G.R. No. L-13298 November 19, 1918 Subsection 6 of section 54, of Act No.

Subsection 6 of section 54, of Act No. 926, entitled The Public Land Law, as amended by Act
No. 1908, reads as follows:
CORNELIO RAMOS, petitioner-appellant,
vs. 6. All persons who by themselves or their predecessors and interest have been in
THE DIRECTOR OF LANDS, objector-appellee. the open, continuous, exclusive, and notorious possession and occupation of
agricultural public lands, as defined by said Act of Congress of July first, nineteen
MALCOLM, J.: hundred and two, under a bona fide claim of ownership except as against the
Government, for a period of ten years next preceding the twenty-sixth day of July,
nineteen hundred and four, except when prevented by war or force majeure, shall
This is an appeal by the applicant and appellant from a judgment of the Court of First Instance
be conclusively presumed to have performed all the conditions essential to a
of Nueva Ecija, denying the registration of the larger portion of parcel No. 1 (Exhibit A of the
government grant and to have received the same, and shall be entitled to a
petitioner), marked by the letters A, B, and C on the plan, Exhibit 1, of the Government.
certificate of title to such land under the provisions of this chapter.
One Restituto Romero y Ponce apparently gained possession of a considerable tract of land
There are two parts to the above quoted subsection which must be discussed. The first relates
located in the municipality of San Jose, Province of Nueva Ecija, in the year 1882. He took
to the open, continuous, exclusive, and notorious possession and occupation of what, for
advantage of the Royal Decree of February 13, 1894, to obtain a possessory information title
present purposes, can be conceded to be agricultural public land, under a bona fide claim of
to the land, registered as such on February 8, 1896. Parcel No. 1, included within the limits of
ownership.
the possessory information title of Restituto Romero, was sold in February, 1907, to Cornelio
Ramos, the instant petitioner, and his wife Ambrosia Salamanca.
Actual possession of land consists in the manifestation of acts of dominion over it of such a
nature as a party would naturally exercise over his own property. Relative to actuality of
Ramos instituted appropriate proceedings to have his title registered. Opposition was entered
possession, it is admitted that the petitioner has cultivated only about one fourth of the entire
by the Director of Lands on the ground that Ramos had not acquired a good title from the
Spanish government and by the Director of Forestry on the ground that the first parcel was
forest land. The trial court agreed with the objectors and excluded parcel No. 1 from
registration. So much for the facts.

As to the law, the principal argument of the Solicitor-General is based on the provisions of the
Spanish Mortgage Law and of the Royal Decree of February 13, 1894, commonly known as
the Maura Law. The Solicitor-General would emphasize that for land to come under the
protective gis of the Maura Law, it must have been shown that the land was cultivated for six
years previously, and that it was not land which pertained to the "zonas forestales." As proof
that the land was, even as long ago as the years 1894 to 1896, forestal and not agricultural in
nature is the fact that there are yet found thereon trees from 50 to 80 years of age.

We do not stop to decide this contention, although it might be possible, following the doctrine
laid down by the United States Supreme Court with reference to Mexican and Spanish grantes
within the United States, where some recital is claimed to be false, to say that the possessory
information, apparently having taken cognizance of the requisites for title, should not now be
disturbed. (Hancock vs. McKinney [1851], 7 Tex., 192; Hornsby and Roland vs.United States
[1869], 10 Wall., 224.) It is sufficient, as will later appear, merely to notice that the
predecessor in interest to the petitioner at least held this tract of land under color of title.

1
tract. This is graphically portrayed by Exhibit 1 of the Government, following:
The question at once arises: Is that actual occupancy of a part of the land described in the
instrument giving color of title sufficient to give title to the entire tract of land?lawphil.net
The doctrine of constructive possession indicates the answer. The general rule is that the
possession and cultivation of a portion of a tract under claim of ownership of all is a
constructive possession of all, if the remainder is not in the adverse possession of another.
(Barr vs. Gratz's Heirs [1819], 4 Wheat., 213; Ellicott vs. Pearl [1836], 10 Pet., 412;
Smith vs. Gale [1892], 144 U. S., 509.) Of course, there are a number of qualifications to the
rule, one particularly relating to the size of the tract in controversy with reference to the portion
actually in possession of the claimant. It is here only necessary to apply the general rule.
The claimant has color of title; he acted in good faith; and he has had open, peaceable, and
notorious possession of a portion of the property, sufficient to apprise the community and the
world that the land was for his enjoyment. (See arts. 446, 448, Civil Code.) Possession in the
2
eyes of the law does not mean that a man has to have his feet on every square meter of
ground before it can be said that he is in possession. Ramos and his predecessor in interest
fulfilled the requirements of the law on the supposition that he premises consisted of
agricultural public land.
The second division of the law requires consideration of the term "agricultural public land."
The law affirms that the phrase is denied by the Act of Congress of July 1st, 1902, known as
the Philippine bill. Turning to the Philippine Bill, we find in sections 13 to 18 thereof that three
classes of land are mentioned. The first is variously denominated "public land" or "public
domain," the second "mineral land," and the third "timber land." Section 18 of the Act of
Congress comes nearest to a precise definition, when it makes the determination of whether
the land is more valuable for agricultural or for forest uses the test of its character.
Although these sections of the Philippine Bill have come before the courts on numerous
occasions, what was said in the case of Jones vs. Insular Government ([1906], 6 Phil., 122), is
still true, namely: "The meaning of these sections is not clear and it is difficult to give to them a
construction that will be entirely free from objection." In the case which gave most serious
consideration to the subject (Mapa vs. Insular Government [1908], 10 Phil., 175), it was found
that there does exist in the Act of Congress a definition of the phrase "agricultural public
lands." It was said that the phrase "agricultural public lands" as used in Act No. 926 means
"those public lands acquired from Spain which are not timber or mineral lands."
The idea would appear to be to determine, by exclusion, if the land is forestal or mineral in
nature and, if not so found, to consider it to be agricultural land. Here, again, Philippine law is
not very helpful. For instance, section 1820 of the Administrative Code of 1917 provides: "For
the purposes of this chapter, 'public forest' includes, except as otherwise specially indicated,
all unreserved public land, including nipa and mangrove swamps, and all forest reserves of
whatever character." This definition of "public forest," it will be noted, is merely "for the
purposes of this chapter." A little further on, section 1827 provides: "Lands in public forests,
not including forest reserves, upon the certification of the Director of Forestry that said lands
are better adapted and more valuable for agricultural than for forest purposes and not required
by the public interests to be kept under forest, shall be declared by the Department Head to
be agricultural lands." With reference to the last section, there is no certification of the Director
of Forestry in the record, as to whether this land is better adapted and more valuable for
agricultural than for forest purposes.
The lexicographers define "forest" as "a large tract of land covered with a natural growth of
trees and underbrush; a large wood." The authorities say that he word "forest" has a
significant, not an insignificant meaning, and that it does not embrace land only partly
woodland. It is a tract of land covered with trees, usually of considerable extent.
(Higgins vs. Long Island R. Co. [1908], 114 N. Y. Supp., 262; People vs. Long Island R. Co.
[1908], 110 N. Y. Supp., 512.)
The foresters say that no legal definition of "forest" is practicable or useful. B. H. Baden-
Powell, in his work on Forest Law of India, states as follows:
Every definition of a forest that can be framed for legal purposes will be found either
to exclude some cases to which the law ought to apply, or on the other hand, to
include some with which the law ought not to interfere. It may be necessary, for
example, to take under the law a tract of perfectly barren land which at present has
neither trees, brushwood, nor grass on it, but which in the course f time it is hoped
will be "reboise;" but any definition wide enough to take in all such lands, would also
take in much that was not wanted. On the other hand, the definition, if framed with
reference to tree-growth, might (and indeed would be almost sure to) include a
garden, shrubbery, orchard, or vineyard, which it was not designed to deal with.
B. E. Fernow, in his work on the Economics of Forestry, states as follows:
A forest in the sense in which we use the term, as an economic factor, is by no
means a mere collection of trees, but an organic whole in which all parts, although
apparently heterogeneous, jumbled together by accident as it were and apparently
unrelated, bear a close relation to each other and are as interdependent as any
other beings and conditions in nature.
The Director of Forestry of the Philippine Islands has said:
During the time of the passage of the Act of Congress of July 1, 1902, this question
of forest and agricultural lands was beginning to receive some attention and it is
clearly shown in section 18 of the above mentioned Act; it leaves to the Bureau of
Forestry the certification as to what lands are for agricultural or forest uses.
Although the Act states timber lands, the Bureau has in its administration since the
passage of this act construed this term to mean forest lands in the sense of what
was necessary to protect, for the public good; waste lands without a tree have been
declared more suitable for forestry in many instances in the past. The term 'timber'
as used in England and in the United States in the past has been applied to wood
suitable for construction purposes but with the increase in civilization and the
application of new methods every plant producing wood has some useful purpose
and the term timber lands is generally though of as synonymous with forest lands or
lands producing wood, or able to produce wood, if agricultural crops on the same
land will not bring the financial return that timber will or if the same land is needed
for protection purposes.
xxx xxx xxx
3
The laws in the United States recognize the necessity of technical advice of duly
appointed boards and leave it in the hands of these boards to decide what lands are
more valuable for forestry purposes or for agricultural purposes.
In the Philippine Islands this policy is follows to as great an extent as allowable
under the law. In many cases, in the opinion of the Bureau of Forestry, lands without
a single tree on them are considered as true forest land. For instance, mountain
sides which are too steep for cultivation under ordinary practice and which, if
cultivated, under ordinary practice would destroy the big natural resource of the soil,
by washing, is considered by this bureau as forest land and in time would be
reforested. Of course, examples exist in the Mountain Province where steep
hillsides have been terraced and intensive cultivation practiced but even then the
mountain people are very careful not to destroy forests or other vegetative cover
which they from experience have found protect their water supply. Certain chiefs
have lodged protests with the Government against other tribes on the opposite side
of the mountain cultivated by them, in order to prevent other tribes from cutting
timber or destroy cover guarding their source of water for irrigation.
Dr. M. S. Shaler, formerly Dean of the Lawrence Scientific School, remarked that if
mankind could not devise and enforce ways dealing with the earth, which will
preserve this source of like "we must look forward to the time, remote it may be, yet
equally discernible, when out kin having wasted its great inheritance will fade from
the earth because of the ruin it has accomplished."
The method employed by the bureau of Forestry in making inspection of lands, in
order to determine whether they are more adapted for agricultural or forest purposes
by a technical and duly trained personnel on the different phases of the
conservation of natural resources, is based upon a previously prepared set of
questions in which the different characters of the land under inspection are
discussed, namely:
Slope of land: Level; moderate; steep; very steep.
Exposure: North; South; East; West.
Soil: Clay; sandy loam; sand; rocky; very rocky.
Character of soil cover: Cultivated, grass land, brush land, brush land and timber
mixed, dense forest.
If cultivated, state crops being grown and approximate number of hectares under
cultivation. (Indicate on sketch.)
For growth of what agricultural products is this land suitable?
State what portion of the tract is wooded, name of important timber species and
estimate of stand in cubic meters per hectare, diameter and percentage of each
species.
If the land is covered with timber, state whether there is public land suitable for
agriculture in vicinity, which is not covered with timber.
Is this land more valuable for agricultural than for forest purposes? (State reasons in
full.)
Is this land included or adjoining any proposed or established forest reserve or
communal forest? Description and ownership of improvements.
If the land is claimed under private ownership, give the name of the claimant, his
place of residence, and state briefly (if necessary on a separate sheet) the grounds
upon which he bases his claim.
When the inspection is made on a parcel of public land which has been applied for,
the corresponding certificate is forwarded to the Director of Lands; if it is made on a
privately claimed parcel for which the issuance of a title is requested from the Court
of Land Registration, and the inspection shows the land to be more adapted for
forest purposes, then the Director of Forestry requests the Attorney-General to file
an opposition, sending him all data collected during the inspection and offering him
the forest officer as a witness.
It should be kept in mind that the lack of personnel of this Bureau, the limited time
intervening between the notice for the trial on an expediente of land and the day of
the trial, and the difficulties in communications as well as the distance of the land in
question greatly hinder the handling of this work.
In the case of lands claimed as private property, the Director of Forestry, by means
of his delegate the examining officer, submits before the court all evidence referring
to the present forest condition of the land, so that the court may compare them with
the alleged right by the claimant. Undoubtedly, when the claimant presents a title
issued by the proper authority or evidence of his right to the land showing that he
complied with the requirements of the law, the forest certificate does not affect him
4
in the least as such land should not be considered as a part of the public domain;
but when the alleged right is merely that of possession, then the public or private
character of the parcel is open to discussion and this character should be
established not simply on the alleged right of the claimant but on the sylvical
condition and soil characteristics of the land, and by comparison between this area,
or different previously occupied areas, and those areas which still preserve their
primitive character.
Either way we look at this question we encounter difficulty. Indubitably, there should be
conservation of the natural resources of the Philippines. The prodigality of the spendthrift who
squanders his substance for the pleasure of the fleeting moment must be restrained for the
less spectacular but surer policy which protects Nature's wealth for future generations. Such is
the wise stand of our Government as represented by the Director of Forestry who, with the
Forester for the Government of the United States, believes in "the control of nature's powers
by man for his own good." On the other hand, the presumption should be, in lieu of contrary
proof, that land is agricultural in nature. One very apparent reason is that it is for the good of
the Philippine Islands to have the large public domain come under private ownership. Such is
the natural attitude of the sagacious citizen.
If in this instance, we give judicial sanction to a private claim, let it be noted that the
Government, in the long run of cases, has its remedy. Forest reserves of public land can be
established as provided by law. When the claim of the citizen and the claim of the
Government as to a particular piece of property collide, if the Government desires to
demonstrate that the land is in reality a forest, the Director of Forestry should submit to the
court convincing proof that the land is not more valuable for agricultural than for forest
purposes. Great consideration, it may be stated, should, and undoubtedly will be, paid by the
courts to the opinion of the technical expert who speaks with authority on forestry matters. But
a mere formal opposition on the part of the Attorney-General for the Director of Forestry,
unsupported by satisfactory evidence will not stop the courts from giving title to the claimant.
We hold that the petitioner and appellant has proved a title to the entire tract of land for which
he asked registration, under the provisions of subsection 6, of section 54, of Act No. 926, as
amended by Act No. 1908, with reference to the Philippine Bill and the Royal Decree of
February 13, 1894, and his possessory information.
Judgment is reversed and the lower court shall register in the name of the applicant the entire
tract in parcel No. 1, as described in plan Exhibit A, without special finding as to costs. So
ordered.
 while in fact but a very small portion of it is covered with trees which protect the nipa
plants and the fish hatchery, it having been proven that a large part of the lot was
G.R. No. L-13756 January 30, 1919 sown with rice and used as pasture land.

THE GOVERNMENT OF THE PHILIPPINE ISLANDS, ET AL., petitioners. 5. The court erred in not holding that the parts of lots 1104, 1154 and 1158, covered
VICENTE JOCSON, ET AL., appellants, by mangrove swamps, are agricultural land, and in not holding to have been proven
vs. that these swamp are not available, inasmuch as they are drained at low tide; errors
THE DIRECTOR OF FORESTRY, objector-appellee. committed with manifest violation of law and disregard of the jurisprudence
established by the Honorable Supreme Court of the Philippine.
In the cadastral land registration for the town of Hinigaran, Occidental Negros, the appellants
sought to register the three lots or parcels of land involved in this appeal, which registration 6. The court erred in not holding that the claimants and appellants, by their
was opposed by the Director of Forestry. peaceable, public, and continuous possession for more than forty years, as owners,
including that held by their predecessors in interests, had acquired by prescription
lots 1104, 1154, and 1158, in conformity with act No. 190, section 41, which, without
The trial court found that lot 1104 was almost entirely "forestry" land, that a small portion of lot
exception, is applicable to the State as well as to private parties, and by
1154 and all of lots 1158 were "forestry" lands, to which appellants had no title, and declared
extraordinary prescription of thirty years.
the lots public lands, and refused registration of the parts of these lots to which opposition had
been filed by the Forestry Bureau. The claimants excepted and perfected their bill of
exceptions and brought the case to this court for review, setting up the following assignments 7. The court erred in not adjudicating said lots to the claimants and appellants, in
of error: consideration of the possession they have had for more than forty years, form the
time of their predecessor in interest to the present time, thus violating the legal
provision whereby the holders of land who have been in its possession for ten years
1. The court erred in not holding to have been proven the facts that the lots 1104,
prior to the enactment of the land law, Act No. 926, by the United States Philippine
1154, and 1158 of the cadastral survey of Hinigaran were possessed by Bibiano
Commission, are to be deemed the absolute owners of such land, and to be
Jocson as owner during his lifetime and from a time prior to the year 1880, and,
presumed to have applied for the same and to have complied with the Spanish laws
after his death, by his heirs, on which lots nipa plants were planted and now exists
and all the proceedings required by the Royal Decrees on the composition of titles;
and that these latter are not spontaneous plants utilized by said heirs.
and, therefore, pursuant to said Act now in force, the land in question should be
adjudicated to the possessors thereof.
2. The court erred in not holding to have been proven the a part of lot No. 1158 is
rice and pasture land that was possessed as owner by Bibiano Jocson during his
8. The court erred in not granting the new trial requested by the appellants, the
lifetime and peaceably long before 1880, a possession continued by his heirs who
motion therefor being based on the ground that his findings of facts, if there are any,
still enjoy the use of the land up to the present time.
are openly and manifestly contrary to the weight of the evidence.
3. The court erred in not holding to have been proven that on that same lot 1158,
It is not necessary to consider all these assignments of error, for the main question involved is
there has existed since the year 1890, and still exists, a fish hatchery which has
whether manglares[mangroves] are agricultural lands or timber lands. If they are timber lands
been possessed and enjoyed by the heirs of Bibiano Jocson, as owners, for more
the claimants cannot acquire them by mere occupation for ten years prior to July 26, 1904; if
than 27 years, not counting the prior possession of their predecessor in interest.
not, they can so acquire them under the Public Land Act, and no grant or title is necessary.
4. The court erred in holding that lot No. 1158 and part of lots 1104 and 1154 are
This being a cadastral case there are no findings of fact, but the trial court states that lot 1104
forest land, finding this fact as sufficiently proven by the sole and absurd testimony
was in possession of claimants and their ancestors for more than thirty years and lot 1154 for
of the ranger to the effect that nipa is a plant of spontaneous growth and in not
more than twenty-five years. Lot 1158 is declared to be wholly "forestal." The are of the lots
planted; and , as the photographs only refer to small portions of the area of the lot,
does not appear.
the court also erred in holding that the whole lot was covered with firewood trees,

