Cruz, Kristine Myrr R.

2 – C Natural Resources and Environmental Law

4th Set of Case Digests

G.R. Nos. 152613 & 152628

APEX MINING CO., INC., vs. Southeast Mindanao Gold Mining Corp.,(SEM) et. Al

FACTS: A motion for reconsideration was filed by SEM. The Assailed Decision held that the assignment of Exploration Permit (EP) 133 in favor of SEM violated one of the conditions stipulated in the permit. It also ruled that the transfer of EP 133 violated Presidential Decree No. 463, which requires that the assignment of a mining right be made with the prior approval of the Secretary of the Department of Environment and Natural Resources (DENR).

It likewise upheld the validity of Proclamation No. 297 absent any question against its validity. In view of this, and considering that under Section 5 of Republic Act No. 7942, otherwise known as the “Mining Act of 1995,” mining operations in mineral reservations may be undertaken directly by the State or through a contractor, the Court deemed the issue of ownership of priority right over the contested Diwalwal Gold Rush Area as having been overtaken by the said proclamation.

It was held in the Assailed Decision that it is now within the prerogative of the Executive Department to undertake directly the mining operations of the disputed area or to award the operations to private entities including petitioners Apex and Balite, subject to applicable laws, rules and regulations, and provided that these private entities are qualified.

Apex, for its part, filed a Motion for Clarification of the Assailed Decision, praying that the Court elucidate on the Decision’s pronouncement that “mining operations, are now, therefore within the full control of the State through the executive branch.” Moreover, Apex asks this Court to order the Mines and Geosciences Board (MGB) to accept its application for an exploration permit. As well as Balite filed its Motion and application.

ISSUE: Whether the transfer or assignment of Exploration Permit (EP) 133 by MMC to SEM was validly made without violating any of the terms and conditions set forth in Presidential Decree No. 463 and EP 133 itself.

HELD: The former was decided on facts and issues that were not attendant in the latter, such as the expiration of EP 133, the violation of the condition embodied in EP 133 prohibiting its assignment, and the unauthorized and invalid assignment of EP 133 by MMC to SEM, since this assignment was effected without the approval of the Secretary of DENR.

SEM did not acquire the rights attached to EP 133, since their transfer was without legal effect. Granting for the sake of argument that SEM was a valid

transferee of the permit, its right is not that of a mining contractor. An exploration permit grantee is vested with the right to conduct exploration only, while an FTAA or MPSA contractor is authorized to extract and carry off the mineral resources that may be discovered in the area.

Recognizing the importance of the countrys natural resources, not only for national economic development, but also for its security and national defense, Section 5 of Republic Act No. 7942 empowers the President, when the national interest so requires, to establish mineral reservations where mining operations shall be undertaken directly by the State or through a contractor, viz:

SEC 5. Mineral Reservations. When the national interest so requires, such as when there is a need to preserve strategic raw materials for industries critical to national development, or certain minerals for scientific, cultural or ecological value, the President may establish mineral reservations upon the recommendation of the Director through the Secretary. Mining operations in existing mineral reservations and such other reservations as may thereafter be established, shall be undertaken by the Department or through a contractor x x x.

Republic Act No. 7942 Otherwise Known as the Philippine Mining Act of 1995, is the Applicable Law. Determined to rivet its crumbling cause, SEM then argues that Proclamation No. 297 is invalid, as it transgressed the statutes governing the exclusion of areas already declared as forest reserves, such as Section 1 of Republic Act No. 3092, Section 14 of the Administrative Code of 1987, Section 5(a) of Republic Act No. 7586, and Section 4(a) of Republic Act No. 6657.

Section 5 of Republic Act No. 7942 authorizes the President to establish mineral reservations, to wit:

Sec. 5. Mineral Reservations. - When the national interest so requires, such as when there is a need to preserve strategic raw materials for industries critical to national development, or certain minerals for scientific, cultural or ecological value, the President may establish mineral reservations upon the recommendation of the Director through the Secretary. Mining operations in existing mineral reservations and such other reservations as may thereafter be established, shall be undertaken by the Department or through a contractor x x x.

G.R. No. 163101 February 13, 2008BENGUET CORPORATION, Petitioner, - versus - DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES - MINES ADJUDICATION BOARD and J.G. REALTY AND MINING Promulgated: CORPORATION, Respondents.

FACTS: On June 1, 1987, Benguet and J.G. Realty entered into a Royalty Agreement with Option to Purchase (RAWOP), wherein J.G. Realty was acknowledged as the owner of four mining claims respectively named as Bonito-I, Bonito-II, Bonito-III, and Bonito-IV, with a total area of 288.8656 hectares, situated in Barangay Luklukam, Sitio Bagong Bayan, Municipality of Jose Panganiban, Camarines Norte. The parties also executed a Supplemental Agreement dated June 1, 1987. The mining claims were covered by MPSA Application No. APSA-V-0009 jointly filed by J.G. Realty as claim owner and Benguet as operator.

In the RAWOP, Benguet obligated itself to perfect the rights to the mining claims and/or otherwise acquire the mining rights to the mineral claims. Within 24 months from the execution of the RAWOP. Benguet should also cause the examination of the mining claims if they are worth developing with reasonable probability of profitable production and also shall conduct all necessary exploration in accordance with a prepared exploration program. It is also provided in the RAWOP that if the mining claims were placed in commercial production by Benguet, J.G. Realty should be entitled to a royalty of five percent (5%) of net realizable value, and to royalty for any production done by Benguet whether during the examination or development periods.

On August 9, 1989, the Executive Vice-President of Benguet, Antonio N. Tachuling, issued a letter informing J.G. Realty of its intention to develop the mining claims. However, on February 9, 1999, J.G. Realty, through its President, Johnny L. Tan, then sent a letter to the President of Benguet informing the latter that it was terminating the RAWOP on the following grounds: a. The fact that your company has failed to perform the obligations set forth in the RAWOP, i.e., to undertake development works within 2 years from the execution of the Agreement; b. Violation of the Contract by allowing high graders to operate on our claim; c. No stipulation was provided with respect to the term limit of the RAWOP; d. Non-payment of the royalties thereon as provided in the RAWOP.

In response, Benguets Manager for Legal Services, Reynaldo P. Mendoza, wrote J.G. Realty a letter dated March 8, 1999, therein alleging that Benguet complied with its obligations under the RAWOP. It appeared that, previously, the practice by J.G. Realty was to pick-up checks from Benguet representing such royalties. However, starting August 1994, J.G. Realty allegedly refused to collect such checks from Benguet. Thus, Benguet posited that there was no valid ground for the termination of the RAWOP. It also reminded J.G. Realty that it should submit the disagreement to arbitration rather than unilaterally terminating the RAWOP.

On June 7, 2000, J.G. Realty filed a Petition for Declaration of Nullity/Cancellation of the RAWOP with the Legaspi City POA, Region V,

docketed as DENR Case No. 2000-01 and entitled J.G. Realty v. Benguet, hence, cancelled.

Benguet filed a Notice of Appeal with the MAB on April 23, 2001, docketed as Mines Administrative Case No. R-M-2000-01. Thereafter, the MAB issued the assailed December 2, 2002 Decision. Benguet then filed a Motion for Reconsideration of the assailed Decision which was denied in the March 17, 2004 Resolution of the MAB.

ISSUE: Whether the arbitrators had jurisdiction over the case.

HELD: In its July 20, 2004 Comment, J.G. Realty reiterated the above rulings of the MAB Panel of Arbitrators (POA) and MAB. It argued that RA 7942 or the Philippine Mining Act of 1995 is a special law which should prevail over the stipulations of the parties and over a general law, such as RA 876. It also argued that the POA cannot be considered as a court under the contemplation of RA 876 and that jurisprudence saying that there must be prior resort to arbitration before filing a case with the courts is inapplicable to the instant case as the POA is itself already engaged in arbitration.

The contention that RA 7942 prevails over RA 876 presupposes a conflict between the two laws. Such is not the case here. To reiterate, availment of voluntary arbitration before resort is made to the courts or quasi-judicial agencies of the government is a valid contractual stipulation that must be adhered to by the parties. As stated in Secs. 6 and 7 of RA 876:

Section 6. Hearing by court. A party aggrieved by the failure, neglect or refusal of another to perform under an agreement in writing providing for arbitration may petition the court for an order directing that such arbitration proceed in the manner provided for in such agreement. Five days notice in writing of the hearing of such application shall be served either personally or by registered mail upon the party in default. The court shall hear the parties, and upon being satisfied that the making of the agreement or such failure to comply therewith is not in issue, shall make an order directing the parties to proceed to arbitration in accordance with the terms of the agreement. If the making of the agreement or default be in issue the court shall proceed to summarily hear such issue. If the finding be that no agreement in writing providing for arbitration was made, or that there is no default in the proceeding thereunder, the proceeding shall be dismissed. If the finding be that a written provision for arbitration was made and there is a default in proceeding thereunder, an order shall be made summarily directing the parties to proceed with the arbitration in accordance with the terms thereof.

x x x x

Section 7. Stay of civil action.If any suit or proceeding be brought upon an issue arising out of an agreement providing for the arbitration thereof, the court in which such suit or proceeding is pending, upon being satisfied that the issue involved in such suit or proceeding is referable to arbitration, shall stay the action or proceeding until an arbitration has been had in accordance with the terms of the

agreement: Provided, That the applicant, for the stay is not in default in proceeding with such arbitration.

In other words, in the event a case that should properly be the subject of voluntary arbitration is erroneously filed with the courts or quasi-judicial agencies, on motion of the defendant, the court or quasi-judicial agency shall determine whether such contractual provision for arbitration is sufficient and effective. If in affirmative, the court or quasi-judicial agency shall then order the enforcement of said provision.

