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Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No.

133250 July 9, 2002

%$i& C)CP shall underta#e all reclamation, construction, and such other or#s in the MCCRRP as ma! be agreed upon b! the parties, to be paid according to progress of or#s on a unit price<lump sum basis for items of or# to be agreed upon, sub"ect to price escalation, retention and other terms and conditions provided for in Presidential )ecree No. .8/4. All the financing re6uired for such or#s shall be provided b! PEA. 777 $iii& 7 7 7 C)CP shall give up all its development rights and hereb! agrees to cede and transfer in favor of PEA, all of the rights, title, interest and participation of C)CP in and to all the areas of land reclaimed b! C)CP in the MCCRRP as of )ecember 1-, ./5. hich have not !et been sold, transferred or other ise disposed of b! C)CP as of said date, hich areas consist of appro7imatel! Ninet!( Nine Thousand 3our 2undred =event! Three $//,401& s6uare meters in the 3inancial Center Area covered b! land pledge No. 8 and appro7imatel! Three Million Three 2undred Eight! T o Thousand Eight 2undred Eight! Eight $1,15,,555& s6uare meters of reclaimed areas at var!ing elevations above Mean >o ?ater >evel located outside the 3inancial Center Area and the 3irst Neighborhood @nit.%1 +n Aanuar! ./, ./55, then President CoraBon C. A6uino issued =pecial Patent No. 18.0, granting and transferring to PEA %the parcels of land so reclaimed under the Manila(Cavite Coastal Road and Reclamation Pro"ect $MCCRRP& containing a total area of one million nine hundred fifteen thousand eight hundred ninet! four $.,/.8,5/4& s6uare meters.% =ubse6uentl!, on April /, ./55, the Register of )eeds of the Municipalit! of ParaCa6ue issued Transfer Certificates of Title Nos. 01-/, 01.., and 01.,, in the name of PEA, covering the three reclaimed islands #no n as the %3reedom *slands% located at the southern portion of the Manila(Cavite Coastal Road, ParaCa6ue Cit!. The 3reedom *slands have a total land area of +ne Million 3ive 2undred =event! Eight Thousand 3our 2undred and 3ort! +ne $.,805,44.& s6uare meters or .80.54. hectares. +n April ,8, .//8, PEA entered into a Aoint Denture Agreement $%ADA% for brevit!& ith AMAR*, a private corporation, to develop the 3reedom *slands. The ADA also re6uired the reclamation of an additional ,8- hectares of submerged areas surrounding these islands to complete the configuration in the Master )evelopment Plan of the =outhern Reclamation Pro"ect(MCCRRP. PEA and AMAR* entered into the ADA through negotiation ithout public bidding.4 +n April ,5, .//8, the Board of )irectors of PEA, in its Resolution No. .,48, confirmed the ADA.8+n Aune 5, .//8, then President 3idel D. Ramos, through then E7ecutive =ecretar! Ruben Torres, approved the ADA.E +n November ,/, .//E, then =enate President Ernesto Maceda delivered a privilege speech in the =enate and denounced the ADA as the %grandmother of all scams.% As a result, the =enate Committee on Fovernment Corporations and Public Enterprises, and the Committee on Accountabilit! of Public +fficers and *nvestigations, conducted a "oint investigation. The =enate Committees reported the results of their investigation in =enate

FRANCISCO I. CHAVEZ, petitioner, vs. PU !IC ESTATES AUTHORIT" #$% AMARI COASTA! A" &EVE!OPMENT CORPORATION, respondents. CARPIO, J.: This is an original Petition for Mandamus ith pra!er for a rit of preliminar! in"unction and a temporar! restraining order. The petition see#s to compel the Public Estates Authorit! $%PEA% for brevit!& to disclose all facts on PEA's then on(going renegotiations ith Amari Coastal Ba! and )evelopment Corporation $%AMAR*% for brevit!& to reclaim portions of Manila Ba!. The petition further see#s to en"oin PEA from signing a ne agreement ith AMAR* involving such reclamation. T'( F#)*+ +n November ,-, ./01, the government, through the Commissioner of Public 2igh a!s, signed a contract ith the Construction and )evelopment Corporation of the Philippines $%C)CP% for brevit!& to reclaim certain foreshore and offshore areas of Manila Ba!. The contract also included the construction of Phases * and ** of the Manila(Cavite Coastal Road. C)CP obligated itself to carr! out all the or#s in consideration of fift! percent of the total reclaimed land. +n 3ebruar! 4, ./00, then President 3erdinand E. Marcos issued Presidential )ecree No. .-54 creating PEA. P) No. .-54 tas#ed PEA %to reclaim land, including foreshore and submerged areas,% and %to develop, improve, ac6uire, 7 7 7 lease and sell an! and all #inds of lands.%. +n the same date, then President Marcos issued Presidential )ecree No. .-58 transferring to PEA the %lands reclaimed in the foreshore and offshore of the Manila Ba!%, under the Manila(Cavite Coastal Road and Reclamation Pro"ect $MCCRRP&. +n )ecember ,/, ./5., then President Marcos issued a memorandum directing PEA to amend its contract ith C)CP, so that %9A:ll future or#s in MCCRRP 7 7 7 shall be funded and o ned b! PEA.% Accordingl!, PEA and C)CP e7ecuted a Memorandum of Agreement dated )ecember ,/, ./5., hich stated;