5
The evidence fully sustains the contention of the claimants that they have been in possession
of all of those lots quietly, adversely and continuously under a claim of ownership for more
than thirty years prior to the hearing in the trial court. There is not a word of proof in the whole
record to the contrary. They set up no documentary title. They do claim the parts of the lands
denied registration are "mangles" with nipa and various other kinds of aquatic bushes or trees
growing on them, and that in 1890 on lot 1158 they constructed a fishpond (vivero de peces)
which was later abandoned as unprofitable, and that part of this lot is pasture land, part palay
and part "mangles."
The attorney-General contends in his brief that the parts of the lands denied registration are
public forest and cannot be acquired by occupation, and that all "manglares are public
forests."
In the Act of Congress of July 1st, 1902, there is a classification of all public lands of the
Philippine Islands, and in mentioning forestry land the Act of Congress used the words "timber
land." These words are always translated in the Spanish translation of that Act as "terrenos
forestales." We think there is an error in this translation and that a better translation would be
"terrenos madereros." Timber land in English means land with trees growing on it.
The manglar plant would never be called a tree in English but a bush, and land which has only
bushes, shrubs or aquatic plants growing on it can not be called "timber land."
The photographs filed by the Government as exhibits in this case show that at two places
there were trees growing on this land, but the forester who testified for the Government
always calls these lots "mangles," and he says the trees which are growing on the lands are of
no value except for firewood. The fact that there are a few trees growing in a manglar or nipa
swamp does not change the general character of the land from manglar to timber land.
That manglares are not forestry lands within the meaning of the words "Timber lands" in the
Act of Congress has been definitely decided by this Court in the case of Montano vs. Insular
Government (12 Phil. Rep., 572). In that case the court said:
Although argued at different times, five of these cases have been presented
substantially together, all being covered by one brief of the late Attorney-General in
behalf of the Government in which, with many interesting historical and graphic
citations he described that part of the marginal seashore of the Philippine Islands
known as manglares, with their characteristic vegetation. In brief, it may be said that
they are mud flats, alternately washed and exposed by the tide, in which grow
various kindered plants which will not live except when watered by the sea,
extending their roots deep into the mud and casting their seeds, which also
germinate there. These constitute the mangrove flats of the tropics, which exists
naturally, but which are also, to some extent, cultivated by man for the sake of the
combustible wood of the mangrove, like trees, as well as for the useful nipa palm
6
propagated thereon. Although these flats are literally tidal lands, yet we are of the
opinion that they can not be so regarded in the sense in which the term is used in
the cases cited or in general American jurisprudence. The waters flowing over them
are not available for purpose of navigation, and they "may be disposed of without
impairment of the public interest in what remains."
The court on page 573 further said:
It is a kindred case to Cirilo Mapa vs. The Insular Government . . . (10 Phil. Rep.,
175).
As some discussion has arisen as to the scope of that decision, it appears
opportune to reaffirm the principle there laid down. The issue was, whether lands
used as a fishery, for the growth of nipa, and as salt deposits, inland some
desistance from the sea, and asserted, thought not clearly proved, to be overflowed
at high tide, could be registered as private property on the strength of ten years'
occupation, under paragraph 6 of section 54 of Act No. 926 of the Philippine
Commission. The point decided was that such land within the meaning of the Act of
Congress of July 1, 1902, was agricultural, the reasoning leading up to that
conclusion being that Congress having divided all the public lands of the Islands into
three classes it must be included in tone of the three, and being clearly neither
forest nor mineral, it must of necessity fall into the division of agricultural land.
In the case of Mapa vs. Insular Government (10 Phil. Rep., 175), this court said that the
phrase "agricultural lands" as used in Act No. 926 means those public lands acquired from
Spain which are not timber or mineral lands.
Whatever may have been the meaning of the term "forestry" under the Spanish law, the Act of
Congress of July 1st, 1902, classified the public lands in the Philippine Islands as timber,
mineral or agricultural lands, and all public lands that are not timber or mineral lands are
necessarily agricultural public lands, whether they are used as nipa swamps, manglares,
fisheries or ordinary farm lands.
The definition of forestry as including manglares found in the Administrative Code of 1917
cannot affect rights which vested prior to its enactment.
These lands being neither timber nor mineral lands the trial court should have considered
them agricultural lands. If they are agricultural lands then the rights of appellants are fully
established by Act No. 926.
Paragraph 6 of section 54 of that Act provides as follows:
 All persons who by themselves or their predecessors in interest have been in the
open, continuous, exclusive, and notorious possession and occupation of
agricultural public lands, as defined by said Act of Congress of July first, nineteen
hundred and two, under a bona fide claim of ownership except as against the
Government, for a period of ten years next preceding the taking effect of this Act,
except when prevented by war of force majuere, shall be conclusively presumed to
have performed all the conditions essential to a government grant and to have
received the same, and shall be entitled to a certificate of title to such land under the
provisions of this chapter.
xxx xxx xxx
This Act went into effect July 26th, 1904. Therefore, all persons who were in possession of
agricultural public lands under the conditions mentioned in the above section of Act No. 926
on the 26th of July, 1894, are conclusively presumed to have a grant to such lands and are
entitled to have a certificate of title issued to them. (Pamintuan vs.Insular Government, 8 Phil.,
Rep., 485.)
While we hold that manglares as well as nipa lands are subject to private acquisition and
ownership when it is fully proved that the possession has been actual, complete and adverse,
we deem it proper to declare that each case must stand on its own merits.
One cannot acquire ownership of a mangrove swamp by merely cutting a few loads of
firewood from the lands occasionally. The possession must be more complete than would be
required for other agricultural lands.
The appellants were in actual possession of the lots in question from 18821, and their
ancestors before that date, and they should have been declared the owners and title should
have been issued to them.
There is no need to consider the other points raised on appeal.
The judgment of the lower court is reversed and the case is returned to the lower court, with
instruction to enter a decree in conformity with this decision. So ordered.
G.R. No. L-19535 July 10, 1967
HEIRS OF PELAGIO ZARA; PIO, CLEMENTE, SERAFIA, PORFIRIO and ESTEBAN, all
surnamed MINDANAO; MARIA and GLICERIA, both surnamed SEDARIA; DULCE
CORDERO, VICTORIA DE LOS REYES and JOSE GARCIA, applicants-appellants,
vs.
7
DIRECTOR OF LANDS, DIRECTOR OF FORESTRY, Government oppositor-appellees.
VICENTE V. DE VILLA, JR., and VICENTE S. DE VILLA, SR., private oppositors-appellees.
MAKALINTAL, J.:
Appeal from an order of the Court of First Instance of Batangas (Lipa City) dismissing
appellants' "application for registration of the parcel of land consisting of 107 hectares, more
or less, situated in the barrio of Sampiro, Municipality of San Juan, Province of Batangas, and
designated in amended plan PSU-103696 as Lot A."
The proceedings in the court a quo are not disputed.
On August 4, 1960 appellants filed an application for registration of the land above described
pursuant to the provisions of Act 496. They alleged that the land had been inherited by them
from their grandfather, Pelagio Zara, who in turn acquired the same under a Spanish grant
known as "Composicion de Terrenos Realengos" issued in 1888. Alternatively, should the
provisions of the Land Registration Act be not applicable, applicants invoke the benefits of the
provisions of Chapter VIII, Section 48, subsection (b) of C.A. 141 as amended, on the ground
that they and their predecessor-in-interest had been in continuous and adverse possession of
the land in concept of owner for more than 30 years immediately preceding the application.
Oppositions were filed by the Director of Lands, the Director of Forestry and by Vicente V. de
Villa, Jr. The latter's opposition recites:
x x x that the parcel of land sought to be registered by the applicants consisting of
107 hectares, more or less, was included in the area of the parcel of land applied for
registration by Vicente S. de Villa, Sr. in Civil Case No. 26, L.R. Case No. 601 in this
Court, which was decided by this same Court through the then incumbent Judge,
the Honorable Juan P. Enriquez, on September 30, 1949; that the parcel sought to
be registered by the applicants was declared public land in said decision; that they
(the oppositors Vicente V. de Villa, Jr. and Vicente S. de Villa, Sr.) have an interest
over the land in question because for a period more than sixty (60) years, the de
Villas have been in possession, and which possession, according to them, was
open continuous, notorious and under the claim of ownership; that the proceeding
being in rem, the failure of the applicants to appear at the case No. 26, L.R. Case
No. 601 to prove their imperfect and incomplete title over the property, barred them
from raising the same issue in another case; and that as far as the decision in Civil
Case No. 26, L.R. Case No. 601 which was affirmed in the appellate court in CA-
G.R. No. 5847-R is concerned, there is already "res-adjudicata" in other words,
the cause of action of the applicant is now barred by prior judgment; and that this
Court has no more jurisdiction over the subject matter, the decision of the Court in
said case having transferred to the Director of Lands.
On November 15, 1960 the De Villas (De Villa, Sr. was subsequently included as oppositor)
filed a motion to dismiss, invoking the same grounds alleged in its opposition, but principally
the fact that the land applied for had already been declared public land by the judgment in the
former registration case.
The trial court, over the objection of the applicants, granted the motion to dismiss by order
dated January 27, 1961, holding, inter alia, that "once a parcel of land is declared or adjudged
public land by the court having jurisdiction x x x it cannot be the subject anymore of another
land registration proceeding x x x (that) it is only the Director of Lands who can dispose of the
same by sale, by lease, by free patent or by homestead."
In the present appeal from the order of dismissal neither the Director of Lands nor the Director
of Forestry filed a brief as appellee. The decisive issue posed by applicants-appellants is
whether the 1949 judgment in the previous case, denying the application of Vicente S. de
Villa, Sr., and declaring the 107 hectares in question to be public land, precludes a
subsequent application by an alleged possessor for judicial confirmation of title on the basis of
continuous possession for at least thirty years, pursuant to Section 48, subsection (b) of the
Public Land Law, C.A. 141, as amended. This provision reads as follows:
The following-described citizens of the Philippines, occupying lands of the public
domain or claiming to own any such lands or an interest therein, but whose titles
have not been perfected or completed, may apply to the Court of First Instance of
the province where the land is located for confirmation of their claims and the
issuance of a certificate of title therefor, under the Land Registration Act, to wit:
xxx xxx xxx
(b) Those who by themselves or through their predecessors in interest have been in
open, continuous, exclusive and notorious possession and occupation of agricultural
lands of the public domain, under a bona fide claim of acquisition of ownership, for
at least thirty years immediately preceding the filing of the application for
confirmation of title, except when prevented by war or force majeure. These shall be
conclusively presumed to have performed all the conditions essential to a
Government grant and shall be entitled to a certificate of title under the provisions of
this Chapter.1wph1.t
The right to file an application under the foregoing provision has been extended by Republic
Act No. 2061 to December 31, 1968.
It should be noted that appellants' application is in the alternative: for registration of their title
of ownership under Act 496 or for judicial confirmation of their "imperfect" title or claim based
on adverse and continuous possession for at least thirty years. It may be that although they
8
were not actual parties in that previous case the judgment therein is a bar to their claim as
owners under the first alternative, since the proceeding was in rem, of which they and their
predecessor had constructive notice by publication. Even so this is a defense that properly
pertains to the Government, in view of the fact that the judgment declared the land in question
to be public land. In any case, appellants' imperfect possessory title was not disturbed or
foreclosed by such declaration, for precisely the proceeding contemplated in the aforecited
provision of Commonwealth Act 141 presupposes that the land is public. The basis of the
decree of judicial confirmation authorized therein is not that the land is already privately
owned and hence no longer part of the public domain, but rather that by reason of the
claimant's possession for thirty years he is conclusively presumed to have performed all the
conditions essential to a Government grant.
On the question of whether or not the private oppositors-appellees have the necessary
personality to file an opposition, we find in their favor, considering that they also claim to be in
possession of the land, and have furthermore applied for its purchase from the Bureau of
Lands.1wph1.t
Wherefore, the order appealed from is set aside and the case is remanded to the Court a
quo for trial and judgment on the merits, with costs against the private oppositors-appellees.
G.R. No. 167707 October 8, 2008
THE SECRETARY OF THE DEPARTMENT OF ENVIRONMENT AND NATURAL
RESOURCES, , petitioners,
vs.
MAYOR JOSE S. YAP, LIBERTAD TALAPIAN, MILA Y. SUMNDAD, and ANICETO YAP, in
their behalf and in behalf of all those similarly situated, respondents.
x--------------------------------------------------x
G.R. No. G.R. No. 173775 October 8, 2008
DR. ORLANDO SACAY and WILFREDO GELITO, joined by THE LANDOWNERS OF
BORACAY SIMILARLY SITUATED NAMED IN A LIST, ANNEX "A" OF THIS
PETITION, petitioners,
vs.
THE SECRETARY OF THE DEPARTMENT OF ENVIRONMENT AND NATURAL
RESOURCES, THE REGIONAL TECHNICAL DIRECTOR FOR LANDS, LANDS
MANAGEMENT BUREAU, REGION VI, PROVINCIAL ENVIRONMENT AND NATURAL
RESOURCES OFFICER, KALIBO, AKLAN, respondents.
DECISION
REYES, R.T., J.:
AT stake in these consolidated cases is the right of the present occupants of Boracay Island
to secure titles over their occupied lands.
There are two consolidated petitions. The first is G.R. No. 167707, a petition for review
on certiorari of the Decision1of the Court of Appeals (CA) affirming that2 of the Regional Trial
Court (RTC) in Kalibo, Aklan, which granted the petition for declaratory relief filed by
respondents-claimants Mayor Jose Yap, et al. and ordered the survey of Boracay for titling
purposes. The second is G.R. No. 173775, a petition for prohibition, mandamus, and
nullification of Proclamation No. 10645">[3] issued by President Gloria Macapagal-Arroyo
classifying Boracay into reserved forest and agricultural land.
The Antecedents
G.R. No. 167707
Boracay Island in the Municipality of Malay, Aklan, with its powdery white sand beaches and
warm crystalline waters, is reputedly a premier Philippine tourist destination. The island is also
home to 12,003 inhabitants4 who live in the bone-shaped islands three barangays.5
On April 14, 1976, the Department of Environment and Natural Resources (DENR) approved
the National Reservation Survey of Boracay
Island,6 which identified several lots as being occupied or claimed by named persons.7
On November 10, 1978, then President Ferdinand Marcos issued Proclamation
No. 18018 declaring Boracay Island, among other islands, caves and peninsulas in the
Philippines, as tourist zones and marine reserves under the administration of the Philippine
Tourism Authority (PTA). President Marcos later approved the issuance of PTA Circular 3-
829 dated September 3, 1982, to implement Proclamation No. 1801.
Claiming that Proclamation No. 1801 and PTA Circular No 3-82 precluded them from filing an
application for judicial confirmation of imperfect title or survey of land for titling purposes,
respondents-claimants
9
Mayor Jose S. Yap, Jr., Libertad Talapian, Mila Y. Sumndad, and Aniceto Yap filed a petition
for declaratory relief with the RTC in Kalibo, Aklan.
In their petition, respondents-claimants alleged that Proclamation No. 1801 and PTA Circular
No. 3-82 raised doubts on their right to secure titles over their occupied lands. They declared
that they themselves, or through their predecessors-in-interest, had been in open, continuous,
exclusive, and notorious possession and occupation in Boracay since June 12, 1945, or
earlier since time immemorial. They declared their lands for tax purposes and paid realty
taxes on them.10
Respondents-claimants posited that Proclamation No. 1801 and its implementing Circular did
not place Boracay beyond the commerce of man. Since the Island was classified as a tourist
zone, it was susceptible of private ownership. Under Section 48(b) of Commonwealth Act (CA)
No. 141, otherwise known as the Public Land Act, they had the right to have the lots
registered in their names through judicial confirmation of imperfect titles.
The Republic, through the Office of the Solicitor General (OSG), opposed the petition for
declaratory relief. The OSG countered that Boracay Island was an unclassified land of the
public domain. It formed part of the mass of lands classified as "public forest," which was not
available for disposition pursuant to Section 3(a) of Presidential Decree (PD) No. 705 or the
Revised Forestry Code,11 as amended.
The OSG maintained that respondents-claimants reliance on PD No. 1801 and PTA Circular
No. 3-82 was misplaced. Their right to judicial confirmation of title was governed by CA No.
141 and PD No. 705. Since Boracay Island had not been classified as alienable and
disposable, whatever possession they had cannot ripen into ownership.
During pre-trial, respondents-claimants and the OSG stipulated on the following facts: (1)
respondents-claimants were presently in possession of parcels of land in Boracay Island; (2)
these parcels of land were planted with coconut trees and other natural growing trees; (3) the
coconut trees had heights of more or less twenty (20) meters and were planted more or less
fifty (50) years ago; and (4) respondents-claimants declared the land they were occupying for
tax purposes.12
The parties also agreed that the principal issue for resolution was purely legal: whether
Proclamation No. 1801 posed any legal hindrance or impediment to the titling of the lands in
Boracay. They decided to forego with the trial and to submit the case for resolution upon
submission of their respective memoranda.13
The RTC took judicial notice14 that certain parcels of land in Boracay Island, more particularly
Lots 1 and 30, Plan PSU-5344, were covered by Original Certificate of Title No. 19502 (RO
2222) in the name of the Heirs of Ciriaco S. Tirol. These lots were involved in Civil Case Nos.
5222 and 5262 filed before the RTC of Kalibo, Aklan.15 The titles were issued on
August 7, 1933.16
RTC and CA Dispositions
On July 14, 1999, the RTC rendered a decision in favor of respondents-claimants, with
a fallo reading:
WHEREFORE, in view of the foregoing, the Court declares that Proclamation No. 1801 and
PTA Circular No. 3-82 pose no legal obstacle to the petitioners and those similarly situated to
acquire title to their lands in Boracay, in accordance with the applicable laws and in the
manner prescribed therein; and to have their lands surveyed and approved by respondent
Regional Technical Director of Lands as the approved survey does not in itself constitute a
title to the land.
SO ORDERED.17
The RTC upheld respondents-claimants right to have their occupied lands titled in their name.
It ruled that neither Proclamation No. 1801 nor PTA Circular No. 3-82 mentioned that lands in
Boracay were inalienable or could not be the subject of disposition.18 The Circular itself
recognized private ownership of lands.19 The trial court cited Sections 8720 and 5321 of the
Public Land Act as basis for acknowledging private ownership of lands in Boracay and that
only those forested areas in public lands were declared as part of the forest reserve.22
The OSG moved for reconsideration but its motion was denied.23 The Republic then appealed
to the CA.
On December 9, 2004, the appellate court affirmed in toto the RTC decision, disposing as
follows:
WHEREFORE, in view of the foregoing premises, judgment is hereby rendered by us
DENYING the appeal filed in this case and AFFIRMING the decision of the lower court.24
The CA held that respondents-claimants could not be prejudiced by a declaration that the
lands they occupied since time immemorial were part of a forest reserve.
Again, the OSG sought reconsideration but it was similarly denied. 25 Hence, the present
petition under Rule 45.
10
G.R. No. 173775
On May 22, 2006, during the pendency of G.R. No. 167707, President Gloria Macapagal-
Arroyo issued Proclamation No. 106426 classifying Boracay Island into four hundred (400)
hectares of reserved forest land (protection purposes) and six hundred twenty-eight and
96/100 (628.96) hectares of agricultural land (alienable and disposable). The Proclamation
likewise provided for a fifteen-meter buffer zone on each side of the centerline of roads and
trails, reserved for right-of-way and which shall form part of the area reserved for forest land
protection purposes.
On August 10, 2006, petitioners-claimants Dr. Orlando Sacay,27 Wilfredo Gelito,28 and other
landowners29 in Boracay filed with this Court an original petition for prohibition, mandamus,
and nullification of Proclamation No. 1064.30 They allege that the Proclamation infringed on
their "prior vested rights" over portions of Boracay. They have been in continued possession
of their respective lots in Boracay since time immemorial. They have also invested billions of
pesos in developing their lands and building internationally renowned first class resorts on
their lots.31
Petitioners-claimants contended that there is no need for a proclamation reclassifying Boracay
into agricultural land. Being classified as neither mineral nor timber land, the island
is deemed agricultural pursuant to the Philippine Bill of 1902 and Act No. 926, known as the
first Public Land Act.32 Thus, their possession in the concept of owner for the required period
entitled them to judicial confirmation of imperfect title.
Opposing the petition, the OSG argued that petitioners-claimants do not have a vested right
over their occupied portions in the island. Boracay is an unclassified public forest land
pursuant to Section 3(a) of PD No. 705. Being public forest, the claimed portions of the island
are inalienable and cannot be the subject of judicial confirmation of imperfect title. It is only the
executive department, not the courts, which has authority to reclassify lands of the public
domain into alienable and disposable lands. There is a need for a positive government act in
order to release the lots for disposition.
On November 21, 2006, this Court ordered the consolidation of the two petitions as they
principally involve the same issues on the land classification of Boracay Island.33
Issues
G.R. No. 167707
The OSG raises the lone issue of whether Proclamation No. 1801 and PTA Circular No. 3-82
pose any legal obstacle for respondents, and all those similarly situated, to acquire title to their
occupied lands in Boracay Island.34
G.R. No. 173775
Petitioners-claimants hoist five (5) issues, namely:
I.
AT THE TIME OF THE ESTABLISHED POSSESSION OF PETITIONERS IN CONCEPT OF
OWNER OVER THEIR RESPECTIVE AREAS IN BORACAY, SINCE TIME IMMEMORIAL
OR AT THE LATEST SINCE 30 YRS. PRIOR TO THE FILING OF THE PETITION FOR
DECLARATORY RELIEF ON NOV. 19, 1997, WERE THE AREAS OCCUPIED BY THEM
PUBLIC AGRICULTURAL LANDS AS DEFINED BY LAWS THEN ON JUDICIAL
CONFIRMATION OF IMPERFECT TITLES OR PUBLIC FOREST AS DEFINED BY SEC. 3a,
PD 705?
II.
HAVE PETITIONERS OCCUPANTS ACQUIRED PRIOR VESTED RIGHT OF PRIVATE
OWNERSHIPOVER THEIR OCCUPIED PORTIONS OF BORACAY LAND, DESPITE THE
FACT THAT THEY HAVE NOT APPLIED YET FOR JUDICIAL CONFIRMATION OF
IMPERFECT TITLE?
III.
IS THE EXECUTIVE DECLARATION OF THEIR AREAS AS ALIENABLE AND
DISPOSABLE UNDER SEC 6, CA 141 [AN] INDISPENSABLE PRE-REQUISITE FOR
PETITIONERS TO OBTAIN TITLEUNDER THE TORRENS SYSTEM?
IV.
IS THE ISSUANCE OF PROCLAMATION 1064 ON MAY 22, 2006, VIOLATIVE OF THE
PRIOR VESTED RIGHTS TO PRIVATE OWNERSHIP OF PETITIONERS OVER THEIR
LANDS IN BORACAY, PROTECTED BY THE DUE PROCESS CLAUSE OF THE
CONSTITUTION OR IS PROCLAMATION 1064 CONTRARY TO SEC. 8, CA 141, OR SEC.
4(a) OF RA 6657.
V.
11
CAN RESPONDENTS BE COMPELLED BY MANDAMUS TO ALLOW THE SURVEY AND
TO APPROVE THE SURVEY PLANS FOR PURPOSES OF THE APPLICATION FOR
TITLING OF THE LANDS OF PETITIONERS IN BORACAY?35 (Underscoring supplied)
In capsule, the main issue is whether private claimants (respondents-claimants in G.R. No.
167707 and petitioners-claimants in G.R. No. 173775) have a right to secure titles over their
occupied portions in Boracay. The twin petitions pertain to their right, if any, to judicial
confirmation of imperfect title under CA No. 141, as amended. They do not involve their right
to secure title under other pertinent laws.
Our Ruling
Regalian Doctrine and power of the executive
to reclassify lands of the public domain
Private claimants rely on three (3) laws and executive acts in their bid for judicial confirmation
of imperfect title, namely: (a) Philippine Bill of 190236 in relation to Act No. 926, later amended
and/or superseded by Act No. 2874 and CA No. 141;37 (b) Proclamation No. 180138 issued by
then President Marcos; and (c) Proclamation No. 106439issued by President Gloria
Macapagal-Arroyo. We shall proceed to determine their rights to apply for judicial confirmation
of imperfect title under these laws and executive acts.
But first, a peek at the Regalian principle and the power of the executive to reclassify lands of
the public domain.
The 1935 Constitution classified lands of the public domain into agricultural, forest or
timber.40 Meanwhile, the 1973 Constitution provided the following divisions: agricultural,
industrial or commercial, residential, resettlement, mineral, timber or forest and grazing lands,
and such other classes as may be provided by law,41 giving the government great leeway for
classification.42 Then the 1987 Constitution reverted to the 1935 Constitution classification
with one addition: national parks.43 Of these, only agricultural lands may be alienated.44 Prior
to Proclamation No. 1064 of May 22, 2006, Boracay Island had never been expressly and
administratively classified under any of these grand divisions. Boracay was an unclassified
land of the public domain.
The Regalian Doctrine dictates that all lands of the public domain belong to the State, that the
State is the source of any asserted right to ownership of land and charged with the
conservation of such patrimony.45 The doctrine has been consistently adopted under the
1935, 1973, and 1987 Constitutions.46
All lands not otherwise appearing to be clearly within private ownership are presumed to "agricultural lands" under the Philippine Bill of 1902, the Court declared in Mapa v. Insular
belong to the State.47Thus, all lands that have not been acquired from the government, either Government:64
by purchase or by grant, belong to the State as part of the inalienable public
domain.48 Necessarily, it is up to the State to determine if lands of the public domain will be x x x In other words, that the phrase "agricultural land" as used in Act No. 926 means those
disposed of for private ownership. The government, as the agent of the state, is possessed of public lands acquired from Spain which are not timber or mineral lands. x x
the plenary power as the persona in law to determine who shall be the favored recipients of x65 (Emphasis Ours)
public lands, as well as under what terms they may be granted such privilege, not excluding
the placing of obstacles in the way of their exercise of what otherwise would be ordinary acts
On February 1, 1903, the Philippine Legislature passed Act No. 496, otherwise known as the
of ownership.49
Land Registration Act. The act established a system of registration by which recorded title
becomes absolute, indefeasible, and imprescriptible. This is known as the Torrens system.66
Our present land law traces its roots to the Regalian Doctrine. Upon the Spanish conquest of
the Philippines, ownership of all lands, territories and possessions in the Philippines passed to
Concurrently, on October 7, 1903, the Philippine Commission passed Act No. 926, which was
the Spanish Crown.50 The Regalian doctrine was first introduced in the Philippines through
the first Public Land Act. The Act introduced the homestead system and made provisions for
the Laws of the Indies and the Royal Cedulas, which laid the foundation that "all lands that
judicial and administrative confirmation of imperfect titles and for the sale or lease of public
were not acquired from the Government, either by purchase or by grant, belong to the public
lands. It permitted corporations regardless of the nationality of persons owning the controlling
domain."51
stock to lease or purchase lands of the public domain.67 Under the Act, open, continuous,
exclusive, and notorious possession and occupation of agricultural lands for the next ten (10)
The Laws of the Indies was followed by the Ley Hipotecaria or the Mortgage Law of 1893. The years preceding July 26, 1904 was sufficient for judicial confirmation of imperfect title. 68
Spanish Mortgage Law provided for the systematic registration of titles and deeds as well as
possessory claims.52
On November 29, 1919, Act No. 926 was superseded by Act No. 2874, otherwise known as
the second Public Land Act. This new, more comprehensive law limited the exploitation of
The Royal Decree of 1894 or the Maura Law53 partly amended the Spanish Mortgage Law agricultural lands to Filipinos and Americans and citizens of other countries which gave
and the Laws of the Indies. It established possessory information as the method of legalizing Filipinos the same privileges. For judicial confirmation of title, possession and occupation en
possession of vacant Crown land, under certain conditions which were set forth in said concepto dueo since time immemorial, or since July 26, 1894, was required.69
decree.54 Under Section 393 of the Maura Law, an informacion posesoria or possessory
information title,55 when duly inscribed in the Registry of Property, is converted into a title of
After the passage of the 1935 Constitution, CA No. 141 amended Act No. 2874 on December
ownership only after the lapse of twenty (20) years of uninterrupted possession which must be
1, 1936. To this day, CA No. 141, as amended, remains as the existing general law governing
actual, public, and adverse,56 from the date of its inscription.57 However, possessory
the classification and disposition of lands of the public domain other than timber and mineral
information title had to be perfected one year after the promulgation of the Maura Law, or until
lands,70 and privately owned lands which reverted to the State.71
April 17, 1895. Otherwise, the lands would revert to the State.58
Section 48(b) of CA No. 141 retained the requirement under Act No. 2874 of possession and
In sum, private ownership of land under the Spanish regime could only be founded on royal
occupation of lands of the public domain since time immemorial or since July 26, 1894.
concessions which took various forms, namely: (1) titulo real or royal grant; (2) concesion
However, this provision was superseded by Republic Act (RA) No. 1942,72 which provided for
especial or special grant; (3) composicion con el estado or adjustment title; (4) titulo de
a simple thirty-year prescriptive period for judicial confirmation of imperfect title. The provision
compra or title by purchase; and (5) informacion posesoria or possessory information title.59>
was last amended by PD No. 1073,73 which now provides for possession and occupation of
the land applied for since June 12, 1945, or earlier.74
The first law governing the disposition of public lands in the Philippines under American rule
was embodied in the Philippine Bill of 1902.60 By this law, lands of the public domain in the
The issuance of PD No. 89275 on February 16, 1976 discontinued the use of Spanish titles as
Philippine Islands were classified into three (3) grand divisions, to wit: agricultural, mineral,
evidence in land registration proceedings.76 Under the decree, all holders of Spanish titles or
and timber or forest lands.61 The act provided for, among others, the disposal of mineral lands
grants should apply for registration of their lands under Act No. 496 within six (6) months from
by means of absolute grant (freehold system) and by lease (leasehold system).62 It also
the effectivity of the decree on February 16, 1976. Thereafter, the recording of all unregistered
provided the definition by exclusion of "agricultural public lands."63 Interpreting the meaning of
12
lands77 shall be governed by Section 194 of the Revised Administrative Code, as amended by
Act No. 3344.
On June 11, 1978, Act No. 496 was amended and updated by PD No. 1529, known as the
Property Registration Decree. It was enacted to codify the various laws relative to registration
of property.78 It governs registration of lands under the Torrens system as well as unregistered
lands, including chattel mortgages.79
A positive act declaring land as alienable and disposable is required. In keeping with the
presumption of State ownership, the Court has time and again emphasized that there must
be a positive act of the government, such as an official proclamation,80 declassifying
inalienable public land into disposable land for agricultural or other purposes.81 In fact, Section
8 of CA No. 141 limits alienable or disposable lands only to those lands which have been
"officially delimited and classified."82
The burden of proof in overcoming the presumption of State ownership of the lands of the
public domain is on the person applying for registration (or claiming ownership), who must
prove that the land subject of the application is alienable or disposable. 83 To overcome this
presumption, incontrovertible evidence must be established that the land subject of the
application (or claim) is alienable or disposable.84 There must still be a positive act declaring
land of the public domain as alienable and disposable. To prove that the land subject of an
application for registration is alienable, the applicant must establish the existence of a positive
act of the government such as a presidential proclamation or an executive order; an
administrative action; investigation reports of Bureau of Lands investigators; and a legislative
act or a statute.85 The applicant may also secure a certification from the government that the
land claimed to have been possessed for the required number of years is alienable and
disposable.86
In the case at bar, no such proclamation, executive order, administrative action, report,
statute, or certification was presented to the Court. The records are bereft of evidence
showing that, prior to 2006, the portions of Boracay occupied by private claimants were
subject of a government proclamation that the land is alienable and disposable. Absent such
well-nigh incontrovertible evidence, the Court cannot accept the submission that lands
occupied by private claimants were already open to disposition before 2006. Matters of land
classification or reclassification cannot be assumed. They call for proof.87
Ankron and De Aldecoa did not make the whole of Boracay Island, or portions of it,
agricultural lands.Private claimants posit that Boracay was already an agricultural land
pursuant to the old cases Ankron v. Government of the Philippine Islands (1919) 88 and De
Aldecoa v. The Insular Government (1909).89 These cases were decided under the provisions
of the Philippine Bill of 1902 and Act No. 926. There is a statement in these old cases that "in
13
the absence of evidence to the contrary, that in each case the lands are agricultural lands until
the contrary is shown."90
Private claimants reliance on Ankron and De Aldecoa is misplaced. These cases did not have
the effect of converting the whole of Boracay Island or portions of it into agricultural lands. It
should be stressed that the Philippine Bill of 1902 and Act No. 926 merely provided the
manner through which land registration courts would classify lands of the public domain.
Whether the land would be classified as timber, mineral, or agricultural depended on proof
presented in each case.
Ankron and De Aldecoa were decided at a time when the President of the Philippines had no
power to classify lands of the public domain into mineral, timber, and agricultural. At that time,
the courts were free to make corresponding classifications in justiciable cases, or were vested
with implicit power to do so, depending upon the preponderance of the evidence. 91 This was
the Courts ruling in Heirs of the Late Spouses Pedro S. Palanca and Soterranea Rafols Vda.
