Natural Resources and Environmental Law 13

(b) belongs to the State, without being for public use, and is intended for some public service or for the
development of the national wealth.
Land belonging to the State that is not of such character, or although of such character but no longer
intended for public use or for public service forms part of the patrimonial property of the State. Land
that is other than part of the patrimonial property of the State, provinces, cities and municipalities is of
private ownership if it belongs to a private individual.
Pursuant to the Regalian Doctrine (Jura Regalia), a legal concept first introduced into the country from
the West by Spain through the Laws of the Indies and the Royal Cedulas, all lands of the public domain
belong to the State. This means that the State is the source of any asserted right to ownership of land, and
is charged with the conservation of such patrimony.
All lands not appearing to be clearly under private ownership are presumed to belong to the State. Also,
public lands remain part of the inalienable land of the public domain unless the State is shown to have
reclassified or alienated them to private persons.
A positive act of the Government is necessary to enable such reclassification, and the exclusive
prerogative to classify public lands under existing laws is vested in the Executive Department, not in the
courts. If, however, public land will be classified as neither agricultural, forest or timber, mineral or
national park, or when public land is no longer intended for public service or for the development of the
national wealth, thereby effectively removing the land from the ambit of public dominion, a declaration of
such conversion must be made in the form of a law duly enacted by Congress or by a Presidential
proclamation in cases where the President is duly authorized by law to that effect. Thus, until the
Executive Department exercises its prerogative to classify or reclassify lands, or until Congress or the
President declares that the State no longer intends the land to be used for public service or for the
development of national wealth, the Regalian Doctrine is applicable.
(2.) Petitioners failed to present sufficient evidence to establish that they and their
predecessors-in-interest had been in possession of the land since June 12, 1945. Without satisfying the
requisite character and period of possession – possession and occupation that is open, continuous,
exclusive, and notorious since June 12, 1945, or earlier – the land cannot be considered ipso jure
converted to private property even upon the subsequent declaration of it as alienable and disposable.

Prescription never began to run against the State, such that the land has remained ineligible for
registration under Section 14(1) of the Property Registration Decree. Likewise, the land continues to be
ineligible for land registration under Section 14(2) of the Property Registration Decree unless Congress
enacts a law or the President issues a proclamation declaring the land as no longer intended for public
service or for the development of the national wealth.

10. Miners Association vs. Factoran, GR No. 98332, January 16, 1995
Full text: ​GR No. 98332
Natural Resources and Environmental Law 14

FACTS: Former President Corazon Aquino issued Executive Order Nos 211 and 279 in the exercise of her
legislative powers. EO No. 211 prescribes the interim procedures in the processing and approval of
applications for the exploration, development and utilization of minerals pursuant to Section 2, Article XII
of the 1987 Constitution. EO No. 279 authorizes the DENR Secretary to negotiate and conclude
joint-venture, co-production, or production- sharing agreements for the exploration, development, and
utilization of mineral resources.
The issuance and the impeding implementation by the DENR of Administrative Order Nos. 57 which
declares that all existing mining leases or agreements which were granted after the effectivity of the 1987
Constitution…shall be converted into production-sharing agreements within one (1) year from the
effectivity of these guidelines.” and Administrative Order No. 82 which provides that a failure to submit
Letter of Intent and Mineral Production-Sharing Agreement within 2 years from the effectivity of the
Department Administrative Order No. 57 shall cause the abandonment of the mining, quarry, and sand
and gravel claims, after their respective effectivity dates compelled the Miners Association of the
Philippines, Inc., an organization composed of mining prospectors and claim owners and claim holders, to
file the instant petition assailing their validity and constitutionality before this Court.
ISSUE: ​Are the two Department Administrative Orders valid?
HELD: Yes. Petitioner's insistence on the application of Presidential Decree No. 463, as amended, as the
governing law on the acceptance and approval of declarations of location and all other kinds of
applications for the exploration, development, and utilization of mineral resources pursuant to Executive
Order No. 211, is erroneous. Presidential Decree No. 463, as amended, pertains to the old system of
exploration, development and utilization of natural resources through "license, concession or lease"
which, however, has been disallowed by Article XII, Section 2 of the 1987 Constitution. By virtue of the
said constitutional mandate and its implementing law, Executive Order No. 279 which superseded
Executive Order No. 211, the provisions dealing on "license, concession or lease" of mineral resources
under Presidential Decree No. 463, as amended, and other existing mining laws are deemed repealed and,
therefore, ceased to operate as the governing law. In other words, in all other areas of administration and
management of mineral lands, the provisions of Presidential Decree No. 463, as amended, and other
existing mining laws, still govern. Section 7 of Executive Order No. 279 provides, thus:
Sec. 7. All provisions of Presidential Decree No. 463, as amended, other existing mining
laws, and their implementing rules and regulations, or parts thereof, which are not
inconsistent with the provisions of this Executive Order, shall continue in force and effect.
Well -settled is the rule, however, that regardless of the reservation clause, mining leases or agreements
granted by the State, such as those granted pursuant to Executive Order No. 211 referred to this petition,
are subject to alterations through a reasonable exercise of the police power of the State. Accordingly, the
State, in the exercise of its police power in this regard, may not be precluded by the constitutional
restriction on non-impairment of contract from altering, modifying and amending the mining leases or
agreements granted under Presidential Decree No. 463, as amended, pursuant to Executive Order No.
211. Police Power, being co-extensive with the necessities of the case and the demands of public interest;
extends to all the vital public needs. The passage of Executive Order No. 279 which superseded Executive
Natural Resources and Environmental Law 15