Committee Report No. 8E- dated =eptember .E, .//0. 0 Among the conclusions of their report are; $.& the reclaimed lands PEA see#s to transfer to AMAR* under the ADA are lands of the public domain hich the government has not classified as alienable lands and therefore PEA cannot alienate these landsG $,& the certificates of title covering the 3reedom *slands are thus void, and $1& the ADA itself is illegal. +n )ecember 8, .//0, then President 3idel D. Ramos issued Presidential Administrative +rder No. 1E8 creating a >egal Tas# 3orce to conduct a stud! on the legalit! of the ADA in vie of =enate Committee Report No. 8E-. The members of the >egal Tas# 3orce ere the =ecretar! of Austice,5 the Chief Presidential >egal Counsel, / and the Fovernment Corporate Counsel..- The >egal Tas# 3orce upheld the legalit! of the ADA, contrar! to the conclusions reached b! the =enate Committees. .. +n April 4 and 8, .//5, the Philippine Daily Inquirer and Today published reports that there ere on(going renegotiations bet een PEA and AMAR* under an order issued b! then President 3idel D. Ramos. According to these reports, PEA )irector Nestor Hala , PEA Chairman Arsenio Iulo and retired Nav! +fficer =ergio CruB composed the negotiating panel of PEA. +n April .1, .//5, Antonio M. Julueta filed before the Court a Petition for Prohibition with Application for the Issuance of a Temporary Restraining Order and Preliminary Injunction doc#eted as F.R. No. .1,//4 see#ing to nullif! the ADA. The Court dismissed the petition %for un arranted disregard of "udicial hierarch!, ithout pre"udice to the refiling of the case before the proper court.%., +n April ,0, .//5, petitioner 3ran# *. ChaveB $%Petitioner% for brevit!& as a ta7pa!er, filed the instant Petition for Mandamus with Prayer for the Issuance of a rit of Preliminary Injunction and Temporary Restraining Order . Petitioner contends the government stands to lose billions of pesos in the sale b! PEA of the reclaimed lands to AMAR*. Petitioner pra!s that PEA publicl! disclose the terms of an! renegotiation of the ADA, invo#ing =ection ,5, Article **, and =ection 0, Article ***, of the ./50 Constitution on the right of the people to information on matters of public concern. Petitioner assails the sale to AMAR* of lands of the public domain as a blatant violation of =ection 1, Article K** of the ./50 Constitution prohibiting the sale of alienable lands of the public domain to private corporations. 3inall!, petitioner asserts that he see#s to en"oin the loss of billions of pesos in properties of the =tate that are of public dominion. After several motions for e7tension of time, .1 PEA and AMAR* filed their Comments on +ctober ./, .//5 and Aune ,8, .//5, respectivel!. Mean hile, on )ecember ,5, .//5, petitioner filed an +mnibus Motion; $a& to re6uire PEA to submit the terms of the renegotiated PEA(AMAR* contractG $b& for issuance of a temporar! restraining orderG and $c& to set the case for hearing on oral argument. Petitioner filed a Reiterative Motion for *ssuance of a TR+ dated Ma! ,E, .///, hich the Court denied in a Resolution dated Aune ,,, .///.

*n a Resolution dated March ,1, .///, the Court gave due course to the petition and re6uired the parties to file their respective memoranda. +n March 1-, .///, PEA and AMAR* signed the Amended Aoint Denture Agreement $%Amended ADA,% for brevit!&. +n Ma! ,5, .///, the +ffice of the President under the administration of then President Aoseph E. Estrada approved the Amended ADA. )ue to the approval of the Amended ADA b! the +ffice of the President, petitioner no pra!s that on %constitutional and statutor! grounds the renegotiated contract be declared null and void.%.4 T'( I++u(+ The issues raised b! petitioner, PEA.8 and AMAR*.E are as follo s; *. ?2ET2ER T2E PR*NC*PA> RE>*E3= PRAIE) 3+R *N T2E PET*T*+N ARE M++T AN) ACA)EM*C BECA@=E +3 =@B=EL@ENT EDENT=G **. ?2ET2ER T2E PET*T*+N MER*T= )*=M*==A> 3+R 3A*>*NF T+ +B=ERDE T2E PR*NC*P>E F+DERN*NF T2E 2*ERARC2I +3 C+@RT=G ***. ?2ET2ER T2E PET*T*+N MER*T= )*=M*==A> 3+R N+N(EK2A@=T*+N +3 A)M*N*=TRAT*DE REME)*E=G *D. ?2ET2ER PET*T*+NER 2A= !O"#$ $TA%DI T+ BR*NF T2*= =@*TG D. ?2ET2ER T2E C+N=T*T@T*+NA> R*F2T T+ *N3+RMAT*+N *NC>@)E= +33*C*A> *N3+RMAT*+N +N +N(F+*NF NEF+T*AT*+N= BE3+RE A 3*NA> AFREEMENTG D*. ?2ET2ER T2E =T*P@>AT*+N= *N T2E AMEN)E) A+*NT DENT@RE AFREEMENT 3+R T2E TRAN=3ER T+ AMAR* +3 CERTA*N >AN)=, REC>A*ME) AN) =T*>> T+ BE REC>A*ME), D*+>ATE T2E ./50 C+N=T*T@T*+NG AN) D**. ?2ET2ER T2E C+@RT *= T2E PR+PER 3+R@M 3+R RA*=*NF T2E *==@E +3 ?2ET2ER T2E AMEN)E) A+*NT DENT@RE AFREEMENT *= FR+==>I )*=A)DANTAFE+@= T+ T2E F+DERNMENT. T'( Cou,*-+ Rul.$/ First issue: whether the principal reliefs prayed for in the petition are moot and academic because of subsequent events.

