lepant~1

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FIRST DIVISION

LEPANTO CONSOLIDATED

MINING CO.,

Petitioner,

- versus -

WMC RESOURCES INT’L. PTY.

LTD., WMC PHILIPPINES, INC.

and SAGITTARIUS MINES, INC., Respondents.

G.R. No. 1621

Present:

PANGANIBAN, CJ

Chairperson,

YNARES-SANTIAGO,

AUSTRIA-MARTINE,

CA!!E"O, SR., and

C#ICO-NAARIO, JJ .

Pro$%&'ated:

No!"#$"% 2&, 2&&6

(- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -(

) E C I S I O N

C#ICO-NAARIO, J .:

Be*ore Us is a Petition *or Re+ie on Certiorari %nder R%&e o* the

R%&es o* Ci+i& Pro/ed%re, assai&in' the )e/ision0 o* the Co%rt o* Appea&s in

CA-G.R. SP No. 1020, dated 30 No+e$4er 3556, hi/h dis$issed herein

petitioner7s Petition *or Re+ie o* the )e/ision3 o* the O**i/e o* the

President dated 36 "%&8 3553 a**ir$in' in toto the Order 6 o* the Se/retar8 o*

the )epart$ent o* En+iron$ent and Nat%ra& Reso%r/es 9)ENR dated 0;)e/e$4er 3550 appro+in' the app&i/ation *or and the /onse<%ent

0 Penned 48 Asso/iate "%sti/e Ro$eo A. Braner, ith Asso/iate "%sti/es "ose !. Sa4io, "r.

and "ose C. Re8es, "r., /on/%rrin'. Rollo, pp. -2;.3 O.P. Case No. 53-A-536= id. at 61>-6>0.6 Re: Trans*er o* the ?inan/ia& and Te/hni/a& Assistan/e A'ree$ent )eno$inated as ?TAA

No. 53- >-@I= id. at 603-60.

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re'istration o* ?TAA No. 53->-@I *ro$ MC Phi&ippines to Sa'ittari%s

Mines, In/.

On 33 Mar/h 0>>, the Phi&ippine Go+ern$ent and MC

Phi&ippines, the &o/a& ho&&8-oned s%4sidiar8 o* MC Reso%r/es

Internationa& Pt8. !td. 9MC Reso%r/es e(e/%ted a ?inan/ia& and Te/hni/a&

Assistan/e A'ree$ent, deno$inated as the Co&%$4io ?TAA No. 53->-@I

9Co&%$4io ?TAA *or the p%rpose o* &ar'e s/a&e e(p&oration, de+e&op$ent,

and /o$$er/ia& e(p&oration o* possi4&e $inera& reso%r/es in an initia&

/ontra/t area o* >>,6;1 he/tares &o/ated in the pro+in/es o* So%th Cota4ato,

S%&tan %darat, )a+ao de& S%r, and North Cota4ato in a//ordan/e ith

E(e/%ti+e Order No. 31> and )epart$ent Ad$inistrati+e Order No. 26,

Series o* 0>>0.

The Co&%$4io ?TAA is /o+ered in part 48 02 $inin' /&ai$s he&d

%nder +ario%s Minera& Prod%/tion Sharin' A'ree$ents 9MPSA 48 So%th/ot

Minin' Corporation, Ta$paan Minin' Corporation, and Sa'ittari%s Mines,

In/. 9/o&&e/ti+e&8 /a&&ed the Ta$paan Co$panies, in a//ordan/e ith the

Ta$paan Option A'ree$ent entered into 48 MC Phi&ippines and the

Ta$paan Co$panies on 3 Apri& 0>>0, as a$ended 48 A$endator8

A'ree$ent dated 0 "%&8 0>>, *or p%rposes o* e(p&oration o* the $inin'

/&ai$s in Ta$paan, So%th Cota4ato. The Option A'ree$ent, a$on' other

thin's, pro+ides *or the 'rant o* the ri'ht o* *irst re*%sa& to the Ta$paan

Co$panies in /ase MC Phi&ippines desires to dispose o* its ri'hts and

interests in the $inin' /&ai$s /o+erin' the area s%4De/t o* the a'ree$ent.

MC Reso%r/es s%4se<%ent&8 di+ested itse&* o* its ri'hts and interests

in the Co&%$4io ?TAA, and on 03 "%&8 3555 e(e/%ted a Sa&e and P%r/hase

A'ree$ent ith petitioner !epanto o+er its entire shareho&din's in MC

Phi&ippines, s%4De/t to the e(er/ise o* the Ta$paan Co$panies7 e(er/ise o*

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their ri'ht o* *irst re*%sa& to p%r/hase the s%4De/t shares. On 3; A%'%st 3555,

petitioner so%'ht the appro+a& o* the 03 "%&8 3555 A'ree$ent *ro$ the

)ENR Se/retar8.

In an A'ree$ent dated 2 O/to4er 3555, hoe+er, the Ta$paan

Co$panies so%'ht to e(er/ise its ri'ht o* *irst re*%sa&. Th%s, in a &etter dated

06 O/to4er 3555, petitioner assai&ed the Ta$paan Co$panies7 e(er/ise o*

its ri'ht o* *irst re*%sa&, a&&e'in' that the Ta$paan Co$panies *ai&ed to

$at/h the ter$s and /onditions set *orth in the 03 "%&8 3555 A'ree$ent.