De Palanca v. Republic,92 in which it stated, through Justice Adolfo Azcuna, viz.:
x x x Petitioners furthermore insist that a particular land need not be formally released by an
act of the Executive before it can be deemed open to private ownership, citing the cases
of Ramos v. Director of Lands and Ankron v. Government of the Philippine Islands.
xxxx
Petitioners reliance upon Ramos v. Director of Lands and Ankron v. Government is
misplaced. These cases were decided under the Philippine Bill of 1902 and the first Public
Land Act No. 926 enacted by the Philippine Commission on October 7, 1926, under which
there was no legal provision vesting in the Chief Executive or President of the Philippines the
power to classify lands of the public domain into mineral, timber and agricultural so that the
courts then were free to make corresponding classifications in justiciable cases, or were
vested with implicit power to do so, depending upon the preponderance of the evidence.93
To aid the courts in resolving land registration cases under Act No. 926, it was then necessary
to devise a presumption on land classification. Thus evolved the dictum in Ankron that "the
courts have a right to presume, in the absence of evidence to the contrary, that in each case
the lands are agricultural lands until the contrary is shown."94
But We cannot unduly expand the presumption in Ankron and De Aldecoa to an argument that
all lands of the public domain had been automatically reclassified as disposable and alienable
agricultural lands. By no stretch of imagination did the presumption convert all lands of the
public domain into agricultural lands.
If We accept the position of private claimants, the Philippine Bill of 1902 and Act No. 926
would have automatically made all lands in the Philippines, except those already classified as
timber or mineral land, alienable and disposable lands. That would take these lands out of
State ownership and worse, would be utterly inconsistent with and totally repugnant to the
long-entrenched Regalian doctrine.
The presumption in Ankron and De Aldecoa attaches only to land registration cases brought
under the provisions of Act No. 926, or more specifically those cases dealing with judicial and
administrative confirmation of imperfect titles. The presumption applies to an applicant for
judicial or administrative conformation of imperfect title under Act No. 926. It certainly cannot
apply to landowners, such as private claimants or their predecessors-in-interest, who failed to
avail themselves of the benefits of Act No. 926. As to them, their land remained unclassified
and, by virtue of the Regalian doctrine, continued to be owned by the State.
In any case, the assumption in Ankron and De Aldecoa was not absolute. Land classification
was, in the end, dependent on proof. If there was proof that the land was better suited for non-
agricultural uses, the courts could adjudge it as a mineral or timber land despite the
presumption. In Ankron, this Court stated:
In the case of Jocson vs. Director of Forestry (supra), the Attorney-General admitted in effect
that whether the particular land in question belongs to one class or another is a question of
fact. The mere fact that a tract of land has trees upon it or has mineral within it is not of itself
sufficient to declare that one is forestry land and the other, mineral land. There must be some
proof of the extent and present or future value of the forestry and of the minerals. While, as we
have just said, many definitions have been given for "agriculture," "forestry," and "mineral"
lands, and that in each case it is a question of fact, we think it is safe to say that in order to be
forestry or mineral land the proof must show that it is more valuable for the forestry or the
mineral which it contains than it is for agricultural purposes. (Sec. 7, Act No. 1148.) It is not
sufficient to show that there exists some trees upon the land or that it bears some mineral.
Land may be classified as forestry or mineral today, and, by reason of the exhaustion of the
timber or mineral, be classified as agricultural land tomorrow. And vice-versa, by reason of the
rapid growth of timber or the discovery of valuable minerals, lands classified as agricultural
today may be differently classified tomorrow. Each case must be decided upon the proof in
that particular case, having regard for its present or future value for one or the other
purposes. We believe, however, considering the fact that it is a matter of public knowledge
that a majority of the lands in the Philippine Islands are agricultural lands that the courts have
a right to presume, in the absence of evidence to the contrary, that in each case the lands are
agricultural lands until the contrary is shown. Whatever the land involved in a particular
land registration case is forestry or mineral land must, therefore, be a matter of proof.
Its superior value for one purpose or the other is a question of fact to be settled by the
proof in each particular case. The fact that the land is a manglar [mangrove swamp] is not
sufficient for the courts to decide whether it is agricultural, forestry, or mineral land. It may
14
perchance belong to one or the other of said classes of land. The Government, in the first
instance, under the provisions of Act No. 1148, may, by reservation, decide for itself what
portions of public land shall be considered forestry land, unless private interests have
intervened before such reservation is made. In the latter case, whether the land is agricultural,
forestry, or mineral, is a question of proof. Until private interests have intervened, the
Government, by virtue of the terms of said Act (No. 1148), may decide for itself what portions
of the "public domain" shall be set aside and reserved as forestry or mineral land. (Ramos vs.
Director of Lands, 39 Phil. 175; Jocson vs. Director of Forestry, supra)95(Emphasis ours)
Since 1919, courts were no longer free to determine the classification of lands from the facts
of each case, except those that have already became private lands.96 Act
No. 2874, promulgated in 1919 and reproduced in Section 6 of CA No. 141, gave the
Executive Department, through the President, the exclusive prerogative to classify or
reclassify public lands into alienable or disposable, mineral or forest.96-a Since then, courts no
longer had the authority, whether express or implied, to determine the classification of lands of
the public domain.97
Here, private claimants, unlike the Heirs of Ciriaco Tirol who were issued their title in
1933,98 did not present a justiciable case for determination by the land registration court of the
propertys land classification. Simply put, there was no opportunity for the courts then to
resolve if the land the Boracay occupants are now claiming were agricultural lands. When Act
No. 926 was supplanted by Act No. 2874 in 1919, without an application for judicial
confirmation having been filed by private claimants or their predecessors-in-interest, the
courts were no longer authorized to determine the propertys land classification. Hence,
private claimants cannot bank on Act No. 926.
We note that the RTC decision99 in G.R. No. 167707 mentioned Krivenko v. Register of Deeds
of Manila,100 which was decided in 1947 when CA No. 141, vesting the Executive with the sole
power to classify lands of the public domain was already in effect. Krivenko cited the old
cases Mapa v. Insular Government,101 De Aldecoa v. The Insular Government,102 and Ankron
v. Government of the Philippine Islands.103
Krivenko, however, is not controlling here because it involved a totally different issue. The
pertinent issue in Krivenko was whether residential lots were included in the general
classification of agricultural lands; and if so, whether an alien could acquire a residential lot.
This Court ruled that as an alien, Krivenko was prohibited by the 1935 Constitution104 from
acquiring agricultural land, which included residential lots. Here, the issue is whether
unclassified lands of the public domain are automatically deemed agricultural.
Notably, the definition of "agricultural public lands" mentioned in Krivenko relied on the old
cases decided prior to the enactment of Act No. 2874, including Ankron and De
Aldecoa.105 As We have already stated, those cases cannot apply here, since they were
decided when the Executive did not have the authority to classify lands as agricultural, timber,
or mineral.
Private claimants continued possession under Act No. 926 does not create a
presumption that the land is alienable. Private claimants also contend that their continued
possession of portions of Boracay Island for the requisite period of ten (10) years under Act
No. 926106 ipso facto converted the island into private ownership. Hence, they may apply for a
title in their name.
A similar argument was squarely rejected by the Court in Collado v. Court of
Appeals.107 Collado, citing the separate opinion of now Chief Justice Reynato S. Puno in Cruz
v. Secretary of Environment and Natural Resources,107-a ruled:
"Act No. 926, the first Public Land Act, was passed in pursuance of the provisions of the
Philippine Bill of 1902. The law governed the disposition of lands of the public domain. It
prescribed rules and regulations for the homesteading, selling and leasing of portions of the
public domain of the Philippine Islands, and prescribed the terms and conditions to enable
persons to perfect their titles to public lands in the Islands. It also provided for the "issuance of
patents to certain native settlers upon public lands," for the establishment of town sites and
sale of lots therein, for the completion of imperfect titles, and for the cancellation or
confirmation of Spanish concessions and grants in the Islands." In short, the Public Land Act
operated on the assumption that title to public lands in the Philippine Islands remained in the
government; and that the governments title to public land sprung from the Treaty of Paris and
other subsequent treaties between Spain and the United States. The term "public land"
referred to all lands of the public domain whose title still remained in the government and are
thrown open to private appropriation and settlement, and excluded the patrimonial property of
the government and the friar lands."
Thus, it is plain error for petitioners to argue that under the Philippine Bill of 1902 and
Public Land Act No. 926, mere possession by private individuals of lands creates the
legal presumption that the lands are alienable and disposable.108 (Emphasis Ours)
Except for lands already covered by existing titles, Boracay was an unclassified land of
the public domain prior to Proclamation No. 1064. Such unclassified lands are
considered public forest under PD No. 705. The DENR109 and the National Mapping and
Resource Information Authority110 certify that Boracay Island is an unclassified land of the
public domain.
PD No. 705 issued by President Marcos categorized all unclassified lands of the public
domain as public forest. Section 3(a) of PD No. 705 defines a public forest as "a mass of
lands of the public domain which has not been the subject of the present system of
classification for the determination of which lands are needed for forest purpose and which are
15
not." Applying PD No. 705, all unclassified lands, including those in Boracay Island, are ipso
factoconsidered public forests. PD No. 705, however, respects titles already existing prior to
its effectivity.
The Court notes that the classification of Boracay as a forest land under PD No. 705 may
seem to be out of touch with the present realities in the island. Boracay, no doubt, has been
partly stripped of its forest cover to pave the way for commercial developments. As a premier
tourist destination for local and foreign tourists, Boracay appears more of a commercial island
resort, rather than a forest land.
Nevertheless, that the occupants of Boracay have built multi-million peso beach resorts on the
island;111 that the island has already been stripped of its forest cover; or that the
implementation of Proclamation No. 1064 will destroy the islands tourism industry,
do not negate its character as public forest.
Forests, in the context of both the Public Land Act and the Constitution 112 classifying lands of
the public domain into "agricultural, forest or timber, mineral lands, and national parks," do not
necessarily refer to large tracts of wooded land or expanses covered by dense growths of
trees and underbrushes.113 The discussion in Heirs of Amunategui v. Director of Forestry114 is
particularly instructive:
A forested area classified as forest land of the public domain does not lose such classification
simply because loggers or settlers may have stripped it of its forest cover. Parcels of land
classified as forest land may actually be covered with grass or planted to crops by kaingin
cultivators or other farmers. "Forest lands" do not have to be on mountains or in out of the way
places. Swampy areas covered by mangrove trees, nipa palms, and other trees growing in
brackish or sea water may also be classified as forest land. The classification is descriptive
of its legal nature or status and does not have to be descriptive of what the land
actually looks like. Unless and until the land classified as "forest" is released in an official
proclamation to that effect so that it may form part of the disposable agricultural lands of the
public domain, the rules on confirmation of imperfect title do not apply.115 (Emphasis supplied)
There is a big difference between "forest" as defined in a dictionary and "forest or timber land"
as a classification of lands of the public domain as appearing in our statutes. One is
descriptive of what appears on the land while the other is a legal status, a classification for
legal purposes.116 At any rate, the Court is tasked to determine the legalstatus of Boracay
Island, and not look into its physical layout. Hence, even if its forest cover has been replaced
by beach resorts, restaurants and other commercial establishments, it has not been
automatically converted from public forest to alienable agricultural land.
Private claimants cannot rely on Proclamation No. 1801 as basis for judicial
confirmation of imperfect title. The proclamation did not convert Boracay into an
agricultural land. However, private claimants argue that Proclamation No. 1801 issued by
then President Marcos in 1978 entitles them to judicial confirmation of imperfect title. The
Proclamation classified Boracay, among other islands, as a tourist zone. Private claimants
assert that, as a tourist spot, the island is susceptible of private ownership.
Proclamation No. 1801 or PTA Circular No. 3-82 did not convert the whole of Boracay into an
agricultural land. There is nothing in the law or the Circular which made Boracay Island an
agricultural land. The reference in Circular No. 3-82 to "private lands"117 and "areas declared
as alienable and disposable"118 does not by itself classify the entire island as agricultural.
Notably, Circular No. 3-82 makes reference not only to private lands and areas but also to
public forested lands. Rule VIII, Section 3 provides:
No trees in forested private lands may be cut without prior authority from the PTA. All
forested areas in public lands are declared forest reserves. (Emphasis supplied)
Clearly, the reference in the Circular to both private and public lands merely recognizes that
the island can be classified by the Executive department pursuant to its powers under CA No.
141. In fact, Section 5 of the Circular recognizes the then Bureau of Forest Developments
authority to declare areas in the island as alienable and disposable when it provides:
Subsistence farming, in areas declared as alienable and disposable by the Bureau of Forest
Development.
Therefore, Proclamation No. 1801 cannot be deemed the positive act needed to classify
Boracay Island as alienable and disposable land. If President Marcos intended to classify the
island as alienable and disposable or forest, or both, he would have identified the specific
limits of each, as President Arroyo did in Proclamation No. 1064. This was not done in
Proclamation No. 1801.
The Whereas clauses of Proclamation No. 1801 also explain the rationale behind the
declaration of Boracay Island, together with other islands, caves and peninsulas in the
Philippines, as a tourist zone and marine reserve to be administered by the PTA to ensure
the concentrated efforts of the public and private sectors in the development of the areas
tourism potential with due regard for ecological balance in the marine environment. Simply
put, the proclamation is aimed at administering the islands for tourism and ecological
purposes. It does not address the areas alienability.119
More importantly, Proclamation No. 1801 covers not only Boracay Island, but sixty-four (64)
other islands, coves, and peninsulas in the Philippines, such as Fortune and Verde Islands in
Batangas, Port Galera in Oriental Mindoro, Panglao and Balicasag Islands in Bohol, Coron
Island, Puerto Princesa and surrounding areas in Palawan, Camiguin Island in Cagayan de
Oro, and Misamis Oriental, to name a few. If the designation of Boracay Island as tourist zone
16
makes it alienable and disposable by virtue of Proclamation No. 1801, all the other areas
mentioned would likewise be declared wide open for private disposition. That could not have
been, and is clearly beyond, the intent of the proclamation.
It was Proclamation No. 1064 of 2006 which positively declared part of Boracay as
alienable and opened the same to private ownership. Sections 6 and 7 of CA No.
141120 provide that it is only the President, upon the recommendation of the proper
department head, who has the authority to classify the lands of the public domain into
alienable or disposable, timber and mineral lands.121
In issuing Proclamation No. 1064, President Gloria Macapagal-Arroyo merely exercised the
authority granted to her to classify lands of the public domain, presumably subject to existing
vested rights. Classification of public lands is the exclusive prerogative of the Executive
Department, through the Office of the President. Courts have no authority to do so.122 Absent
such classification, the land remains unclassified until released and rendered open to
disposition.123
Proclamation No. 1064 classifies Boracay into 400 hectares of reserved forest land and
628.96 hectares of agricultural land. The Proclamation likewise provides for a 15-meter buffer
zone on each side of the center line of roads and trails, which are reserved for right of way
and which shall form part of the area reserved for forest land protection purposes.
Contrary to private claimants argument, there was nothing invalid or irregular, much less
unconstitutional, about the classification of Boracay Island made by the President through
Proclamation No. 1064. It was within her authority to make such classification, subject to
existing vested rights.
Proclamation No. 1064 does not violate the Comprehensive Agrarian Reform
Law. Private claimants further assert that Proclamation No. 1064 violates the provision of the
Comprehensive Agrarian Reform Law (CARL) or RA No. 6657 barring conversion of public
forests into agricultural lands. They claim that since Boracay is a public forest under PD No.
705, President Arroyo can no longer convert it into an agricultural land without running afoul of
Section 4(a) of RA No. 6657, thus:
SEC. 4. Scope. The Comprehensive Agrarian Reform Law of 1988 shall cover, regardless of
tenurial arrangement and commodity produced, all public and private agricultural lands as
provided in Proclamation No. 131 and Executive Order No. 229, including other lands of the
public domain suitable for agriculture.
More specifically, the following lands are covered by the Comprehensive Agrarian Reform
Program:
(a) All alienable and disposable lands of the public domain devoted to or suitable for
agriculture. No reclassification of forest or mineral lands to agricultural lands shall be
undertaken after the approval of this Act until Congress, taking into account ecological,
developmental and equity considerations, shall have determined by law, the specific limits of
the public domain.
That Boracay Island was classified as a public forest under PD No. 705 did not bar the
Executive from later converting it into agricultural land. Boracay Island still remained an
unclassified land of the public domain despite PD No. 705.
In Heirs of the Late Spouses Pedro S. Palanca and Soterranea Rafols v. Republic,124 the
Court stated that unclassified lands are public forests.
While it is true that the land classification map does not categorically state that the
islands are public forests, the fact that they were unclassified lands leads to the same
result. In the absence of the classification as mineral or timber land, the land remains
unclassified land until released and rendered open to disposition.125 (Emphasis supplied)
Moreover, the prohibition under the CARL applies only to a "reclassification" of land. If the
land had never been previously classified, as in the case of Boracay, there can be no
prohibited reclassification under the agrarian law. We agree with the opinion of the
Department of Justice126 on this point:
Indeed, the key word to the correct application of the prohibition in Section 4(a) is the word
"reclassification." Where there has been no previous classification of public forest [referring,
we repeat, to the mass of the public domain which has not been the subject of the present
system of classification for purposes of determining which are needed for forest purposes and
which are not] into permanent forest or forest reserves or some other forest uses under the
Revised Forestry Code, there can be no "reclassification of forest lands" to speak of within the
meaning of Section 4(a).
Thus, obviously, the prohibition in Section 4(a) of the CARL against the reclassification of
forest lands to agricultural lands without a prior law delimiting the limits of the public domain,
does not, and cannot, apply to those lands of the public domain, denominated as "public
forest" under the Revised Forestry Code, which have not been previously determined, or
classified, as needed for forest purposes in accordance with the provisions of the Revised
Forestry Code.127
Private claimants are not entitled to apply for judicial confirmation of imperfect title
under CA No. 141. Neither do they have vested rights over the occupied lands under
the said law. There are two requisites for judicial confirmation of imperfect or incomplete title
under CA No. 141, namely: (1) open, continuous, exclusive, and notorious possession and
17
occupation of the subject land by himself or through his predecessors-in-interest under a bona
fide claim of ownership since time immemorial or from June 12, 1945; and (2) the
classification of the land as alienable and disposable land of the public domain.128
As discussed, the Philippine Bill of 1902, Act No. 926, and Proclamation No. 1801 did not
convert portions of Boracay Island into an agricultural land. The island remained an
unclassified land of the public domain and, applying the Regalian doctrine, is considered State
property.
Private claimants bid for judicial confirmation of imperfect title, relying on the Philippine Bill of
1902, Act No. 926, and Proclamation No. 1801, must fail because of the absence of the
second element of alienable and disposable land. Their entitlement to a government grant
under our present Public Land Act presupposes that the land possessed and applied for is
already alienable and disposable. This is clear from the wording of the law itself.129Where the
land is not alienable and disposable, possession of the land, no matter how long, cannot
confer ownership or possessory rights.130
Neither may private claimants apply for judicial confirmation of imperfect title under
Proclamation No. 1064, with respect to those lands which were classified as agricultural lands.
Private claimants failed to prove the first element of open, continuous, exclusive, and
notorious possession of their lands in Boracay since June 12, 1945.
We cannot sustain the CA and RTC conclusion in the petition for declaratory relief that private
claimants complied with the requisite period of possession.
The tax declarations in the name of private claimants are insufficient to prove the first element
of possession. We note that the earliest of the tax declarations in the name of private
claimants were issued in 1993. Being of recent dates, the tax declarations are not sufficient to
convince this Court that the period of possession and occupation commenced on June 12,
1945.
Private claimants insist that they have a vested right in Boracay, having been in possession of
the island for a long time. They have invested millions of pesos in developing the island into a
tourist spot. They say their continued possession and investments give them a vested right
which cannot be unilaterally rescinded by Proclamation No. 1064.
The continued possession and considerable investment of private claimants do not
automatically give them a vested right in Boracay. Nor do these give them a right to apply for
a title to the land they are presently occupying. This Court is constitutionally bound to decide
cases based on the evidence presented and the laws applicable. As the law and
jurisprudence stand, private claimants are ineligible to apply for a judicial confirmation of title
over their occupied portions in Boracay even with their continued possession and
considerable investment in the island.
One Last Note
The Court is aware that millions of pesos have been invested for the development of Boracay
Island, making it a by-word in the local and international tourism industry. The Court also
notes that for a number of years, thousands of people have called the island their home. While
the Court commiserates with private claimants plight, We are bound to apply the law strictly
and judiciously. This is the law and it should prevail. Ito ang batas at ito ang dapat umiral.
All is not lost, however, for private claimants. While they may not be eligible to apply for
judicial confirmation of imperfect title under Section 48(b) of CA No. 141, as amended, this
does not denote their automatic ouster from the residential, commercial, and other areas they
possess now classified as agricultural. Neither will this mean the loss of their substantial
investments on their occupied alienable lands. Lack of title does not necessarily mean lack of
right to possess.
For one thing, those with lawful possession may claim good faith as builders of improvements.
They can take steps to preserve or protect their possession. For another, they may look into
other modes of applying for original registration of title, such as by homestead 131 or sales
patent,132 subject to the conditions imposed by law.
More realistically, Congress may enact a law to entitle private claimants to acquire title to their
occupied lots or to exempt them from certain requirements under the present land laws. There
is one such bill133 now pending in the House of Representatives. Whether that bill or a similar
bill will become a law is for Congress to decide.
In issuing Proclamation No. 1064, the government has taken the step necessary to open up
the island to private ownership. This gesture may not be sufficient to appease some sectors
which view the classification of the island partially into a forest reserve as absurd. That the
island is no longer overrun by trees, however, does not becloud the vision to protect its
remaining forest cover and to strike a healthy balance between progress and ecology.
Ecological conservation is as important as economic progress.
To be sure, forest lands are fundamental to our nations survival. Their promotion and
protection are not just fancy rhetoric for politicians and activists. These are needs that become
more urgent as destruction of our environment gets prevalent and difficult to control. As aptly
observed by Justice Conrado Sanchez in 1968 in Director of Forestry v. Munoz:134
18
The view this Court takes of the cases at bar is but in adherence to public policy that should
be followed with respect to forest lands. Many have written much, and many more have
spoken, and quite often, about the pressing need for forest preservation, conservation,
protection, development and reforestation. Not without justification. For, forests constitute a
vital segment of any country's natural resources. It is of common knowledge by now that
absence of the necessary green cover on our lands produces a number of adverse or ill
effects of serious proportions. Without the trees, watersheds dry up; rivers and lakes which
they supply are emptied of their contents. The fish disappear. Denuded areas become dust
bowls. As waterfalls cease to function, so will hydroelectric plants. With the rains, the fertile
topsoil is washed away; geological erosion results. With erosion come the dreaded floods that
wreak havoc and destruction to property crops, livestock, houses, and highways not to
mention precious human lives. Indeed, the foregoing observations should be written down in a
lumbermans decalogue.135
WHEREFORE, judgment is rendered as follows:
1. The petition for certiorari in G.R. No. 167707 is GRANTED and the Court of Appeals
Decision in CA-G.R. CV No. 71118 REVERSED AND SET ASIDE.
2. The petition for certiorari in G.R. No. 173775 is DISMISSED for lack of merit.
Cruz V DENR Secretary GR No. 135385 Dec 6, 2000.
PER CURIAM:
Petitioners Isagani Cruz and Cesar Europa brought this suit for prohibition and mandamus as
citizens and taxpayers, assailing the constitutionality of certain provisions of Republic Act No.
8371 (R.A. 8371), otherwise known as the Indigenous Peoples Rights Act of 1997 (IPRA), and
its Implementing Rules and Regulations (Implementing Rules).
In its resolution of September 29, 1998, the Court required respondents to comment. 1 In
compliance, respondents Chairperson and Commissioners of the National Commission on
Indigenous Peoples (NCIP), the government agency created under the IPRA to implement its
provisions, filed on October 13, 1998 their Comment to the Petition, in which they defend the
constitutionality of the IPRA and pray that the petition be dismissed for lack of merit.
On October 19, 1998, respondents Secretary of the Department of Environment and Natural
Resources (DENR) and Secretary of the Department of Budget and Management (DBM) filed
through the Solicitor General a consolidated Comment. The Solicitor General is of the view
that the IPRA is partly unconstitutional on the ground that it grants ownership over natural
resources to indigenous peoples and prays that the petition be granted in part.
On November 10, 1998, a group of intervenors, composed of Sen. Juan Flavier, one of the
authors of the IPRA, Mr. Ponciano Bennagen, a member of the 1986 Constitutional
Commission, and the leaders and members of 112 groups of indigenous peoples (Flavier, et.
al), filed their Motion for Leave to Intervene. They join the NCIP in defending the
constitutionality of IPRA and praying for the dismissal of the petition.
On March 22, 1999, the Commission on Human Rights (CHR) likewise filed a Motion to
Intervene and/or to Appear as Amicus Curiae. The CHR asserts that IPRA is an expression of
the principle of parens patriae and that the State has the responsibility to protect and
guarantee the rights of those who are at a serious disadvantage like indigenous peoples. For
this reason it prays that the petition be dismissed.
On March 23, 1999, another group, composed of the Ikalahan Indigenous People and the
Haribon Foundation for the Conservation of Natural Resources, Inc. (Haribon, et al.), filed a
motion to Intervene with attached Comment-in-Intervention. They agree with the NCIP and
Flavier, et al. that IPRA is consistent with the Constitution and pray that the petition for
prohibition and mandamus be dismissed.
The motions for intervention of the aforesaid groups and organizations were granted.
Oral arguments were heard on April 13, 1999. Thereafter, the parties and intervenors filed
their respective memoranda in which they reiterate the arguments adduced in their earlier
pleadings and during the hearing.
Petitioners assail the constitutionality of the following provisions of the IPRA and its
Implementing Rules on the ground that they amount to an unlawful deprivation of the States
ownership over lands of the public domain as well as minerals and other natural resources
therein, in violation of the regalian doctrine embodied in Section 2, Article XII of the
Constitution:
"(1) Section 3(a) which defines the extent and coverage of ancestral domains, and Section
3(b) which, in turn, defines ancestral lands;
"(2) Section 5, in relation to section 3(a), which provides that ancestral domains including
inalienable public lands, bodies of water, mineral and other resources found within ancestral
domains are private but community property of the indigenous peoples;
"(3) Section 6 in relation to section 3(a) and 3(b) which defines the composition of ancestral
domains and ancestral lands;
19
"(4) Section 7 which recognizes and enumerates the rights of the indigenous peoples over the
ancestral domains;
(5) Section 8 which recognizes and enumerates the rights of the indigenous peoples over the
ancestral lands;
"(6) Section 57 which provides for priority rights of the indigenous peoples in the harvesting,
extraction, development or exploration of minerals and other natural resources within the
areas claimed to be their ancestral domains, and the right to enter into agreements with
nonindigenous peoples for the development and utilization of natural resources therein for a
period not exceeding 25 years, renewable for not more than 25 years; and
"(7) Section 58 which gives the indigenous peoples the responsibility to maintain, develop,
protect and conserve the ancestral domains and portions thereof which are found to be
necessary for critical watersheds, mangroves, wildlife sanctuaries, wilderness, protected
areas, forest cover or reforestation."2
Petitioners also content that, by providing for an all-encompassing definition of "ancestral
domains" and "ancestral lands" which might even include private lands found within said
areas, Sections 3(a) and 3(b) violate the rights of private landowners.3
In addition, petitioners question the provisions of the IPRA defining the powers and jurisdiction
of the NCIP and making customary law applicable to the settlement of disputes involving
ancestral domains and ancestral lands on the ground that these provisions violate the due
process clause of the Constitution.4
These provisions are:
"(1) sections 51 to 53 and 59 which detail the process of delineation and recognition
of ancestral domains and which vest on the NCIP the sole authority to delineate
ancestral domains and ancestral lands;
"(2) Section 52[i] which provides that upon certification by the NCIP that a particular
area is an ancestral domain and upon notification to the following officials, namely,
the Secretary of Environment and Natural Resources, Secretary of Interior and
Local Governments, Secretary of Justice and Commissioner of the National
Development Corporation, the jurisdiction of said officials over said area terminates;
"(3) Section 63 which provides the customary law, traditions and practices of
indigenous peoples shall be applied first with respect to property rights, claims of
ownership, hereditary succession and settlement of land disputes, and that any
 doubt or ambiguity in the interpretation thereof shall be resolved in favor of the
indigenous peoples;
"(4) Section 65 which states that customary laws and practices shall be used to
resolve disputes involving indigenous peoples; and
"(5) Section 66 which vests on the NCIP the jurisdiction over all claims and disputes
involving rights of the indigenous peoples."5
Finally, petitioners assail the validity of Rule VII, Part II, Section 1 of the NCIP Administrative
Order No. 1, series of 1998, which provides that "the administrative relationship of the NCIP to
the Office of the President is characterized as a lateral but autonomous relationship for
purposes of policy and program coordination." They contend that said Rule infringes upon the
Presidents power of control over executive departments under Section 17, Article VII of the
Constitution.6
Petitioners pray for the following:
"(1) A declaration that Sections 3, 5, 6, 7, 8, 52[I], 57, 58, 59, 63, 65 and 66 and
other related provisions of R.A. 8371 are unconstitutional and invalid;
"(2) The issuance of a writ of prohibition directing the Chairperson and
Commissioners of the NCIP to cease and desist from implementing the assailed
provisions of R.A. 8371 and its Implementing Rules;
"(3) The issuance of a writ of prohibition directing the Secretary of the Department of
Environment and Natural Resources to cease and desist from implementing
Department of Environment and Natural Resources Circular No. 2, series of 1998;
"(4) The issuance of a writ of prohibition directing the Secretary of Budget and
Management to cease and desist from disbursing public funds for the
implementation of the assailed provisions of R.A. 8371; and
"(5) The issuance of a writ of mandamus commanding the Secretary of Environment
and Natural Resources to comply with his duty of carrying out the States
constitutional mandate to control and supervise the exploration, development,
utilization and conservation of Philippine natural resources."7
After due deliberation on the petition, the members of the Court voted as follows:
20
Seven (7) voted to dismiss the petition. Justice Kapunan filed an opinion, which the Chief
Justice and Justices Bellosillo, Quisumbing, and Santiago join, sustaining the validity of the
challenged provisions of R.A. 8371. Justice Puno also filed a separate opinion sustaining all
challenged provisions of the law with the exception of Section 1, Part II, Rule III of NCIP
Administrative Order No. 1, series of 1998, the Rules and Regulations Implementing the
IPRA, and Section 57 of the IPRA which he contends should be interpreted as dealing with
the large-scale exploitation of natural resources and should be read in conjunction with
Section 2, Article XII of the 1987 Constitution. On the other hand, Justice Mendoza voted to
dismiss the petition solely on the ground that it does not raise a justiciable controversy and
petitioners do not have standing to question the constitutionality of R.A. 8371.
