Chavez Vs Pea Digest 3qh4j

CHAVEZ vs PEA and AMARI FACTS: Government signed a contract with CD to reclaim certain foreshore and offshore areas of Manila Bay which also included the construction of Phases I and II of the Manila-Cavite Coastal Road. CD obligated itself to carry out all the works in consideration of fifty percent of the total reclaimed land. Pres. Marcos created and tasked PEA to reclaim land, including foreshore and submerged areas and to develop, improve, acquire, lease and sell any and all kinds of lands. By virtue of PD No. 1085, he transferred to PEA the lands reclaimed in the foreshore and offshore of the Manila Bay. Then President Aquino issued Special Patent granting and transferring to PEA the parcels of land so reclaimed under MCCRR Project. Subsequently, the of Deeds of Parañaque issued Transfer Certificates of Titles in the name of PEA, covering the three reclaimed islands known as the Freedom Islands. PEA entered into a JVA with AMARI, a private corporation, to develop the Freedom Islands through negotiation without public bidding. 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. The BOD of PEA and Pres. Ramos approved the JVA.

a. government stands to lose billions of pesos in the sale by PEA of the reclaimed lands to AMARI b. praying public disclosure of of any negotiation pursuant to right of people to information on matters of public concern. c. assailing also the sale of PEA 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. PEA and AMARI signed the Amended JVA and the office of the Pres. approved under the istration of then Pres. Estrada approved the Amended JVA. Due to the approval of the Amended JVA petitioner now prays that on "constitutional and statutory grounds the renegotiated contract be declared null and void. ISSUES: 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;

Senate President Ernesto Maceda delivered a privilege speech in the Senate and denounced the JVA as the "grandmother of all scams. As a result t investigation was conducted and found out that JVA is illegal for alienating reclaimed lands which is land of public domain.

III. WHETHER THE PETITION MERITS DISMISSAL FOR NONEXHAUSTION OF ISTRATIVE REMEDIES;

Pres. Ramos created a task force to investigate the legality of JVA, which tasked force upheld the legality of JVA contrary to conclusions reached by Senate committees. 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.

V. WHETHER THE CONSTITUTIONAL RIGHT TO INFORMATION INCLUDES OFFICIAL INFORMATION ON ON-GOING NEGOTIATIONS BEFORE A FINAL AGREEMENT;

Chavez, petitioner as a taxpayer, filed the instant Petition for Mandamus with Prayer for the Issuance of a Writ of Preliminary Injunction and Temporary Restraining Order contending that:

IV. WHETHER PETITIONER HAS LOCUS STANDI TO BRING THIS SUIT;

VI. WHETHER THE STIPULATIONS IN THE AMENDED T 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 T VENTURE AGREEMENT IS GROSSLY DISADVANTAGEOUS TO THE GOVERNMENT.

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HELD: First issue: whether the principal reliefs prayed for in the petition are moot and academic because of subsequent events. ●

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We rule that the g 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 en the g of the Amended JVA on constitutional grounds necessarily includes preventing its implementation. Supervening events, whether intended or accidental, cannot prevent the Court from rendering a decision if there is a grave violation of the Constitution. 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. The instant petition is a case of first impression. 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.

Fourth issue: whether petitioner has locus standi to bring this suit ●

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Principle of hierarchy of courts applies generally to cases involving factual questions. The instant case raises constitutional issues of transcendental importance to the public. The Court can resolve this case without determining any factual issue related to the case.

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Third issue: whether the petition merits dismissal for non-exhaustion of istrative remedies.

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.

● Second issue: whether the petition merits dismissal for failing to observe the principle governing the hierarchy of courts.

We rule that the principle of exhaustion of istrative remedies does not apply in the instant case. The principle of exhaustion of istrative remedies does not apply when the issue involved is a purely legal or constitutional question. 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.

Section 7 Art. III and Section 28 Art. II 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. The court 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. Gov’t Auditing Code requires public bidding on matters relating to the disposition of property of PEA. So PEA must on its own and without demand from anyone, disclose to the public matters relating to the disposition of its property. If PEA fails to make this disclosure, any citizen can demand from PEA this information at any time during the bidding process. Information 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. 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.

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The right to information, however, does not extend to matters recognized as privileged information. Since there is no claim by PEA that the information demanded by petitioner is privileged information, we rule, therefore, that the constitutional right to information includes official information on ongoing negotiations before a final contract.

Act No. 2874 the Public Land Act authorized the Governor-General to "classify lands of the public domain, to "declare what lands are open to disposition or concession and also limited alienable or disposable lands only to those lands which have been "officially delimited and classified. ●

Sixth issue: whether stipulations in the Amended JVA for the transfer to AMARI of lands, reclaimed or to be reclaimed, violate the Constitution. The ownership of lands reclaimed from foreshore and submerged areas is rooted in the Regalian doctrine.

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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.