G.R. No. 148267. August 8, 2002ARMANDO C. CARPIO, petitioner, vs. SULU RESOURCES DEVELOPMENT CORPORATION, respondent.

FACTS: A petition filed by respondent (Sulu Resources Development Corporation]) for Mines Production Sharing Agreement (MPSA) No. MPSA-IV-131, covering certain areas in Antipolo, Rizal. Petitioner Armando C. Carpio filed an opposition/adverse claim thereto, alleging, inter alia, that his landholdings in Cupang and Antipolo, Rizal will be covered by respondents claim, thus he enjoys a preferential right to explore and extract the quarry resources on his properties.

After due proceedings were held, the Panel of Arbitrators of the Mines and Geo-Sciences Bureau of the DENR rendered a Resolution that Armando C. Carpio is hereby upheld. Accordingly, the properties of CARPIO are ordered excluded from the area of PMPSA-IV-131 of SULU RESOURCES DEVELOPMENT CORPORATION, and the area not covered by the adverse claim as subject to mining locations in accordance with existing laws, rules and regulations.

Respondent appealed the foregoing Resolution to the Mines Adjudication Board. Meanwhile, petitioner filed a motion to dismiss appeal on the ground of respondents failure to comply with the requirements of the New Mining Acts Implementing Rules and Regulations.

On June 20, 1997, the Mines Adjudication Board rendered the assailed Order dismissing petitioners opposition/adverse claim. Citing Section 79 of Chapter XIII of the Philippine Mining Act of 1995 (RA 7942), the CA ruled that it did not have jurisdiction to review the Decision of the Mines Adjudication Board (MAB). The adjudication of conflicting mining claims is completely administrative in nature.

Under RA 7942, the settlement of disputes involving rights to mining areas, mineral agreements, and surface owners, occupants and claimholders/concessionaires shall pertain exclusively to a Panel of Arbitrators in the regional office of the Department of Environment and Natural Resources, whose decisions are appealable to the Mines Adjudication Board. Under Section 79 of RA 7942, the findings of fact by the MAB as well as its decision or order shall be final and executory.

ISSUE: Whether or not appeals from the Decision or Final Orders of the Mines Adjudication Board should be made directly to the Supreme Court as contended by the respondent and the Court of Appeals, or such appeals be first made to the Court of Appeals as contended by herein petitioner.

HELD: Factual controversies are usually involved in administrative actions; and the CA is prepared to handle such issues because, unlike this Court, it is mandated to rule on questions of fact. In Metro Construction, we observed that not only did the CA have appellate jurisdiction over Construction Industry Arbitration Commission (CIAC) decisions and orders, but the review of such decisions included questions of fact and law. At the very least when factual findings of the

MAB are challenged or alleged to have been made in grave abuse of discretion as in the present case, the CA may review them, consistent with the constitutional duty of the judiciary.

There are sufficient legal footings authorizing a review of the MAB Decision under Rule 43 of the Rules of Court. First, Section 30 of Article VI of the 1987 Constitution, mandates that [n]o law shall be passed increasing the appellate jurisdiction of the Supreme Court as provided in this Constitution without its advice and consent. On the other hand, Section 79 of RA No. 7942 provides that decisions of the MAB may be reviewed by this Court on a petition for review by certiorari. This provision is obviously an expansion of the Courts appellate jurisdiction, an expansion to which this Court has not consented. Indiscriminate enactment of legislation enlarging the appellate jurisdiction of this Court would unnecessarily burden it.

The Supreme Court, in the exercise of its rule-making power, transfers to the CA pending cases involving a review of a quasi-judicial bodys decisions, such transfer relates only to procedure; hence, it does not impair the substantive and vested rights of the parties. The aggrieved parties’ right to appeal is preserved; what is changed is only the procedure by which the appeal is to be made or decided. The parties still have a remedy and a competent tribunal to grant this remedy.

The Revised Rules of Civil Procedure included Rule 43 to provide a uniform rule on appeals from quasi-judicial agencies. Under the rule, appeals from their judgments and final orders are now required to be brought to the CA on a verified petition for review. A quasi-judicial agency or body has been defined as an organ of government, other than a court or legislature, which affects the rights of private parties through either adjudication or rule-making. MAB falls under this definition; hence, it is no different from the other quasi-judicial bodies enumerated under Rule 43. Besides, the introductory words in Section 1 of Circular No. 1-91 -- among these agencies are -- indicate that the enumeration is not exclusive or conclusive and acknowledge the existence of other quasi-judicial agencies which, though not expressly listed, should be deemed included therein.

The Court realizes that under Batas Pambansa (BP) Blg. 129 as amended by RA No. 7902, factual controversies are usually involved in decisions of quasi-judicial bodies; and the CA, which is likewise tasked to resolve questions of fact, has more elbow room to resolve them. By including questions of fact among the issues that may be raised in an appeal from quasi-judicial agencies to the CA, Section 3 of Revised Administrative Circular No. 1-95 and Section 3 of Rule 43 explicitly expanded the list of such issues.

According to Section 3 of Rule 43, [a]n appeal under this Rule may be taken to the Court of Appeals within the period and in the manner herein provided whether the appeal involves questions of fact, of law, or mixed questions of fact and law. Hence, appeals from quasi-judicial agencies even only on questions of law may be brought to the CA.

The judicial policy of observing the hierarchy of courts dictates that direct resort from administrative agencies to this Court will not be entertained, unless the redress desired cannot be obtained from the appropriate lower tribunals, or unless exceptional and compelling circumstances justify availment of a remedy falling within and calling for the exercise of our primary jurisdiction.

Consistent with these rulings and legal bases, we therefore hold that Section 79 of RA 7942 is likewise to be understood as having been modified by Circular No. 1-91, BP Blg. 129 as amended by RA 7902, Revised Administrative Circular 1-95, and Rule 43 of the Rules of Court. In brief, appeals from decisions of the MAB shall be taken to the CA through petitions for review in accordance with the provisions of Rule 43 of the 1997 Rules of Court.

G.R. No. 169080

CELESTIAL NICKEL MINING EXPLORATION CORPORATION, Petitioner, - versus - MACROASIA CORPORATION TINGA, (formerly INFANTA MINERAL AND VELASCO, JR., and INDUSTRIAL CORPORATION), CHICO-NAZARIO, BLUE RIDGE MINERAL CORPORATION, and LEBACH MINING CORPORATION, Respondents.

FACTS: On September 24, 1973, the then Secretary of Agriculture and Natural Resources and Infanta Mineral and Industrial Corporation (Infanta) entered into a Mining Lease Contract (V-1050) for a term of 25 years up to September 23, 1998 for mining lode claims covering an area of 216 hectares at Sitio Linao, Ipilan, Brookes Point, Palawan.

Infantas corporate name was changed to Cobertson Holdings Corporation on January 26, 1994 and subsequently to its present name, Macroasia Corporation, on November 6, 1995. Sometime in 1997, Celestial filed a Petition to Cancel the subject mining lease contracts and other mining claims of Macroasia including those covered by Mining Lease Contract No. V-1050, before the Panel of Arbitrators (POA) of the Mines and Geo-Sciences Bureau (MGB) of the DENR.

Blue Ridge, in an earlier letter-petition, also wrote the Director of Mines to seek cancellation of mining lease contracts and other mining rights of Macroasia and another entity, Lebach Mining Corporation (Lebach), in mining areas in Brookes Point.

Celestial is the assignee of 144 mining claims covering such areas contiguous to Infanta’s (now Macroasia) mining lode claims. Celestial also holds an MPSA with the government which covers 2,835 hectares located at Ipilan/Maasin, Brooke’s Point, Palawan and two pending applications covering another 4,040 hecta res in Barangay Mainit also in Brooke’s Point. Celestial sought the cancellation of Macroasia’s lease contracts. Macroasia refuted the grounds for cancellation invoked by Celestial.

The Ruling of the Panel of Arbitrators found that Macroasia and Lebach not only automatically abandoned their areas/mining claims but likewise had lost all their rights to the mining claims. The POA granted the petition of Celestial to cancel the following Mining Lease Contracts of Macroasia and found the claims of the others indubitably meritorious. It gave Celestial the preferential right to Macroasias mining areas. Blue Ridge and Macroasia appealed before the MAB.

The Rulings of the Mines Adjudication Board affirmed the POA findings that Macroasia abandoned its mining claims. The MAB found that Macroasia did not comply with its work obligations from 1986 to 1991. It based its conclusion on the field verifications conducted by the MGB, Region IV and validated by the Special Team tasked by the MAB. However, contrary to the findings of the POA, the MAB found that it was Blue Ridge that had prior and preferential rights over the mining claims of Macroasia, and not Celestial.

On April 15, 2005, the CA 12th Division affirmed the November 26, 2004 MAB Resolution which declared Macroasias seven mining lease contracts as

subsisting; rejected Blue Ridges claim for preferential right over said mining claims; and upheld the exclusive authority of the DENR Secretary to approve, cancel, and revoke mineral agreements. The CA also denied Celestials Motion for Reconsideration of the assailed August 3, 2005 Resolution.

ISSUE: Whether or not it is only the Secretary of the DENR who has the jurisdiction to cancel mining contracts and privileges.