Seven (7) other members of the Court voted to grant the petition. Justice Panganiban filed a
separate opinion expressing the view that Sections 3 (a)(b), 5, 6, 7 (a)(b), 8, and related
provisions of R.A. 8371 are unconstitutional. He reserves judgment on the constitutionality of
Sections 58, 59, 65, and 66 of the law, which he believes must await the filing of specific
cases by those whose rights may have been violated by the IPRA. Justice Vitug also filed a
separate opinion expressing the view that Sections 3(a), 7, and 57 of R.A. 8371 are
unconstitutional. Justices Melo, Pardo, Buena, Gonzaga-Reyes, and De Leon join in the
separate opinions of Justices Panganiban and Vitug.
As the votes were equally divided (7 to 7) and the necessary majority was not obtained, the
case was redeliberated upon. However, after redeliberation, the voting remained the same.
Accordingly, pursuant to Rule 56, Section 7 of the Rules of Civil Procedure, the petition is
DISMISSED.
Attached hereto and made integral parts thereof are the separate opinions of Justices Puno,
Vitug, Kapunan, Mendoza, and Panganiban.
SO ORDERED.
Davide, Jr., C.J., Bellosillo, Melo, Quisumbing, Pardo, Buena, Gonzaga-Reyes, Ynares-
Santiago, and De Leon, Jr., JJ., concur.
Puno, Vitug, Kapunan, Mendoza and Panganiban JJ., see separate opinion
JOHNSON V MACINTOSH
Dispute-
Thomas Johnson purchased land from the Piankeshaw Indians in the Northwest Territory in
1775. His purchase of a large plot in Illinois was then peacefully handed down to his heirs until
the year of 1818 when conflict arose. William McIntosh purchased 11,000 acres of land within
the boundaries of Johnsons land from Congress. Once the conflicting claims on the territory
were realized, Johnsons heirs sued Mcintosh in the Illinois State Court in an effort to regain
the land originally appropriated to them. The District Court of Illinois ruled in favor of McIntosh
for the simplistic reason McIntoshs title was valid because it was granted by a higher authority
(Congress). Johnsons heirs chose to appeal to the Supreme Court, who were then posed
with the dilemma: Whos claim to the land was justified by the letter of the law?
Constitutional Principle in Question: Did Native American Tribes have the right to sell off their
land, or were they merely occupants rather than owners of territory? The first of a trilogy of
Marshall decisions with Native Americans, the Supreme Court must decide whether it is the
exclusive right of Federal Government to take lands from the Native Americans.
Significance-
The Supreme Court unanimously upheld the decision of the District Court on the grounds that
federal government had the sole right of negotiation with the Native American nations.
Therefore, Johnsons purchase was void and the precedent was set Indians did not have the
right to sell land to individuals. McIntoshs claim to the land, deriving in Congress reigned
superior to Johnsons claim from an illegal negotiation with Indian Tribes. Johnson v. McIntosh
is a vital part of Marshall Court because, it epitomizes his dealings with the Native Americans,
and his desire to vest extended powers in the hands of federal government. This decision,
once again authored by Chief Justice John Marshall is highly nationalistic and serves the
purpose of expanding powers of the federal government, in this case over the tribes.
Note: The ruling of this case has seemed to be eroded by subsequent case, however, has
never been overruled
G.R. No. 133250 July 9, 2002
FRANCISCO I. CHAVEZ, petitioner,
vs.
PUBLIC ESTATES AUTHORITY and AMARI COASTAL BAY DEVELOPMENT
CORPORATION, respondents.
CARPIO, J.:
This is an original Petition for Mandamus with prayer for a writ of preliminary injunction and a
temporary restraining order. The petition seeks to compel the Public Estates Authority ("PEA"
for brevity) to disclose all facts on PEA's then on-going renegotiations with Amari Coastal Bay
and Development Corporation ("AMARI" for brevity) to reclaim portions of Manila Bay. The
petition further seeks to enjoin PEA from signing a new agreement with AMARI involving such
reclamation.
21
The Facts
On November 20, 1973, the government, through the Commissioner of Public Highways,
signed a contract with the Construction and Development Corporation of the Philippines
("CDCP" for brevity) to reclaim certain foreshore and offshore areas of Manila Bay. The
contract also included the construction of Phases I and II of the Manila-Cavite Coastal Road.
CDCP obligated itself to carry out all the works in consideration of fifty percent of the total
reclaimed land.
On February 4, 1977, then President Ferdinand E. Marcos issued Presidential Decree No.
1084 creating PEA. PD No. 1084 tasked PEA "to reclaim land, including foreshore and
submerged areas," and "to develop, improve, acquire, x x x lease and sell any and all kinds of
lands."1 On the same date, then President Marcos issued Presidential Decree No. 1085
transferring to PEA the "lands reclaimed in the foreshore and offshore of the Manila
Bay"2 under the Manila-Cavite Coastal Road and Reclamation Project (MCCRRP).
On December 29, 1981, then President Marcos issued a memorandum directing PEA to
amend its contract with CDCP, so that "[A]ll future works in MCCRRP x x x shall be funded
and owned by PEA." Accordingly, PEA and CDCP executed a Memorandum of Agreement
dated December 29, 1981, which stated:
"(i) CDCP shall undertake all reclamation, construction, and such other works in the
MCCRRP as may be agreed upon by the parties, to be paid according to progress
of works on a unit price/lump sum basis for items of work to be agreed upon, subject
to price escalation, retention and other terms and conditions provided for in
Presidential Decree No. 1594. All the financing required for such works shall be
provided by PEA.
xxx
(iii) x x x CDCP shall give up all its development rights and hereby agrees to cede
and transfer in favor of PEA, all of the rights, title, interest and participation of CDCP
in and to all the areas of land reclaimed by CDCP in the MCCRRP as of December
30, 1981 which have not yet been sold, transferred or otherwise disposed of by
CDCP as of said date, which areas consist of approximately Ninety-Nine Thousand
Four Hundred Seventy Three (99,473) square meters in the Financial Center Area
covered by land pledge No. 5 and approximately Three Million Three Hundred
Eighty Two Thousand Eight Hundred Eighty Eight (3,382,888) square meters of
reclaimed areas at varying elevations above Mean Low Water Level located outside
the Financial Center Area and the First Neighborhood Unit."3
On January 19, 1988, then President Corazon C. Aquino issued Special Patent No. 3517,
granting and transferring to PEA "the parcels of land so reclaimed under the Manila-Cavite
Coastal Road and Reclamation Project (MCCRRP) containing a total area of one million nine
hundred fifteen thousand eight hundred ninety four (1,915,894) square meters."
Subsequently, on April 9, 1988, the Register of Deeds of the Municipality of Paraaque issued
Transfer Certificates of Title Nos. 7309, 7311, and 7312, in the name of PEA, covering the
three reclaimed islands known as the "Freedom Islands" located at the southern portion of the
Manila-Cavite Coastal Road, Paraaque City. The Freedom Islands have a total land area of
One Million Five Hundred Seventy Eight Thousand Four Hundred and Forty One (1,578,441)
square meters or 157.841 hectares.
On April 25, 1995, PEA entered into a Joint Venture Agreement ("JVA" for brevity) with
AMARI, a private corporation, to develop the Freedom Islands. The JVA also required the
reclamation of an additional 250 hectares of submerged areas surrounding these islands to
complete the configuration in the Master Development Plan of the Southern Reclamation
Project-MCCRRP. PEA and AMARI entered into the JVA through negotiation without public
bidding.4 On April 28, 1995, the Board of Directors of PEA, in its Resolution No. 1245,
confirmed the JVA.5 On June 8, 1995, then President Fidel V. Ramos, through then Executive
Secretary Ruben Torres, approved the JVA.6
On November 29, 1996, then Senate President Ernesto Maceda delivered a privilege speech
in the Senate and denounced the JVA as the "grandmother of all scams." As a result, the
Senate Committee on Government Corporations and Public Enterprises, and the Committee
on Accountability of Public Officers and Investigations, conducted a joint investigation. The
Senate Committees reported the results of their investigation in Senate Committee Report No.
560 dated September 16, 1997.7 Among the conclusions of their report are: (1) the reclaimed
lands PEA seeks to transfer to AMARI under the JVA are lands of the public domain which the
government has not classified as alienable lands and therefore PEA cannot alienate these
lands; (2) the certificates of title covering the Freedom Islands are thus void, and (3) the JVA
itself is illegal.
On December 5, 1997, then President Fidel V. Ramos issued Presidential Administrative
Order No. 365 creating a Legal Task Force to conduct a study on the legality of the JVA in
view of Senate Committee Report No. 560. The members of the Legal Task Force were the
Secretary of Justice,8 the Chief Presidential Legal Counsel,9 and the Government Corporate
Counsel.10 The Legal Task Force upheld the legality of the JVA, contrary to the conclusions
reached by the Senate Committees.11
On April 4 and 5, 1998, the Philippine Daily Inquirer and Today published reports that there
were on-going renegotiations between PEA and AMARI under an order issued by then
President Fidel V. Ramos. According to these reports, PEA Director Nestor Kalaw, PEA
22
Chairman Arsenio Yulo and retired Navy Officer Sergio Cruz composed the negotiating panel
of PEA.
On April 13, 1998, Antonio M. Zulueta filed before the Court a Petition for Prohibition with
Application for the Issuance of a Temporary Restraining Order and Preliminary
Injunction docketed as G.R. No. 132994 seeking to nullify the JVA. The Court dismissed the
petition "for unwarranted disregard of judicial hierarchy, without prejudice to the refiling of the
case before the proper court."12
On April 27, 1998, petitioner Frank I. Chavez ("Petitioner" for brevity) as a taxpayer, filed the
instant Petition for Mandamus with Prayer for the Issuance of a Writ of Preliminary Injunction
and Temporary Restraining Order. Petitioner contends the government stands to lose billions
of pesos in the sale by PEA of the reclaimed lands to AMARI. Petitioner prays that PEA
publicly disclose the terms of any renegotiation of the JVA, invoking Section 28, Article II, and
Section 7, Article III, of the 1987 Constitution on the right of the people to information on
matters of public concern. Petitioner assails the sale to AMARI of lands of the public domain
as a blatant violation of Section 3, Article XII of the 1987 Constitution prohibiting the sale of
alienable lands of the public domain to private corporations. Finally, petitioner asserts that he
seeks to enjoin the loss of billions of pesos in properties of the State that are of public
dominion.
After several motions for extension of time,13 PEA and AMARI filed their Comments on
October 19, 1998 and June 25, 1998, respectively. Meanwhile, on December 28, 1998,
petitioner filed an Omnibus Motion: (a) to require PEA to submit the terms of the renegotiated
PEA-AMARI contract; (b) for issuance of a temporary restraining order; and (c) to set the case
for hearing on oral argument. Petitioner filed a Reiterative Motion for Issuance of a TRO dated
May 26, 1999, which the Court denied in a Resolution dated June 22, 1999.
In a Resolution dated March 23, 1999, the Court gave due course to the petition and required
the parties to file their respective memoranda.
On March 30, 1999, PEA and AMARI signed the Amended Joint Venture Agreement
("Amended JVA," for brevity). On May 28, 1999, the Office of the President under the
administration of then President Joseph E. Estrada approved the Amended JVA.
Due to the approval of the Amended JVA by the Office of the President, petitioner now prays
that on "constitutional and statutory grounds the renegotiated contract be declared null and
void."14
The Issues
The issues raised by petitioner, PEA15 and AMARI16 are as follows:
I. WHETHER THE PRINCIPAL RELIEFS PRAYED FOR IN THE PETITION ARE
MOOT AND ACADEMIC BECAUSE OF SUBSEQUENT EVENTS;
II. WHETHER THE PETITION MERITS DISMISSAL FOR FAILING TO OBSERVE
THE PRINCIPLE GOVERNING THE HIERARCHY OF COURTS;
III. WHETHER THE PETITION MERITS DISMISSAL FOR NON-EXHAUSTION OF
ADMINISTRATIVE REMEDIES;
IV. WHETHER PETITIONER HAS LOCUS STANDI TO BRING THIS SUIT;
V. WHETHER THE CONSTITUTIONAL RIGHT TO INFORMATION INCLUDES
OFFICIAL INFORMATION ON ON-GOING NEGOTIATIONS BEFORE A FINAL
AGREEMENT;
VI. WHETHER THE STIPULATIONS IN THE AMENDED JOINT VENTURE
AGREEMENT FOR THE TRANSFER TO AMARI OF CERTAIN LANDS,
RECLAIMED AND STILL TO BE RECLAIMED, VIOLATE THE 1987
CONSTITUTION; AND
VII. WHETHER THE COURT IS THE PROPER FORUM FOR RAISING THE ISSUE
OF WHETHER THE AMENDED JOINT VENTURE AGREEMENT IS GROSSLY
DISADVANTAGEOUS TO THE GOVERNMENT.
The Court's Ruling
First issue: whether the principal reliefs prayed for in the petition are moot and
academic because of subsequent events.
The petition prays that PEA publicly disclose the "terms and conditions of the on-going
negotiations for a new agreement." The petition also prays that the Court enjoin PEA from
"privately entering into, perfecting and/or executing any new agreement with AMARI."
PEA and AMARI claim the petition is now moot and academic because AMARI furnished
petitioner on June 21, 1999 a copy of the signed Amended JVA containing the terms and
conditions agreed upon in the renegotiations. Thus, PEA has satisfied petitioner's prayer for a
public disclosure of the renegotiations. Likewise, petitioner's prayer to enjoin the signing of the
Amended JVA is now moot because PEA and AMARI have already signed the Amended JVA
23
on March 30, 1999. Moreover, the Office of the President has approved the Amended JVA on
May 28, 1999.
Petitioner counters that PEA and AMARI cannot avoid the constitutional issue by simply fast-
tracking the signing and approval of the Amended JVA before the Court could act on the
issue. Presidential approval does not resolve the constitutional issue or remove it from the
ambit of judicial review.
We rule that the signing of the Amended JVA by PEA and AMARI and its approval by the
President cannot operate to moot the petition and divest the Court of its jurisdiction. PEA and
AMARI have still to implement the Amended JVA. The prayer to enjoin the signing of the
Amended JVA on constitutional grounds necessarily includes preventing its implementation if
in the meantime PEA and AMARI have signed one in violation of the Constitution. Petitioner's
principal basis in assailing the renegotiation of the JVA is its violation of Section 3, Article XII
of the Constitution, which prohibits the government from alienating lands of the public domain
to private corporations. If the Amended JVA indeed violates the Constitution, it is the duty of
the Court to enjoin its implementation, and if already implemented, to annul the effects of such
unconstitutional contract.
The Amended JVA is not an ordinary commercial contract but one which seeks to transfer
title and ownership to 367.5 hectares of reclaimed lands and submerged areas of
Manila Bay to a single private corporation. It now becomes more compelling for the Court
to resolve the issue to insure the government itself does not violate a provision of the
Constitution intended to safeguard the national patrimony. Supervening events, whether
intended or accidental, cannot prevent the Court from rendering a decision if there is a grave
violation of the Constitution. In the instant case, if the Amended JVA runs counter to the
Constitution, the Court can still prevent the transfer of title and ownership of alienable lands of
the public domain in the name of AMARI. Even in cases where supervening events had made
the cases moot, the Court did not hesitate to resolve the legal or constitutional issues raised to
formulate controlling principles to guide the bench, bar, and the public.17
Also, the instant petition is a case of first impression. All previous decisions of the Court
involving Section 3, Article XII of the 1987 Constitution, or its counterpart provision in the 1973
Constitution,18 covered agricultural lands sold to private corporations which acquired the
lands from private parties. The transferors of the private corporations claimed or could claim
the right to judicial confirmation of their imperfect titles19 under Title II of Commonwealth
Act. 141 ("CA No. 141" for brevity). In the instant case, AMARI seeks to acquire from PEA, a
public corporation, reclaimed lands and submerged areas for non-agricultural purposes
by purchase under PD No. 1084 (charter of PEA) and Title III of CA No. 141. Certain
undertakings by AMARI under the Amended JVA constitute the consideration for the
purchase. Neither AMARI nor PEA can claim judicial confirmation of their titles because the
lands covered by the Amended JVA are newly reclaimed or still to be reclaimed. Judicial
confirmation of imperfect title requires open, continuous, exclusive and notorious occupation
of agricultural lands of the public domain for at least thirty years since June 12, 1945 or
earlier. Besides, the deadline for filing applications for judicial confirmation of imperfect title
expired on December 31, 1987.20
Lastly, there is a need to resolve immediately the constitutional issue raised in this petition
because of the possible transfer at any time by PEA to AMARI of title and ownership to
portions of the reclaimed lands. Under the Amended JVA, PEA is obligated to transfer to
AMARI the latter's seventy percent proportionate share in the reclaimed areas as the
reclamation progresses. The Amended JVA even allows AMARI to mortgage at any time
the entire reclaimed area to raise financing for the reclamation project.21
Second issue: whether the petition merits dismissal for failing to observe the principle
governing the hierarchy of courts.
PEA and AMARI claim petitioner ignored the judicial hierarchy by seeking relief directly from
the Court. The principle of hierarchy of courts applies generally to cases involving factual
questions. As it is not a trier of facts, the Court cannot entertain cases involving factual issues.
The instant case, however, raises constitutional issues of transcendental importance to the
public.22 The Court can resolve this case without determining any factual issue related to the
case. Also, the instant case is a petition for mandamus which falls under the original
jurisdiction of the Court under Section 5, Article VIII of the Constitution. We resolve to exercise
primary jurisdiction over the instant case.
Third issue: whether the petition merits dismissal for non-exhaustion of administrative
remedies.
PEA faults petitioner for seeking judicial intervention in compelling PEA to disclose publicly
certain information without first asking PEA the needed information. PEA claims petitioner's
direct resort to the Court violates the principle of exhaustion of administrative remedies. It also
violates the rule that mandamus may issue only if there is no other plain, speedy and
adequate remedy in the ordinary course of law.
PEA distinguishes the instant case from Taada v. Tuvera23 where the Court granted the
petition for mandamus even if the petitioners there did not initially demand from the Office of
the President the publication of the presidential decrees. PEA points out that in Taada, the
Executive Department had an affirmative statutory duty under Article 2 of the Civil
Code24 and Section 1 of Commonwealth Act No. 63825 to publish the presidential decrees.
There was, therefore, no need for the petitioners in Taada to make an initial demand from
the Office of the President. In the instant case, PEA claims it has no affirmative statutory duty
to disclose publicly information about its renegotiation of the JVA. Thus, PEA asserts that the
24
Court must apply the principle of exhaustion of administrative remedies to the instant case in
view of the failure of petitioner here to demand initially from PEA the needed information.
The original JVA sought to dispose to AMARI public lands held by PEA, a government
corporation. Under Section 79 of the Government Auditing Code,26 the disposition of
government lands to private parties requires public bidding. PEA was under a positive legal
duty to disclose to the public the terms and conditions for the sale of its lands. The law
obligated PEA to make this public disclosure even without demand from petitioner or from
anyone. PEA failed to make this public disclosure because the original JVA, like the Amended
JVA, was the result of a negotiated contract, not of a public bidding. Considering that PEA
had an affirmative statutory duty to make the public disclosure, and was even in breach of this
legal duty, petitioner had the right to seek direct judicial intervention.
Moreover, and this alone is determinative of this issue, the principle of exhaustion of
administrative remedies does not apply when the issue involved is a purely legal or
constitutional question.27 The principal issue in the instant case is the capacity of AMARI to
acquire lands held by PEA in view of the constitutional ban prohibiting the alienation of lands
of the public domain to private corporations. We rule that the principle of exhaustion of
administrative remedies does not apply in the instant case.
Fourth issue: whether petitioner has locus standi to bring this suit
PEA argues that petitioner has no standing to institute mandamus proceedings to enforce his
constitutional right to information without a showing that PEA refused to perform an affirmative
duty imposed on PEA by the Constitution. PEA also claims that petitioner has not shown that
he will suffer any concrete injury because of the signing or implementation of the Amended
JVA. Thus, there is no actual controversy requiring the exercise of the power of judicial
review.
The petitioner has standing to bring this taxpayer's suit because the petition seeks to compel
PEA to comply with its constitutional duties. There are two constitutional issues involved here.
First is the right of citizens to information on matters of public concern. Second is the
application of a constitutional provision intended to insure the equitable distribution of
alienable lands of the public domain among Filipino citizens. The thrust of the first issue is to
compel PEA to disclose publicly information on the sale of government lands worth billions of
pesos, information which the Constitution and statutory law mandate PEA to disclose. The
thrust of the second issue is to prevent PEA from alienating hundreds of hectares of alienable
lands of the public domain in violation of the Constitution, compelling PEA to comply with a
constitutional duty to the nation.
Moreover, the petition raises matters of transcendental importance to the public. In Chavez v.
PCGG,28 the Court upheld the right of a citizen to bring a taxpayer's suit on matters of
transcendental importance to the public, thus -
"Besides, petitioner emphasizes, the matter of recovering the ill-gotten wealth of the
Marcoses is an issue of 'transcendental importance to the public.' He asserts that
ordinary taxpayers have a right to initiate and prosecute actions questioning the
validity of acts or orders of government agencies or instrumentalities, if the issues
raised are of 'paramount public interest,' and if they 'immediately affect the social,
economic and moral well being of the people.'
Moreover, the mere fact that he is a citizen satisfies the requirement of personal
interest, when the proceeding involves the assertion of a public right, such as in this
case. He invokes several decisions of this Court which have set aside the
procedural matter of locus standi, when the subject of the case involved public
interest.
xxx
In Taada v. Tuvera, the Court asserted that when the issue concerns a public right
and the object of mandamus is to obtain the enforcement of a public duty, the
people are regarded as the real parties in interest; and because it is sufficient that
petitioner is a citizen and as such is interested in the execution of the laws, he need
not show that he has any legal or special interest in the result of the action. In the
aforesaid case, the petitioners sought to enforce their right to be informed on
matters of public concern, a right then recognized in Section 6, Article IV of the 1973
Constitution, in connection with the rule that laws in order to be valid and
enforceable must be published in the Official Gazette or otherwise effectively
promulgated. In ruling for the petitioners' legal standing, the Court declared that the
right they sought to be enforced 'is a public right recognized by no less than the
fundamental law of the land.'
Legaspi v. Civil Service Commission, while reiterating Taada, further declared that
'when a mandamus proceeding involves the assertion of a public right, the
requirement of personal interest is satisfied by the mere fact that petitioner is a
citizen and, therefore, part of the general 'public' which possesses the right.'
Further, in Albano v. Reyes, we said that while expenditure of public funds may not
have been involved under the questioned contract for the development,
management and operation of the Manila International Container Terminal, 'public
interest [was] definitely involved considering the important role [of the subject
contract] . . . in the economic development of the country and the magnitude of the
25
financial consideration involved.' We concluded that, as a consequence, the
disclosure provision in the Constitution would constitute sufficient authority for
upholding the petitioner's standing.
Similarly, the instant petition is anchored on the right of the people to information
and access to official records, documents and papers a right guaranteed under
Section 7, Article III of the 1987 Constitution. Petitioner, a former solicitor general, is
a Filipino citizen. Because of the satisfaction of the two basic requisites laid down by
decisional law to sustain petitioner's legal standing, i.e. (1) the enforcement of a
public right (2) espoused by a Filipino citizen, we rule that the petition at bar should
be allowed."
We rule that since the instant petition, brought by a citizen, involves the enforcement of
constitutional rights - to information and to the equitable diffusion of natural resources -
matters of transcendental public importance, the petitioner has the requisite locus standi.
Fifth issue: whether the constitutional right to information includes official information
on on-going negotiations before a final agreement.
Section 7, Article III of the Constitution explains the people's right to information on matters of
public concern in this manner:
"Sec. 7. The right of the people to information on matters of public concern shall be
recognized. Access to official records, and to documents, and papers
pertaining to official acts, transactions, or decisions, as well as to government
research data used as basis for policy development, shall be afforded the citizen,
subject to such limitations as may be provided by law." (Emphasis supplied)
The State policy of full transparency in all transactions involving public interest reinforces the
people's right to information on matters of public concern. This State policy is expressed in
Section 28, Article II of the Constitution, thus:
"Sec. 28. Subject to reasonable conditions prescribed by law, the State adopts and
implements a policy of full public disclosure of all its transactions involving
public interest." (Emphasis supplied)
These twin provisions of the Constitution seek to promote transparency in policy-making and
in the operations of the government, as well as provide the people sufficient information to
exercise effectively other constitutional rights. These twin provisions are essential to the
exercise of freedom of expression. If the government does not disclose its official acts,
transactions and decisions to citizens, whatever citizens say, even if expressed without any
restraint, will be speculative and amount to nothing. These twin provisions are also essential
to hold public officials "at all times x x x accountable to the people,"29 for unless citizens have
the proper information, they cannot hold public officials accountable for anything. Armed with
the right information, citizens can participate in public discussions leading to the formulation of
government policies and their effective implementation. An informed citizenry is essential to
the existence and proper functioning of any democracy. As explained by the Court
in Valmonte v. Belmonte, Jr.30
"An essential element of these freedoms is to keep open a continuing dialogue or
process of communication between the government and the people. It is in the
interest of the State that the channels for free political discussion be maintained to
the end that the government may perceive and be responsive to the people's will.
Yet, this open dialogue can be effective only to the extent that the citizenry is
informed and thus able to formulate its will intelligently. Only when the participants in
the discussion are aware of the issues and have access to information relating
thereto can such bear fruit."
PEA asserts, citing Chavez v. PCGG,31 that in cases of on-going negotiations the right to
information is limited to "definite propositions of the government." PEA maintains the right
does not include access to "intra-agency or inter-agency recommendations or
communications during the stage when common assertions are still in the process of being
formulated or are in the 'exploratory stage'."
Also, AMARI contends that petitioner cannot invoke the right at the pre-decisional stage or
before the closing of the transaction. To support its contention, AMARI cites the following
discussion in the 1986 Constitutional Commission:
"Mr. Suarez. And when we say 'transactions' which should be distinguished from
contracts, agreements, or treaties or whatever, does the Gentleman refer to the
steps leading to the consummation of the contract, or does he refer to the contract
itself?
Mr. Ople: The 'transactions' used here, I suppose is generic and therefore, it
can cover both steps leading to a contract and already a consummated
contract, Mr. Presiding Officer.
Mr. Suarez: This contemplates inclusion of negotiations leading to the
consummation of the transaction.
Mr. Ople: Yes, subject only to reasonable safeguards on the national interest.
26
Mr. Suarez: Thank you."32 (Emphasis supplied)
AMARI argues there must first be a consummated contract before petitioner can invoke the
right. Requiring government officials to reveal their deliberations at the pre-decisional stage
will degrade the quality of decision-making in government agencies. Government officials will
hesitate to express their real sentiments during deliberations if there is immediate public
dissemination of their discussions, putting them under all kinds of pressure before they
decide.
We must first distinguish between information the law on public bidding requires PEA to
disclose publicly, and information the constitutional right to information requires PEA to
release to the public. Before the consummation of the contract, PEA must, on its own and
without demand from anyone, disclose to the public matters relating to the disposition of its
property. These include the size, location, technical description and nature of the property
being disposed of, the terms and conditions of the disposition, the parties qualified to bid, the
minimum price and similar information. PEA must prepare all these data and disclose them to
the public at the start of the disposition process, long before the consummation of the
contract, because the Government Auditing Code requires public bidding. If PEA fails to
make this disclosure, any citizen can demand from PEA this information at any time during the
bidding process.
Information, however, on on-going evaluation or review of bids or proposals being
undertaken by the bidding or review committee is not immediately accessible under the right
to information. While the evaluation or review is still on-going, there are no "official acts,
transactions, or decisions" on the bids or proposals. However, once the committee makes
its official recommendation, there arises a "definite proposition" on the part of the
government. From this moment, the public's right to information attaches, and any citizen can
access all the non-proprietary information leading to such definite proposition. In Chavez v.
PCGG,33 the Court ruled as follows:
"Considering the intent of the framers of the Constitution, we believe that it is
incumbent upon the PCGG and its officers, as well as other government
representatives, to disclose sufficient public information on any proposed settlement
they have decided to take up with the ostensible owners and holders of ill-gotten
wealth. Such information, though, must pertain to definite propositions of the
government, not necessarily to intra-agency or inter-agency recommendations or
communications during the stage when common assertions are still in the process
of being formulated or are in the "exploratory" stage. There is need, of course, to
observe the same restrictions on disclosure of information in general, as discussed
earlier such as on matters involving national security, diplomatic or foreign
relations, intelligence and other classified information." (Emphasis supplied)
Contrary to AMARI's contention, the commissioners of the 1986 Constitutional Commission
understood that the right to information "contemplates inclusion of negotiations leading to
the consummation of the transaction."Certainly, a consummated contract is not a
requirement for the exercise of the right to information. Otherwise, the people can never
exercise the right if no contract is consummated, and if one is consummated, it may be too
late for the public to expose its defects.1wphi1.nt
Requiring a consummated contract will keep the public in the dark until the contract, which
may be grossly disadvantageous to the government or even illegal, becomes a fait accompli.
This negates the State policy of full transparency on matters of public concern, a situation
which the framers of the Constitution could not have intended. Such a requirement will prevent
the citizenry from participating in the public discussion of any proposed contract, effectively
truncating a basic right enshrined in the Bill of Rights. We can allow neither an emasculation
of a constitutional right, nor a retreat by the State of its avowed "policy of full disclosure of all
its transactions involving public interest."
The right covers three categories of information which are "matters of public concern,"
namely: (1) official records; (2) documents and papers pertaining to official acts, transactions
and decisions; and (3) government research data used in formulating policies. The first
category refers to any document that is part of the public records in the custody of government
agencies or officials. The second category refers to documents and papers recording,
evidencing, establishing, confirming, supporting, justifying or explaining official acts,
transactions or decisions of government agencies or officials. The third category refers to
research data, whether raw, collated or processed, owned by the government and used in
formulating government policies.
The information that petitioner may access on the renegotiation of the JVA includes evaluation
reports, recommendations, legal and expert opinions, minutes of meetings, terms of reference
and other documents attached to such reports or minutes, all relating to the JVA. However,
the right to information does not compel PEA to prepare lists, abstracts, summaries and the
like relating to the renegotiation of the JVA.34 The right only affords access to records,
documents and papers, which means the opportunity to inspect and copy them. One who
exercises the right must copy the records, documents and papers at his expense. The
exercise of the right is also subject to reasonable regulations to protect the integrity of the
public records and to minimize disruption to government operations, like rules specifying when
and how to conduct the inspection and copying.35
The right to information, however, does not extend to matters recognized as privileged
information under the separation of powers.36 The right does not also apply to information on
military and diplomatic secrets, information affecting national security, and information on
investigations of crimes by law enforcement agencies before the prosecution of the accused,
27
which courts have long recognized as confidential.37 The right may also be subject to other
limitations that Congress may impose by law.
There is no claim by PEA that the information demanded by petitioner is privileged information
rooted in the separation of powers. The information does not cover Presidential conversations,
correspondences, or discussions during closed-door Cabinet meetings which, like internal
deliberations of the Supreme Court and other collegiate courts, or executive sessions of either
house of Congress,38 are recognized as confidential. This kind of information cannot be pried
open by a co-equal branch of government. A frank exchange of exploratory ideas and
assessments, free from the glare of publicity and pressure by interested parties, is essential to
protect the independence of decision-making of those tasked to exercise Presidential,
Legislative and Judicial power.39 This is not the situation in the instant case.
We rule, therefore, that the constitutional right to information includes official information
on on-going negotiationsbefore a final contract. The information, however, must constitute
definite propositions by the government and should not cover recognized exceptions like
privileged information, military and diplomatic secrets and similar matters affecting national
security and public order.40 Congress has also prescribed other limitations on the right to
information in several legislations.41
Sixth issue: whether stipulations in the Amended JVA for the transfer to AMARI of
lands, reclaimed or to be reclaimed, violate the Constitution.
The Regalian Doctrine
The ownership of lands reclaimed from foreshore and submerged areas is rooted in the
Regalian doctrine which holds that the State owns all lands and waters of the public domain.