Therea*ter, petitioner *i&ed a /ase *or InD%n/tion, Spe/i*i/

Per*or$an/e, Ann%&$ent o* Contra/ts and Contra/t%a& Inter*eren/e ith the

Re'iona& Tria& Co%rt o* Maati, Bran/h 06, a'ainst MC Reso%r/es,

MC Phi&ippines, and the Ta$paan Co$panies. MC Phi&ippines and

the Ta$paan Co$panies $o+ed *or the dis$issa& o* said /ase. Said

Motion to )is$iss ha+in' 4een denied, MC Phi&ippines /ha&&en'ed the

order dis$issin' the Motion on appea& 4e*ore the Co%rt o* Appea&s hi/h

s%4se<%ent&8 ordered the dis$issa& o* the /ase on the 'ro%nd o* *or%$

shoppin' in this ise:

Ne+erthe&ess, the Co%rt *inds that pri+ate respondent is '%i&t8 o*

*or%$-shoppin'. There is *or%$-shoppin' hene+er, as a res%&t o* anad+erse opinion in one *or%$, a part8 sees a *a+ora4&e opinion 9other

than 48 appea& or /ertiorari in another. The prin/ip&e app&ies not on&8

ith respe/t to s%its *i&ed in /o%rts 4%t a&so in /onne/tion ith &iti'ation/o$$en/ed in the /o%rts hi&e an ad$inistrati+e pro/esses and in

anti/ipation o* an %n*a+ora4&e ad$inistrati+e r%&in' and a *a+ora4&e /o%rt

r%&in'.

In this /ase, petitioners ar'%e that pri+ate respondent is '%i&t8 o* *or%$ shoppin' *or ha+in' &od'ed the /o$p&ain 4e*ore respondent Co%rt

pendin' a/tion 48 the Se/retar8 o* the )ENR thro%'h the Mines and Geo-S/ien/es B%rea% 9MGB on its appro+a& o* the Sa&e and P%r/hase

A'ree$ent dated "%&8 03, 3555. Pri+ate respondent on the other hand,

)o/eted as Ci+i& Case No. 50-;1. CA G.R. SP No. 2>2.

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opposes the *ore'oin' /ontention ar'%in' that the MGB i&& 4e $ere&8e(er/isin' its ad$inistrati+e not <%asi-D%di/ia& poer.

The a/tion 4e*ore respondent /o%rt as *i&ed 48 pri+ate respondent

to /o$pe& petitioner MC Reso%r/es to /on+e8 its e<%it8 in MC Phi&s.and #i&&/rest to the *or$er. Meanhi&e, in the /ase 4e*ore the MGB,

pri+ate respondent so%'ht the appro+a& o* Sa&e and that the MGB7s

a%thorit8 o+er the /ase is p%re&8 ad$inistrati+e, 4%t *%rther re+ie shosthat pri+ate respondent raised /ontentio%s iss%es hi/h need reso&%tion 48

the MGB 4e*ore it /an re/o$$end an8 appro+a& to the Se/retar8 o* the

)ENR. Parti/%&ar&8, in its &etter dated O/to4er 06, 3555 to the Se/retar8

o* the )ENR, pri+ate respondent posed its o4De/tion to the appro+a& o* theSa&es and P%r/hase a'ree$ents 4eteen MC Reso%r/es and the

Ta$paan Co$panies, assertin' that the &atter *ai&ed to +a&id&8 e(er/ise its

ri'ht o* *irst re*%sa&. A&so, in its &etter to the )ire/tor o* the MGB dated)e/e$4er ;, 3555, pri+ate respondent spe&&ed o%t in detai& its reasons *or

o4De/tin' to the a'ree$ent 4eteen MC Reso%r/es and the Ta$paan

Co$panies, and in the sa$e 4reath, ar'%ed *or the appro+a& o* its on/ontra/t. And 4e/a%se o* the opposin' /&ai$s posited 48 pri+ate

respondent and petitioners, the MGB as /onstrained to re<%ire the parties

to s%4$it their respe/ti+e /o$$ents. At the D%n/t%re, the MGB7s a%thorit8/eased to 4e ad$inistrati+e. E+ident&8, the MGB has to re+ie a&& these

opposin' /ontentions and reso&+e the sa$e. A reso&%tion o* the MGB onhi/h /ontra/t to re/o$$end or endorse to the Se/retar8 o* the )ENR *or appro+a& i&& ne/essari&8 in/&%de a de/&aration on the +a&idit8 o* the

di**erent Sa&e and P%r/hase A'ree$ents e(e/%ted 4eteen the disa'reein'

parties, as e&& as on the e(er/ise o* the Ta$paan Co$panies e(er/ise o*

its ri'ht o* *irst re*%sa& and its <%a&i*i/ation as a /ontra/tor %nder the?TAA. E+en the MGB is aare that the disp%te re+o&+es aro%nd these

sa&es and p%r/hase a'ree$ents. #en/e, it /annot 4e 'ainsaid that the

MGB i&& 4e e(er/isin' its <%asi-D%di/ia& poers in reso&+in' the /on*&i/t 4e*ore it. hether the MGB /an +a&id&8 e(er/ise s%/h D%risdi/tion o+er

the /ontro+ers8 is another iss%e 4%t nonethe&ess i$$ateria& in deter$inin'

hether pri+ate respondent is '%i&t8 o* *or%$-shoppin'. hat isdeter$inati+e is the *i&in' o* to 93 separate a/tions in di**erent *or a

4ased prin/ipa&&8 on the sa$e /a%se on the s%pposition that one or the

other /o%rt o%&d $ae a *a+ora4&e disposition. Th%s, it is not hi'h&8

%n&ie&8 that respondent Co%rt and MGB i&& /o$e %p ith /on*&i/tin' prono%n/e$ents on the disp%te, there48 /reatin' a <%andar8 as to hi/h

one i&& pre+ai&. Pri+ate respondent7s a/t %ndisp%ta4&8 /onstit%tes a /&ear

/ase o* *or%$-shoppin', a 'ro%nd *or s%$$ar8 dis$issa& ith preD%di/e o* the a/tion. The respondent /o%rt /o$$itted 'ra+e a4%se o* dis/retion in

re*%sin' to dis$iss Ci+i& Case No. 50-5;1 on 'ro%nd o* *or%$-shoppin'.2

ith the denia& o* petitioner7s Motion *or Re/onsideration, the /ase1

as e&e+ated to this Co%rt. In a )e/ision dated 3 Septe$4er 3556, the

2 Rollo, pp. 635-633.1 Lepanto Consolidated Mining Co. v. WMC Resources Int’l. Pty Ltd., G.R. Nos. 06;;

0230, 3 Septe$4er 3556, ; SCRA 150.