The petition pra!s that PEA publicl! disclose the %terms and conditions of the on(going negotiations for a ne agreement.% The petition also pra!s that the Court en"oin PEA from %privatel! entering into, perfecting and<or e7ecuting an! ne agreement ith AMAR*.% PEA and AMAR* claim the petition is no moot and academic because AMAR* furnished petitioner on Aune ,., ./// a cop! of the signed Amended ADA containing the terms and conditions agreed upon in the renegotiations. Thus, PEA has satisfied petitioner's pra!er for a public disclosure of the renegotiations. >i#e ise, petitioner's pra!er to en"oin the signing of the Amended ADA is no moot because PEA and AMAR* have alread! signed the Amended ADA on March 1-, .///. Moreover, the +ffice of the President has approved the Amended ADA on Ma! ,5, .///. Petitioner counters that PEA and AMAR* cannot avoid the constitutional issue b! simpl! fast(trac#ing the signing and approval of the Amended ADA before the Court could act on the issue. Presidential approval does not resolve the constitutional issue or remove it from the ambit of "udicial revie . ?e rule that the signing of the Amended ADA b! PEA and AMAR* and its approval b! the President cannot operate to moot the petition and divest the Court of its "urisdiction. PEA and AMAR* have still to implement the Amended ADA. The pra!er to en"oin the signing of the Amended ADA on constitutional grounds necessaril! includes preventing its implementation if in the meantime PEA and AMAR* have signed one in violation of the Constitution. Petitioner's principal basis in assailing the renegotiation of the ADA is its violation of =ection 1, Article K** of the Constitution, hich prohibits the government from alienating lands of the public domain to private corporations. *f the Amended ADA indeed violates the Constitution, it is the dut! of the Court to en"oin its implementation, and if alread! implemented, to annul the effects of such unconstitutional contract. The Amended ADA is not an ordinar! commercial contract but one hich see#s to transfer title and ownership to 367.5 hectares of reclaimed lands and submerged areas of anila !ay to a single private corporation . *t no 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 patrimon!. =upervening events, hether intended or accidental, cannot prevent the Court from rendering a decision if there is a grave violation of the Constitution. *n the instant case, if the Amended ADA runs counter to the Constitution, the Court can still prevent the transfer of title and o nership of alienable lands of the public domain in the name of AMAR*. Even in cases here 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..0 Also, the instant petition is a case of first impression. All previous decisions of the Court involving =ection 1, Article K** of the ./50 Constitution, or its counterpart provision in the ./01 Constitution,.5 covered agricultural landssold to private corporations hich ac6uired the lands from private parties. The transferors of the private corporations claimed or could claim the right to "udicial confirmation of their imperfect

titles./ under #itle $$ of Common ealth Act. .4. $%CA No. .4.% for brevit!&. *n the instant case, AMAR* see#s to ac6uire from PEA, a public corporation, reclaimed lands and submerged areas for non%agricultural purposes b! purchase under P) No. .-54 $charter of PEA& and #itle $$$ of CA No. .4.. Certain underta#ings b! AMAR* under the Amended ADA constitute the consideration for the purchase. Neither AMAR* nor PEA can claim "udicial confirmation of their titles because the lands covered b! the Amended ADA are ne l! reclaimed or still to be reclaimed. Audicial confirmation of imperfect title re6uires open, continuous, e7clusive and notorious occupation of agricultural lands of the public domain for at least thirt! !ears since Aune .,, ./48 or earlier. Besides, the deadline for filing applications for "udicial confirmation of imperfect title e7pired on )ecember 1., ./50.,>astl!, there is a need to resolve immediatel! the constitutional issue raised in this petition because of the possible transfer at an! time b! PEA to AMAR* of title and o nership to portions of the reclaimed lands. @nder the Amended ADA, PEA is obligated to transfer to AMAR* the latter's sevent! percent proportionate share in the reclaimed areas as the reclamation progresses. The Amended ADA even allo s AMAR* to mortgage at an! time the entirereclaimed area to raise financing for the reclamation pro"ect. ,. &econd issue: whether the petition merits dismissal for failing to observe the principle governing the hierarchy of courts. PEA and AMAR* claim petitioner ignored the "udicial hierarch! b! see#ing relief directl! from the Court. The principle of hierarch! of courts applies generall! to cases involving factual 6uestions. As it is not a trier of facts, the Court cannot entertain cases involving factual issues. The instant case, ho ever, raises constitutional issues of transcendental importance to the public.,, The Court can resolve this case ithout determining an! factual issue related to the case. Also, the instant case is a petition for mandamus hich falls under the original "urisdiction of the Court under =ection 8, Article D*** of the Constitution. ?e resolve to e7ercise primar! "urisdiction over the instant case. #hird issue: whether the petition merits dismissal for non%e'haustion of administrative remedies. PEA faults petitioner for see#ing "udicial intervention in compelling PEA to disclose publicl! certain information ithout first as#ing PEA the needed information. PEA claims petitioner's direct resort to the Court violates the principle of e7haustion of administrative remedies. *t also violates the rule that mandamus ma! issue onl! if there is no other plain, speed! and ade6uate remed! in the ordinar! course of la . PEA distinguishes the instant case from TaCada v. Tuvera ,1 here the Court granted the petition for mandamus even if the petitioners there did not initiall! demand from the +ffice of the President the publication of the presidential decrees. PEA points out that in TaCada, the E7ecutive )epartment had an affirmative statutory dut! under Article , of the Civil Code,4 and =ection . of Common ealth Act No. E15 ,8 to publish the presidential decrees. There as, therefore, no need for the petitioners in TaCada to ma#e an initial