HELD: Under PD 463, The Mineral Resources Development Decree of 1974, which took effect on May 17, 1974, applications for lease of mining claims were required to be filed with the Director of the Bureau of Mines, within two (2) days from the date of their recording. Sec. 40 of PD 463 provided that if no adverse claim was filed within (15) days after the first date of publication, it was conclusively presumed that no adverse claim existed and thereafter no objection from third parties to the grant of the lease could be heard, except protests pending at the time of publication. The Secretary would then approve and issue the corresponding mining lease contract. In case of any protest or adverse claim relating to any mining claim and lease application, Secs. 48 and 50 of PD 463 prescribed the procedure. Under Sec. 48, the protest should be filed with the Bureau of Mines. Under Sec. 50, any party not satisfied with the decision or order of the Director could, within five (5) days from receipt of the decision or order, appeal to the Secretary. The decisions of the Secretary were likewise appealable within five (5) days from receipts by the affected party to the President of the Philippines whose decision shall be final and executory. PD 463 was, however, silent as to who was authorized to cancel the mineral agreements.

Under Sec. 2 of EO 211, the processing, evaluation, and approval of all mining applications, declarations of locations, operating agreements, and service contracts were governed by PD 463, as amended. EO 211 likewise did not contain any provision on the authority to cancel operating agreements and service contracts.

On July 25, 1987, EO 279 was issued by President Aquino. It authorized the DENR Secretary to negotiate and enter into, for and in behalf of the Government, joint venture, co-production, or production-sharing agreements for the exploration, development, and utilization of mineral resources with any Filipino citizen, corporation, or association, at least 60% of whose capital was owned by Filipino citizens. The contract or agreement was subject to the approval of the President. With respect to contracts of foreign-owned corporations or foreign investors involving either technical or financial assistance for large-scale exploration, development, and utilization of minerals, the DENR Secretary could recommend approval of said contracts to the President. EO 279 provided that PD 463 and its implementing rules and regulations, which were not inconsistent with EO 279, continued in force and effect. Again, EO 279 was silent on the authority to cancel mineral agreements.

RA 7942, The Philippine Mining Act of 1995 enacted on March 3, 1995, repealed the provisions of PD 463 inconsistent with RA 7942. Unlike PD 463, where the application was filed with the Bureau of Mines Director, the applications for mineral agreements are now required to be filed with the Regional Director as provided by Sec. 29 of RA 7942. The proper filing gave the proponent the prior

right to be approved by the Secretary and thereafter to be submitted to the President. The President shall provide a list to Congress of every approved mineral agreement within 30 days from its approval by the Secretary. Again, RA 7942 is silent on who has authority to cancel the agreement.

The power of the DENR Secretary to cancel mineral agreements emanates from his administrative authority, supervision, management, and control over mineral resources under Chapter I, Title XIV of Book IV of the Revised Administrative Code of 1987. It is the DENR, through the Secretary, that manages, supervises, and regulates the use and development of all mineral resources of the country. It has exclusive jurisdiction over the management of all lands of public domain, which covers mineral resources and deposits from said lands. It has the power to oversee, supervise, and police our natural resources which include mineral resources. Derived from the broad and explicit powers of the DENR and its Secretary under the Administrative Code of 1987 is the power to approve mineral agreements and necessarily to cancel or cause to cancel said agreements.

RA 7942 confers to the DENR Secretary specific authority over mineral resources.

Secs. 8 and 29 of RA 7942 pertinently provide:

SEC. 8. Authority of the Department.The Department shall be the primary government agency responsible for the conservation, management, development, and proper use of the States mineral resources including those in reservations, watershed areas, and lands of the public domain. The Secretary shall have the authority to enter into mineral agreements on behalf of the Government upon the recommendation of the Director, promulgate such rules and regulations as may be necessary to implement the intent and provisions of this Act.

SEC. 29. Filing and approval of Mineral Agreements.x x x.

The filing of a proposal for a mineral agreement shall give the proponent the prior right to areas covered by the same. The proposed mineral agreement will be approved by the Secretary and copies thereof shall be submitted to the President. Thereafter, the President shall provide a list to Congress of every approved mineral agreement within thirty (30) days from its approval by the Secretary. (Emphasis supplied.)

Sec. 29 is a carry over of Sec. 40 of PD 463 which granted jurisdiction to the DENR Secretary to approve mining lease contracts on behalf of the government, thus:

SEC. 40. Issuance of Mining Lease Contract. If no adverse claim is filed within fifteen (15) days after the first date of publication, it shall be conclusively presumed that no such adverse claim exists and thereafter no objection from third parties to the grant of the lease shall be heard, except protest pending at the time of publication, and the Secretary shall approve and issue the corresponding mining lease x x x.

G.R. No. 157882 March 30, 2006

DIDIPIO EARTH-SAVERS MULTI-PURPOSE ASSOCIATION, INCORPORATED (DESAMA), Petitioners, - versus- ELISEA GOZUN, in her capacity as SECRETARY of the DEPARTMENT OF ENVIRONMENT and NATURAL RESOURCES (DENR), Respondent.

FACTS: On 25 July 1987, then President Corazon C. Aquino promulgated Executive Order No. 279 which authorized the DENR Secretary to accept, consider and evaluate proposals from foreign-owned corporations or foreign investors for contracts of agreements involving either technical or financial assistance for large-scale exploration, development, and utilization of minerals, which, upon appropriate recommendation of the Secretary, the President may execute with the foreign proponent.

On 3 March 1995, then President Fidel V. Ramos signed into law Rep. Act No. 7942 entitled, An Act Instituting A New System of Mineral Resources Exploration, Development, Utilization and Conservation, otherwise known as the Philippine Mining Act of 1995.

On 15 August 1995, then DENR Secretary Victor O. Ramos issued DENR Administrative Order (DAO) No. 23, Series of 1995, containing the implementing guidelines of Rep. Act No. 7942. This was soon superseded by DAO No. 96-40, s. 1996, which took effect on 23 January 1997 after due publication.

On 20 June 1994, President Ramos executed an FTAA with AMC over a total land area of 37,000 hectares covering the provinces of Nueva Vizcaya and Quirino. AMC consolidated with Climax Mining Limited to form a single company that now goes under the new name of Climax-Arimco Mining Corporation (CAMC), the controlling 99% of stockholders of which are Australian nationals.

Counsels for petitioners filed a demand letter addressed to then DENR Secretary Heherson Alvarez, for the cancellation of the CAMC FTAA for the primary reason that Rep. Act No. 7942 and its Implementing Rules and Regulations DAO 96-40 are unconstitutional. This letter was indorsed to the DENR Secretary and eventually referred to the Panel of Arbitrators of the Mines and Geosciences Bureau (MGB), Regional Office No. 02, Tuguegarao, Cagayan, for further action.

On 12 November 2002, counsels for petitioners received a letter from the Panel of Arbitrators of the MGB requiring the petitioners to comply with the Rules of the Panel of Arbitrators before the letter may be acted upon.

Yet again, counsels for petitioners sent President Arroyo another demand letter dated 8 November 2002. Said letter was again forwarded to the DENR Secretary who referred the same to the MGB, Quezon City.

In a letter dated 19 February 2003, the MGB rejected the demand of counsels for petitioners for the cancellation of the CAMC FTAA.

Petitioners thus filed the present petition for prohibition and mandamus, with a prayer for a temporary restraining order: declaring unconstitutional the Philippine Mining Act of 1995 and Its Implementing Rules and Regulations.

ISSUES:

1) Whether or not the mining act and its implementing rules and regulations are void and unconstitutional for sanctioning an unconstitutional administrative process of determining just compensation.

2) Whether or not the state, through republic act no. 7942 and the CAMC FTAA, abdicated its primary responsibility to the full control and supervision over natural resources.

HELD: In seeking to nullify Rep. Act No. 7942 and its implementing rules DAO 96-40 as unconstitutional, petitioners set their sight on Section 76 of Rep. Act No. 7942 and Section 107 of DAO 96-40 which they claim allow the unlawful and unjust taking of private property for private purpose in contradiction with Section 9, Article III of the 1987 Constitution mandating that private property shall not be taken except for public use and the corresponding payment of just compensation. They assert that public respondent DENR, through the Mining Act and its Implementing Rules and Regulations, cannot, on its own, permit entry into a private property and allow taking of land without payment of just compensation.

petitioners claim that the entry into a private property by CAMC, pursuant to its FTAA, is for more than a momentary period and renewable for another 25 years; that the entry into the property is under the warrant or color of legal authority pursuant to the FTAA executed between the government and CAMC; and that the entry substantially ousts the owner or possessor and deprives him of all beneficial enjoyment of the property.

The doctrine in the Castellvi case, the nature of the mining activity, the extent of the land area covered by the CAMC FTAA and the various rights granted to the proponent or the FTAA holder, such as (a) the right of possession of the Exploration Contract Area, with full right of ingress and egress and the right to occupy the same; (b) the right not to be prevented from entry into private lands by surface owners and/or occupants thereof when prospecting, exploring and exploiting for minerals therein; (c) the right to enjoy easement rights, the use of timber, water and other natural resources in the Exploration Contract Area; (d) the right of possession of the Mining Area, with full right of ingress and egress and the right to occupy the same; and (e) the right to enjoy easement rights, water and other natural resources in the Mining Area, result in a taking of private property.

Public respondents are inclined to believe that by entering private lands and concession areas, FTAA holders do not oust the owners thereof nor deprive them of all beneficial enjoyment of their properties as the said entry merely establishes a legal easement upon surface owners, occupants and concessionaires of a mining contract area.