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Co%rt a**ir$ed the )e/ision o* the appe&&ate /o%rt and dis$issed the

petition. In said )e/ision, the Co%rt e&%/idated that:

Tr%e, the <%estioned a'ree$ents o* sa&e 4eteen petitioner and

MC on one hand and 4eteen MC and the Ta$paan Co$panies onthe other pertain to trans*er o* shares o* sto/ *ro$ one entit8 to another.

B%t said shares o* sto/ represent onership o* $inin' ri'hts or interest in

$inin' a'ree$ents. #en/e, the poer o* the MGB to r%&e on the +a&idit8

o* the <%estioned a'ree$ents o* sa&e, hi/h as raised 48 petitioner

4e*ore the )ENR, is ine(tri/a4&8 &ined to the +er8 nat%re o* s%/ha'ree$ents o+er hi/h the MGB has D%risdi/tion %nder the &a.

Una+oida4&8, there is identit8 o* re&ie*s that petitioner sees *ro$ 4oth theMGB and the RTC.

?or%$ shoppin' e(ists hen 4oth a/tions in+o&+e the sa$etransa/tions, sa$e essentia& *a/ts and /ir/%$stan/es and raise identi/a&

/a%ses o* a/tions, s%4De/t $atter, and iss%es. S%/h e&e$ents are e+ident&8

present in 4oth the pro/eedin's 4e*ore the MGB and 4e*ore the tria& /o%rt.The /ase instit%ted ith the RTC as th%s /orre/t&8 ordered dis$issed 48

the appe&&ate /o%rt on the 'ro%nd o* *or%$ shoppin'. Besides, not on&8 did

petitioner /o$$it *or%$ shoppin' 4%t it a&so *ai&ed to e(ha%stad$inistrati+e re$edies 48 optin' to 'o ahead in seein' re&ie*s *ro$ the/o%rt e+en hi&e those sa$e re&ie*s ere appropriate&8 aaitin' reso&%tion

48 the MGB.;

In the interi$, on 05 "an%ar8 3550, /ontendin' that the 03 "%&8

A'ree$ent 4eteen petitioner and MC Phi&ippines had e(pired d%e to

*ai&%re to $eet the ne/essar8 pre/onditions *or its +a&idit8, MC Reso%r/es

and the Ta$paan Co$panies e(e/%ted another Sa&e and P%r/hase

A'ree$ent, here Sa'ittari%s Mines, In/. as desi'nated assi'nee and

/orporate +ehi/&e hi/h o%&d a/<%ire the shareho&din's and %ndertae the

Co&%$4io ?TAA a/ti+ities. On 0 "an%ar8 3550, Sa'ittari%s Mines, In/.

in/reased its a%thoriFed /apita&iFation to P35 $i&&ion. S%4se<%ent&8, MC

Reso%r/es and Sa'ittari%s Mines, In/. e(e/%ted a )eed o* A4so&%te Sa&e o*

Shares o* Sto/s on 36 "an%ar8 3550.

A*ter d%e /onsideration and e+a&%ation o* the *inan/ia& and te/hni/a&

<%a&i*i/ations o* Sa'ittari%s Mines, In/., the )ENR Se/retar8 appro+ed the

; Id. at 105-100.

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trans*er o* the Co&%$4io ?TAA *ro$ MC Phi&ippines to Sa'ittari%s Mines,

In/. in the assai&ed Order. A//ordin' to said Order, p%rs%ant to Se/tion 22

o* )epart$ent Ad$inistrati+e Order No. >2-5, as a$ended, Sa'ittari%s

Mines, In/. $eets the <%a&i*i/ation re<%ire$ents as Contra/tor-Trans*eree o*

?TAA No. 53->-@I, and that the app&i/ation *or trans*er o* said ?TAA ent

thr% the pro/ed%re and other re<%ire$ents set *orth %nder the &a.

A''rie+ed 48 the trans*er o* the Co&%$4io ?TAA in *a+or o*

Sa'ittari%s Mines, In/., petitioner *i&ed a Petition *or Re+ie o* the Order o*

the )ENR Se/retar8 ith the O**i/e o* the President. Petitioner assai&s the

+a&idit8 o* the 0; )e/e$4er 3550 Order on the 'ro%nd that: 0 it +io&ates the

/onstit%tiona& ri'ht o* !epanto to d%e pro/ess= 3 it pree$pts the reso&%tion

o* +er8 /r%/ia& &e'a& iss%es pendin' ith the re'%&ar /o%rts= and 6 it

4&atant&8 +io&ates Se/tion 5 o* the Minin' A/t.