demand from the +ffice of the President. *n the instant case, PEA claims it has no affirmative statutor! dut! to disclose publicl! information about its renegotiation of the ADA. Thus, PEA asserts that the Court must appl! the principle of e7haustion of administrative remedies to the instant case in vie of the failure of petitioner here to demand initiall! from PEA the needed information. The original ADA sought to dispose to AMAR* public lands held b! PEA, a government corporation. @nder =ection 0/ of the Fovernment Auditing Code, ,E the disposition of government lands to private parties re6uires public bidding. ()* was under a positive legal duty to disclose to the public the terms and conditions for the sale of its lands. The la obligated PEA to ma#e this public disclosure even ithout demand from petitioner or from an!one. PEA failed to ma#e this public disclosure because the original ADA, li#e the Amended ADA, as the result of a negotiated contract, not of a public bidding. Considering that PEA had an affirmative statutor! dut! to ma#e the public disclosure, and as even in breach of this legal dut!, petitioner had the right to see# direct "udicial intervention. Moreover, and this alone is determinative of this issue, the principle of e7haustion of administrative remedies does not appl! hen the issue involved is a purel! legal or constitutional 6uestion.,0 The principal issue in the instant case is the capacit! of AMAR* to ac6uire lands held b! PEA in vie of the constitutional ban prohibiting the alienation of lands of the public domain to private corporations. ?e rule that the principle of e7haustion of administrative remedies does not appl! 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 ithout a sho ing that PEA refused to perform an affirmative dut! imposed on PEA b! the Constitution. PEA also claims that petitioner has not sho n that he ill suffer an! concrete in"ur! because of the signing or implementation of the Amended ADA. Thus, there is no actual controvers! re6uiring the e7ercise of the po er of "udicial revie . The petitioner has standing to bring this ta7pa!er's suit because the petition see#s to compel PEA to compl! ith its constitutional duties. There are t o constitutional issues involved here. 3irst is the right of citiBens to information on matters of public concern. =econd is the application of a constitutional provision intended to insure the e6uitable distribution of alienable lands of the public domain among 3ilipino citiBens. The thrust of the first issue is to compel PEA to disclose publicl! information on the sale of government lands orth billions of pesos, information hich the Constitution and statutor! la 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 compl! ith a constitutional dut! to the nation.

Moreover, the petition raises matters of transcendental importance to the public. *n +have, v. (+--,,5 the Court upheld the right of a citiBen to bring a ta7pa!er's suit on matters of transcendental importance to the public, thus ( %Besides, petitioner emphasiBes, the matter of recovering the ill(gotten ealth of the Marcoses is an issue of 'transcendental importance to the public.' 2e asserts that ordinar! ta7pa!ers have a right to initiate and prosecute actions 6uestioning the validit! of acts or orders of government agencies or instrumentalities, if the issues raised are of 'paramount public interest,' and if the! 'immediatel! affect the social, economic and moral ell being of the people.' Moreover, the mere fact that he is a citiBen satisfies the re6uirement of personal interest, hen the proceeding involves the assertion of a public right, such as in this case. 2e invo#es several decisions of this Court hich have set aside the procedural matter of locus standi, hen the sub"ect of the case involved public interest. 777 *n Ta&ada '( Tu'era, the Court asserted that hen the issue concerns a public right and the ob"ect of mandamus is to obtain the enforcement of a public dut!, the people are regarded as the real parties in interestG and because it is sufficient that petitioner is a citiBen and as such is interested in the e7ecution of the la s, he need not sho that he has an! legal or special interest in the result of the action. *n the aforesaid case, the petitioners sought to enforce their right to be informed on matters of public concern, a right then recogniBed in =ection E, Article *D of the ./01 Constitution, in connection ith the rule that la s in order to be valid and enforceable must be published in the +fficial FaBette or other ise effectivel! promulgated. *n ruling for the petitioners' legal standing, the Court declared that the right the! sought to be enforced 'is a public right recogniBed b! no less than the fundamental la of the land.' !egaspi '( "i'il $er'ice "ommission , hile reiterating TaCada, further declared that ' hen a mandamus proceeding involves the assertion of a public right, the re6uirement of personal interest is satisfied b! the mere fact that petitioner is a citiBen and, therefore, part of the general 'public' hich possesses the right.' 3urther, in Albano '( Reyes, e said that hile e7penditure of public funds ma! not have been involved under the 6uestioned contract for the development, management and operation of the Manila *nternational Container Terminal, 'public interest 9 as: definitel! involved considering the important role 9of the sub"ect contract: . . . in the economic development of the countr! and the magnitude of the financial consideration involved.' ?e concluded that, as a conse6uence, the disclosure provision in the Constitution ould constitute sufficient authorit! for upholding the petitioner's standing.

=imilarl!, the instant petition is anchored on the right of the people to information and access to official records, documents and papers M a right guaranteed under =ection 0, Article *** of the ./50 Constitution. Petitioner, a former solicitor general, is a 3ilipino citiBen. Because of the satisfaction of the t o basic re6uisites laid do n b! decisional la to sustain petitioner's legal standing, i.e. $.& the enforcement of a public right $,& espoused b! a 3ilipino citiBen, e rule that the petition at bar should be allo ed.% ?e rule that since the instant petition, brought b! a citiBen, involves the enforcement of constitutional rights ( to information and to the e6uitable diffusion of natural resources ( matters of transcendental public importance, the petitioner has the re6uisite locus standi. Fifth issue: whether the constitutional right to information includes official information on on%going negotiations before a final agreement. =ection 0, Article *** of the Constitution e7plains the people's right to information on matters of public concern in this manner; %=ec. 0. The right of the people to information on matters of public concern shall be recogniBed. *ccess to official records. and to documents. and papers pertaining to official acts. transactions. or decisions , as ell as to government research data used as basis for polic! development, shall be afforded the citiBen, sub"ect to such limitations as ma! be provided b! la .% $Emphasis supplied& The =tate polic! of full transparenc! in all transactions involving public interest reinforces the people's right to information on matters of public concern. This =tate polic! is e7pressed in =ection ,5, Article ** of the Constitution, thus; %=ec. ,5. =ub"ect to reasonable conditions prescribed b! la , the =tate adopts and implements a policy of full public disclosure of all its transactions involving public interest.% $Emphasis supplied& These t in provisions of the Constitution see# to promote transparenc! in polic!(ma#ing and in the operations of the government, as ell as provide the people sufficient information to e7ercise effectivel! other constitutional rights. These t in provisions are essential to the e7ercise of freedom of e7pression. *f the government does not disclose its official acts, transactions and decisions to citiBens, hatever citiBens sa!, even if e7pressed ithout an! restraint, ill be speculative and amount to nothing. These t in provisions are also essential to hold public officials %at all times 7 7 7 accountable to the people,%,/ for unless citiBens have the proper information, the! cannot hold public officials accountable for an!thing. Armed ith the right information, citiBens can participate in public discussions leading to the formulation of government policies and their effective implementation. An informed citiBenr! is essential to the e7istence and proper functioning of an! democrac!. As e7plained b! the Court in/almonte v. !elmonte. Jr.1- N