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Article 339 of the Civil Code of 1889 provides that 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. Article 341 of the Civil Code of 1889, a not self-executing provision; declare that 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 upon declaration of the executive and ing of a law by the legislative. Act No. 1654 mandated that the government should retain title to all lands reclaimed by the government. It also vests in the government control and disposition of foreshore lands. ●

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Private parties could lease lands reclaimed by the government only if these lands were no longer needed for public purpose and mandated public bidding in the lease of government reclaimed lands. This act 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. This act did not repeal the provision of Spanish Law of Waters allowing private parties to reclaim parts of the sea with government’s permission and such reclaimed lands remained private lands.

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This act 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. 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. Under Act No. 2874, the government could not sell government reclaimed, foreshore and marshy lands to private parties, unless the legislature ed a law allowing their sale.49 It did not prohibit private parties from reclaiming parts of the sea pursuant to Spanish Law of Waters and lands reclaimed from the sea by private parties with government permission remained private lands.

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. ●

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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. But the legislature did not repeal Act 2874 but 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 readopted the prohibition in 1935 Constitution of 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.

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The government could sell to private parties only those lands for nonagricultural purposes not classified as government reclaimed, foreshore and marshy disposable lands of the public domain. This act 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." 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 a law authorizing such sale. 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. In case of sale or lease of disposable lands of the public domain, CA No. 141 mandates the Government to put to public auction all leases or sales. CA No. 141 did not repeal Spanish Law of Waters provision allowing private parties to reclaim portions of the sea with government permission. However, this time the reclaimed is not automatically a private land. It could become private land only after being classified as alienable agricultural land of the public domain open to disposition.

The Civil Code of 1950 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. ●

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It also included as property of public dominion those properties 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.

1973 Constitutions prohibited the alienation of all natural resources except agricultural lands of the public domain. ● ●

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Under 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 ●

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. ●

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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 in view of CA 141. 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.

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.

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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 constitutional ban strengthens the constitutional limitation on individuals from acquiring more than the allowed area of alienable lands of the public domain. Without the constitutional ban, individuals who already acquired the maximum area of alienable lands of the public domain could easily set up corporations to acquire more alienable public lands. An individual could own as many corporations as his means would allow him.

The Amended JVA covers a reclamation area of 750 hectares. Only 157.84 hectares of the 750-hectare reclamation project have been reclaimed, and the rest of the 592.15 hectares are still submerged areas forming part of Manila Bay.

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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 in line of 70-30% of total net usable area. ● To implement the Amended JVA, PEA delegated to the unincorporated PEA-AMARI t venture PEA's statutory authority, rights and privileges to reclaim foreshore and submerged areas in Manila Bay. The Threshold Issue

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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. 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 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.

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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. 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. CA No. 141 provides that "only those lands shall be declared open to disposition or concession which have been officially delimited and classified. There must be a law or presidential proclamation officially classifying these reclaimed lands as alienable or disposable and open to disposition or concession and must not been reserved for some public or quasipublic use. PD No. 1085 authorized the issuance of special land patents for lands reclaimed by PEA from the foreshore or submerged areas of Manila Bay 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. The Freedom Islands are thus alienable or disposable lands of the public domain, open to disposition or concession to qualified parties. 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. 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. 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 reclaimed by PEA remain inalienable lands of the public domain. PEA must observe the provisions of CA No. 141 requiring public auction, in the absence of a law exempting PEA from holding a public auction. For the Special Patent issued to PEA expressly acknowledge that the provisions of CA No. 141 apply to the disposition of reclaimed alienable lands of the public domain unless otherwise provided by law.

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Executive Order No. 654 which authorizes PEA "to determine the kind and manner of payment in contracts it entered into for reclamation does not exempt PEA from the requirement of public auction. No. 1445, the Government Auditing Code required sale of valuable government property through public bidding.

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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. 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. The failure of public bidding conducted on December 10, 1991, by PEA involving only 407.84 hectares 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 more than three years before the g of the original JVA on April 25, 1995. The economic situation in the country had greatly improved during the intervening period. The Ban on Private corporations or associations holding alienable lands of the public domain except by lease is clear and absolute. A private corporation, even one that undertakes the physical reclamation of a government project, cannot acquire reclaimed alienable lands of the public domain in view of the constitutional ban. Thus whatever repayment Scheme in the contract entered by PEA if the contractor or developer is a private corporation like AMARI can only be paid with leaseholds on portions of the reclaimed lands to avoid a direct collision with the Constitution. The issuance of special patent and certificate of title to PEA does convert the FREEDOM ISLAND into private land contrary to what defendants contended. 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. The registration of lands of the public domain under the Torrens system, by itself, cannot convert public lands into private lands.

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Several laws authorize lands of the public domain to be ed under the Torrens System without losing their character as public lands. Such registration, however, is expressly subject to the condition in 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." The need for legislative authority prevents the ed land of the public domain from becoming private land that can be disposed of to qualified private parties. Whether the Amended JVA is a sale or a t venture, the fact remains that the Amended JVA requires PEA to "cause the issuance and delivery of the certificates of title conveying AMARI's Land Share in the name of AMARI. 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 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