In a )e/ision dated 36 "%&8 3553, the O**i/e o* the President

dis$issed the petition in this ise:

At the o%tset, it 4ears e$phasis that <%ite /ontrar8 to the ar'%$ent

o* petitioner !epanto, the a4o+e Order o* the )ENR Se/retar8 is not

+io&ati+e o* the Minin' !a. Sin/e the s%4De/t Co&%$4io ?TAA as'ranted in a//ordan/e ith the pertinent pro+isions o* E(e/%ti+e Order

No. 31> and )epart$ent Ad$inistrati+e Order No. 26 on 33 Mar/h 0>>,

or prior to the e**e/ti+it8 o* the Phi&ippine Minin' A/t o* 0>>, espe/ia&&8as it hi'h&i'hts the non-i$pair$ent o* e(istin' $inin' andor <%arr8in'

ri'hts, %nder Se/tion 0.0 94 thereo*, on&8 the /onsent o* )ENR Se/retar8

is re<%ired. To ho&d otherise o%&d 4e to %nd%&8 i$pose a 4%rden ontrans*eror MC and there48 restri/t its *reedo$ to dispose o* or a&ienate

this propert8 ri'ht itho%t d%e pro/ess. Th%s, %nder the Re+ised

I$p&e$entin' R%&es and Re'%&ations o* the Phi&ippine Minin' A/t o* 0>>, Chapter @@@ thereo* e(press&8 e/hoes the '%arant8:

HSe/tion 313. Non-Impairment o !"isting

Mining#$uarrying Rig%ts.- A&& +a&id and e(istin' $inin'&ease /ontra/ts, per$its&i/enses, &eases pendin' renea&,

Minera& Prod%/tion Sharin' A'ree$ents, ?TAA 'ranted

%nder E(e/%ti+e Order No. 31>, at the date o* the A/t sha&&

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re$ain +a&id, sha&& not 4e i$paired and sha&& 4e re/o'niFed 48 the Go+ern$ent ( ( (.

( ( ( Pro+ided, *ina&&8, That this pro+ision is

app&i/a4&e on&8 to a&& ?TAAMPSA app&i/ations *i&ed %nder )epart$ent Ad$inistrati+e Order No. 26 prior to the

e**e/ti+it8 o* the a/t and these i$p&e$entin' r%&es and

re'%&ations.

As /orre/t&8 stated 48 the MGB )ire/tor and a**ir$ed 48 the

)ENR Se/retar8, Se/tion 0.0 o* the Co&%$4io ?TAA pro+ides that the

?TAA $a8 4e trans*erred pro+ided that the Se/retar8 /onsents to thesa$e. P%rs%ant to Se/tion 003 o* the Minin' A/t and Se/tion 313 o* )AO

No. >2-5, as a$ended, on non-i$pair$ent o* e(istin' $inin' ri'hts, the

s%4De/t app&i/ation *or trans*er o* the Co&%$4io ?TAA to Sa'ittari%sre<%ires on&8 the appro+a& o* the )ENR Se/retar8.

Moreo+er, there is no $erit in petitioner !epanto7s ar'%$ent thatthe )ENR Se/retar8 and /onse<%ent&8, this O**i/e, has no D%risdi/tion

o+er the s%4De/t $atter in iss%e. The assai&ed Order o* the )ENR

Se/retar8 as p%rs%ant to the &atter7s e(er/ise o* the e&&-entren/heddo/trine o* pri$ar8 D%risdi/tion o* ad$inistrati+e a'en/ies.

B8 +irt%e o* the operation o* the do/trine o* pri$ar8 D%risdi/tion,H/o%rts /annot and i&& not deter$ine a /ontro+ers8 in+o&+in' a <%estion

hi/h is ithin the D%risdi/tion o* an ad$inistrati+e tri4%na&, espe/ia&&8

here the <%estion de$ands the e(er/ise o* so%nd ad$inistrati+e

dis/retion re<%irin' the spe/ia& no&ed'e, e(perien/e and ser+i/es o* thetri4%na& to deter$ine te/hni/a& and intri/ate $atters o* *a/t and here a

%ni*or$it8 o* r%&in' is essentia& to /o$p&8 ith the p%rposes re'%&ator8

stat%te ad$inistered. 9 Province o &am'oanga del Norte v. Court o (ppeals, 63 SCRA > J3555K= )actoran v. Court o (ppeals, 635 SCRA

65 J0>>>K= *rett v. Intermediate (ppellate Court, 0>0 SCRA 2;1 J0>>5K=

$ualitrans Limousine +ervice, Inc. v. Royal Class Limousine +ervice, 01>SCRA 2> J0>;>K. Th%s, e+en tho%'h an a/tion $a8 4e &od'ed in /o%rt

that is ostensi4&8 *or ann%&$ent or Hres/ission o* hat appears to 4e an

ordinar8 /i+i& /ontra/t /o'niFa4&e 48 a /i+i& /o%rt, the do/trine o* pri$ar8

D%risdi/tion sti&& app&ies. 9 Industrial !nterprises, Inc. v. Court o (ppeals,0; SCRA 32 J0>>5K.

Se/tion , Chapter 0, Tit&e @IL, Boo IL o* the Ad$inistrati+eCode o* 0>;1 spe/i*ies the poers and *%n/tions o* the )ENR. A&so, the

Phi&ippine Minin' A/t o* 0>> pro+ides that the )ENR Hsha&& 4e the

pri$ar8 'o+ern$ent a'en/8 responsi4&e *or the /onser+ation,

$ana'e$ent, de+e&op$ent, and proper %se o* the State7s $inera& reso%r/esin/&%din' those in reser+ations, atershed areas, and &ands o* the p%4&i/

do$ain. The Se/retar8 sha&& ha+e the a%thorit8 to enter into $inera&a'ree$ents on 4eha&* o* the Go+ern$ent %pon the re/o$$endation o* the

)ire/tor, pro$%&'ate s%/h r%&es and re'%&ations as $a8 4e ne/essar8 to

i$p&e$ent the intent and pro+isions o* this A/t. 9Chapter II, Se/tion ;.