%An essential element of these freedoms is to #eep open a continuing dialogue or process of communication bet een the government and the people. *t is in the interest of the =tate that the channels for free political discussion be maintained to the end that the government ma! perceive and be responsive to the people's ill. Iet, this open dialogue can be effective onl! to the e7tent that the citiBenr! is informed and thus able to formulate its ill intelligentl!. +nl! hen the participants in the discussion are a are of the issues and have access to information relating thereto can such bear fruit.% PEA asserts, citing +have, v. (+--,1. 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(agenc! or inter(agenc! recommendations or communications during the stage hen common assertions are still in the process of being formulated or are in the 'e7plorator! stage'.% Also, AMAR* contends that petitioner cannot invo#e the right at the pre(decisional stage or before the closing of the transaction. To support its contention, AMAR* cites the follo ing discussion in the ./5E Constitutional Commission; 0M,. Su#,(1. And hen e sa! 'transactions' hich should be distinguished from contracts, agreements, or treaties or hatever, does the Fentleman refer to the steps leading to the consummation of the contract, or does he refer to the contract itselfO M,. O2l(3 #he 0transactions0 used here. $ suppose is generic and therefore. it can cover both steps leading to a contract and already a consummated contract. r. (residing 1fficer. r. &uare,: #his contemplates inclusion of negotiations leading to the consummation of the transaction. r. 1ple: 2es. sub"ect only to reasonable safeguards on the national interest. r. &uare,: Than# !ou.%1, $Emphasis supplied& AMAR* argues there must first be a consummated contract before petitioner can invo#e the right. Re6uiring government officials to reveal their deliberations at the pre(decisional stage ill degrade the 6ualit! of decision(ma#ing in government agencies. Fovernment officials ill hesitate to e7press their real sentiments during deliberations if there is immediate public dissemination of their discussions, putting them under all #inds of pressure before the! decide. ?e must first distinguish bet een information the la on public bidding re6uires PEA to disclose publicl!, and information the constitutional right to information re6uires PEA to

release to the public. Before the consummation of the contract, PEA must, on its o n and ithout demand from an!one, disclose to the public matters relating to the disposition of its propert!. These include the siBe, location, technical description and nature of the propert! being disposed of, the terms and conditions of the disposition, the parties 6ualified 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 Fovernment Auditing Code re6uires public bidding. *f PEA fails to ma#e this disclosure, an! citiBen can demand from PEA this information at an! time during the bidding process. *nformation, ho ever, on on%going evaluation or review of bids or proposals being underta#en b! the bidding or revie committee is not immediatel! accessible under the right to information. ?hile the evaluation or revie is still on(going, there are no %official acts, transactions, or decisions% on the bids or proposals. 2o ever, once the committee ma#es its official recommendation, there arises a 3definite proposition3 on the part of the government. 3rom this moment, the public's right to information attaches, and an! citiBen can access all the non(proprietar! information leading to such definite proposition. *n +have, v. (+--,11 the Court ruled as follo s; %Considering the intent of the framers of the Constitution, e believe that it is incumbent upon the PCFF and its officers, as ell as other government representatives, to disclose sufficient public information on an! proposed settlement the! have decided to ta#e up ith the ostensible o ners and holders of ill(gotten ealth. =uch information, though, must pertain to definite propositions of the government, not necessaril! to intra(agenc! or inter( agenc! recommendations or communications during the stage hen common assertions are still in the process of being formulated or are in the %e7plorator!% stage. There is need, of course, to observe the same restrictions on disclosure of information in general, as discussed earlier N such as on matters involving national securit!, diplomatic or foreign relations, intelligence and other classified information.% $Emphasis supplied& Contrar! to AMAR*'s contention, the commissioners of the ./5E Constitutional Commission understood that the right to information 3contemplates inclusion of negotiations leading to the consummation of the transaction.3 Certainl!, a consummated contract is not a re6uirement for the e7ercise of the right to information. +ther ise, the people can never e7ercise the right if no contract is consummated, and if one is consummated, it ma! be too late for the public to e7pose its defects. )*wphi)(n+t Re6uiring a consummated contract ill #eep the public in the dar# until the contract, hich ma! be grossl! disadvantageous to the government or even illegal, becomes a fait accompli. This negates the =tate polic! of full transparenc! on matters of public concern, a situation hich the framers of the Constitution could not have intended. =uch a re6uirement ill prevent the citiBenr! from participating in the public discussion of an! proposedcontract, effectivel! truncating a basic right enshrined in the Bill of Rights.