Upon the Spanish conquest of the Philippines, ownership of all "lands, territories and
possessions" in the Philippines passed to the Spanish Crown.42 The King, as the sovereign
ruler and representative of the people, acquired and owned all lands and territories in the
Philippines except those he disposed of by grant or sale to private individuals.
The 1935, 1973 and 1987 Constitutions adopted the Regalian doctrine substituting, however,
the State, in lieu of the King, as the owner of all lands and waters of the public domain. The
Regalian doctrine is the foundation of the time-honored principle of land ownership that "all
lands that were not acquired from the Government, either by purchase or by grant, belong to
the public domain."43 Article 339 of the Civil Code of 1889, which is now Article 420 of the Civil
Code of 1950, incorporated the Regalian doctrine.
Ownership and Disposition of Reclaimed Lands
The Spanish Law of Waters of 1866 was the first statutory law governing the ownership and
disposition of reclaimed lands in the Philippines. On May 18, 1907, the Philippine Commission
enacted Act No. 1654 which provided for the lease, but not the sale, of reclaimed lands of
the government to corporations and individuals. Later, on November 29, 1919, the
Philippine Legislature approved Act No. 2874, the Public Land Act, which authorized the
lease, but not the sale, of reclaimed lands of the government to corporations and
individuals. On November 7, 1936, the National Assembly passed Commonwealth Act No.
141, also known as the Public Land Act, which authorized the lease, but not the sale, of
reclaimed lands of the government to corporations and individuals. CA No. 141
continues to this day as the general law governing the classification and disposition of lands of
the public domain.
The Spanish Law of Waters of 1866 and the Civil Code of 1889
Under the Spanish Law of Waters of 1866, the shores, bays, coves, inlets and all waters
within the maritime zone of the Spanish territory belonged to the public domain for public
use.44 The Spanish Law of Waters of 1866 allowed the reclamation of the sea under Article 5,
which provided as follows:
"Article 5. Lands reclaimed from the sea in consequence of works constructed by
the State, or by the provinces, pueblos or private persons, with proper permission,
shall become the property of the party constructing such works, unless otherwise
provided by the terms of the grant of authority."
Under the Spanish Law of Waters, land reclaimed from the sea belonged to the party
undertaking the reclamation, provided the government issued the necessary permit and did
not reserve ownership of the reclaimed land to the State.
Article 339 of the Civil Code of 1889 defined property of public dominion as follows:
"Art. 339. Property of public dominion is
1. That devoted to public use, such as roads, canals, rivers, torrents, ports and
bridges constructed by the State, riverbanks, shores, roadsteads, and that of a
similar character;
2. That belonging exclusively to the State which, without being of general public use,
is employed in some public service, or in the development of the national wealth,
such as walls, fortresses, and other works for the defense of the territory, and
mines, until granted to private individuals."
28
Property devoted to public use referred to property open for use by the public. In contrast,
property devoted to public service referred to property used for some specific public service
and open only to those authorized to use the property.
Property of public dominion referred not only to property devoted to public use, but also to
property not so used but employed to develop the national wealth. This class of property
constituted property of public dominion although employed for some economic or commercial
activity to increase the national wealth.
Article 341 of the Civil Code of 1889 governed the re-classification of property of public
dominion into private property, to wit:
"Art. 341. Property of public dominion, when no longer devoted to public use or to
the defense of the territory, shall become a part of the private property of the State."
This provision, however, was not self-executing. The legislature, or the executive department
pursuant to law, must declare the property no longer needed for public use or territorial
defense before the government could lease or alienate the property to private parties.45
Act No. 1654 of the Philippine Commission
On May 8, 1907, the Philippine Commission enacted Act No. 1654 which regulated the lease
of reclaimed and foreshore lands. The salient provisions of this law were as follows:
"Section 1. The control and disposition of the foreshore as defined in existing
law, and the title to all Government or public lands made or reclaimed by the
Government by dredging or filling or otherwise throughout the Philippine
Islands, shall be retained by the Government without prejudice to vested rights
and without prejudice to rights conceded to the City of Manila in the Luneta
Extension.
Section 2. (a) The Secretary of the Interior shall cause all Government or public
lands made or reclaimed by the Government by dredging or filling or otherwise to be
divided into lots or blocks, with the necessary streets and alleyways located thereon,
and shall cause plats and plans of such surveys to be prepared and filed with the
Bureau of Lands.
(b) Upon completion of such plats and plans the Governor-General shall give
notice to the public that such parts of the lands so made or reclaimed as are
not needed for public purposes will be leased for commercial and business
purposes, x x x.
 xxx
(e) The leases above provided for shall be disposed of to the highest and best
bidder therefore, subject to such regulations and safeguards as the Governor-
General may by executive order prescribe." (Emphasis supplied)
Act No. 1654 mandated that the government should retain title to all lands reclaimed by
the government. The Act also vested in the government control and disposition of foreshore
lands. Private parties could lease lands reclaimed by the government only if these lands were
no longer needed for public purpose. Act No. 1654 mandated public bidding in the lease of
government reclaimed lands. Act No. 1654 made government reclaimed lands sui generis in
that unlike other public lands which the government could sell to private parties, these
reclaimed lands were available only for lease to private parties.
Act No. 1654, however, did not repeal Section 5 of the Spanish Law of Waters of 1866. Act
No. 1654 did not prohibit private parties from reclaiming parts of the sea under Section 5 of
the Spanish Law of Waters. Lands reclaimed from the sea by private parties with government
permission remained private lands.
Act No. 2874 of the Philippine Legislature
On November 29, 1919, the Philippine Legislature enacted Act No. 2874, the Public Land
Act.46 The salient provisions of Act No. 2874, on reclaimed lands, were as follows:
"Sec. 6. The Governor-General, upon the recommendation of the Secretary of
Agriculture and Natural Resources, shall from time to time classify the lands
of the public domain into
(a) Alienable or disposable,
(b) Timber, and
(c) Mineral lands, x x x.
Sec. 7. For the purposes of the government and disposition of alienable or
disposable public lands, the Governor-General, upon recommendation by the
Secretary of Agriculture and Natural Resources, shall from time to time
declare what lands are open to disposition or concession under this Act."
Sec. 8. Only those lands shall be declared open to disposition or concession
which have been officially delimited or classified x x x.
29
xxx
Sec. 55. Any tract of land of the public domain which, being neither timber nor
mineral land, shall be classified as suitable for residential purposes or for
commercial, industrial, or other productive purposes other than agricultural
purposes, and shall be open to disposition or concession, shall be disposed of
under the provisions of this chapter, and not otherwise.
Sec. 56. The lands disposable under this title shall be classified as follows:
(a) Lands reclaimed by the Government by dredging, filling, or other
means;
(b) Foreshore;
(c) Marshy lands or lands covered with water bordering upon the shores
or banks of navigable lakes or rivers;
(d) Lands not included in any of the foregoing classes.
x x x.
Sec. 58. The lands comprised in classes (a), (b), and (c) of section fifty-six
shall be disposed of to private parties by lease only and not otherwise, as
soon as the Governor-General, upon recommendation by the Secretary of
Agriculture and Natural Resources, shall declare that the same are not
necessary for the public service and are open to disposition under this
chapter. The lands included in class (d) may be disposed of by sale or lease
under the provisions of this Act." (Emphasis supplied)
Section 6 of Act No. 2874 authorized the Governor-General to "classify lands of the public
domain into x x x alienable or disposable"47 lands. Section 7 of the Act empowered the
Governor-General to "declare what lands are open to disposition or concession." Section 8 of
the Act limited alienable or disposable lands only to those lands which have been "officially
delimited and classified."
Section 56 of Act No. 2874 stated that lands "disposable under this title48 shall be classified"
as government reclaimed, foreshore and marshy lands, as well as other lands. All these lands,
however, must be suitable for residential, commercial, industrial or other productive non-
agricultural purposes. These provisions vested upon the Governor-General the power to
classify inalienable lands of the public domain into disposable lands of the public domain.
These provisions also empowered the Governor-General to classify further such disposable
lands of the public domain into government reclaimed, foreshore or marshy lands of the public
domain, as well as other non-agricultural lands.
Section 58 of Act No. 2874 categorically mandated that disposable lands of the public domain
classified as government reclaimed, foreshore and marshy lands "shall be disposed of to
private parties by lease only and not otherwise." The Governor-General, before allowing
the lease of these lands to private parties, must formally declare that the lands were "not
necessary for the public service." Act No. 2874 reiterated the State policy to lease and not to
sell government reclaimed, foreshore and marshy lands of the public domain, a policy first
enunciated in 1907 in Act No. 1654. Government reclaimed, foreshore and marshy lands
remained sui generis, as the only alienable or disposable lands of the public domain that the
government could not sell to private parties.
The rationale behind this State policy is obvious. Government reclaimed, foreshore and
marshy public lands for non-agricultural purposes retain their inherent potential as areas for
public service. This is the reason the government prohibited the sale, and only allowed the
lease, of these lands to private parties. The State always reserved these lands for some future
public service.
Act No. 2874 did not authorize the reclassification of government reclaimed, foreshore and
marshy lands into other non-agricultural lands under Section 56 (d). Lands falling under
Section 56 (d) were the only lands for non-agricultural purposes the government could sell to
private parties. Thus, under Act No. 2874, the government could not sell government
reclaimed, foreshore and marshy lands to private parties, unless the legislature passed a
law allowing their sale.49
Act No. 2874 did not prohibit private parties from reclaiming parts of the sea pursuant to
Section 5 of the Spanish Law of Waters of 1866. Lands reclaimed from the sea by private
parties with government permission remained private lands.
Dispositions under the 1935 Constitution
On May 14, 1935, the 1935 Constitution took effect upon its ratification by the Filipino people.
The 1935 Constitution, in adopting the Regalian doctrine, declared in Section 1, Article XIII,
that
"Section 1. 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
30
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 limit of the grant." (Emphasis supplied)
The 1935 Constitution barred the alienation of all natural resources except public agricultural
lands, which were the only natural resources the State could alienate. Thus, foreshore lands,
considered part of the State's natural resources, became inalienable by constitutional fiat,
available only for lease for 25 years, renewable for another 25 years. The government could
alienate foreshore lands only after these lands were reclaimed and classified as alienable
agricultural lands of the public domain. Government reclaimed and marshy lands of the public
domain, being neither timber nor mineral lands, fell under the classification of public
agricultural lands.50 However, government reclaimed and marshy lands, although subject to
classification as disposable public agricultural lands, could only be leased and not sold to
private parties because of Act No. 2874.
The prohibition on private parties from acquiring ownership of government reclaimed and
marshy lands of the public domain was only a statutory prohibition and the legislature could
therefore remove such prohibition. The 1935 Constitution did not prohibit individuals and
corporations from acquiring government reclaimed and marshy lands of the public domain that
were classified as agricultural lands under existing public land laws. Section 2, Article XIII of
the 1935 Constitution provided as follows:
"Section 2. No private corporation or association may acquire, lease, or hold
public agricultural lands in excess of one thousand and twenty four hectares,
nor may any individual acquire such lands by purchase in excess of one
hundred and forty hectares, or by lease in excess of one thousand and
twenty-four hectares, or by homestead in excess of twenty-four hectares. Lands
adapted to grazing, not exceeding two thousand hectares, may be leased to an
individual, private corporation, or association." (Emphasis supplied)
Still, after the effectivity of the 1935 Constitution, the legislature did not repeal Section 58 of
Act No. 2874 to open for sale to private parties government reclaimed and marshy lands of
the public domain. On the contrary, the legislature continued the long established State policy
of retaining for the government title and ownership of government reclaimed and marshy lands
of the public domain.
Commonwealth Act No. 141 of the Philippine National Assembly
On November 7, 1936, the National Assembly approved Commonwealth Act No. 141, also
known as the Public Land Act, which compiled the then existing laws on lands of the public
domain. CA No. 141, as amended, remains to this day the existing general law governing
the classification and disposition of lands of the public domain other than timber and mineral
lands.51
Section 6 of CA No. 141 empowers the President to classify lands of the public domain into
"alienable or disposable"52 lands of the public domain, which prior to such classification are
inalienable and outside the commerce of man. Section 7 of CA No. 141 authorizes the
President to "declare what lands are open to disposition or concession." Section 8 of CA No.
141 states that the government can declare open for disposition or concession only lands that
are "officially delimited and classified." Sections 6, 7 and 8 of CA No. 141 read as follows:
"Sec. 6. The President, upon the recommendation of the Secretary of
Agriculture and Commerce, shall from time to time classify the lands of the
public domain into
(a) Alienable or disposable,
(b) Timber, and
(c) Mineral lands,
and may at any time and in like manner transfer such lands from one class to
another,53 for the purpose of their administration and disposition.
Sec. 7. For the purposes of the administration and disposition of alienable or
disposable public lands, the President, upon recommendation by the Secretary
of Agriculture and Commerce, shall from time to time declare what lands are
open to disposition or concession under this Act.
Sec. 8. Only those lands shall be declared open to disposition or concession
which have been officially delimited and classified and, when practicable,
surveyed, and which have not been reserved for public or quasi-public uses,
nor appropriated by the Government, nor in any manner become private property,
nor those on which a private right authorized and recognized by this Act or any other
valid law may be claimed, or which, having been reserved or appropriated, have
ceased to be so. x x x."
31
Thus, before the government could alienate or dispose of lands of the public domain, the
President must first officially classify these lands as alienable or disposable, and then declare
them open to disposition or concession. There must be no law reserving these lands for public
or quasi-public uses.
The salient provisions of CA No. 141, on government reclaimed, foreshore and marshy lands
of the public domain, are as follows:
"Sec. 58. Any tract of land of the public domain which, being neither timber
nor mineral land, is intended to be used for residential purposes or for
commercial, industrial, or other productive purposes other than agricultural,
and is open to disposition or concession, shall be disposed of under the
provisions of this chapter and not otherwise.
Sec. 59. The lands disposable under this title shall be classified as follows:
(a) Lands reclaimed by the Government by dredging, filling, or other
means;
(b) Foreshore;
(c) Marshy lands or lands covered with water bordering upon the shores
or banks of navigable lakes or rivers;
(d) Lands not included in any of the foregoing classes.
Sec. 60. Any tract of land comprised under this title may be leased or sold, as the
case may be, to any person, corporation, or association authorized to purchase or
lease public lands for agricultural purposes. x x x.
Sec. 61. The lands comprised in classes (a), (b), and (c) of section fifty-nine
shall be disposed of to private parties by lease only and not otherwise, as
soon as the President, upon recommendation by the Secretary of Agriculture, shall
declare that the same are not necessary for the public service and are open to
disposition under this chapter. The lands included in class (d) may be disposed
of by sale or lease under the provisions of this Act." (Emphasis supplied)
Section 61 of CA No. 141 readopted, after the effectivity of the 1935 Constitution, Section 58
of Act No. 2874 prohibiting the sale of government reclaimed, foreshore and marshy
disposable lands of the public domain. All these lands are intended for residential,
commercial, industrial or other non-agricultural purposes. As before, Section 61 allowed only
the lease of such lands to private parties. The government could sell to private parties only
lands falling under Section 59 (d) of CA No. 141, or those lands for non-agricultural purposes
not classified as government reclaimed, foreshore and marshy disposable lands of the public
domain. Foreshore lands, however, became inalienable under the 1935 Constitution which
only allowed the lease of these lands to qualified private parties.
Section 58 of CA No. 141 expressly states that disposable lands of the public domain
intended for residential, commercial, industrial or other productive purposes other than
agricultural "shall be disposed of under the provisions of this chapter and not
otherwise." Under Section 10 of CA No. 141, the term "disposition" includes lease of the land.
Any disposition of government reclaimed, foreshore and marshy disposable lands for non-
agricultural purposes must comply with Chapter IX, Title III of CA No. 141,54 unless a
subsequent law amended or repealed these provisions.
In his concurring opinion in the landmark case of Republic Real Estate Corporation v. Court
of Appeals,55Justice Reynato S. Puno summarized succinctly the law on this matter, as
follows:
"Foreshore lands are lands of public dominion intended for public use. So too are
lands reclaimed by the government by dredging, filling, or other means. Act 1654
mandated that the control and disposition of the foreshore and lands under water
remained in the national government. Said law allowed only the 'leasing' of
reclaimed land. The Public Land Acts of 1919 and 1936 also declared that the
foreshore and lands reclaimed by the government were to be "disposed of to private
parties by lease only and not otherwise." Before leasing, however, the Governor-
General, upon recommendation of the Secretary of Agriculture and Natural
Resources, had first to determine that the land reclaimed was not necessary for the
public service. This requisite must have been met before the land could be disposed
of. But even then, the foreshore and lands under water were not to be
alienated and sold to private parties. The disposition of the reclaimed land
was only by lease. The land remained property of the State." (Emphasis
supplied)
As observed by Justice Puno in his concurring opinion, "Commonwealth Act No. 141 has
remained in effect at present."
The State policy prohibiting the sale to private parties of government reclaimed, foreshore and
marshy alienable lands of the public domain, first implemented in 1907 was thus reaffirmed in
CA No. 141 after the 1935 Constitution took effect. The prohibition on the sale of foreshore
lands, however, became a constitutional edict under the 1935 Constitution. Foreshore lands
became inalienable as natural resources of the State, unless reclaimed by the government
32
and classified as agricultural lands of the public domain, in which case they would fall under
the classification of government reclaimed lands.
After the effectivity of the 1935 Constitution, government reclaimed and marshy disposable
lands of the public domain continued to be only leased and not sold to private parties.56 These
lands remained sui generis, as the only alienable or disposable lands of the public domain
the government could not sell to private parties.
Since then and until now, the only way the government can sell to private parties government
reclaimed and marshy disposable lands of the public domain is for the legislature to pass a
law authorizing such sale. CA No. 141 does not authorize the President to reclassify
government reclaimed and marshy lands into other non-agricultural lands under Section 59
(d). Lands classified under Section 59 (d) are the only alienable or disposable lands for non-
agricultural purposes that the government could sell to private parties.
Moreover, Section 60 of CA No. 141 expressly requires congressional authority before lands
under Section 59 that the government previously transferred to government units or entities
could be sold to private parties. Section 60 of CA No. 141 declares that
"Sec. 60. x x x The area so leased or sold shall be such as shall, in the judgment of
the Secretary of Agriculture and Natural Resources, be reasonably necessary for
the purposes for which such sale or lease is requested, and shall not exceed one
hundred and forty-four hectares: Provided, however, That this limitation shall not
apply to grants, donations, or transfers made to a province, municipality or branch or
subdivision of the Government for the purposes deemed by said entities conducive
to the public interest; but the land so granted, donated, or transferred to a
province, municipality or branch or subdivision of the Government shall not
be alienated, encumbered, or otherwise disposed of in a manner affecting its
title, except when authorized by Congress: x x x." (Emphasis supplied)
The congressional authority required in Section 60 of CA No. 141 mirrors the legislative
authority required in Section 56 of Act No. 2874.
One reason for the congressional authority is that Section 60 of CA No. 141 exempted
government units and entities from the maximum area of public lands that could be acquired
from the State. These government units and entities should not just turn around and sell these
lands to private parties in violation of constitutional or statutory limitations. Otherwise, the
transfer of lands for non-agricultural purposes to government units and entities could be used
to circumvent constitutional limitations on ownership of alienable or disposable lands of the
public domain. In the same manner, such transfers could also be used to evade the statutory
prohibition in CA No. 141 on the sale of government reclaimed and marshy lands of the public
domain to private parties. Section 60 of CA No. 141 constitutes by operation of law a lien on
these lands.57
In case of sale or lease of disposable lands of the public domain falling under Section 59 of
CA No. 141, Sections 63 and 67 require a public bidding. Sections 63 and 67 of CA No. 141
provide as follows:
"Sec. 63. Whenever it is decided that lands covered by this chapter are not needed
for public purposes, the Director of Lands shall ask the Secretary of Agriculture and
Commerce (now the Secretary of Natural Resources) for authority to dispose of the
same. Upon receipt of such authority, the Director of Lands shall give notice by
public advertisement in the same manner as in the case of leases or sales of
agricultural public land, x x x.
Sec. 67. The lease or sale shall be made by oral bidding; and adjudication
shall be made to the highest bidder. x x x." (Emphasis supplied)
Thus, CA No. 141 mandates the Government to put to public auction all leases or sales of
alienable or disposable lands of the public domain.58
Like Act No. 1654 and Act No. 2874 before it, CA No. 141 did not repeal Section 5 of the
Spanish Law of Waters of 1866. Private parties could still reclaim portions of the sea with
government permission. However, the reclaimed land could become private land only if
classified as alienable agricultural land of the public domain open to disposition under
CA No. 141. The 1935 Constitution prohibited the alienation of all natural resources except
public agricultural lands.
The Civil Code of 1950
The Civil Code of 1950 readopted substantially the definition of property of public dominion
found in the Civil Code of 1889. Articles 420 and 422 of the Civil Code of 1950 state that
"Art. 420. The following things are property of public dominion:
(1) Those intended for public use, such as roads, canals, rivers, torrents, ports and
bridges constructed by the State, banks, shores, roadsteads, and others of similar
character;
(2) Those which belong to the State, without being for public use, and are intended
for some public service or for the development of the national wealth.
33
x x x.
Art. 422. Property of public dominion, when no longer intended for public use or for
public service, shall form part of the patrimonial property of the State."
Again, the government must formally declare that the property of public dominion is no longer
needed for public use or public service, before the same could be classified as patrimonial
property of the State.59 In the case of government reclaimed and marshy lands of the public
domain, the declaration of their being disposable, as well as the manner of their disposition, is
governed by the applicable provisions of CA No. 141.
Like the Civil Code of 1889, the Civil Code of 1950 included as property of public dominion
those properties of the State which, without being for public use, are intended for public
service or the "development of the national wealth." Thus, government reclaimed and
marshy lands of the State, even if not employed for public use or public service, if developed
to enhance the national wealth, are classified as property of public dominion.
Dispositions under the 1973 Constitution
The 1973 Constitution, which took effect on January 17, 1973, likewise adopted the Regalian
doctrine. Section 8, Article XIV of the 1973 Constitution stated that
"Sec. 8. 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." (Emphasis supplied)
The 1973 Constitution prohibited the alienation of all natural resources with the exception of
"agricultural, industrial or commercial, residential, and resettlement lands of the public
domain." In contrast, the 1935 Constitution barred the alienation of all natural resources
except "public agricultural lands." However, the term "public agricultural lands" in the 1935
Constitution encompassed industrial, commercial, residential and resettlement lands of the
public domain.60 If the land of public domain were neither timber nor mineral land, it would fall
under the classification of agricultural land of the public domain. Both the 1935 and 1973
Constitutions, therefore, prohibited the alienation of all natural resources except
agricultural lands of the public domain.
The 1973 Constitution, however, limited the alienation of lands of the public domain to
individuals who were citizens of the Philippines. Private corporations, even if wholly owned by
Philippine citizens, were no longer allowed to acquire alienable lands of the public domain
unlike in the 1935 Constitution. Section 11, Article XIV of the 1973 Constitution declared that
"Sec. 11. The Batasang Pambansa, taking into account conservation, ecological,
and development requirements of the natural resources, shall determine by law the
size of land of the public domain which may be developed, held or acquired by, or
leased to, any qualified individual, corporation, or association, and the conditions
therefor. No private corporation or association may hold alienable lands of the
public domain except by lease not to exceed one thousand hectares in area nor
may any citizen hold such lands by lease in excess of five hundred hectares or
acquire by purchase, homestead or grant, in excess of twenty-four hectares. No
private corporation or association may hold by lease, concession, license or permit,
timber or forest lands and other timber or forest resources in excess of one hundred
thousand hectares. However, such area may be increased by the Batasang
Pambansa upon recommendation of the National Economic and Development
Authority." (Emphasis supplied)
Thus, under the 1973 Constitution, private corporations could hold alienable lands of the
public domain only through lease. Only individuals could now acquire alienable lands of the
public domain, and private corporations became absolutely barred from acquiring any
kind of alienable land of the public domain. The constitutional ban extended to all kinds of
alienable lands of the public domain, while the statutory ban under CA No. 141 applied only to
government reclaimed, foreshore and marshy alienable lands of the public domain.
PD No. 1084 Creating the Public Estates Authority
On February 4, 1977, then President Ferdinand Marcos issued Presidential Decree No. 1084
creating PEA, a wholly government owned and controlled corporation with a special charter.
Sections 4 and 8 of PD No. 1084, vests PEA with the following purposes and powers:
"Sec. 4. Purpose. The Authority is hereby created for the following purposes:
(a) To reclaim land, including foreshore and submerged areas, by dredging,
filling or other means, or to acquire reclaimed land;
34
(b) To develop, improve, acquire, administer, deal in, subdivide, dispose, lease and
sell any and all kinds of lands, buildings, estates and other forms of real property,
owned, managed, controlled and/or operated by the government;
(c) To provide for, operate or administer such service as may be necessary for the
efficient, economical and beneficial utilization of the above properties.
Sec. 5. Powers and functions of the Authority. The Authority shall, in carrying out the
purposes for which it is created, have the following powers and functions:
(a)To prescribe its by-laws.
xxx
(i) To hold lands of the public domain in excess of the area permitted to private
corporations by statute.
(j) To reclaim lands and to construct work across, or otherwise, any stream,
watercourse, canal, ditch, flume x x x.
xxx
(o) To perform such acts and exercise such functions as may be necessary for the
attainment of the purposes and objectives herein specified." (Emphasis supplied)
PD No. 1084 authorizes PEA to reclaim both foreshore and submerged areas of the public
domain. Foreshore areas are those covered and uncovered by the ebb and flow of the
tide.61 Submerged areas are those permanently under water regardless of the ebb and flow of
the tide.62 Foreshore and submerged areas indisputably belong to the public domain63 and are
inalienable unless reclaimed, classified as alienable lands open to disposition, and further
declared no longer needed for public service.
The ban in the 1973 Constitution on private corporations from acquiring alienable lands of the
public domain did not apply to PEA since it was then, and until today, a fully owned
government corporation. The constitutional ban applied then, as it still applies now, only to
"private corporations and associations." PD No. 1084 expressly empowers PEA "to hold
lands of the public domain" even "in excess of the area permitted to private corporations by
statute." Thus, PEA can hold title to private lands, as well as title to lands of the public
domain.
In order for PEA to sell its reclaimed foreshore and submerged alienable lands of the public
domain, there must be legislative authority empowering PEA to sell these lands. This
legislative authority is necessary in view of Section 60 of CA No.141, which states
"Sec. 60. x x x; but the land so granted, donated or transferred to a province,
municipality, or branch or subdivision of the Government shall not be alienated,
encumbered or otherwise disposed of in a manner affecting its title, except when
authorized by Congress; x x x." (Emphasis supplied)
Without such legislative authority, PEA could not sell but only lease its reclaimed foreshore
and submerged alienable lands of the public domain. Nevertheless, any legislative authority
granted to PEA to sell its reclaimed alienable lands of the public domain would be subject to
the constitutional ban on private corporations from acquiring alienable lands of the public
domain. Hence, such legislative authority could only benefit private individuals.
Dispositions under the 1987 Constitution
The 1987 Constitution, like the 1935 and 1973 Constitutions before it, has adopted the
Regalian doctrine. The 1987 Constitution declares that all natural resources are "owned by
the State," and except for alienable agricultural lands of the public domain, natural resources
cannot be alienated. Sections 2 and 3, Article XII of the 1987 Constitution state that
"Section 2. All lands of the public domain, waters, minerals, coal, petroleum and
other mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife,
flora and fauna, and other natural resources are owned by the State. With the
exception of agricultural lands, all other natural resources shall not be
alienated. The exploration, development, and utilization of natural resources shall
be under the full control and supervision of the State. x x x.
Section 3. Lands of the public domain are classified into agricultural, forest or
timber, mineral lands, and national parks. Agricultural lands of the public domain
may be further classified by law according to the uses which they may be
devoted. Alienable lands of the public domain shall be limited to agricultural
lands. Private corporations or associations may not hold such alienable lands
of the public domain except by lease, for a period not exceeding twenty-five
years, renewable for not more than twenty-five years, and not to exceed one
thousand hectares in area. Citizens of the Philippines may lease not more than
five hundred hectares, or acquire not more than twelve hectares thereof by
purchase, homestead, or grant.
35
Taking into account the requirements of conservation, ecology, and development,
and subject to the requirements of agrarian reform, the Congress shall determine,
by law, the size of lands of the public domain which may be acquired, developed,
held, or leased and the conditions therefor." (Emphasis supplied)
The 1987 Constitution continues the State policy in the 1973 Constitution banning private
corporations from acquiring any kind of alienable land of the public domain. Like the 1973
Constitution, the 1987 Constitution allows private corporations to hold alienable lands of the
public domain only through lease. As in the 1935 and 1973 Constitutions, the general law
governing the lease to private corporations of reclaimed, foreshore and marshy alienable
lands of the public domain is still CA No. 141.
The Rationale behind the Constitutional Ban
The rationale behind the constitutional ban on corporations from acquiring, except through
lease, alienable lands of the public domain is not well understood. During the deliberations of
the 1986 Constitutional Commission, the commissioners probed the rationale behind this ban,
thus:
"FR. BERNAS: Mr. Vice-President, my questions have reference to page 3, line 5
which says:
`No private corporation or association may hold alienable lands of the public domain
except by lease, not to exceed one thousand hectares in area.'
If we recall, this provision did not exist under the 1935 Constitution, but this was
introduced in the 1973 Constitution. In effect, it prohibits private corporations from
acquiring alienable public lands. But it has not been very clear in jurisprudence
what the reason for this is. In some of the cases decided in 1982 and 1983, it was
indicated that the purpose of this is to prevent large landholdings. Is that the
intent of this provision?
MR. VILLEGAS: I think that is the spirit of the provision.
FR. BERNAS: In existing decisions involving the Iglesia ni Cristo, there were
instances where the Iglesia ni Cristo was not allowed to acquire a mere 313-square
meter land where a chapel stood because the Supreme Court said it would be in
violation of this." (Emphasis supplied)
In Ayog v. Cusi,64 the Court explained the rationale behind this constitutional ban in this way:
 "Indeed, one purpose of the constitutional prohibition against purchases of public
agricultural lands by private corporations is to equitably diffuse land ownership or to
encourage 'owner-cultivatorship and the economic family-size farm' and to prevent a
recurrence of cases like the instant case. Huge landholdings by corporations or
private persons had spawned social unrest."
1. "[T]hree partially reclaimed and substantially eroded islands along Emilio
Aguinaldo Boulevard in Paranaque and Las Pinas, Metro Manila, with a combined
titled area of 1,578,441 square meters;"
2. "[A]nother area of 2,421,559 square meters contiguous to the three islands;" and