Petitioners charge that Rep. Act No. 7942, as well as its Implementing Rules and Regulations, makes it possible for FTAA contracts to cede over to a fully foreign-owned corporation full control and management of mining enterprises, with the result that the State is allegedly reduced to a passive regulator dependent

on submitted plans and reports, with weak review and audit powers. The State is not acting as the supposed owner of the natural resources for and on behalf of the Filipino people; it practically has little effective say in the decisions made by the enterprise. In effect, petitioners asserted that the law, the implementing regulations, and the CAMC FTAA cede beneficial ownership of the mineral resources to the foreign RA 7942 provides for the states control and supervision over mining operations. The following provisions thereof establish the mechanism of inspection and visitorial rights over mining operations and institute reportorial requirements in this manner:

1. Sec. 8 which provides for the DENRs power of over-all supervision and periodic review for the conservation, management, development and proper use of the States mineral resources;

2. Sec. 9 which authorizes the Mines and Geosciences Bureau (MGB) under the DENR to exercise direct charge in the administration and disposition of mineral resources, and empowers the MGB to monitor the compliance by the contractor of the terms and conditions of the mineral agreements, confiscate surety and performance bonds, and deputize whenever necessary any member or unit of the Phil. National Police, barangay, duly registered non-governmental organization (NGO) or any qualified person to police mining activities;

3. Sec. 66 which vests in the Regional Director exclusive jurisdiction over safety inspections of all installations, whether surface or underground, utilized in mining operations.

4. Sec. 35, which incorporates into all FTAAs the following terms, conditions and warranties:

(g) Mining operations shall be conducted in accordance with the provisions of the Act and its IRR.

(h) Work programs and minimum expenditures commitments.

x x x x

(k) Requiring proponent to effectively use appropriate anti-pollution technology and facilities to protect the environment and restore or rehabilitate mined-out areas.

(l) The contractors shall furnish the Government records of geologic, accounting and other relevant data for its mining operation, and that books of accounts and records shall be open for inspection by the government. x x x.

(m) Requiring the proponent to dispose of the minerals at the highest price and more advantageous terms and conditions.

x x x x

(o) Such other terms and conditions consistent with the Constitution and with this Act as the Secretary may deem to be for the best interest of the State and the welfare of the Filipino people contractor.

G.R. No. 162331 November 20, 2006

LEPANTO CONSOLIDATED MINING CO., Petitioner, -versus- WMC RESOURCES INTL. PTY. LTD., WMC PHILIPPINES, INC. and SAGITTARIUS MINES, INC., Respondents.

FACTS: On 22 March 1995, the Philippine Government and WMC Philippines, the local wholly-owned subsidiary of WMC Resources International Pty. Ltd. (WMC Resources) executed a Financial and Technical Assistance Agreement, denominated as the Columbio FTAA No. 02-95-XI (Columbio FTAA) for the purpose of large scale exploration, development, and commercial exploration of possible mineral resources in an initial contract area of 99,387 hectares located in the provinces of South Cotabato, Sultan Kudarat, Davao del Sur, and North Cotabato in accordance with Executive Order No. 279 and Department Administrative Order No. 63, Series of 1991.

The Columbio FTAA is covered in part by 156 mining claims held under various Mineral Production Sharing Agreements (MPSA) by Southcot Mining Corporation, Tampakan Mining Corporation, and Sagittarius Mines, Inc. (collectively called the Tampakan Companies), in accordance with the Tampakan Option Agreement entered into by WMC Philippines and the Tampakan Companies on 25 April 1991, as amended by Amendatory Agreement dated 15 July 1994, for purposes of exploration of the mining claims in Tampakan, South Cotabato. The Option Agreement, among other things, provides for the grant of the right of first refusal to the Tampakan Companies in case WMC Philippines desires to dispose of its rights and interests in the mining claims covering the area subject of the agreement.

WMC Resources subsequently divested itself of its rights and interests in the Columbio FTAA, and on 12 July 2000 executed a Sale and Purchase Agreement with petitioner Lepanto over its entire shareholdings in WMC Philippines, subject to the exercise of the Tampakan Companies exercise of their right of first refusal to purchase the subject shares. On 28 August 2000, petitioner sought the approval of the 12 July 2000 Agreement from the DENR Secretary.

On 10 January 2001, contending that the 12 July Agreement between petitioner and WMC Philippines had expired due to failure to meet the necessary preconditions for its validity, WMC Resources and the Tampakan Companies executed another Sale and Purchase Agreement, where Sagittarius Mines, Inc. was designated assignee and corporate vehicle which would acquire the shareholdings and undertake the Columbio FTAA activities. On 15 January 2001, Sagittarius Mines, Inc. increased its authorized capitalization to P250 million. Subsequently, WMC Resources and Sagittarius Mines, Inc. executed a Deed of Absolute Sale of Shares of Stocks on 23 January 2001.

After due consideration and evaluation of the financial and technical qualifications of Sagittarius Mines, Inc., the DENR Secretary approved the transfer of the Columbio FTAA from WMC Philippines to Sagittarius Mines, Inc. in the assailed Order. Aggrieved by the transfer of the Columbio FTAA in favor of

Sagittarius Mines, Inc., petitioner filed a Petition for Review of the Order of the DENR Secretary with the Office of the President.

ISSUE: Whether the propriety of the application to the Columbio FTAA of Republic Act No. 7942 or the Philippine Mining Act of 1995, particularly Section 40 thereof requiring the approval of the President of the assignment or transfer of financial or technical assistance agreements. Petitioner maintains that respondents failed to comprehend the express language of Section 40 of the Philippine Mining Act of 1995 requiring the approval of the President on the transfer or assignment of a financial or technical assistance agreement.

HELD: To resolve this matter, it is imperative at this point to stress the fact that the Columbio FTAA was entered into by the Philippine Government and WMC Philippines on 22 March 1995, undoubtedly before the Philippine Mining Act of 1995 took effect on 14 April 1995. Furthermore, it is undisputed that said FTAA was granted in accordance with Executive Order No. 279 and Department Administrative Order No. 63, Series of 1991, which does not contain any similar condition on the transfer or assignment of financial or technical assistance agreements. Thus, it would seem that what petitioner would want this Court to espouse is the retroactive application of the Philippine Mining Act of 1995 to the Columbio FTAA, a valid agreement concluded prior to the naissance of said piece of legislation.

Article 4 of the Civil Code provides that: Laws shall not have a retroactive effect unless therein otherwise provided. According to this provision of law, in order that a law may have retroactive effect it is necessary that an express provision to this effect be made in the law, otherwise nothing should be understood which is not embodied in the law.

In the case at bar, there is an absence of either an express declaration or an implication in the Philippine Mining Act of 1995 that the provisions of said law shall be made to apply retroactively, therefore, any section of said law must be made to apply only prospectively, in view of the rule that a statute ought not to receive a construction making it act retroactively, unless the words used are so clear, strong, and imperative that no other meaning can be annexed to them, or unless the intention of the legislature cannot be otherwise satisfied.

Be that as it may, assuming for the sake of argument that We are to apply the Philippine Mining Act of 1995 retrospectively to the Columbio FTAA, the lack of presidential approval will not be fatal as to render the transfer illegal, especially since, as in the instant case, the alleged lack of presidential approval has been remedied when petitioner appealed the matter to the Office of the President which approved the Order of the DENR Secretary granting the application for transfer of the Columbio FTAA to Sagittarius Mines, Inc.

G.R. No. 152644 February 10, 2006

JOHN ERIC LONEY, STEVEN PAUL REID and PEDRO B. HERNANDEZ, Petitioners, -versus - PEOPLE OF THE PHILIPPINES, Respondent.

FACTS: Petitioners John Eric Loney, Steven Paul Reid, and Pedro B. Hernandez are the President and Chief Executive Officer, Senior Manager, and Resident Manager for Mining Operations, respectively, of Marcopper Mining Corporation (Marcopper), a corporation engaged in mining in the province of Marinduque.

Marcopper had been storing tailings from its operations in a pit in Mt. Tapian, Marinduque. At the base of the pit ran a drainage tunnel leading to the Boac and Makalupnit rivers. It appears that Marcopper had placed a concrete plug at the tunnels end. On 24 March 1994, tailings gushed out of or near the tunnels end. In a few days, the Mt. Tapian pit had discharged millions of tons of tailings into the Boac and Makalupnit rivers.

In August 1996, the Department of Justice separately charged petitioners in the Municipal Trial Court of Boac, Marinduque (MTC) with violation of Article 91(B), sub-paragraphs 5 and 6 of Presidential Decree No. 1067 or the Water Code of the Philippines (PD 1067), Section 8 of Presidential Decree No. 984 or the National Pollution Control Decree of 1976 (PD 984), Section 108 of Republic Act No. 7942 or the Philippine Mining Act of 1995 (RA 7942), and Article 365 of the Revised Penal Code (RPC) for Reckless Imprudence Resulting in Damage to Property.

Petitioners move to quash the informations.

The Municipal Trial Court’s ruling is convinced that as far as the three (3) aforesaid laws are concerned, only the Information for [v]iolation of Philippine Mining Act should be maintained. In other words, the Informations for [v]iolation of Anti-Pollution Law (PD 984) and the Water Code (PD 1067) should be dismissed/quashed because the elements constituting the aforesaid violations are absorbed by the same elements which constitute violation of the Philippine Mining Act (RA 7942). Petitioners subsequently filed a petition for certiorari with the Regional Trial Court, Boac, Marinduque, assailing that portion of the Consolidated Order maintaining the Informations for violation of RA 7942.

Regional Trial Court, Branch 94 set aside the Consolidated Order in so far as it quashed the Informations for violation of PD 1067 and PD 984 and ordered those charges reinstated. Branch 94 affirmed the Consolidated Order in all other respects and denied the petitioner’s petition.