?e can allo neither an emasculation of a constitutional right, nor a retreat b! the =tate of its avo ed %polic! of full disclosure of all its transactions involving public interest.% The right covers three categories of information hich are %matters of public concern,% namel!; $.& official recordsG $,& documents and papers pertaining to official acts, transactions and decisionsG and $1& government research data used in formulating policies. The first categor! refers to an! document that is part of the public records in the custod! of government agencies or officials. The second categor! refers to documents and papers recording, evidencing, establishing, confirming, supporting, "ustif!ing or e7plaining official acts, transactions or decisions of government agencies or officials. The third categor! refers to research data, hether ra , collated or processed, o ned b! the government and used in formulating government policies. The information that petitioner ma! access on the renegotiation of the ADA includes evaluation reports, recommendations, legal and e7pert opinions, minutes of meetings, terms of reference and other documents attached to such reports or minutes, all relating to the ADA. 2o ever, the right to information does not compel PEA to prepare lists, abstracts, summaries and the li#e relating to the renegotiation of the ADA. 14 The right onl! affords access to records, documents and papers, hich means the opportunit! to inspect and cop! them. +ne ho e7ercises the right must cop! the records, documents and papers at his e7pense. The e7ercise of the right is also sub"ect to reasonable regulations to protect the integrit! of the public records and to minimiBe disruption to government operations, li#e rules specif!ing hen and ho to conduct the inspection and cop!ing. 18 The right to information, ho ever, does not e7tend to matters recogniBed as privileged information under the separation of po ers. 1E The right does not also appl! to information on militar! and diplomatic secrets, information affecting national securit!, and information on investigations of crimes b! la enforcement agencies before the prosecution of the accused, hich courts have long recogniBed as confidential. 10 The right ma! also be sub"ect to other limitations that Congress ma! impose b! la . There is no claim b! PEA that the information demanded b! petitioner is privileged information rooted in the separation of po ers. The information does not cover Presidential conversations, correspondences, or discussions during closed(door Cabinet meetings hich, li#e internal deliberations of the =upreme Court and other collegiate courts, or e7ecutive sessions of either house of Congress, 15 are recogniBed as confidential. This #ind of information cannot be pried open b! a co(e6ual branch of government. A fran# e7change of e7plorator! ideas and assessments, free from the glare of publicit! and pressure b! interested parties, is essential to protect the independence of decision( ma#ing of those tas#ed to e7ercise Presidential, >egislative and Audicial po er. 1/ This is not the situation in the instant case. ?e rule, therefore, that the constitutional right to information includes official information on on%going negotiations before a final contract. The information, ho ever, must constitute definite propositions b! the government and should not cover recogniBed e7ceptions li#e privileged information, militar! and diplomatic secrets and similar matters

affecting national securit! and public order. 4- Congress has also prescribed other limitations on the right to information in several legislations. 4. &i'th issue: whether stipulations in the *mended J/* for the transfer to * *4$ of lands. reclaimed or to be reclaimed. violate the +onstitution. #he 4egalian 5octrine The o nership of lands reclaimed from foreshore and submerged areas is rooted in the Regalian doctrine hich holds that the =tate o ns all lands and aters of the public domain. @pon the =panish con6uest of the Philippines, o nership of all %lands, territories and possessions% in the Philippines passed to the =panish Cro n. 4, The Hing, as the sovereign ruler and representative of the people, ac6uired and o ned all lands and territories in the Philippines e7cept those he disposed of b! grant or sale to private individuals. The ./18, ./01 and ./50 Constitutions adopted the Regalian doctrine substituting, ho ever, the =tate, in lieu of the Hing, as the o ner of all lands and aters of the public domain. The Regalian doctrine is the foundation of the time(honored principle of land o nership that %all lands that ere not ac6uired from the Fovernment, either b! purchase or b! grant, belong to the public domain.% 41 Article 11/ of the Civil Code of .55/, hich is no Article 4,- of the Civil Code of ./8-, incorporated the Regalian doctrine. 1wnership and 5isposition of 4eclaimed 6ands The =panish >a of ?aters of .5EE as the first statutor! la governing the o nership and disposition of reclaimed lands in the Philippines. +n Ma! .5, ./-0, the Philippine Commission enacted Act No. .E84 hich provided for the lease. but not the sale. of reclaimed lands of the government to corporations and individuals . >ater, on November ,/, ././, the Philippine >egislature approved Act No. ,504, the Public >and Act, hich authoriBed the lease. but not the sale. of reclaimed lands of the government to corporations and individuals . +n November 0, ./1E, the National Assembl! passed Common ealth Act No. .4., also #no n as the Public >and Act, hich authori,ed the lease. but not the sale. of reclaimed lands of the government to corporations and individuals. CA No. .4. continues to this da! as the general la governing the classification and disposition of lands of the public domain. #he &panish 6aw of 7aters of 8966 and the +ivil +ode of 899: @nder the =panish >a of ?aters of .5EE, the shores, ba!s, coves, inlets and all aters ithin the maritime Bone of the =panish territor! belonged to the public domain for public use.44 The =panish >a of ?aters of .5EE allo ed the reclamation of the sea under Article 8, hich provided as follo s;

%Article 8. >ands reclaimed from the sea in conse6uence of or#s constructed b! the =tate, or b! the provinces, pueblos or private persons, ith proper permission, shall become the propert! of the part! constructing such or#s, unless other ise provided b! the terms of the grant of authorit!.% @nder the =panish >a of ?aters, land reclaimed from the sea belonged to the part! underta#ing the reclamation, provided the government issued the necessar! permit and did not reserve o nership of the reclaimed land to the =tate. Article 11/ of the Civil Code of .55/ defined propert! of public dominion as follo s; %Art. 11/. Propert! of public dominion is N .. That devoted to public use, such as roads, canals, rivers, torrents, ports and bridges constructed b! the =tate, riverban#s, shores, roadsteads, and that of a similar characterG ,. That belonging e7clusivel! to the =tate hich, ithout being of general public use, is emplo!ed in some public service, or in the development of the national ealth, such as alls, fortresses, and other or#s for the defense of the territor!, and mines, until granted to private individuals.% Propert! devoted to public use referred to propert! open for use b! the public. *n contrast, propert! devoted to public service referred to propert! used for some specific public service and open onl! to those authoriBed to use the propert!. Propert! of public dominion referred not onl! to propert! devoted to public use, but also to propert! not so used but emplo!ed to develop the national wealth. This class of propert! constituted propert! of public dominion although emplo!ed for some economic or commercial activit! to increase the national ealth. Article 14. of the Civil Code of .55/ governed the re(classification of propert! of public dominion into private propert!, to it; %Art. 14.. Propert! of public dominion, hen no longer devoted to public use or to the defense of the territor!, shall become a part of the private propert! of the =tate.% This provision, ho ever, as not self(e7ecuting. The legislature, or the e7ecutive department pursuant to la , must declare the propert! no longer needed for public use or territorial defense before the government could lease or alienate the propert! to private parties.48 *ct ;o. 865< of the (hilippine +ommission