However, if the constitutional intent is to prevent huge landholdings, the Constitution could 3. "[A]t AMARI's option as approved by PEA, an additional 350 hectares more or
have simply limited the size of alienable lands of the public domain that corporations could less to regularize the configuration of the reclaimed area."65
acquire. The Constitution could have followed the limitations on individuals, who could acquire
not more than 24 hectares of alienable lands of the public domain under the 1973
PEA confirms that the Amended JVA involves "the development of the Freedom Islands and
Constitution, and not more than 12 hectares under the 1987 Constitution.
further reclamation of about 250 hectares x x x," plus an option "granted to AMARI to
subsequently reclaim another 350 hectares x x x."66
If the constitutional intent is to encourage economic family-size farms, placing the land in the
name of a corporation would be more effective in preventing the break-up of farmlands. If the
In short, the Amended JVA covers a reclamation area of 750 hectares. Only 157.84 hectares
farmland is registered in the name of a corporation, upon the death of the owner, his heirs
of the 750-hectare reclamation project have been reclaimed, and the rest of the 592.15
would inherit shares in the corporation instead of subdivided parcels of the farmland. This
hectares are still submerged areas forming part of Manila Bay.
would prevent the continuing break-up of farmlands into smaller and smaller plots from one
generation to the next.
Under the Amended JVA, AMARI will reimburse PEA the sum of P1,894,129,200.00 for PEA's
"actual cost" in partially reclaiming the Freedom Islands. AMARI will also complete, at its own
In actual practice, the constitutional ban strengthens the constitutional limitation on individuals
expense, the reclamation of the Freedom Islands. AMARI will further shoulder all the
from acquiring more than the allowed area of alienable lands of the public domain. Without the
reclamation costs of all the other areas, totaling 592.15 hectares, still to be reclaimed. AMARI
constitutional ban, individuals who already acquired the maximum area of alienable lands of
and PEA will share, in the proportion of 70 percent and 30 percent, respectively, the total net
the public domain could easily set up corporations to acquire more alienable public lands. An
usable area which is defined in the Amended JVA as the total reclaimed area less 30 percent
individual could own as many corporations as his means would allow him. An individual could
earmarked for common areas. Title to AMARI's share in the net usable area, totaling 367.5
even hide his ownership of a corporation by putting his nominees as stockholders of the
hectares, will be issued in the name of AMARI. Section 5.2 (c) of the Amended JVA provides
corporation. The corporation is a convenient vehicle to circumvent the constitutional limitation
that
on acquisition by individuals of alienable lands of the public domain.
"x x x, PEA shall have the duty to execute without delay the necessary deed of
The constitutional intent, under the 1973 and 1987 Constitutions, is to transfer ownership of
transfer or conveyance of the title pertaining to AMARI's Land share based on the
only a limited area of alienable land of the public domain to a qualified individual. This
Land Allocation Plan. PEA, when requested in writing by AMARI, shall then
constitutional intent is safeguarded by the provision prohibiting corporations from acquiring
cause the issuance and delivery of the proper certificates of title covering
alienable lands of the public domain, since the vehicle to circumvent the constitutional intent is
AMARI's Land Share in the name of AMARI, x x x; provided, that if more than
removed. The available alienable public lands are gradually decreasing in the face of an ever-
seventy percent (70%) of the titled area at any given time pertains to AMARI, PEA
growing population. The most effective way to insure faithful adherence to this constitutional
shall deliver to AMARI only seventy percent (70%) of the titles pertaining to AMARI,
intent is to grant or sell alienable lands of the public domain only to individuals. This, it would
until such time when a corresponding proportionate area of additional land
seem, is the practical benefit arising from the constitutional ban.
pertaining to PEA has been titled." (Emphasis supplied)