Petitioners filed a petition for certiorari with the Court of Appeals alleging that Branch 94 acted with grave abuse of discretion because (1) the Informations for violation of PD 1067, PD 984, RA 7942 and the Article 365 of the RPC proceed from and are based on a single act or incident of polluting the Boac and Makalupnit rivers thru dumping of mine tailings and (2) the duplicitous nature of the Informations. Hence, the Court of Appeals affirmed the Regional Trial Court, Branch 94 ruling.

ISSUE: Whether all the charges filed against petitioners except one should be quashed for duplicity of charges and only the charge for Reckless Imprudence Resulting in Damage to Property should stand.

HELD: Double jeopardy is not at issue because not all of its elements are present.[ However, for the limited purpose of controverting petitioners claim that they should be charged with one offense only, we quote with approval Branch 94s comparative analysis of PD 1067, PD 984, RA 7942, and Article 365 of the RPC showing that in each of these laws on which petitioners were charged, there is one essential element not required of the others, thus:

In P.D. 1067 (Philippines Water Code), the additional element to be established is the dumping of mine tailings into the Makulapnit River and the entire Boac River System without prior permit from the authorities concerned. The gravamen of the offense here is the absence of the proper permit to dump said mine tailings. This element is not indispensable in the prosecution for violation of PD 984 (Anti-Pollution Law), [RA] 7942 (Philippine Mining Act) and Art. 365 of the Revised Penal Code. One can be validly prosecuted for violating the Water Code even in the absence of actual pollution, or even [if] it has complied with the terms of its Environmental Compliance Certificate, or further, even [if] it did take the necessary precautions to prevent damage to property.

In P.D. 984 (Anti-Pollution Law), the additional fact that must be proved is the existence of actual pollution. The gravamen is the pollution itself. In the absence of any pollution, the accused must be exonerated under this law although there was unauthorized dumping of mine tailings or lack of precaution on its part to prevent damage to property.

In R.A. 7942 (Philippine Mining Act), the additional fact that must be established is the willful violation and gross neglect on the part of the accused to abide by the terms and conditions of the Environmental Compliance Certificate, particularly that the Marcopper should ensure the containment of run-off and silt materials from reaching the Mogpog and Boac Rivers. If there was no violation or neglect, and that the accused satisfactorily proved [sic] that Marcopper had done everything to ensure containment of the run-off and silt materials, they will not be liable. It does not follow, however, that they cannot be prosecuted under the Water Code, Anti-Pollution Law and the Revised Penal Code because violation of the Environmental Compliance Certificate is not an essential element of these laws.

On the other hand, the additional element that must be established in Art. 365 of the Revised Penal Code is the lack of necessary or adequate precaution, negligence, recklessness and imprudence on the part of the accused to prevent damage to property. This element is not required under the previous laws. Unquestionably, it is different from dumping of mine tailings without permit, or causing pollution to the Boac river system, much more from violation or neglect to abide by the terms of the Environmental Compliance Certificate. Moreover, the offenses punished by special law are mal[a] prohibita in contrast with those punished by the Revised Penal Code which are mala in se.

Consequently, the filing of the multiple charges against petitioners, although based on the same incident, is consistent with settled doctrine.

On petitioners claim that the charge for violation of Article 365 of the RPC absorbs the charges for violation of PD 1067, PD 984, and RA 7942, suffice it to say that a mala in se felony (such as Reckless Imprudence Resulting in Damage to Property) cannot absorb mala prohibita crimes (such as those violating PD 1067, PD 984, and RA 7942). What makes the former a felony is criminal intent (dolo) or negligence (culpa); what makes the latter crimes are the special laws enacting them.

G.R. No. 139548. December 22, 2000

MARCOPPER MINING CORPORATION, petitioner, vs. ALBERTO G. BUMOLO in his own behalf and as Attorney-in-Fact of Benito Cachili, Conchita Bumolo, Patricio Dumlao, Jacinto Aliguyon, Alfonso Maddawat, Toledo Gillao, Jose Tigo and Peter Cabiggat Bumolo, DALTON PACIFIC RESOURCES, INC., OROPHILIPPINES VENTURES INC., and the MINES ADJUDICATION BOARD (MAB), respondents.

FACTS: MARCOPPER MINING CORPORATION registered its mining claims in Pao, Kasibu, Nueva Vizcaya with the DENR from February 02, 1982 to October 12, 1982. Private respondents Alberto G. Bumolo and others registered their mining claims in the same area from 28 July 1981 to 22 September 1988, which claims were subsequently converted into Mineral Production Sharing Agreements (MPSA).

On March 12, 1982 petitioner entered into Option Agreements over the mining claims with respondent Alberto G. Bumolo, for himself and as attorney-in-fact of the other respondents on one hand; and with Rosario Camma on the other, for herself and as attorney-in-fact of the rest. Under the Agreements, petitioner was granted the exclusive and irrevocable right to explore the mining claims for three (3) years with provision for extension.

On 23 December 1982 and 26 March 1987 petitioner filed Prospecting Permit Applications (PPA) with the Bureau of Forest Development, DENR, on the alleged ground that a portion of the area covered by the mining claims was within the Magat River Forest Reservation under Proc. 573 of 26 June 1969[1] and with the Department of Agrarian Reform (DAR) on account of alleged coverage of the other portion within the Nueva Vizcaya-Quirino Civil Reservation under Proc. 1498 of 11 September 1975.

On 11 February 1991 and 12 March 1991 petitioner informed respondent Alberto G. Bumolo and Rosario Camma that it was terminating the Agreements since its conduct of a systematic exploration program disclosed that the area was relatively weak and of limited tonnage which did not justify further drilling for big tonnage of low grade gold exploration target.

On 15 July 1991 DENR Regional Executive Director Leonardo A. Paat rejected petitioners Prospecting Permit Application (PPA) on the ground that the Memorandum of 8 July 1991 endorsed by the Regional Technical Director for Mines revealed that the area covered was outside government reservation.

On 15 August 1991 petitioner moved for reconsideration. On 9 June 1995 Regional Executive Director Samuel Paragas recommended to the DENR Secretary that petitioner's request for reconsideration be denied; that the existing rights of mining claim holders be respected; and, that the prior legal rights of MPSA/Financial and Technical Assistance Agreement applicants over subject area be recognized. On 15 August 1997 petitioner appealed to public respondent Mines Adjudication Board (MAB), DENR, naming respondents Alberto G. Bumolo, Benito Cachili, Conchita Bumolo, Patricio Dumlao, Jacinto Aliguyon, Alfonso Maddawat, Toledo Gillao, Jose Tigo and Peter Cabiggat Bumolo as appellees.

Petitioner maintained that subject area was within the Magat River Forest Reservation. On 11 June 1998 the rejection of the PPA was affirmed whereas the mining claims of respondents Alberto G. Bumolo et al. that had been converted into a MPSA, subject to compliance with R.A. 7942 and DAO No. 96-40, were given due course.

ISSUE: Whether respondent MAB erred in finding that the area subject of the PPA was outside the Magat River Forest Reservation.

HELD: Respondent MAB correctly upheld the ratiocination of Regional Executive Director Paragas in denying petitioner's PPA.

In other words, the circumstance that the area covered by petitioner's PPA is outside the Magat River Forest Reservation has been adequately established by the following evidence: (a) confirmation as early as 31 May 1989 by the Forest Engineering Section of Tuguegarao, Cagayan; (b) the 8 July 1991 Memorandum Report of Regional Technical Director Punsal Jr.; and, (c) plotting provided by the National Mapping and Resources Information Authority per its 2 June 1995 indorsement of the maps to the office of the Regional Executive Director. Petitioner contests the exclusion of the area subject of its PPA within the Magat River Forest Reservation based merely on the alleged "typographical error committed by somebody in the Engineering Section of the DENR." Aside from the fact that the allegation does not have anything to support it, the aforementioned documents which the Regional Executive Directors relied upon in denying the PPA had already settled the issue.

Furthermore, respondent MAB even fortified the bases for the rejection of petitioner's PPA. As plotted by the Lands Management Sector of DENR Region 2 contained in the sketch plan of 11 November 1996 and as shown in the Land Use map of the Community Environment and Natural Resources Office of Dupax, Nueva Vizcaya, the area covered under the PPA is indeed outside any government reservation.

G.R. No. 178188

OLYMPIC MINES AND DEVELOPMENT CORP., Petitioner, - versus - PLATINUM GROUP METALS CORPORATION, respondent.

FACTS: In 1971 and 1980, Olympic was granted Mining Lease Contracts by the Secretary of the Department of Environment and Natural Resources (DENR) covering mining areas located in the municipalities of Narra and Espanola, Palawan.

On July 18, 2003, Olympic entered into an Operating Agreement with Platinum, by virtue of which Platinum was given the exclusive right to control, possess, manage/operate, and conduct mining operations, and to market or dispose mining products on the Toronto Nickel Mine in the Municipality of Narra, with an area of 768 hectares, and the Pulot Nickel Mine in the Municipality of Espanola, covering an area of 1,408 hectares (referred to as subject mining areas), for a period of twenty five years. In return, Platinum would pay Olympic a royalty fee of 2% of the gross revenues.

Olympic and Platinum applied for, and were subsequently granted the necessary government permits and environmental compliance certificates.

On April 24, 2006, Olympic sent a letter to Platinum, informing the latter of the immediate termination of the Operating Agreement on account of Platinums gross violations of its terms, and directing Platinum to immediately surrender possession of the subject mining areas under the Operating Agreement.

On April 25, 2006, Olympic instituted an action for the issuance of an injunctive writ before the RTC of Puerto Princesa, Branch 52 with a prayer, Olympic sought to enjoin Platinum from conducting mining operations on the subject mining areas, and also to recover possession thereof.