+n Ma! 5, ./-0, the Philippine Commission enacted Act No. .E84 hich regulated the lease of reclaimed and foreshore lands. The salient provisions of this la ere as follo s; %=ection .. The control and disposition of the foreshore as defined in e7isting la , and the title to all -overnment or public lands made or reclaimed by the -overnment by dredging or filling or other ise throughout the Philippine *slands, shall be retained by the -overnment ithout pre"udice to vested rights and ithout pre"udice to rights conceded to the Cit! of Manila in the >uneta E7tension. =ection ,. $a& The =ecretar! of the *nterior shall cause all Fovernment or public lands made or reclaimed b! the Fovernment b! dredging or filling or other ise to be divided into lots or bloc#s, ith the necessar! streets and alle! a!s located thereon, and shall cause plats and plans of such surve!s to be prepared and filed ith the Bureau of >ands. $b& @pon completion of such plats and plans the -overnor%-eneral 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, 7 7 7. 777 $e& #he leases above provided for shall be disposed of to the highest and best bidder therefore, sub"ect to such regulations and safeguards as the Fovernor(Feneral ma! b! e7ecutive order prescribe.% $Emphasis supplied& Act No. .E84 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 b! the government onl! if these lands ere no longer needed for public purpose. Act No. .E84 mandated public bidding in the lease of government reclaimed lands. Act No. .E84 made government reclaimed lands sui generis in that unli#e other public lands hich the government could sell to private parties, these reclaimed lands ere available onl! for lease to private parties. Act No. .E84, ho ever, did not repeal =ection 8 of the =panish >a of ?aters of .5EE. Act No. .E84 did not prohibit private parties from reclaiming parts of the sea under =ection 8 of the =panish >a of ?aters. >ands reclaimed from the sea b! private parties ith government permission remained private lands. *ct ;o. =97< of the (hilippine 6egislature +n November ,/, ././, the Philippine >egislature enacted Act No. ,504, the Public >and Act.4E The salient provisions of Act No. ,504, on reclaimed lands, ere as follo s;

%=ec. E. #he -overnor%-eneral. upon the recommendation of the &ecretary of *griculture and ;atural 4esources. shall from time to time classify the lands of the public domain into N $a& *lienable or disposable, $b& Timber, and $c& Mineral lands, 7 7 7. =ec. 0. 3or the purposes of the government and disposition of alienable or disposable public lands, the -overnor%-eneral. upon recommendation by the &ecretary of *griculture and ;atural 4esources. shall from time to time declare what lands are open to disposition or concession under this *ct.% =ec. 5. 1nly those lands shall be declared open to disposition or concession which have been officially delimited or classified 7 7 7. 777 =ec. 88. An! tract of land of the public domain hich, 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 other ise. =ec. 8E. #he lands disposable under this title shall be classified as follows; >a? 6ands reclaimed by the -overnment by dredging. filling. or other meansG >b? Foreshore@ >c? arshy lands or lands covered ith or ban#s of navigable la#es or riversG ater bordering upon the shores

$d& >ands not included in an! of the foregoing classes. 7 7 7.

=ec. 85. #he lands comprised in classes >a?. >b?. and >c? of section fifty%si' shall be disposed of to private parties by lease only and not otherwise , as soon as the -overnor%-eneral. upon recommendation by the &ecretary of *griculture and ;atural 4esources. shall declare that the same are not necessary for the public service and are open to disposition under this chapter. #he lands included in class >d? may be disposed of by sale or lease under the provisions of this *ct.% $Emphasis supplied& =ection E of Act No. ,504 authoriBed the Fovernor(Feneral to %classif! lands of the public domain into 7 7 7 alienable or disposable% 40 lands. =ection 0 of the Act empo ered the Fovernor(Feneral to %declare hat lands are open to disposition or concession.% =ection 5 of the Act limited alienable or disposable lands onl! to those lands hich have been %officiall! delimited and classified.% =ection 8E of Act No. ,504 stated that lands %disposable under this title 45 shall be classified% as government reclaimed, foreshore and marsh! lands, as ell as other lands. All these lands, ho ever, must be suitable for residential, commercial, industrial or other productive non%agricultural purposes. These provisions vested upon the Fovernor( Feneral the po er to classif! inalienable lands of the public domain into disposable lands of the public domain. These provisions also empo ered the Fovernor(Feneral to classif! further such disposable lands of the public domain into government reclaimed, foreshore or marsh! lands of the public domain, as ell as other non(agricultural lands. =ection 85 of Act No. ,504 categoricall! mandated that disposable lands of the public domain classified as government reclaimed, foreshore and marsh! lands 3shall be disposed of to private parties by lease only and not otherwise.3 The Fovernor( Feneral, before allo ing the lease of these lands to private parties, must formall! declare that the lands ere %not necessar! for the public service.% Act No. ,504 reiterated the =tate polic! to lease and not to sell government reclaimed, foreshore and marsh! lands of the public domain, a polic! first enunciated in ./-0 in Act No. .E84. Fovernment reclaimed, foreshore and marsh! lands remained sui generis, as the onl! alienable or disposable lands of the public domain that the government could not sell to private parties. The rationale behind this =tate polic! is obvious. Fovernment reclaimed, foreshore and marsh! 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 onl! allo ed the lease, of these lands to private parties. The =tate al a!s reserved these lands for some future public service. Act No. ,504 did not authoriBe the reclassification of government reclaimed, foreshore and marsh! lands into other non(agricultural lands under =ection 8E $d&. >ands falling under =ection 8E $d& ere the onl! lands for non(agricultural purposes the government could sell to private parties. Thus, under Act No. ,504, the government could not sell government reclaimed, foreshore and marsh! lands to private parties . unless the legislature passed a law allowing their sale.4/