The Amended Joint Venture Agreement

Indisputably, under the Amended JVA AMARI will acquire and own a maximum of 367.5
hectares of reclaimed land which will be titled in its name.
The subject matter of the Amended JVA, as stated in its second Whereas clause, consists of
three properties, namely:

36
To implement the Amended JVA, PEA delegated to the unincorporated PEA-AMARI joint
venture PEA's statutory authority, rights and privileges to reclaim foreshore and submerged
areas in Manila Bay. Section 3.2.a of the Amended JVA states that
"PEA hereby contributes to the joint venture its rights and privileges to perform
Rawland Reclamation and Horizontal Development as well as own the Reclamation
Area, thereby granting the Joint Venture the full and exclusive right, authority and
privilege to undertake the Project in accordance with the Master Development Plan."
The Amended JVA is the product of a renegotiation of the original JVA dated April 25, 1995
and its supplemental agreement dated August 9, 1995.
The Threshold Issue
The threshold issue is whether AMARI, a private corporation, can acquire and own under the
Amended JVA 367.5 hectares of reclaimed foreshore and submerged areas in Manila Bay in
view of Sections 2 and 3, Article XII of the 1987 Constitution which state that:
"Section 2. All lands of the public domain, waters, minerals, coal, petroleum, and
other mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife,
flora and fauna, and other natural resources are owned by the State. With the
exception of agricultural lands, all other natural resources shall not be
alienated. x x x.
xxx
Section 3. x x x Alienable lands of the public domain shall be limited to agricultural
lands. Private corporations or associations may not hold such alienable lands
of the public domain except by lease, x x x."(Emphasis supplied)
Classification of Reclaimed Foreshore and Submerged Areas
PEA readily concedes that lands reclaimed from foreshore or submerged areas of Manila Bay
are alienable or disposable lands of the public domain. In its Memorandum,67 PEA admits that
"Under the Public Land Act (CA 141, as amended), reclaimed lands are classified
as alienable and disposable lands of the public domain:
'Sec. 59. The lands disposable under this title shall be classified as
follows:
37
(a) Lands reclaimed by the government by dredging, filling, or other
means;
x x x.'" (Emphasis supplied)
Likewise, the Legal Task Force68 constituted under Presidential Administrative Order No. 365
admitted in its Report and Recommendation to then President Fidel V. Ramos, "[R]eclaimed
lands are classified as alienable and disposable lands of the public domain."69 The
Legal Task Force concluded that
"D. Conclusion
Reclaimed lands are lands of the public domain. However, by statutory authority, the
rights of ownership and disposition over reclaimed lands have been transferred to
PEA, by virtue of which PEA, as owner, may validly convey the same to any
qualified person without violating the Constitution or any statute.
The constitutional provision prohibiting private corporations from holding public land,
except by lease (Sec. 3, Art. XVII,70 1987 Constitution), does not apply to reclaimed
lands whose ownership has passed on to PEA by statutory grant."
Under Section 2, Article XII of the 1987 Constitution, the foreshore and submerged areas of
Manila Bay are part of the "lands of the public domain, waters x x x and other natural
resources" and consequently "owned by the State." As such, foreshore and submerged areas
"shall not be alienated," unless they are classified as "agricultural lands" of the public domain.
The mere reclamation of these areas by PEA does not convert these inalienable natural
resources of the State into alienable or disposable lands of the public domain. There must be
a law or presidential proclamation officially classifying these reclaimed lands as alienable or
disposable and open to disposition or concession. Moreover, these reclaimed lands cannot be
classified as alienable or disposable if the law has reserved them for some public or quasi-
public use.71
Section 8 of CA No. 141 provides that "only those lands shall be declared open to disposition
or concession which have been officially delimited and classified."72 The President has the
authority to classify inalienable lands of the public domain into alienable or disposable lands of
the public domain, pursuant to Section 6 of CA No. 141. In Laurel vs. Garcia,73 the Executive
Department attempted to sell the Roppongi property in Tokyo, Japan, which was acquired by
the Philippine Government for use as the Chancery of the Philippine Embassy. Although the
Chancery had transferred to another location thirteen years earlier, the Court still ruled that,
under Article 42274 of the Civil Code, a property of public dominion retains such character until
formally declared otherwise. The Court ruled that
 "The fact that the Roppongi site has not been used for a long time for actual
Embassy service does not automatically convert it to patrimonial property. Any such
conversion happens only if the property is withdrawn from public use (Cebu Oxygen
and Acetylene Co. v. Bercilles, 66 SCRA 481 [1975]. A property continues to be
part of the public domain, not available for private appropriation or ownership
'until there is a formal declaration on the part of the government to withdraw it
from being such' (Ignacio v. Director of Lands, 108 Phil. 335 [1960]." (Emphasis
supplied)
PD No. 1085, issued on February 4, 1977, authorized the issuance of special land patents for
lands reclaimed by PEA from the foreshore or submerged areas of Manila Bay. On January
19, 1988 then President Corazon C. Aquino issued Special Patent No. 3517 in the name of
PEA for the 157.84 hectares comprising the partially reclaimed Freedom Islands.
Subsequently, on April 9, 1999 the Register of Deeds of the Municipality of Paranaque issued
TCT Nos. 7309, 7311 and 7312 in the name of PEA pursuant to Section 103 of PD No. 1529
authorizing the issuance of certificates of title corresponding to land patents. To this day,
these certificates of title are still in the name of PEA.
PD No. 1085, coupled with President Aquino's actual issuance of a special patent covering
the Freedom Islands, is equivalent to an official proclamation classifying the Freedom Islands
as alienable or disposable lands of the public domain. PD No. 1085 and President Aquino's
issuance of a land patent also constitute a declaration that the Freedom Islands are no longer
needed for public service. The Freedom Islands are thus alienable or disposable lands of
the public domain, open to disposition or concession to qualified parties.
At the time then President Aquino issued Special Patent No. 3517, PEA had already
reclaimed the Freedom Islands although subsequently there were partial erosions on some
areas. The government had also completed the necessary surveys on these islands. Thus,
the Freedom Islands were no longer part of Manila Bay but part of the land mass. Section 3,
Article XII of the 1987 Constitution classifies lands of the public domain into "agricultural,
forest or timber, mineral lands, and national parks." Being neither timber, mineral, nor national
park lands, the reclaimed Freedom Islands necessarily fall under the classification of
agricultural lands of the public domain. Under the 1987 Constitution, agricultural lands of the
public domain are the only natural resources that the State may alienate to qualified private
parties. All other natural resources, such as the seas or bays, are "waters x x x owned by the
State" forming part of the public domain, and are inalienable pursuant to Section 2, Article XII
of the 1987 Constitution.
AMARI claims that the Freedom Islands are private lands because CDCP, then a private
corporation, reclaimed the islands under a contract dated November 20, 1973 with the
Commissioner of Public Highways. AMARI, citing Article 5 of the Spanish Law of Waters of
1866, argues that "if the ownership of reclaimed lands may be given to the party constructing
38
the works, then it cannot be said that reclaimed lands are lands of the public domain which the
State may not alienate."75 Article 5 of the Spanish Law of Waters reads as follows:
"Article 5. Lands reclaimed from the sea in consequence of works constructed by
the State, or by the provinces, pueblos or private persons, with proper permission,
shall become the property of the party constructing such works, unless otherwise
provided by the terms of the grant of authority." (Emphasis supplied)
Under Article 5 of the Spanish Law of Waters of 1866, private parties could reclaim from the
sea only with "proper permission" from the State. Private parties could own the reclaimed land
only if not "otherwise provided by the terms of the grant of authority." This clearly meant that
no one could reclaim from the sea without permission from the State because the sea is
property of public dominion. It also meant that the State could grant or withhold ownership of
the reclaimed land because any reclaimed land, like the sea from which it emerged, belonged
to the State. Thus, a private person reclaiming from the sea without permission from the State
could not acquire ownership of the reclaimed land which would remain property of public
dominion like the sea it replaced.76 Article 5 of the Spanish Law of Waters of 1866 adopted the
time-honored principle of land ownership that "all lands that were not acquired from the
government, either by purchase or by grant, belong to the public domain."77
Article 5 of the Spanish Law of Waters must be read together with laws subsequently enacted
on the disposition of public lands. In particular, CA No. 141 requires that lands of the public
domain must first be classified as alienable or disposable before the government can alienate
them. These lands must not be reserved for public or quasi-public purposes.78 Moreover, the
contract between CDCP and the government was executed after the effectivity of the 1973
Constitution which barred private corporations from acquiring any kind of alienable land of the
public domain. This contract could not have converted the Freedom Islands into private lands
of a private corporation.
Presidential Decree No. 3-A, issued on January 11, 1973, revoked all laws authorizing the
reclamation of areas under water and revested solely in the National Government the power
to reclaim lands. Section 1 of PD No. 3-A declared that
"The provisions of any law to the contrary notwithstanding, the reclamation of
areas under water, whether foreshore or inland, shall be limited to the National
Government or any person authorized by it under a proper contract. (Emphasis
supplied)
x x x."
PD No. 3-A repealed Section 5 of the Spanish Law of Waters of 1866 because reclamation of
areas under water could now be undertaken only by the National Government or by a person
contracted by the National Government. Private parties may reclaim from the sea only under a
contract with the National Government, and no longer by grant or permission as provided in
Section 5 of the Spanish Law of Waters of 1866.
Executive Order No. 525, issued on February 14, 1979, designated PEA as the National
Government's implementing arm to undertake "all reclamation projects of the government,"
which "shall be undertaken by the PEA or through a proper contract executed by it with
any person or entity." Under such contract, a private party receives compensation for
reclamation services rendered to PEA. Payment to the contractor may be in cash, or in kind
consisting of portions of the reclaimed land, subject to the constitutional ban on private
corporations from acquiring alienable lands of the public domain. The reclaimed land can be
used as payment in kind only if the reclaimed land is first classified as alienable or disposable
land open to disposition, and then declared no longer needed for public service.
The Amended JVA covers not only the Freedom Islands, but also an additional 592.15
hectares which are still submerged and forming part of Manila Bay. There is no legislative or
Presidential act classifying these submerged areas as alienable or disposable lands of
the public domain open to disposition. These submerged areas are not covered by any
patent or certificate of title. There can be no dispute that these submerged areas form part of
the public domain, and in their present state are inalienable and outside the commerce of
man. Until reclaimed from the sea, these submerged areas are, under the Constitution,
"waters x x x owned by the State," forming part of the public domain and consequently
inalienable. Only when actually reclaimed from the sea can these submerged areas be
classified as public agricultural lands, which under the Constitution are the only natural
resources that the State may alienate. Once reclaimed and transformed into public agricultural
lands, the government may then officially classify these lands as alienable or disposable lands
open to disposition. Thereafter, the government may declare these lands no longer needed for
public service. Only then can these reclaimed lands be considered alienable or disposable
lands of the public domain and within the commerce of man.
The classification of PEA's reclaimed foreshore and submerged lands into alienable or
disposable lands open to disposition is necessary because PEA is tasked under its charter to
undertake public services that require the use of lands of the public domain. Under Section 5
of PD No. 1084, the functions of PEA include the following: "[T]o own or operate railroads,
tramways and other kinds of land transportation, x x x; [T]o construct, maintain and operate
such systems of sanitary sewers as may be necessary; [T]o construct, maintain and operate
such storm drains as may be necessary." PEA is empowered to issue "rules and regulations
as may be necessary for the proper use by private parties of any or all of the highways,
roads, utilities, buildings and/or any of its properties and to impose or collect fees or tolls
for their use." Thus, part of the reclaimed foreshore and submerged lands held by the PEA
would actually be needed for public use or service since many of the functions imposed on
PEA by its charter constitute essential public services.
39
Moreover, Section 1 of Executive Order No. 525 provides that PEA "shall be primarily
responsible for integrating, directing, and coordinating all reclamation projects for and on
behalf of the National Government." The same section also states that "[A]ll reclamation
projects shall be approved by the President upon recommendation of the PEA, and shall be
undertaken by the PEA or through a proper contract executed by it with any person or entity; x
x x." Thus, under EO No. 525, in relation to PD No. 3-A and PD No.1084, PEA became the
primary implementing agency of the National Government to reclaim foreshore and
submerged lands of the public domain. EO No. 525 recognized PEA as the government entity
"to undertake the reclamation of lands and ensure their maximum utilization in promoting
public welfare and interests."79 Since large portions of these reclaimed lands would
obviously be needed for public service, there must be a formal declaration segregating
reclaimed lands no longer needed for public service from those still needed for public
service.1wphi1.nt
Section 3 of EO No. 525, by declaring that all lands reclaimed by PEA "shall belong to or be
owned by the PEA," could not automatically operate to classify inalienable lands into alienable
or disposable lands of the public domain. Otherwise, reclaimed foreshore and submerged
lands of the public domain would automatically become alienable once reclaimed by PEA,
whether or not classified as alienable or disposable.
The Revised Administrative Code of 1987, a later law than either PD No. 1084 or EO No. 525,
vests in the Department of Environment and Natural Resources ("DENR" for brevity) the
following powers and functions:
"Sec. 4. Powers and Functions. The Department shall:
(1) x x x
xxx
(4) Exercise supervision and control over forest lands, alienable and disposable
public lands, mineral resources and, in the process of exercising such control,
impose appropriate taxes, fees, charges, rentals and any such form of levy and
collect such revenues for the exploration, development, utilization or gathering of
such resources;
xxx
(14) Promulgate rules, regulations and guidelines on the issuance of licenses,
permits, concessions, lease agreements and such other privileges concerning
the development, exploration and utilization of the country's marine,
 freshwater, and brackish water and over all aquatic resources of the country
and shall continue to oversee, supervise and police our natural resources;
cancel or cause to cancel such privileges upon failure, non-compliance or violations
of any regulation, order, and for all other causes which are in furtherance of the
conservation of natural resources and supportive of the national interest;
(15) Exercise exclusive jurisdiction on the management and disposition of all
lands of the public domain and serve as the sole agency responsible for
classification, sub-classification, surveying and titling of lands in consultation with
appropriate agencies."80 (Emphasis supplied)
As manager, conservator and overseer of the natural resources of the State, DENR exercises
"supervision and control over alienable and disposable public lands." DENR also exercises
"exclusive jurisdiction on the management and disposition of all lands of the public domain."
Thus, DENR decides whether areas under water, like foreshore or submerged areas of Manila
Bay, should be reclaimed or not. This means that PEA needs authorization from DENR before
PEA can undertake reclamation projects in Manila Bay, or in any part of the country.
DENR also exercises exclusive jurisdiction over the disposition of all lands of the public
domain. Hence, DENR decides whether reclaimed lands of PEA should be classified as
alienable under Sections 681 and 782 of CA No. 141. Once DENR decides that the reclaimed
lands should be so classified, it then recommends to the President the issuance of a
proclamation classifying the lands as alienable or disposable lands of the public domain open
to disposition. We note that then DENR Secretary Fulgencio S. Factoran, Jr. countersigned
Special Patent No. 3517 in compliance with the Revised Administrative Code and Sections 6
and 7 of CA No. 141.
In short, DENR is vested with the power to authorize the reclamation of areas under water,
while PEA is vested with the power to undertake the physical reclamation of areas under
water, whether directly or through private contractors. DENR is also empowered to classify
lands of the public domain into alienable or disposable lands subject to the approval of the
President. On the other hand, PEA is tasked to develop, sell or lease the reclaimed alienable
lands of the public domain.
Clearly, the mere physical act of reclamation by PEA of foreshore or submerged areas does
not make the reclaimed lands alienable or disposable lands of the public domain, much less
patrimonial lands of PEA. Likewise, the mere transfer by the National Government of lands of
the public domain to PEA does not make the lands alienable or disposable lands of the public
domain, much less patrimonial lands of PEA.
Absent two official acts a classification that these lands are alienable or disposable and
open to disposition and a declaration that these lands are not needed for public service, lands
40
reclaimed by PEA remain inalienable lands of the public domain. Only such an official
classification and formal declaration can convert reclaimed lands into alienable or disposable
lands of the public domain, open to disposition under the Constitution, Title I and Title III83 of
CA No. 141 and other applicable laws.84
PEA's Authority to Sell Reclaimed Lands
PEA, like the Legal Task Force, argues that as alienable or disposable lands of the public
domain, the reclaimed lands shall be disposed of in accordance with CA No. 141, the Public
Land Act. PEA, citing Section 60 of CA No. 141, admits that reclaimed lands transferred to a
branch or subdivision of the government "shall not be alienated, encumbered, or otherwise
disposed of in a manner affecting its title, except when authorized by Congress: x x
x."85 (Emphasis by PEA)
In Laurel vs. Garcia,86 the Court cited Section 48 of the Revised Administrative Code of
1987, which states that
"Sec. 48. Official Authorized to Convey Real Property. Whenever real property of
the Government is authorized by law to be conveyed, the deed of conveyance
shall be executed in behalf of the government by the following: x x x."
Thus, the Court concluded that a law is needed to convey any real property belonging to the
Government. The Court declared that -
"It is not for the President to convey real property of the government on his or her
own sole will. Any such conveyance must be authorized and approved by a law
enacted by the Congress. It requires executive and legislative concurrence."
(Emphasis supplied)
PEA contends that PD No. 1085 and EO No. 525 constitute the legislative authority allowing
PEA to sell its reclaimed lands. PD No. 1085, issued on February 4, 1977, provides that
"The land reclaimed in the foreshore and offshore area of Manila Bay pursuant
to the contract for the reclamation and construction of the Manila-Cavite Coastal
Road Project between the Republic of the Philippines and the Construction and
Development Corporation of the Philippines dated November 20, 1973 and/or any
other contract or reclamation covering the same area is hereby transferred,
conveyed and assigned to the ownership and administration of the Public
Estates Authority established pursuant to PD No. 1084; Provided, however, That
the rights and interests of the Construction and Development Corporation of the
Philippines pursuant to the aforesaid contract shall be recognized and respected.
 Henceforth, the Public Estates Authority shall exercise the rights and assume the
obligations of the Republic of the Philippines (Department of Public Highways)
arising from, or incident to, the aforesaid contract between the Republic of the
Philippines and the Construction and Development Corporation of the Philippines.
In consideration of the foregoing transfer and assignment, the Public Estates
Authority shall issue in favor of the Republic of the Philippines the corresponding
shares of stock in said entity with an issued value of said shares of stock (which)
shall be deemed fully paid and non-assessable.
The Secretary of Public Highways and the General Manager of the Public Estates
Authority shall execute such contracts or agreements, including appropriate
agreements with the Construction and Development Corporation of the Philippines,
as may be necessary to implement the above.
Special land patent/patents shall be issued by the Secretary of Natural
Resources in favor of the Public Estates Authority without prejudice to the
subsequent transfer to the contractor or his assignees of such portion or
portions of the land reclaimed or to be reclaimed as provided for in the above-
mentioned contract. On the basis of such patents, the Land Registration
Commission shall issue the corresponding certificate of title." (Emphasis
supplied)
On the other hand, Section 3 of EO No. 525, issued on February 14, 1979, provides that -
"Sec. 3. All lands reclaimed by PEA shall belong to or be owned by the
PEA which shall be responsible for its administration, development, utilization or
disposition in accordance with the provisions of Presidential Decree No. 1084. Any
and all income that the PEA may derive from the sale, lease or use of reclaimed
lands shall be used in accordance with the provisions of Presidential Decree No.
1084."
There is no express authority under either PD No. 1085 or EO No. 525 for PEA to sell its
reclaimed lands. PD No. 1085 merely transferred "ownership and administration" of lands
reclaimed from Manila Bay to PEA, while EO No. 525 declared that lands reclaimed by PEA
"shall belong to or be owned by PEA." EO No. 525 expressly states that PEA should dispose
of its reclaimed lands "in accordance with the provisions of Presidential Decree No. 1084," the
charter of PEA.
PEA's charter, however, expressly tasks PEA "to develop, improve, acquire, administer, deal
in, subdivide, dispose, lease and sell any and all kinds of lands x x x owned, managed,
controlled and/or operated by the government."87(Emphasis supplied) There is, therefore,
41
legislative authority granted to PEA to sell its lands, whether patrimonial or alienable
lands of the public domain. PEA may sell to private parties its patrimonial propertiesin
accordance with the PEA charter free from constitutional limitations. The constitutional ban on
private corporations from acquiring alienable lands of the public domain does not apply to the
sale of PEA's patrimonial lands.
PEA may also sell its alienable or disposable lands of the public domain to private
individuals since, with the legislative authority, there is no longer any statutory prohibition
against such sales and the constitutional ban does not apply to individuals. PEA, however,
cannot sell any of its alienable or disposable lands of the public domain to private corporations
since Section 3, Article XII of the 1987 Constitution expressly prohibits such sales. The
legislative authority benefits only individuals. Private corporations remain barred from
acquiring any kind of alienable land of the public domain, including government reclaimed
lands.
The provision in PD No. 1085 stating that portions of the reclaimed lands could be transferred
by PEA to the "contractor or his assignees" (Emphasis supplied) would not apply to private
corporations but only to individuals because of the constitutional ban. Otherwise, the
provisions of PD No. 1085 would violate both the 1973 and 1987 Constitutions.
The requirement of public auction in the sale of reclaimed lands
Assuming the reclaimed lands of PEA are classified as alienable or disposable lands open to
disposition, and further declared no longer needed for public service, PEA would have to
conduct a public bidding in selling or leasing these lands. PEA must observe the provisions of
Sections 63 and 67 of CA No. 141 requiring public auction, in the absence of a law exempting
PEA from holding a public auction.88 Special Patent No. 3517 expressly states that the patent
is issued by authority of the Constitution and PD No. 1084, "supplemented by Commonwealth
Act No. 141, as amended." This is an acknowledgment that the provisions of CA No. 141
apply to the disposition of reclaimed alienable lands of the public domain unless otherwise
provided by law. Executive Order No. 654,89 which authorizes PEA "to determine the kind and
manner of payment for the transfer" of its assets and properties, does not exempt PEA from
the requirement of public auction. EO No. 654 merely authorizes PEA to decide the mode of
payment, whether in kind and in installment, but does not authorize PEA to dispense with
public auction.
Moreover, under Section 79 of PD No. 1445, otherwise known as the Government Auditing
Code, the government is required to sell valuable government property through public bidding.
Section 79 of PD No. 1445 mandates that
"Section 79. When government property has become unserviceable for any
cause, or is no longer needed, it shall, upon application of the officer accountable
 therefor, be inspected by the head of the agency or his duly authorized
representative in the presence of the auditor concerned and, if found to be valueless
or unsaleable, it may be destroyed in their presence. If found to be valuable, it
may be sold at public auction to the highest bidder under the supervision of the
proper committee on award or similar body in the presence of the auditor concerned
or other authorized representative of the Commission, after advertising by printed
notice in the Official Gazette, or for not less than three consecutive days in
any newspaper of general circulation, or where the value of the property does not
warrant the expense of publication, by notices posted for a like period in at least
three public places in the locality where the property is to be sold. In the event that
the public auction fails, the property may be sold at a private sale at such
price as may be fixed by the same committee or body concerned and
approved by the Commission."
It is only when the public auction fails that a negotiated sale is allowed, in which case the
Commission on Audit must approve the selling price.90 The Commission on Audit implements
Section 79 of the Government Auditing Code through Circular No. 89-29691 dated January 27,
1989. This circular emphasizes that government assets must be disposed of only through
public auction, and a negotiated sale can be resorted to only in case of "failure of public
auction."
At the public auction sale, only Philippine citizens are qualified to bid for PEA's reclaimed
foreshore and submerged alienable lands of the public domain. Private corporations are
barred from bidding at the auction sale of any kind of alienable land of the public domain.
PEA originally scheduled a public bidding for the Freedom Islands on December 10, 1991.
PEA imposed a condition that the winning bidder should reclaim another 250 hectares of
submerged areas to regularize the shape of the Freedom Islands, under a 60-40 sharing of
the additional reclaimed areas in favor of the winning bidder.92 No one, however, submitted a
bid. On December 23, 1994, the Government Corporate Counsel advised PEA it could sell the
Freedom Islands through negotiation, without need of another public bidding, because of the
failure of the public bidding on December 10, 1991.93
However, the original JVA dated April 25, 1995 covered not only the Freedom Islands and the
additional 250 hectares still to be reclaimed, it also granted an option to AMARI to reclaim
another 350 hectares. The original JVA, a negotiated contract, enlarged the reclamation area
to 750 hectares.94 The failure of public bidding on December 10, 1991, involving only 407.84
hectares,95 is not a valid justification for a negotiated sale of 750 hectares, almost double the
area publicly auctioned. Besides, the failure of public bidding happened on December 10,
1991, more than three years before the signing of the original JVA on April 25, 1995. The
economic situation in the country had greatly improved during the intervening period.
42
Reclamation under the BOT Law and the Local Government Code
The constitutional prohibition in Section 3, Article XII of the 1987 Constitution is absolute and
clear: "Private corporations or associations may not hold such alienable lands of the public
domain except by lease, x x x." Even Republic Act No. 6957 ("BOT Law," for brevity), cited by
PEA and AMARI as legislative authority to sell reclaimed lands to private parties, recognizes
the constitutional ban. Section 6 of RA No. 6957 states
"Sec. 6. Repayment Scheme. - For the financing, construction, operation and
maintenance of any infrastructure projects undertaken through the build-operate-
and-transfer arrangement or any of its variations pursuant to the provisions of this
Act, the project proponent x x x may likewise be repaid in the form of a share in the
revenue of the project or other non-monetary payments, such as, but not limited to,
the grant of a portion or percentage of the reclaimed land, subject to the
constitutional requirements with respect to the ownership of the land: x x x."
(Emphasis supplied)
A private corporation, even one that undertakes the physical reclamation of a government
BOT project, cannot acquire reclaimed alienable lands of the public domain in view of the
constitutional ban.
Section 302 of the Local Government Code, also mentioned by PEA and AMARI, authorizes
local governments in land reclamation projects to pay the contractor or developer in kind
consisting of a percentage of the reclaimed land, to wit:
"Section 302. Financing, Construction, Maintenance, Operation, and Management
of Infrastructure Projects by the Private Sector. x x x
xxx
In case of land reclamation or construction of industrial estates, the repayment plan
may consist of the grant of a portion or percentage of the reclaimed land or the
industrial estate constructed."
Although Section 302 of the Local Government Code does not contain a proviso similar to that
of the BOT Law, the constitutional restrictions on land ownership automatically apply even
though not expressly mentioned in the Local Government Code.
Thus, under either the BOT Law or the Local Government Code, the contractor or developer,
if a corporate entity, can only be paid with leaseholds on portions of the reclaimed land. If the
contractor or developer is an individual, portions of the reclaimed land, not exceeding 12
hectares96 of non-agricultural lands, may be conveyed to him in ownership in view of the
legislative authority allowing such conveyance. This is the only way these provisions of the
BOT Law and the Local Government Code can avoid a direct collision with Section 3, Article
XII of the 1987 Constitution.
Registration of lands of the public domain
Finally, PEA theorizes that the "act of conveying the ownership of the reclaimed lands to
public respondent PEA transformed such lands of the public domain to private lands." This
theory is echoed by AMARI which maintains that the "issuance of the special patent leading to
the eventual issuance of title takes the subject land away from the land of public domain and
converts the property into patrimonial or private property." In short, PEA and AMARI contend
that with the issuance of Special Patent No. 3517 and the corresponding certificates of titles,
the 157.84 hectares comprising the Freedom Islands have become private lands of PEA. In
support of their theory, PEA and AMARI cite the following rulings of the Court:
1. Sumail v. Judge of CFI of Cotabato,97 where the Court held
"Once the patent was granted and the corresponding certificate of title was issued,
the land ceased to be part of the public domain and became private property over
which the Director of Lands has neither control nor jurisdiction."
2. Lee Hong Hok v. David,98 where the Court declared -
"After the registration and issuance of the certificate and duplicate certificate of title
based on a public land patent, the land covered thereby automatically comes under
the operation of Republic Act 496 subject to all the safeguards provided
therein."3. Heirs of Gregorio Tengco v. Heirs of Jose Aliwalas,99 where the Court
ruled -
"While the Director of Lands has the power to review homestead patents, he may do
so only so long as the land remains part of the public domain and continues to be
under his exclusive control; but once the patent is registered and a certificate of title
is issued, the land ceases to be part of the public domain and becomes private
property over which the Director of Lands has neither control nor jurisdiction."
4. Manalo v. Intermediate Appellate Court,100 where the Court held
"When the lots in dispute were certified as disposable on May 19, 1971, and free
patents were issued covering the same in favor of the private respondents, the said
43
lots ceased to be part of the public domain and, therefore, the Director of Lands lost
jurisdiction over the same."
5.Republic v. Court of Appeals,101 where the Court stated
"Proclamation No. 350, dated October 9, 1956, of President Magsaysay legally
effected a land grant to the Mindanao Medical Center, Bureau of Medical Services,
Department of Health, of the whole lot, validly sufficient for initial registration under
the Land Registration Act. Such land grant is constitutive of a 'fee simple' title or
absolute title in favor of petitioner Mindanao Medical Center. Thus, Section 122 of
the Act, which governs the registration of grants or patents involving public lands,
provides that 'Whenever public lands in the Philippine Islands belonging to the
Government of the United States or to the Government of the Philippines are
alienated, granted or conveyed to persons or to public or private corporations, the
same shall be brought forthwith under the operation of this Act (Land Registration
Act, Act 496) and shall become registered lands.'"
The first four cases cited involve petitions to cancel the land patents and the corresponding
certificates of titles issued to private parties. These four cases uniformly hold that the
Director of Lands has no jurisdiction over private lands or that upon issuance of the certificate
of title the land automatically comes under the Torrens System. The fifth case cited involves
the registration under the Torrens System of a 12.8-hectare public land granted by the
National Government to Mindanao Medical Center, a government unit under the Department
of Health. The National Government transferred the 12.8-hectare public land to serve as the
site for the hospital buildings and other facilities of Mindanao Medical Center, which performed
a public service. The Court affirmed the registration of the 12.8-hectare public land in the
name of Mindanao Medical Center under Section 122 of Act No. 496. This fifth case is an
example of a public land being registered under Act No. 496 without the land losing its
character as a property of public dominion.
In the instant case, the only patent and certificates of title issued are those in the name of
PEA, a wholly government owned corporation performing public as well as proprietary
functions. No patent or certificate of title has been issued to any private party. No one is
asking the Director of Lands to cancel PEA's patent or certificates of title. In fact, the thrust of
the instant petition is that PEA's certificates of title should remain with PEA, and the land
covered by these certificates, being alienable lands of the public domain, should not be sold to
a private corporation.
Registration of land under Act No. 496 or PD No. 1529 does not vest in the registrant private
or public ownership of the land. Registration is not a mode of acquiring ownership but is
merely evidence of ownership previously conferred by any of the recognized modes of
acquiring ownership. Registration does not give the registrant a better right than what the
registrant had prior to the registration.102 The registration of lands of the public domain under
the Torrens system, by itself, cannot convert public lands into private lands.103
Jurisprudence holding that upon the grant of the patent or issuance of the certificate of title the
alienable land of the public domain automatically becomes private land cannot apply to
government units and entities like PEA. The transfer of the Freedom Islands to PEA was
made subject to the provisions of CA No. 141 as expressly stated in Special Patent No. 3517
issued by then President Aquino, to wit:
"NOW, THEREFORE, KNOW YE, that by authority of the Constitution of the
Philippines and in conformity with the provisions of Presidential Decree No. 1084,
supplemented by Commonwealth Act No. 141, as amended, there are hereby
granted and conveyed unto the Public Estates Authority the aforesaid tracts of land
containing a total area of one million nine hundred fifteen thousand eight hundred
ninety four (1,915,894) square meters; the technical description of which are hereto
attached and made an integral part hereof." (Emphasis supplied)
Thus, the provisions of CA No. 141 apply to the Freedom Islands on matters not covered by
PD No. 1084. Section 60 of CA No. 141 prohibits, "except when authorized by Congress," the
sale of alienable lands of the public domain that are transferred to government units or
entities. Section 60 of CA No. 141 constitutes, under Section 44 of PD No. 1529, a "statutory
lien affecting title" of the registered land even if not annotated on the certificate of
title.104Alienable lands of the public domain held by government entities under Section 60 of
CA No. 141 remain public lands because they cannot be alienated or encumbered unless
Congress passes a law authorizing their disposition. Congress, however, cannot authorize the
sale to private corporations of reclaimed alienable lands of the public domain because of the
constitutional ban. Only individuals can benefit from such law.
The grant of legislative authority to sell public lands in accordance with Section 60 of CA No.
141 does not automatically convert alienable lands of the public domain into private or
patrimonial lands. The alienable lands of the public domain must be transferred to qualified
private parties, or to government entities not tasked to dispose of public lands, before these
lands can become private or patrimonial lands. Otherwise, the constitutional ban will become
illusory if Congress can declare lands of the public domain as private or patrimonial lands in
the hands of a government agency tasked to dispose of public lands. This will allow private
corporations to acquire directly from government agencies limitless areas of lands which, prior
to such law, are concededly public lands.
Under EO No. 525, PEA became the central implementing agency of the National
Government to reclaim foreshore and submerged areas of the public domain. Thus, EO No.
525 declares that
44
"EXECUTIVE ORDER NO. 525
Designating the Public Estates Authority as the Agency Primarily Responsible for all
Reclamation Projects
Whereas, there are several reclamation projects which are ongoing or being
proposed to be undertaken in various parts of the country which need to be
evaluated for consistency with national programs;
Whereas, there is a need to give further institutional support to the Government's
declared policy to provide for a coordinated, economical and efficient reclamation of
lands;
Whereas, Presidential Decree No. 3-A requires that all reclamation of areas shall be
limited to the National Government or any person authorized by it under proper
contract;
Whereas, a central authority is needed to act on behalf of the National
Government which shall ensure a coordinated and integrated approach in the
reclamation of lands;
Whereas, Presidential Decree No. 1084 creates the Public Estates Authority as
a government corporation to undertake reclamation of lands and ensure their
maximum utilization in promoting public welfare and interests; and
Whereas, Presidential Decree No. 1416 provides the President with continuing
authority to reorganize the national government including the transfer, abolition, or
merger of functions and offices.
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by
virtue of the powers vested in me by the Constitution and pursuant to Presidential
Decree No. 1416, do hereby order and direct the following:
Section 1. The Public Estates Authority (PEA) shall be primarily responsible
for integrating, directing, and coordinating all reclamation projects for and on
behalf of the National Government. All reclamation projects shall be approved by
the President upon recommendation of the PEA, and shall be undertaken by the
PEA or through a proper contract executed by it with any person or entity; Provided,
that, reclamation projects of any national government agency or entity authorized
under its charter shall be undertaken in consultation with the PEA upon approval of
the President.
 x x x ."
As the central implementing agency tasked to undertake reclamation projects nationwide, with
authority to sell reclaimed lands, PEA took the place of DENR as the government agency
charged with leasing or selling reclaimed lands of the public domain. The reclaimed lands
being leased or sold by PEA are not private lands, in the same manner that DENR, when it
disposes of other alienable lands, does not dispose of private lands but alienable lands of the
public domain. Only when qualified private parties acquire these lands will the lands become
private lands. In the hands of the government agency tasked and authorized to dispose
of alienable of disposable lands of the public domain, these lands are still public, not
private lands.
Furthermore, PEA's charter expressly states that PEA "shall hold lands of the public
domain" as well as "any and all kinds of lands." PEA can hold both lands of the public domain
and private lands. Thus, the mere fact that alienable lands of the public domain like the
Freedom Islands are transferred to PEA and issued land patents or certificates of title in
PEA's name does not automatically make such lands private.
To allow vast areas of reclaimed lands of the public domain to be transferred to PEA as
private lands will sanction a gross violation of the constitutional ban on private corporations
from acquiring any kind of alienable land of the public domain. PEA will simply turn around, as
PEA has now done under the Amended JVA, and transfer several hundreds of hectares of
these reclaimed and still to be reclaimed lands to a single private corporation in only one
transaction. This scheme will effectively nullify the constitutional ban in Section 3, Article XII of
the 1987 Constitution which was intended to diffuse equitably the ownership of alienable lands
of the public domain among Filipinos, now numbering over 80 million strong.
This scheme, if allowed, can even be applied to alienable agricultural lands of the public
domain since PEA can "acquire x x x any and all kinds of lands." This will open the floodgates
to corporations and even individuals acquiring hundreds of hectares of alienable lands of the
public domain under the guise that in the hands of PEA these lands are private lands. This will
result in corporations amassing huge landholdings never before seen in this country - creating
the very evil that the constitutional ban was designed to prevent. This will completely reverse
the clear direction of constitutional development in this country. The 1935 Constitution allowed
private corporations to acquire not more than 1,024 hectares of public lands.105 The 1973
Constitution prohibited private corporations from acquiring any kind of public land, and the
1987 Constitution has unequivocally reiterated this prohibition.
The contention of PEA and AMARI that public lands, once registered under Act No. 496 or PD
No. 1529, automatically become private lands is contrary to existing laws. Several laws
authorize lands of the public domain to be registered under the Torrens System or Act No.
45
496, now PD No. 1529, without losing their character as public lands. Section 122 of Act No.
496, and Section 103 of PD No. 1529, respectively, provide as follows:
Act No. 496
"Sec. 122. Whenever public lands in the Philippine Islands belonging to the x x x
Government of the Philippine Islands are alienated, granted, or conveyed to persons
or the public or private corporations, the same shall be brought forthwith under
the operation of this Act and shall become registered lands."
PD No. 1529
"Sec. 103. Certificate of Title to Patents. Whenever public land is by the
Government alienated, granted or conveyed to any person, the same shall be
brought forthwith under the operation of this Decree." (Emphasis supplied)
Based on its legislative history, the phrase "conveyed to any person" in Section 103 of PD No.
1529 includes conveyances of public lands to public corporations.
Alienable lands of the public domain "granted, donated, or transferred to a province,
municipality, or branch or subdivision of the Government," as provided in Section 60 of CA
No. 141, may be registered under the Torrens System pursuant to Section 103 of PD No.
1529. Such registration, however, is expressly subject to the condition in Section 60 of CA No.
141 that the land "shall not be alienated, encumbered or otherwise disposed of in a manner
affecting its title, except when authorized by Congress." This provision refers to
government reclaimed, foreshore and marshy lands of the public domain that have been titled
but still cannot be alienated or encumbered unless expressly authorized by Congress. The
need for legislative authority prevents the registered land of the public domain from becoming
private land that can be disposed of to qualified private parties.
The Revised Administrative Code of 1987 also recognizes that lands of the public domain may
be registered under the Torrens System. Section 48, Chapter 12, Book I of the Code states
"Sec. 48. Official Authorized to Convey Real Property. Whenever real property of
the Government is authorized by law to be conveyed, the deed of conveyance shall
be executed in behalf of the government by the following:
(1) x x x
(2) For property belonging to the Republic of the Philippines, but titled in the
name of any political subdivision or of any corporate agency or
 instrumentality, by the executive head of the agency or instrumentality." (Emphasis
supplied)
Thus, private property purchased by the National Government for expansion of a public wharf
may be titled in the name of a government corporation regulating port operations in the
country. Private property purchased by the National Government for expansion of an airport
may also be titled in the name of the government agency tasked to administer the airport.
Private property donated to a municipality for use as a town plaza or public school site may
likewise be titled in the name of the municipality.106 All these properties become properties of
the public domain, and if already registered under Act No. 496 or PD No. 1529, remain
registered land. There is no requirement or provision in any existing law for the de-registration
of land from the Torrens System.
Private lands taken by the Government for public use under its power of eminent domain
become unquestionably part of the public domain. Nevertheless, Section 85 of PD No. 1529
authorizes the Register of Deeds to issue in the name of the National Government new
certificates of title covering such expropriated lands. Section 85 of PD No. 1529 states
"Sec. 85. Land taken by eminent domain. Whenever any registered land, or interest
therein, is expropriated or taken by eminent domain, the National Government,
province, city or municipality, or any other agency or instrumentality exercising such
right shall file for registration in the proper Registry a certified copy of the judgment
which shall state definitely by an adequate description, the particular property or
interest expropriated, the number of the certificate of title, and the nature of the
public use. A memorandum of the right or interest taken shall be made on each
certificate of title by the Register of Deeds, and where the fee simple is taken, a new
certificate shall be issued in favor of the National Government, province, city,
municipality, or any other agency or instrumentality exercising such right for the
land so taken. The legal expenses incident to the memorandum of registration or
issuance of a new certificate of title shall be for the account of the authority taking
the land or interest therein." (Emphasis supplied)
Consequently, lands registered under Act No. 496 or PD No. 1529 are not exclusively private
or patrimonial lands. Lands of the public domain may also be registered pursuant to existing
laws.
AMARI makes a parting shot that the Amended JVA is not a sale to AMARI of the Freedom
Islands or of the lands to be reclaimed from submerged areas of Manila Bay. In the words of
AMARI, the Amended JVA "is not a sale but a joint venture with a stipulation for
reimbursement of the original cost incurred by PEA for the earlier reclamation and
construction works performed by the CDCP under its 1973 contract with the Republic."
Whether the Amended JVA is a sale or a joint venture, the fact remains that the Amended
46
JVA requires PEA to "cause the issuance and delivery of the certificates of title conveying
AMARI's Land Share in the name of AMARI."107
This stipulation still contravenes Section 3, Article XII of the 1987 Constitution which provides
that private corporations "shall not hold such alienable lands of the public domain except by
lease." The transfer of title and ownership to AMARI clearly means that AMARI will "hold" the
reclaimed lands other than by lease. The transfer of title and ownership is a "disposition" of
the reclaimed lands, a transaction considered a sale or alienation under CA No. 141,108 the
Government Auditing Code,109 and Section 3, Article XII of the 1987 Constitution.
The Regalian doctrine is deeply implanted in our legal system. Foreshore and submerged
areas form part of the public domain and are inalienable. Lands reclaimed from foreshore and
submerged areas also form part of the public domain and are also inalienable, unless
converted pursuant to law into alienable or disposable lands of the public domain. Historically,
lands reclaimed by the government are sui generis, not available for sale to private parties
unlike other alienable public lands. Reclaimed lands retain their inherent potential as areas for
public use or public service. Alienable lands of the public domain, increasingly becoming
scarce natural resources, are to be distributed equitably among our ever-growing population.
To insure such equitable distribution, the 1973 and 1987 Constitutions have barred private
corporations from acquiring any kind of alienable land of the public domain. Those who
attempt to dispose of inalienable natural resources of the State, or seek to circumvent the
constitutional ban on alienation of lands of the public domain to private corporations, do so at
their own risk.
We can now summarize our conclusions as follows:
1. The 157.84 hectares of reclaimed lands comprising the Freedom Islands, now
covered by certificates of title in the name of PEA, are alienable lands of the
public domain. PEA may lease these lands to private corporations but may not sell
or transfer ownership of these lands to private corporations. PEA may only sell
these lands to Philippine citizens, subject to the ownership limitations in the 1987
Constitution and existing laws.
2. The 592.15 hectares of submerged areas of Manila Bay remain inalienable
natural resources of the public domain until classified as alienable or disposable
lands open to disposition and declared no longer needed for public service. The
government can make such classification and declaration only after PEA has
reclaimed these submerged areas. Only then can these lands qualify as agricultural
lands of the public domain, which are the only natural resources the government
can alienate. In their present state, the 592.15 hectares of submerged areas are
inalienable and outside the commerce of man.
 3. Since the Amended JVA seeks to transfer to AMARI, a private corporation,
ownership of 77.34 hectares110of the Freedom Islands, such transfer is void for
being contrary to Section 3, Article XII of the 1987 Constitution which prohibits
private corporations from acquiring any kind of alienable land of the public domain.