Olympic then filed two cases with different agencies of the DENR:

A. Provincial Mining Regulatory Board (PMRB) Case No. 001-06 (filed on May 18, 2006) for the revocation of the SSMPs of Platinum, on the ground of Olympics termination of the Operating Agreement because of the alleged gross violations thereof by Platinum. It was dismissed.

B. POA Case No. 2006-01-B (filed on June 8, 2006) for the cancellation of the Operating Agreement and the revocation of the SSMPs of Platinum. This case was subsequently withdrawn by Olympic on June 20, 2006.

While these two administrative cases were pending, Olympic transferred its applications for mineral agreements, including its rights under the Operating Agreement, to Citinickel via a Deed of Assignment dated June 9, 2006, without the knowledge or consent of Platinum. This assignment was thereafter approved by the Regional Director of the Mines and Geosciences Bureau (MGB) on September 6, 2006.

Civil Case No. 4199 involved a complaint for quieting of title, damages, breach of contract, and specific performance filed by Platinum against Olympic before the RTC of Puerto Princesa, Palawan, Branch 95 on June 14, 2006. Olympic

sought the dismissal of Platinums Civil Case No. 4199 through a motion to dismiss where Olympic alleged that the trial court was without jurisdiction to rule on the issues raised in the case.

Olympic contended that the case involved a mining dispute requiring the technical expertise of the POA; accordingly, jurisdiction should be with the POA. The RTC denied the motion to dismiss in a Resolution dated August 15, 2006. When Olympic failed to secure a reversal of the RTCs August 15 Resolution, it filed an appeal with the CA. The CA declared that the trial court properly exercised jurisdiction over Civil Case No. 4199 because the main issue therein was whether Platinum had a claim and/or right over the subject mining areas pursuant to the Operating Agreement. The dismissal of its petition before the CA prompted Olympic to elevate the matter with this Court, through a petition for review on certiorari.

Notwithstanding the injunctive writ issued in Civil Case No. 4199 ordering Olympic/Citinickel to respect the rights of Platinum under the Operating Agreement (including its right to control, possess, and operate the subject mining areas), Citinickel instituted a mandamus petition with the RTC of Quezon City, Branch 100 (docketed as Civil Case No. Q-07-59855), for the DENR Secretary to confiscate and maintain custody and possession of the mineral ores stockpiled at the Palawan Pier until the determination of the rights of Citinickel and Platinum under the Operating Agreement. While the trial court initially issued a status quo order, it eventually dismissed the Citinickels petition for mandamus in its Decision dated May 4, 2007, for Citinickels failure to prove a clear legal right on its part to justify the issuance of a mandamus writ in its favor, and also for forum shopping.

ISSUE: Which body has the authority to hear and decide the dispute between Olympic/Citinickel and Platinum, as parties to the operating agreement.

HELD: It posits that to fall under the jurisdiction of the POA, the dispute must necessarily involve questions of facts or matters requiring the application of technological knowledge and expertise or which needs the interpretation and the application of particular knowledge and expertise possessed by the members of the Panel. It reads Platinums complaint in Civil Case No. 4199, to be a matter involving a mining dispute that raises questions of facts or matters requiring the application of technical knowledge and expertise of the POA an interpretation that we cannot sustain in light of the clear wording of the law.

The POAs jurisdiction is set forth in Section 77 of the Mining Act:

Sec. 77. Panel of Arbitrators. xxx. Within thirty (30) working days, after the submission of the case by the parties for decision, the panel shall have exclusive and original jurisdiction to hear and decide on the following:

a. Disputes involving rights to mining areas;

b. Disputes involving mineral agreements or permits;

c. Disputes involving surface owners, occupants and claimholders/concessionaires; and

d. Disputes pending before the Bureau and the Department at the date of the effectivity of this Act.

Although Section 77 (d) of the Mining Act has transferred to the POA jurisdiction over disputes pending before the Bureau of Mines and the DENR, Section 77 (b) did not adopt the wording of Section 7, paragraphs (a) and (c) of PD No. 1281 so as to include all other forms of contracts public or private involving mining rights; Section 77 (b) in relation to Section 3 (ab) of the Mining Act did not include a general catch-all phrase to cover other agreements involving mining rights similar to those in Section 7, paragraphs (a) and (c) of PD No. 1281. Instead, the Mining Act, through the above-quoted Sections 3 (ab) and 26, has limited the jurisdiction of the POA, as successor of the adjudicatory functions of the Bureau of Mines, to mineral agreements between the government and the private contractor. Otherwise stated, while disputes between parties to any mining contract (including operating agreements) may previously fall within the Bureau of Mines jurisdiction under Section 7 (a) or (c) of PD No. 1281, it can no longer be so placed now within the authority of the POA to settle under Section 77 (b) of the Mining Law because its jurisdiction has been limited to the resolution of disputes involving public mineral agreements.

Since the Operating Agreement is not the mineral agreement contemplated by law, the contention that jurisdiction should be with the POA under Section 77(b) of the Mining Act cannot be legally correct. In plainer terms, no jurisdiction vests in the POA under the cited provision because the Operating Agreement is not the mineral agreement that Section 77(b) refers to. In other words, they are now estopped from claiming that the POA, rather than the trial court, has the sole and exlcusive authority to resolve the issue of whether the Operating Agreement may be rescinded for Platinums alleged violations.

G.R. No. 163509 December 6, 2006

PICOP RESOURCES, INC., Petitioner, - versus - BASE METALS MINERAL RESOURCES CORPORATION and THE MINES ADJUDICATION BOARD, Respondents.

FACTS: In 1987, the Central Mindanao Mining and Development Corporation (CMMCI for brevity) entered into a Mines Operating Agreement (Agreement for brevity) with Banahaw Mining and Development Corporation (Banahaw Mining for brevity) whereby the latter agreed to act as Mine Operator for the exploration, development, and eventual commercial operation of CMMCIs eighteen (18) mining claims located in Agusan del Sur.

Pursuant to the terms of the Agreement, Banahaw Mining filed applications for Mining Lease Contracts over the mining claims with the Bureau of Mines. On April 29, 1988, Banahaw Mining was issued a Mines Temporary Permit authorizing it to extract and dispose of precious minerals found within its mining claims. Upon its expiration, the temporary permit was subsequently renewed thrice by the Bureau of Mines, the last being on June 28, 1991.

Banahaw Mining and petitioner PICOP entered into a Memorandum of Agreement. In 1991, Banahaw Mining converted its mining claims to applications for Mineral Production Sharing Agreements (MPSA for brevity).

While the MPSA were pending, Banahaw Mining, on December 18, 1996, decided to sell/assign its rights and interests over thirty-seven (37) mining claims in favor of private respondent Base Metals Mineral Resources Corporation (Base Metals for brevity). The transfer included mining claims held by Banahaw Mining in its own right as claim owner, as well as those covered by its mining operating agreement with CMMCI.

On March 10, 1997, private respondent Base Metals amended Banahaw Minings pending MPSA applications with the Bureau of Mines to substitute itself as applicant and to submit additional documents in support of the application. Area clearances from the DENR Regional Director and Superintendent of the Agusan Marsh and Wildlife Sanctuary were submitted, as required. On October 7, 1997, private respondent Base Metals amended MPSA applications were published in accordance with the requirements of the Mining Act of 1995.

On November 18, 1997, petitioner PICOP filed with the Mines Geo-Sciences Bureau (MGB), Caraga Regional Office No. XIII an Adverse Claim and/or Opposition to private respondent Base Metals application.

The Panel Arbitrator issued an Order disapproving private respondent Base Metals’ MPSA on the reasons that adverse claim was filed on time, that the granting of the MPSA application on area subject of an IFMA or PTLA which is covered by a Presidential Warranty, the panel believes it cannot, unless the grantee consents thereto, without the grantee’s consent, the area is considered closed to mining location (sec. 19)(b) (No. 2), DAO No. 96-40) and that the mining location in forest or timberland is allowed only if such forest or timberland is not leased by the government to a qualified person or entity and if it

is leased the consent of the lessor is necessary, in addition to the area clearance to be issued by the agency concerned before it is subjected to mining operation.

The area is allegedly also part of permanent forest established under Republic Act No. 3092 (RA 3092), and overlaps the wilderness area where mining applications are expressly prohibited under RA 7586. Hence, the area is closed to mining operations under Sec. 19(f) of RA 7942.

Private respondent Base Metals filed a Notice of Appeal with public respondent MAB, the latter rendered the assailed decision setting aside the Panel Arbitrator’s order. The Court of Appeals upheld the decision of the MAB.

ISSUE: Whether or not the area covered by Base Metals’ MPSA is, by law, closed to mining activities.

HELD: The Court ruled that the area covered by Base Metals’ MPSA is, by law, not closed to mining activities. There is no evidence in this case that the area covered by Base Metals’ MPSA has been proclaimed as watershed forest reserves.

PICOP’s obvious misreading of our decision in Apex Mining Co., Inc. v. Garcia, supra, to the effect that mineral agreements are not allowed in the forest reserve established under Proclamation 369, the Court in that case actually ruled that pursuant to PD 463 as amended by PD 1385, one can acquire mining rights within forest reserves, such as the Agusan-Davao-Surigao Forest Reserve, by initially applying for a permit to prospect with the Bureau of Forest and Development and subsequently for a permit to explore with the Bureau of Mines and Geosciences. Moreover, Sec. 18 RA 7942 allows mining even in timberland or forestry subject to existing rights and reservations. Similarly, Sec. 47 of PD 705 permits mining operations in forest lands which include the public forest, the permanent forest or forest reserves, and forest reservations.

