same may be annotated thereon.

SO ORDERED.