Order No. 211 provided legal basis for the DENR Secretary to carry into effect the mandate of Article XII,
Section 2 of the 1987 Constitution.
WHEREFORE, the petition is DISMISSED for lack of merit.
11. Narra Nickel Mining vs. Redmont, GR No. 195580, January 28, 2015
Full text: ​GR No. 195580

FACTS: ​Redmont Consolidated Mines, Inc. (Redmont) filed before the Panel of Arbitrators (POA) of the
DENR separate petitions for denial of McArthur Mining, Inc. (McArthur), Tesoro and Mining and
Development, Inc. (Tesoro), and Narra Nickel Mining and Development Corporation (Narra) applications
Mineral Production Sharing Agreement (MPSA) on the ground that they are not “qualified persons” and
thus disqualified from engaging in mining activities through MPSAs reserved only for Filipino citizens.
McArthur Mining, Inc., is composed, among others, by Madridejos Mining Corporation (Filipino) owning
5,997 out of 10,000 shares, and MBMI Resources, Inc. (Canadian) owning 3,998 out of 10,000 shares;
MBMI also owns 3,331 out of 10,000 shares of Madridejos Mining Corporation;
Tesoro and Mining and Development, Inc., is composed, among others, by Sara Marie Mining, Inc.
(Filipino) owning 5,997 out of 10,000 shares, and MBMI Resources, Inc. (Canadian) owning 3,998 out of
10,000 shares; MBMI also owns 3,331 out of 10,000 shares of Sara Marie Mining, Inc.;
Narra Nickel Mining and Development Corporation, is composed, among others, by Patricia Louise
Mining & Development Corporation (Filipino) owning 5,997 out of 10,000 shares, and MBMI Resources,
Inc. (Canadian) owning 3,998 out of 10,000 shares; MBMI also owns 3,396 out of 10,000 shares of
Patricia Louise Mining & Development Corporation;
ISSUES: (1) Is the Grandfather Rule applicable? (2) Whether McArthur, Tesoro and Narra are Filipino
nationals.
HELD:
(1) YES. The instant case presents a situation which exhibits a scheme employed by stockholders to
circumvent the law, creating a cloud of doubt in the Court’s mind. To determine, therefore, the actual
participation, direct or indirect, of MBMI, the grandfather rule must be used.
The Strict Rule or the Grandfather Rule pertains to the portion in Paragraph 7 of the 1967 SEC Rules
which states, “but if the percentage of Filipino ownership in the corporation or partnership is less than
60%, only the number of shares corresponding to such percentage shall be counted as of Philippine
nationality.” Under the Strict Rule or Grandfather Rule Proper, the combined totals in the Investing
Corporation and the Investee Corporation must be traced (i.e., “grandfathered”) to determine the total
percentage of Filipino ownership.
(2) NO. Petitioners McArthur, Tesoro and Narra are not Filipino since MBMI, a 100% Canadian
corporation, owns 60% or more of their equity interests. Such conclusion is derived from grandfathering
petitioners’ corporate owners. xxx Noticeably, the ownership of the “layered” corporations boils down to
xxx group wherein MBMI has joint venture agreements with, practically exercising majority control over
the corporations mentioned. In effect, whether looking at the capital structure or the underlying
Natural Resources and Environmental Law 16

relationships between and among the corporations, petitioners are NOT Filipino nationals and must be
considered foreign since 60% or more of their capital stocks or equity interests are owned by MBMI.