4. Since the Amended JVA also seeks to transfer to AMARI ownership of 290.156
hectares111 of still submerged areas of Manila Bay, such transfer is void for being
contrary to Section 2, Article XII of the 1987 Constitution which prohibits the
alienation of natural resources other than agricultural lands of the public domain.
PEA may reclaim these submerged areas. Thereafter, the government can classify
the reclaimed lands as alienable or disposable, and further declare them no longer
needed for public service. Still, the transfer of such reclaimed alienable lands of the
public domain to AMARI will be void in view of Section 3, Article XII of the 1987
Constitution which prohibits private corporations from acquiring any kind of alienable
land of the public domain.

Clearly, the Amended JVA violates glaringly Sections 2 and 3, Article XII of the 1987
Constitution. Under Article 1409112 of the Civil Code, contracts whose "object or purpose is
contrary to law," or whose "object is outside the commerce of men," are "inexistent and void
from the beginning." The Court must perform its duty to defend and uphold the Constitution,
and therefore declares the Amended JVA null and void ab initio.

Seventh issue: whether the Court is the proper forum to raise the issue of whether the
Amended JVA is grossly disadvantageous to the government.

Considering that the Amended JVA is null and void ab initio, there is no necessity to rule on
this last issue. Besides, the Court is not a trier of facts, and this last issue involves a
determination of factual matters.

WHEREFORE, the petition is GRANTED. The Public Estates Authority and Amari Coastal
Bay Development Corporation are PERMANENTLY ENJOINED from implementing the
Amended Joint Venture Agreement which is hereby declared NULL and VOID ab initio.

SO ORDERED.

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