Sin/e an ?TAA is Ha /ontra/t in+o&+in' *inan/ia& or te/hni/a& assistan/e*or &ar'e-s/a&e e(p&oration, de+e&op$ent and %ti&iFation o* $inera&

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reso%r/es 9 I'id ., Chapter 0, Se/tion 6 JrK, an8 iss%e a**e/tin' the sa$e isind%4ita4&8 ithin the pri$ar8 D%risdi/tion o* the )ENR, as in *a/t, the

'o+ern$ent enters into ?TAA7s thro%'h the )ENR 9 I'id ., Chapter LI,

Se/tion 66.

There is no disp%te that the instant /ase in+o&+es and re<%ires the

spe/ia& te/hni/a& no&ed'e and e(pertise o* the )ENR. In the

deter$ination 48 the )ENR o* a H<%a&i*ied person p%rs%ant to thePhi&ippine Minin' A/t o* 0>>, s%/h person $%st possess the te/hni/a& and

*inan/ia& /apa4i&it8 to %ndertae $inera& reso%r/es de+e&op$ent.

9Chapter I, Se/tion 6 Ja<K O4+io%s&8, this deter$ination pe/%&iar&8 &ies

ithin the e(pertise o* the )ENR.

The +a&idit8 o* the s%//essi+e trans*ers is not a /i+i& iss%e, /ontrar8

to the a&&e'ation o* petitioner !epanto, 4e/a%se +a&idit8 o* trans*er depends on te/hni/a& <%a&i*i/ations o* the trans*eree and /o$p&ian/e ith

the )ENR re<%ire$ents on <%a&i*i/ations, a&& o* hi/h re<%ire

ad$inistrati+e e(pertise. No'a$(), *"'+'+on"% L"*an'o + "'o**"d -%o#

aa+(+n '/" *%+#a%) 0%+d+'+on o- '/" DENR +n" *"'+'+on"%

L"*an'o +'"(- an/o%"d +' P"'+'+on 3cf . **. 457 on '/" on'"n'+on '/a',

a((""d(), 8'/" Ta#*a9an Co#*an+" -a+("d 'o #a'/ '/" '"%# and

ond+'+on o- '/" :() 12 A%""#"n' ;+'/ *"'+'+on"% L"*an'o +n '/a'

'/") d+d no' *o" '/" -+nan+a( and '"/n+a( <a(+-+a'+on nd"%'/" M+n+n A' and +' I#*("#"n'+n R("=. P"'+'+on"% L"*an'o’

o$0"'+on '/"%"-o%" o +n'o '/" !"%) <a(+-+a'+on o- a '%an-"%""

;/+/ + a '"/n+a( +".

This /ontention is a re/o'nition 48 petitioner !epanto itse&* o* the*a/t that the /r%/ia& and deter$inati+e iss%e in the instant /ase is 'ro%nded

on the *inan/ia& and te/hni/a& <%a&i*i/ations o* a trans*eree, hi/h iss%e,

indisp%ta4&8, is ithin the e(/&%si+e do$ain and e(pertise o* the )ENR and not o* the /o%rts.

( ( ( (

Mo%"o!"%, *"'+'+on"% L"*an'o, $) +' ond', + aa+n "'o**"d

-%o# aa+(+n '/" DENR’ 0%+d+'+on a-'"% a'+!"() *a%'++*a'+n +n

'/" *%o""d+n '/"%"+n and ""9+n a--+%#a'+!" %"(+"-. A part8 hoin+oed the D%risdi/tion Jo*K a tri4%na& and a/ti+e&8 parti/ipated in the

pro/eedin's therein /annot i$p%'n s%/h D%risdi/tion hen *a/ed ith an

ad+erse de/ision. 9c. *riad (gro evelopment Corporation v. dela +erna,01 SCRA 3 J0>;>K.> JE$phasis o%rsK

ith the denia& o* its Motion *or Re/onsideration, petitioner &od'ed an

appea& 4e*ore the Co%rt o* Appea&s hi/h as /onse<%ent&8 dis$issed 48

> OP )e/ision pp. -2, 00-03= rollo, pp. 6;3-6;, 6;>-6>5.

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the appe&&ate /o%rt in the herein assai&ed )e/ision. A//ordin' to the Co%rt

o* Appea&s:

Petitioner *or/e*%&&8 ar'%es that the )ENR Se/retar8 had %s%rped

the poer o* the President o* the Phi&ippines to appro+e the trans*er o*

?TAA, as %nder the pro+ision o* Se/tion 5 o* the Phi&ippine Minin' A/to* 0>>, an8 trans*er or assi'n$ent o* an ?TAA has to 4e appro+ed not 48

the )ENR Se/retar8 4%t 48 the President.

The ar'%$ent does not ash.

The iss%e hin'es on the app&i/a4i&it8 o* Se/tion 5 o* RA 1>3 or

the Phi&ippine Minin' A/t o* 0>>, hi/h too *or/e on 0 Apri& 0>>, onthe trans*er o* ?TAA *ro$ MC to the Ta$paan Co$panies, parti/%&ar&8

the Sa'ittari%s Mines, In/.

The said &a pro+ides:

HSe/. 5. Assi'n$entTrans*er A *inan/ia& or te/hni/a& assistan/e a'ree$ent $a8 4e assi'ned or

trans*erred, in ho&e or in part, to a <%a&i*ied person s%4De/tto the prior appro+a& o* the President: Pro+ided, that thePresident sha&& noti*8 Con'ress o* e+er8 *inan/ia& or

te/hni/a& assistan/e a'ree$ent assi'ned or /on+erted in

a//ordan/e ith this pro+ision ithin thirt8 965 da8s *ro$

the date o* appro+a&.