G.R. No. 179674

PYRO COPPER MINING CORPORATION, petitioner. – versus - MINES ADJUDICATION BOARD-DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES, MINES AND GEO-SCIENCES, respondents.

FACTS: Petitioner is a corporation duly organized and existing under Philippine laws engaged in the business of mining. On 31 March 2000, petitioners Application for Mineral Production Sharing Agreement (MPSA), identified as APSA-SF-000089, with the Mines and Geo-Sciences Bureau (MGB) of the DENR, Regional Office No. 1, San Fernando City in La Union, for the exploration, development and commercial utilization of certain pyrite ore and other mineral deposits in a 4,360.71-hectare land in Dasol, Pangasinan, was approved and MPSA No. 153-2000-1 was issued in its favor.

Private respondent is also a corporation organized and existing under the laws of the Philippines and engaged in the business of mining. On 12 September 2003, private respondent filed an Application for Exploration Permit with MGB covering the same properties covered by and during the subsistence of APSA-SF-000089 and MPSA No. 153-2000-1 of petitioner. In turn, petitioner filed a Verified Protest/Opposition to the Application for Exploration Permit of the private respondent. It was allegedly filed with the Panel of Arbitrators on 30 August 2005 and was received by the latter on 5 September 2005.

Prior, however, to petitioner’s filing of its Verified Protest/Opposition to the private respondent’s Application for Exploration Permit, petitioner’s MPSA No. 153-2000-1 was cancelled, a Motion for Reconsideration was likewise denied. The MGB issued EP No. 05-001 to private respondent. Panel of Arbitrators dismissed motu proprio the Verified Protest/Opposition of petitioner. Petitioner elevated by appeal to the MAB which was also dismissed. It was elevated to the Court of Appeals.

ISSUE: Whether the Panel of Arbitrators has jurisdiction to cancel, deny and/or revoke EP No.05-001 issued by MGB to private respondent.

HELD: Finally, petitioner posits that Section 77 of Republic Act No. 7942 and Sections 202 to 203 of its Implementing Rules vest the Panel of Arbitrators with the jurisdiction to entertain and accept any claim, protest or opposition filed directly with its office. In the discharge thereof, the office and function bestowed upon the Panel of Arbitrators include the power and authority to deny clearances, exclude exploration permits, and not to accept or entertain the same.

The Court disagrees.

Section 77 of Republic Act No. 7942 establishes the jurisdiction of the Panel of Arbitrators, thus:

Sec. 77. Panel of Arbitrators. x x x. Within thirty (30) working days, after the submission of the case by the parties for decision, the panel shall have exclusive and original jurisdiction to hear and decide on the following:

a. Disputes involving rights to mining areas;

b. Disputes involving mineral agreements or permits;

c. Disputes involving surface owners, occupants and claimholders/concessionaires; and

d. Disputes pending before the Bureau and the Department at the date of the effectivity of this Act.

According to Section 5 of DAO No. 96-40, Director means the Director of the MGB Central Office, while Regional Director means the Regional Director of any MGB Regional Office. As the authority to issue an Exploration Permit is vested in the MGB, then the same necessarily includes the corollary power to revoke, withdraw or cancel the same. Indisputably, the authority to deny, revoke, or cancel EP No. 05-001 of private respondent is already lodged with the MGB, and not with the Panel of Arbitrators.

G.R. No. L-49109 December 1, 1987

SANTA ROSA MINING COMPANY, INC., petitioner, vs. HON. MINISTER OF NATURAL RESOURCES JOSE J. LEIDO, JR. AND DIRECTOR OF MINES JUANITO C. FERNANDEZ, respondents.

FACTS: Petitioner Santa Rosa Mining Company, Inc. is a mining corporation duly organized and existing under the laws of the Philippines. It alleges that it is the holder of fifty (50) valid mining claims situated in Jose Panganiban, Camarines Norte, acquired under the provisions of the Act of the U.S. Congress dated 1 July 1902 (Philippine Bill of 1902, for short).

On 14 October 1977, Presidential Decree No. 1214 was issued, requiring holders of subsisting and valid patentable mining claims located under the provisions of the Philippine Bill of 1902 to file a mining lease application within one (1) year from the approval of the Decree. Petitioner accordingly filed a mining lease application, but "under protest," on 13 October 1978, with a reservation annotated on the back of its application that it is not waiving its rights over its mining claims until the validity of Presidential Decree No. 1214 shall have been passed upon by this Court.

On 10 October 1978, or three (3) days before filing the disputed mining lease application, petitioner filed this special civil action for certiorari and prohibition, alleging that it has no other plain, speedy and adequate remedy in the ordinary course of law to protect its rights. Petitioner assails Presidential Decree No. 1214 as unconstitutional in that it amounts to a deprivation of property without due process of law.

Petitioner avers that its fifty (50) mining claims had already been declared as its own private and exclusive property in final judgments rendered by the Court of First Instance of Camarines Norte (CFI, for short) in land registration proceedings initiated by third persons, such as, a September 1951 land title application by a certain Gervacio Liwanag, where the Director of Mines opposed the grant of said application because herein petitioner, according to him (Director of Mines), had already located and perfected its mining claims over the area applied for. Petitioner also cites LRC Case No. 240, filed 11 July 1960, by one Antonio Astudillo and decided in 1974 against said applicant, in which, petitioner's mining claims were described as vested property outside the jurisdiction of the Director of Mines.

ISSUE: Whether or not Presidential Decree No. 1214 is constitutional.

HELD: Presidential Decree No. 1214 is in accord with Sec. 8, Art. XIV of the 1973 Constitution which states:

All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential energy, fisheries, wildlife, and other natural resources of the Philippines belong to the State. With the exception of agricultural, industrial or commercial, residential and resettlement lands of the public domain, natural resources shall not be alienated, and no license, concession, or lease for the exploration, development, exploitation, or utilization of any of the natural

resources shall be granted for a period exceeding twenty-five years, renewable for not more than twenty-five years, except as to water rights for irrigation, water supply, fisheries, or industrial uses other than the development of water power, in which cases, beneficial use may be the measure and the limit of the grant.

The same constitutional mandate is found in Sec. 2, Art. XII of the 1987 Constitution, which declares:

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. ...

G.R. No. 135190. April 3, 2002

SOUTHEAST MINDANAO GOLD MINING CORPORATION, petitioner, vs. BALITE PORTAL MINING COOPERATIVE and others similarly situated; and THE HONORABLE ANTONIO CERILLES, in his capacity as Secretary of the Department of Environment and Natural Resources (DENR), PROVINCIAL MINING REGULATORY BOARD OF DAVAO (PMRB-Davao), respondents.

FACTS: The instant case involves a rich tract of mineral land situated in the Agusan-Davao-Surigao Forest Reserve known as the Diwalwal Gold Rush Area. Located at Mt. Diwata in the municipalities of Monkayo and Cateel in Davao Del Norte, the land has been embroiled in controversy since the mid-80s due to the scramble over gold deposits found within its bowels.

On March 10, 1988, Marcopper Mining Corporation (Marcopper) was granted Exploration Permit No. 133 (EP No. 133) over 4,491 hectares of land, which included the hotly-contested Diwalwal area.

Congress enacted on June 27, 1991 Republic Act No. 7076, or the Peoples Small-Scale Mining Act. The law established a Peoples Small-Scale Mining Program to be implemented by the Secretary of the DENR and created the Provincial Mining Regulatory Board (PMRB) under the DENR Secretarys direct supervision and control. The statute also authorized the PMRB to declare and set aside small-scale mining areas subject to review by the DENR Secretary and award mining contracts to small-scale miners under certain conditions.

On December 21, 1991, DENR Secretary Fulgencio S. Factoran issued Department Administrative Order (DAO) No. 66, declaring 729 hectares of the Diwalwal area as non-forest land open to small-scale mining. The issuance was made pursuant to the powers vested in the DENR Secretary by Proclamation No. 369, which established the Agusan-Davao-Surigao Forest Reserve.

Subsequently, a petition for the cancellation of EP No. 133 and the admission of a Mineral Production Sharing Arrangement (MPSA) proposal over Diwalwal was filed before the DENR Regional Executive Director.

On February 16, 1994, while the RED Mines case was pending, Marcopper assigned its EP No. 133 to petitioner Southeast Mindanao Gold Mining Corporation (SEM). In the meantime, on March 3, 1995, Republic Act No. 7942, the Philippine Mining Act, was enacted. Pursuant to this statute, the above-enumerated MAC cases were referred to a Regional Panel of Arbitrators (RPA) tasked to resolve disputes involving conflicting mining rights. The RPA subsequently took cognizance of the RED Mines case, which was consolidated with the MAC cases.

On April 1, 1997, Provincial Mining Regulatory Board of Davao passed Resolution No. 26, Series of 1997, authorizing the issuance of ore transport permits (OTPs) to small-scale miners operating in the Diwalwal mines.

On May 30, 1997, petitioner filed a complaint for damages before the Regional Trial Court of Makati City, Branch 61, against the DENR Secretary and PMRB-Davao. SEM alleged that the illegal issuance of the OTPs allowed the extraction and hauling of P60,000.00 worth of gold ore per truckload from SEMs mining claim.