12. Manila International Airport Authority vs. Court of Appeals, GR No. 155650, July 20, 2006
Full text: ​GR No. 155650

FACTS: Petitioner Manila International Airport Authority (MIAA) operates the Ninoy Aquino
International Airport (NAIA) complex in Parañaque City under Executive Order No. 9303, otherwise
known as the revised charter of the MIAA. EO 903 was issued on July 21, 1983 by then President
Ferdinand E. Marcos. Subsequently EO 909 and 298 amended the MIAA charter as operator of the
international operator, MIAA administers the land, improvements, and equipments within the NAIA
complex. The MIAA charter transferred to MIAA approximately 600 hectares of land, including the
runways and buildings then under the Bureau of Air Transportation. The MIAA charter provides that no
portion of the land transferred to MIAA shall be disposed of through sale or any other mode unless
specifically approved by the President of the Philippines. On March 21, 1997, the Office of the
Government Corporate Counsel issued opinion no. 061. The OGCC opined that the local government code
of 1991 withdraw the exemption from real estate tax granted to MIAA under section 21 of the MIAA
charter. Thus, MIAA negotiated with respondent city of Parañaque to pay the real estate tax imposed by
the city. MIAA then paid some of the real estate tax already due. On July 17, 2001, the City of Parañaque,
through its city treasurer issued notices of levy and warrants of levy on the airport lands and buildings.
The mayor of the city of Parañaque threatened to sell at public auction the airport lands and buildings
should MIAA fail to pay the real estate tax deliquency. MIAA thus sought clarification of OGCC opinion no.
061. On August 9, 2001, the OGCC issued opinion no. 147 clarifying OGCC opinion no. 061. The OGCC
pointed out that section 206 of the local government code requires persons exempt from real estate tax
to show proof of exemption. The OGCC opined that section 21 of the MIAA charter is the proof that MIAA
is exempt from real estate tax.
ISSUE:​ Whether or not the airport lands and buildings are exempt from real estate tax.
HELD: Yes. MIAA is a government instrumentality vested with corporate powers to perform efficiently its
governmental functions. MIAA is like any other government instrumentality, the only difference is that
MIAA is vested with corporate powers. Section 21 (10) of the introductory provisions of the
administrative code defines a government instrumentality as follows:

Sec 2 General terms defined

xxx

10.) Instrumentality refers to any agency of the national government, not integrated within the
department framework, vested with special functions or jurisdiction by law, endowed with some if not all
Natural Resources and Environmental Law 17

corporate powers, administering special funds, and enjoying operational autonomy, usually through a
charter.

When the law vests in a government instrumentality corporate powers, the instrumentality does not
become a corporation. Unless the government instrumentality is organized as a stock or non-stock
corporation, it remains a government instrumentality exercising not only governmental but also
corporate powers. Thus, MIAA exercises the governmental powers of eminent domain, police authority
and the surging of fees and charges. At the same time, MIAA exercises all the powers of a corporation
under the corporation law, in so far as these powers are not inconsistent with the provisions of this
executive order.

A government instrumentality like MIAA falls under section 133 (o) of the local government code, which
states:

Sec 133 Common limitations on the taxing powers of the local government units – Unless otherwise
provided herein, the exercise of the taxing power of the provinces, cities, municipalities and barangays
shall not extend to the levy of the following:

xxx

o.) Taxes, fees or charges of any kind on the national government, its agencies and instrumentalities and
local government units.

Section 133 (0) recognizes the basic principles that local governments cannot tax the national
government, which historically, merely delegated to the local governments the power to tax. While the
1987 constitution now includes taxation as one of the powers of the local governments, local
governments may only exercise such powers subject to such guidelines and limitations as the congress
may provide.

E. Social Justice and Human Rights

*STUDY BREAK REMINDER: PLEASE DON’T FORGET TO TAKE CARE OF YOURSELF!*

II. General Environmental Laws

1. Republic vs. IAC, GR No. 75042, November 29, 1988

FACTS: ​Properties Involved: (a) Lots 1, 2, and 3 situated in Barrio Masin, Municipality of Candelaria,
Quezon Province. (b) Lot 4 located in Barrio Bucal (Taguan), Municipality of Candelaria, Quezon Province.
On February 2, 1979, the Roman Catholic Bishop of Lucena filed an application for confirmation of title
for the aforementioned four parcels of land. However, the Solicitor-General (in behalf of the Director of
Lands and the Director of the Bureau of Forest Development) filed an opposition to this application on
April 20, 1979, citing that the Bishop of Lucena did not have an imperfect title or title in fee simple to the
parcels of land being applied for.
The Bishop of Lucena provided evidence that Lot 1 was acquired by the Roman Catholic Church thru Rev.
Father Raymundo Esquenet by purchase from the spouses Atanacio Yranso and Maria Coronado on
October 20, 1928, while Lot 2 was acquired by purchase from the spouses Benito Maramot and Venancia
Descaller on May 22, 1969.