#oe+er, the a4o+e pro+ision does not app&8 to the Co&%$4io

?TAA hi/h as entered into 48 and 4eteen the Phi&ippine Go+ern$entand MCP on 33 Mar/h 0>>, or prior to the e**e/ti+it8 o* RA No. 1>3.

Se/tion 0.0 o* the Co&%$4io ?TAA, %nder hi/h the Ta$paan

Co$panies /&ai$ their ri'hts to *irst re*%sa&, reads:

H0.0 Assi'n$ent

HThe Contra/tor $a8 assi'n, trans*er, /on+e8 or otherisedispose o* a&& or an8 part o* its interest in the A'ree$ent

pro+ided that s%/h assi'n$ent, trans*er, /on+e8an/e or

disposition does not in*rin'e an8 Phi&ippine &a app&i/a4&eto *orei'n onership:

9a to an A**i&iate pro+ided that it 'i+es noti/e o* s%/h

assi'n$ent to the Se/retar8 ithin 65 da8s a*ter s%/hassi'n$ent= or

94 to an8 third part8 pro+ided that the Se/retar8 /onsentsto the sa$e, hi/h /onsent sha&& not 4e %nreasona4&8

ithhe&d.

Se/tion 05, Arti/&e III o* the Phi&ippine Constit%tion enDoinsCon'ress *ro$ passin' a &a i$pairin' the o4&i'ation o* /ontra/ts. It is

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a(io$ati/ that a &a that i$pairs an o4&i'ation o* /ontra/t a&so +io&ates thed%e pro/ess /&a%se. The o4&i'ation o* an e(istin' /ontra/t is i$paired

hen its ter$s and /onditions are /han'ed 48 &a, ordinan/e, or an8

iss%an/e ha+in' the *or/e o* &a, there48 eaenin' the position or

di$inishin' the ri'hts o* a part8 to the /ontra/t. The e(tent o* the /han'eis not $ateria&. It is not a <%estion o* de'ree or $anner or /a%se, 4%t o*

en/roa/hin' in an8 respe/t on its o4&i'ations or dispensin' ith an8 part

o* its *or/e. I$pair$ent has a&so 4een predi/ated on &as hi/h, itho%tdestro8in' /ontra/ts, dero'ate *ro$ s%4stantia& /ontra/t%a& ri'hts.

The /ondition o* RA No. 1>3 re<%irin' the *%rther appro+a& o* the

President, i* $ade to app&8 retroa/ti+e&8 to the Co&%$4io ?TAA, o%&di$pair the o4&i'ation o* /ontra/ts si$p&8 4e/a%se it /onstit%tes a

restri/tion on the ri'ht o* the /ontra/tor to assi'n or trans*er its interest in

an ?TAA. In other ords, it di$inished the +ested ri'hts o* the /ontra/tor to assi'n or trans*er its interests on $ere appro+a& o* the )ENR Se/retar8.

The restri/tion is there*ore s%4stanti+e, and not $ere&8 pro/ed%ra&,

/ontrar8 to the /ontention o* petitioner.

( ( ( (

!ieise $i&itatin' a'ainst the petitioner7s side is the do/trine that

stat%tes are to 4e /onstr%ed as ha+in' on&8 a prospe/ti+e operation %n&essthe p%rpose and intention o* the !e'is&at%re to 'i+e the$ a retrospe/ti+ee**e/t is e(press&8 de/&ared or is ne/essari&8 i$p&ied *ro$ the &an'%a'e

%sed. In /ase o* do%4t, the do%4t $%st 4e reso&+ed a'ainst the

retrospe/ti+e e**e/t. At an8 rate, e+en i* RA No. 1>3 4e a//orded a

retroa/ti+e e**e/t, this does not ipso acto per$it the app&i/ation o* there<%ire$ent o* se/%rin' a prior presidentia& /onsent to the trans*er o*

?TAA, *or, to iterate, this o%&d i$pair the o4&i'ation o* /ontra/t. In s%/h

a /ase, the /orre/t app&i/ation o* RA No. 1>3 is *or the pro+isions to J4eK$ade to app&8 on e(istin' ?TAAs on&8 i* the sa$e o%&d not res%&t in

i$pair$ent o* o4&i'ation o* /ontra/ts.

This is as it sho%&d 4e. To ho&d otherise o%&d 4e to %nd%&8

i$pose a 4%rden on trans*eror MC and there48 restri/t its *reedo$ to

dispose o* or a&ienate its propert8 ri'ht itho%t d%e pro/ess. It /onstit%tes

i$pair$ent o* o4&i'ation o* /ontra/ts, hi/h the ?%nda$enta& !aenDoins, and /ontra+enes the do/trine o* prospe/ti+e app&i/ation o* &as.05

#en/e, the instant Petition.

The pi+ota& iss%e to 4e reso&+ed herein in+o&+es the propriet8 o* the

app&i/ation to the Co&%$4io ?TAA o* Rep%4&i/ A/t No. 1>3 or the

Phi&ippine Minin' A/t o* 0>>, parti/%&ar&8 Se/tion 5 thereo* re<%irin' the

05 CA )e/ision, pp. 2->= rollo, pp. 25-26.

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appro+a& o* the President o* the assi'n$ent or trans*er o* *inan/ia& or

te/hni/a& assistan/e a'ree$ents. Petitioner $aintains that respondents *ai&ed

to /o$prehend the e(press &an'%a'e o* Se/tion 5 o* the Phi&ippine Minin'

A/t o* 0>> re<%irin' the appro+a& o* the President on the trans*er or

assi'n$ent o* a *inan/ia& or te/hni/a& assistan/e a'ree$ent.