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

HELD: Court of Appeals ruling that the challenged MO 97-03 did not conclusively adopt direct state utilization as a policy in resolving the Diwalwal dispute. The terms of the memorandum clearly indicate that what was directed thereunder was merely a study of this option and nothing else. Contrary to petitioners contention, it did not grant any management/operating or profit-sharing agreement to small-scale miners or to any party, for that matter, but simply instructed the DENR officials concerned to undertake studies to determine its feasibility. As the Court of Appeals extensively discussed in its decision:

x x x under the Memorandum Order, the State still had to study prudently and exhaustively the various options available to it in rationalizing the explosive and ever perilous situation in the area, the debilitating adverse effects of mining in the community and at the same time, preserve and enhance the safety of the mining operations and ensure revenues due to the government from the development of the mineral resources and the exploitation thereof. The government was still in earnest search of better options that would be fair and just to all parties concerned, including, notably, the Petitioner. The direct state utilization of the mineral resources in the area was only one of the options of the State. Indeed, it is too plain to see, x x x that before the State will settle on an option, x x x an extensive and intensive study of all the facets of a direct state exploitation was directed by the Public Respondent DENR Secretary. And even if direct state exploitation was opted by the government, the DENR still had to promulgate rules and regulations to implement the same x x x, in coordination with the other concerned agencies of the government.

With respect to the alleged vested rights claimed by petitioner, it is well to note that the same is invariably based on EP No. 133, whose validity is still being disputed in the Consolidated Mines cases. A reading of the appealed MAB decision reveals that the continued efficacy of EP No. 133 is one of the issues raised in said cases, with respondents therein asserting that Marcopper cannot legally assign the permit which purportedly had expired. In other words, whether or not petitioner actually has a vested right over Diwalwal under EP No. 133 is still an indefinite and unsettled matter. And until a positive pronouncement is made by the appellate court in the Consolidated Mines cases, EP No. 133 cannot be deemed as a source of any conclusive rights that can be impaired by the issuance of MO 97-03.

G.R. No. L-69997 September 30, 1987

UNGAY MALOBAGO MINES, INC., petitioner, vs. HON. INTERMEDIATE APPELLATE COURT, DIRECTOR OF LANDS, GREGORIA BOLANOS, AUREA ARAOJO, GERVACIO ARAOJO, MARIA BERNAL, FELIX DETECIO, JESUS ASUNCION, MELENCIO ASUNCION and BIENVENIDO ASUNCION, respondents.

FACTS: On July 20, 1962, the President of the Philippines granted the following mining patents on mineral claims located at Ungay Malobago, Rapu-Rapu Albay.

On October 30, 1959, John Canson, Jr. and Carlos Stilianopulos assigned their rights to their mining claims in favor of the petitioner. The assignment of rights was recorded in the Office of the Mining Recorder of Albay on December 2, 1959.

The aforestated mining patents, after their issuance on July 20, 1962, were all recorded in the Office of the Mining Recorder of Albay on August 28, 1962 and transcribed on September 4, 1962 in the Registration Book of the Registry of Deeds of Albay. Consequently, the Register of Deeds of Albay issued the respective original certificates of titles pursuant to Section 122 of Act No. 496 in the names of John Canson, Jr., Carlos Stilianopulos, and the petitioner.

From 1968 to 1974, the following free patents were granted by the respondent Director of Lands and the corresponding original certificates of titles were issued by the Register of Deeds of Albay. All of the above patents covered portions of the lots covered by the patents belonging to the petitioner.

The petitioner filed a complaint for annulment and cancellation of patents against the private respondents and prayed that all the free patent titles issued in their favor for properties over which original certificates of title had already been issued in its favor be declared null and void. The trial court rendered a decision dismissing the complaint. The CA affirmed the decision of the trial court.

ISSUE: Whether or not the appellate court committed an error of law when it ruled that the lands in question belong to the public domain.

HELD: No. Article XIII, Section I of the 1935 Constitution provides:

All agricultural timber, and mineral lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential energy, and other natural resources of the Philippines belong to the State, and their disposition, exploitation, development, or utilization shall be limited to citizens of the Philippines, or to corporations or associations at least sixty per centum of the capital of which is owned by such citizens, subject to any existing right, grant, lease, or concession at the time of the inauguration of the Government established under this Constitution. Natural resources, with the exception of public agricultural land, shall not be alienated and no license, concession, or lease for the exploitation, development, or utilization of any of the natural resources shall be granted for a period exceeding twenty-five years, renewable for another twenty-five years, except as to water rights for irrigation, water supply, fisheries, or industrial uses

other than the development of water power, in which cases beneficial use may be the measure and the at of the grant. (Emphasis supplied)

Therefore, applying the aforequoted provision to the case at bar, we conclude that the issuance of the lode patents on mineral claims by the President of the Philippines in 1962 in favor of the petitioner granted to it only the right to extract or utilize the minerals which may be found on or under the surface of the land. On the other hand, the issuance of the free patents by the respondent Director of Lands in 1979 in favor of the private respondents granted to them the ownership and the right to use the land for agricultural purposes but excluding the ownership of, and the right to extract or utilize, the minerals which may be found on or under the surface.

There is no basis in the records for the petitioner's stand that it acquired the right to the mineral lands prior to the effectivity of the 1935 Constitution, thus, making such acquisition outside its purview and scope. Every application for a concession of public land has to be viewed in the light of its peculiar circumstances.

In the case at bar, although the original certificates of titles of the petitioner were issued prior to the titles of the private respondents, the former cannot prevail over the latter for the provisions of the Constitution which governed at the time of their issuance prohibited the alienation of mineral lands of the public domain.

G.R. No 127882 January 27, 2004

La Bugal-B'Laan Tribal Association vs. VICTOR O. RAMOS, SECRETARY, DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES (DENR), HORACIO RAMOS, DIRECTOR, MINES AND GEOSCIENCES BUREAU (MGB-DENR), RUBEN TORRES, EXECUTIVE SECRETARY, and WMC (PHILIPPINES), INC.

FACTS: On July 25, 1987, then President Corazon C. Aquino issued Executive Order (E.O.) No. 2796 authorizing the DENR Secretary to accept, consider and evaluate proposals from foreign-owned corporations or foreign investors for contracts or agreements involving either technical or financial assistance for large-scale exploration, development, and utilization of minerals, which, upon appropriate recommendation of the Secretary, the President may execute with the foreign proponent.

On March 3, 1995, then President Fidel V. Ramos approved R.A. No. 7942 to "govern the exploration, development, utilization and processing of all mineral resources." R.A. No. 7942 defines the modes of mineral agreements for mining operations, outlines the procedure for their filing and approval, assignment/transfer and withdrawal, and fixes their terms. Similar provisions govern financial or technical assistance agreements.

On April 9, 1995, 30 days following its publication on March 10, 1995 in Malaya and Manila Times, two newspapers of general circulation, R.A. No. 7942 took effect. On March 30, 1995, the President entered into an FTAA with WMCP covering 99,387 hectares of land in South Cotabato, Sultan Kudarat, Davao del Sur and North Cotabato.

On August 15, 1995, then DENR Secretary Victor O. Ramos issued DENR Administrative Order (DAO) No. 95-23, s. 1995, otherwise known as the Implementing Rules and Regulations of R.A. No. 7942. This was later repealed by DAO No. 96-40, s. 1996 which was adopted on December 20, 1996.

Petitioners thus filed the present petition for prohibition and mandamus, with a prayer for a temporary restraining order. They allege that at the time of the filing of the petition, 100 FTAA applications had already been filed, covering an area of 8.4 million hectares, 64 of which applications are by fully foreign-owned corporations covering a total of 5.8 million hectares, and at least one by a fully foreign-owned mining company over offshore areas.

ISSUE: Whether or not R.A. No. 7942 is constitutional.

HELD: In sum, the Court finds the following provisions of R.A. No. 7942 to be violative of Section 2, Article XII of the Constitution:

(1) The proviso in Section 3 (aq), which defines "qualified person," to wit:

Provided, That a legally organized foreign-owned corporation shall be deemed a qualified person for purposes of granting an exploration permit, financial or technical assistance agreement or mineral processing permit.

(2) Section 23, which specifies the rights and obligations of an exploration permittee, insofar as said section applies to a financial or technical assistance agreement,

(3) Section 33, which prescribes the eligibility of a contractor in a financial or technical assistance agreement;

(4) Section 35, which enumerates the terms and conditions for every financial or technical assistance agreement;

(5) Section 39, which allows the contractor in a financial and technical assistance agreement to convert the same into a mineral production-sharing agreement;

(6) Section 56, which authorizes the issuance of a mineral processing permit to a contractor in a financial and technical assistance agreement;

The following provisions of the same Act are likewise void as they are dependent on the foregoing provisions and cannot stand on their own:

(1) Section 3 (g), which defines the term "contractor," insofar as it applies to a financial or technical assistance agreement.

Section 34, which prescribes the maximum contract area in a financial or technical assistance agreements;

Section 36, which allows negotiations for financial or technical assistance agreements;

Section 37, which prescribes the procedure for filing and evaluation of financial or technical assistance agreement proposals;

Section 38, which limits the term of financial or technical assistance agreements;

Section 40, which allows the assignment or transfer of financial or technical assistance agreements;

Section 41, which allows the withdrawal of the contractor in an FTAA;

The second and third paragraphs of Section 81, which provide for the Government's share in a financial and technical assistance agreement; and

Section 90, which provides for incentives to contractors in FTAAs insofar as it applies to said contractors;

When the parts of the statute are so mutually dependent and connected as conditions, considerations, inducements, or compensations for each other, as to warrant a belief that the legislature intended them as a whole, and that if all could not be carried into effect, the legislature would not pass the residue independently, then, if some parts are unconstitutional, all the provisions which are thus dependent, conditional, or connected, must fall with them.

The Court hereby declares unconstitutional and void.