To reso&+e this $atter, it is i$perati+e at this point to stress the *a/t

that the Co&%$4io ?TAA as entered into 48 the Phi&ippine Go+ern$ent

and MC Phi&ippines on 33 Mar/h 0>>, %ndo%4ted&8 4e*ore the Phi&ippine

Minin' A/t o* 0>> too e**e/t on 0 Apri& 0>>. ?%rther$ore, it is

%ndisp%ted that said ?TAA as 'ranted in a//ordan/e ith E(e/%ti+e Order

No. 31> and )epart$ent Ad$inistrati+e Order No. 26, Series o* 0>>0,

hi/h does not /ontain an8 si$i&ar /ondition on the trans*er or assi'n$ent

o* *inan/ia& or te/hni/a& assistan/e a'ree$ents. Th%s, it o%&d see$ that

hat petitioner o%&d ant this Co%rt to espo%se is the retroa/ti+e

app&i/ation o* the Phi&ippine Minin' A/t o* 0>> to the Co&%$4io ?TAA, a

+a&id a'ree$ent /on/&%ded prior to the naissan/e o* said pie/e o* &e'is&ation.

This post%re o* petitioner o%&d /&ear&8 /ontradi/t the esta4&ished

&e'a& do/trine that stat%tes are to 4e /onstr%ed as ha+in' on&8 a prospe/ti+e

operation %n&ess the /ontrar8 is e(press&8 stated or ne/essari&8 i$p&ied *ro$

the &an'%a'e %sed in the &a. As reiterated in the /ase o* +egovia v. Noel,

a so%nd /annon o* stat%tor8 /onstr%/tion is that a stat%te operates

prospe/ti+e&8 on&8 and ne+er retroa/ti+e&8, %n&ess the &e'is&ati+e intent to the

/ontrar8 is $ade $ani*est either 48 the e(press ter$s o* the stat%te or 48

ne/essar8 i$p&i/ation.

Arti/&e o* the Ci+i& Code pro+ides that: H!as sha&& not ha+e a

retroa/ti+e e**e/t %n&ess therein otherise pro+ided. A//ordin' to this

00 1 Phi&. 6 90>3.

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pro+ision o* &a, in order that a &a $a8 ha+e retroa/ti+e e**e/t it is

ne/essar8 that an e(press pro+ision to this e**e/t 4e $ade in the &a,

otherise nothin' sho%&d 4e %nderstood hi/h is not e$4odied in the &a.03

?%rther$ore, it $%st 4e 4orne in $ind that a &a is a r%&e esta4&ished to

'%ide o%r a/tions itho%t no 4indin' e**e/t %nti& it is ena/ted, here*ore, it

has no app&i/ation to past ti$es 4%t on&8 to *%t%re ti$e, and that is h8 it is

said that the &a &oos to the *%t%re on&8 and has no retroa/ti+e e**e/t %n&ess

the &e'is&ator $a8 ha+e *or$a&&8 'i+en that e**e/t to so$e &e'a& pro+isions.06

In the /ase at 4ar, there is an a4sen/e o* either an e(press de/&aration

or an i$p&i/ation in the Phi&ippine Minin' A/t o* 0>> that the pro+isions o*

said &a sha&& 4e $ade to app&8 retroa/ti+e&8, there*ore, an8 se/tion o* said

&a $%st 4e $ade to app&8 on&8 prospe/ti+e&8, in +ie o* the r%&e that a

stat%te o%'ht not to re/ei+e a /onstr%/tion $ain' it a/t retroa/ti+e&8, %n&ess

the ords %sed are so /&ear, stron', and i$perati+e that no other $eanin'

/an 4e anne(ed to the$, or %n&ess the intention o* the &e'is&at%re /annot 4e

otherise satis*ied.0

Be that as it $a8, ass%$in' *or the sae o* ar'%$ent that e are to

app&8 the Phi&ippine Minin' A/t o* 0>> retrospe/ti+e&8 to the Co&%$4io

?TAA, the &a/ o* presidentia& appro+a& i&& not 4e *ata& as to render the

trans*er i&&e'a&, espe/ia&&8 sin/e, as in the instant /ase, the a&&e'ed &a/ o*

presidentia& appro+a& has 4een re$edied hen petitioner appea&ed the $atter

to the O**i/e o* the President hi/h appro+ed the Order o* the )ENR

Se/retar8 'rantin' the app&i/ation *or trans*er o* the Co&%$4io ?TAA to

Sa'ittari%s Mines, In/. As e(po%nded 48 the Co%rt in the Reso&%tion o* the

03 *alat'at v. Court o (ppeals, G.R. No. 6261;, 31 "an%ar8 0>>3, 35 SCRA 0>, 32.06 Id.0 S%pra note >.

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Motion *or Re/onsideration in the La *ugal-*’Laan ri'al (ssociation, Inc.

v. Ramos/ /ase, in+o&+in' the sa$e ?TAA s%4De/t o* the instant /ase:

( ( ( Moreo+er, hen the trans*eree o* an ?TAA is another *orei'n

/orporation, there is a &o'i/a& app&i/ation o* the re<%ire$ent o* prior appro+a& 48 the President o* the Rep%4&i/ and noti*i/ation to Con'ress in

the e+ent o* assi'n$ent or trans*er o* an ?TAA. In this sit%ation, s%/h

appro+a& and noti*i/ation are appropriate sa*e'%ards, /onsiderin' that the

ne /ontra/tor is the s%4De/t o* a *orei'n 'o+ern$ent.

On '/" o'/"% /and, ;/"n '/" '%an-"%"" o- '/" FTAA /a**"n

'o $" a F+(+*+no o%*o%a'+on, '/" n""d -o% / a-"a%d + no'

%+'+a(> /"n", '/" (a9 o- *%+o% a**%o!a( and no'+-+a'+on #a) no' $"

d""#"d -a'a( a 'o %"nd"% '/" '%an-"% +n!a(+d. ?"+d", +' + no' a +-

a**%o!a( $) '/" P%"+d"n' + "n'+%"() a$"n' +n '/+ +n'an". ( ( ( That/ase in+o&+ed the re+ie o* the )e/ision o* the Co%rt o* Appea&s dated

No+e$4er 30, 3556 in CA G.R. SP No. 1020, hi/h a**ir$ed the )ENR

Order dated )e/e$4er 60, 3550 and the )e/ision o* the O**i/e o* thePresident dated "%&8 36, 3553, $o'/ approving '/" a+n#"n' o- '/"

WMCP FTAA 'o Sa+''a%+.02 9E$phasis o%rs.

?%rther$ore, i* petitioner as indeed o* the $ind that Se/tion 5 o*

the Phi&ippine Minin' A/t o* 0>> is app&i/a4&e to the Co&%$4io ?TAA, th%s

ne/essitatin' the appro+a& o* the President *or the +a&idit8 o* its trans*er or

assi'n$ent, it o%&d see$ /ontradi/tor8 that petitioner so%'ht the appro+a&

o* the )ENR Se/retar8, and not that o* the President, o* its 03 "%&8 3555

Sa&e and P%r/hase A'ree$ent ith MC Reso%r/es. #en/e, it $a8 4e'&i$psed *ro$ the +er8 a/t o* petitioner that it re/o'niFed that the pro+ision

o* the Co&%$4io ?TAA re'ardin' the /onsent o* the )ENR Se/retar8 ith

respe/t to the trans*er o* said ?TAA $%st 4e %phe&d.

It is en'rained in D%rispr%den/e that the /onstit%tiona& prohi4ition on

the i$pair$ent o* the o4&i'ation o* /ontra/t does not prohi4it e+er8 /han'e

in e(istin' &as,01 and to *a&& ithin the prohi4ition, the /han'e $%st not

on&8 i$pair the o4&i'ation o* the e(istin' /ontra/t, 4%t the i$pair$ent $%st

0 G.R. No. 031;;3, 0 )e/e$4er 355, SCRA 0.02 Id. at ;>.01 P%il. Rural !lectric Coop. (ssoc.Inc. v. epartment o Interior and Local 0overnment

+ecretary, 0 Phi&. 2;6, 2>> 93556.

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4e s%4stantia&.0; S%4stantia& i$pair$ent as /on/ei+ed in re&ation to

i$pair$ent o* /ontra/ts has 4een e(p&ained in the /ase o* Clemons v.

Nolting,1 hi/h stated that: a &a hi/h /han'es the ter$s o* a &e'a&

/ontra/t 4eteen parties, either in the ti$e or $ode o* per*or$an/e, or

i$poses ne /onditions, or dispenses ith those e(pressed, or a%thoriFes *or

its satis*a/tion so$ethin' di**erent *ro$ that pro+ided in its ter$s, is &a

hi/h i$pairs the o4&i'ation o* a /ontra/t and is there*ore n%&& and +oid.

Se/tion 5 o* the Phi&ippine Minin' A/t o* 0>> re<%irin' the appro+a& o*

the President ith respe/t to assi'n$ent or trans*er o* ?TAAs, i* $ade

app&i/a4&e retroa/ti+e&8 to the Co&%$4io ?TAA, o%&d 4e tanta$o%nt to an

i$pair$ent o* the o4&i'ations %nder said /ontra/t as it o%&d e**e/ti+e&8

restri/t the ri'ht o* the parties thereto to assi'n or trans*er their interests in

the said ?TAA.

B8 i$posin' a ne /ondition apart *ro$ those a&read8 /ontained in

the a'ree$ent, 4e*ore the parties to the Co&%$4io ?TAA $a8 assi'n or

trans*er its ri'hts and interest in the said a'ree$ent, Se/tion 5 o* the

Phi&ippine Minin' A/t o* 0>>, i* $ade to app&8 to the Co&%$4io ?TAA,

i&& e**e/ti+e&8 $odi*8 the ter$s o* the ori'ina& /ontra/t and th%s i$pair the

o4&i'ations o* the parties thereto and restri/t the e(er/ise o* their +ested

ri'hts %nder the ori'ina& a'ree$ent. S%/h $odi*i/ation to the Co&%$4io

?TAA, parti/%&ar&8 in the /onditions i$posed *or its +a&id trans*er is

e<%i+a&ent to an i$pair$ent o* said /ontra/t +io&ati+e o* the Constit%tion.

#ERE?ORE, pre$ises /onsidered, the instant petition is here48

)ENIE). The )e/ision o* the Co%rt o* Appea&s in CA G.R. SP No. 1020

dated 30 No+e$4er 3556 is here48 A??IRME). Costs a'ainst petitioner.

0; Id.0> 3 Phi&. 153, 101 90>33.

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SO ORDERED.

MINITA V. CHICO5NA@ARIO

Asso/iate "%sti/e

E CONCUR:

ARTEMIO V. PANGANI?AN

Chie* "%sti/eChairperson

CONSUELO YNARES5SANTIAGO MA. ALICIA AUSTRIA5

MARTINE@

Asso/iate "%sti/e Asso/iate "%sti/e

ROMEO :. CALLE:O, SR.

Asso/iate "%sti/e

C E R T I F I C A T I O N

P%rs%ant to Arti/&e LIII, Se/tion 06 o* the Constit%tion, it is here48

/erti*ied that the /on/&%sions in the a4o+e )e/ision ere rea/hed in

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/ons%&tation 4e*ore the /ase as assi'ned to the riter o* the opinion o* theCo%rt7s )i+ision.

ARTEMIO V. PANGANI?AN

Chie* "%sti/e

lepant~1

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