Act No. ,504 did not prohibit private parties from reclaiming parts of the sea pursuant to =ection 8 of the =panish >a of ?aters of .5EE. >ands reclaimed from the sea b! private parties ith government permission remained private lands. 5ispositions under the 8:35 +onstitution +n Ma! .4, ./18, the ./18 Constitution too# effect upon its ratification b! the 3ilipino people. The ./18 Constitution, in adopting the Regalian doctrine, declared in =ection ., Article K***, that N %=ection .. All agricultural, timber, and mineral lands of the public domain, aters, minerals, coal, petroleum, and other mineral oils, all forces of potential energ! and other natural resources of the Philippines belong to the =tate, and their disposition, e7ploitation, development, or utiliBation shall be limited to citiBens of the Philippines or to corporations or associations at least si7t! per centum of the capital of hich is o ned b! such citiBens, sub"ect to an! e7isting right, grant, lease, or concession at the time of the inauguration of the Fovernment established under this Constitution. ;atural resources. with the e'ception of public agricultural land. shall not be alienated , and no license, concession, or lease for the e7ploitation, development, or utiliBation of an! of the natural resources shall be granted for a period e7ceeding t ent!(five !ears, rene able for another t ent!(five !ears, e7cept as to ater rights for irrigation, ater suppl!, fisheries, or industrial uses other than the development of ater po er, in hich cases beneficial use ma! be the measure and limit of the grant.% $Emphasis supplied& The ./18 Constitution barred the alienation of all natural resources e7cept public agricultural lands, hich ere the onl! natural resources the =tate could alienate. Thus, foreshore lands, considered part of the =tate's natural resources, became inalienable b! constitutional fiat, available onl! for lease for ,8 !ears, rene able for another ,8 !ears. The government could alienate foreshore lands onl! after these lands ere reclaimed and classified as alienable agricultural lands of the public domain. Fovernment reclaimed and marsh! lands of the public domain, being neither timber nor mineral lands, fell under the classification of public agricultural lands. 8- 2o ever, government reclaimed and marsh! lands, although sub"ect to classification as disposable public agricultural lands, could onl! be leased and not sold to private parties because of Act No. ,504. The prohibition on private parties from ac6uiring o nership of government reclaimed and marsh! lands of the public domain as onl! a statutor! prohibition and the legislature could therefore remove such prohibition. The ./18 Constitution did not prohibit individuals and corporations from ac6uiring government reclaimed and marsh! lands of the public domain that ere classified as agricultural lands under e7isting public land la s. =ection ,, Article K*** of the ./18 Constitution provided as follo s; %=ection ,. ;o private corporation or association may acquire. lease. or hold public agricultural lands in e'cess of one thousand and twenty four

hectares. nor may any individual acquire such lands by purchase in e'cess of one hundred and forty hectares. or by lease in e'cess of one thousand and twenty%four hectares, or b! homestead in e7cess of t ent!(four hectares. >ands adapted to graBing, not e7ceeding t o thousand hectares, ma! be leased to an individual, private corporation, or association.% $Emphasis supplied& =till, after the effectivit! of the ./18 Constitution, the legislature did not repeal =ection 85 of Act No. ,504 to open for sale to private parties government reclaimed and marsh! lands of the public domain. +n the contrar!, the legislature continued the long established =tate polic! of retaining for the government title and o nership of government reclaimed and marsh! lands of the public domain. +ommonwealth *ct ;o. 8<8 of the (hilippine ;ational *ssembly +n November 0, ./1E, the National Assembl! approved Common ealth Act No. .4., also #no n as the Public >and Act, hich compiled the then e7isting la s on lands of the public domain. CA No. .4., as amended, remains to this da! the e'isting general law governing the classification and disposition of lands of the public domain other than timber and mineral lands.8. =ection E of CA No. .4. empo ers the President to classif! lands of the public domain into %alienable or disposable% 8, lands of the public domain, hich prior to such classification are inalienable and outside the commerce of man. =ection 0 of CA No. .4. authoriBes the President to %declare hat lands are open to disposition or concession.% =ection 5 of CA No. .4. states that the government can declare open for disposition or concession onl! lands that are %officiall! delimited and classified.% =ections E, 0 and 5 of CA No. .4. read as follo s; %=ec. E. #he (resident. upon the recommendation of the &ecretary of *griculture and +ommerce. shall from time to time classify the lands of the public domain into N >a? *lienable or disposable, $b& Timber, and $c& Mineral lands, and ma! at an! time and in li#e manner transfer such lands from one class to another,81 for the purpose of their administration and disposition. =ec. 0. 3or the purposes of the administration and disposition of alienable or disposable public lands, the (resident. upon recommendation by the

&ecretary of *griculture and +ommerce. shall from time to time declare what lands are open to disposition or concession under this Act. =ec. 5. 1nly those lands shall be declared open to disposition or concession which have been officially delimited and classified and, hen practicable, surve!ed, and which have not been reserved for public or quasi%public uses, nor appropriated b! the Fovernment, nor in an! manner become private propert!, nor those on hich a private right authoriBed and recogniBed b! this Act or an! other valid la ma! be claimed, or hich, having been reserved or appropriated, have ceased to be so. 7 7 7.% Thus, before the government could alienate or dispose of lands of the public domain, the President must first officiall! classif! these lands as alienable or disposable, and then declare them open to disposition or concession. There must be no la reserving these lands for public or 6uasi(public uses. The salient provisions of CA No. .4., on government reclaimed, foreshore and marsh! lands of the public domain, are as follo s; %=ec. 85. *ny 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 . =ec. 8/. #he lands disposable under this title shall be classified as follows; >a? 6ands reclaimed by the -overnment by dredging. filling. or other means@ >b? Foreshore@ >c? arshy lands or lands covered ith or ban#s of navigable la#es or riversG ater bordering upon the shores

$d& >ands not included in an! of the foregoing classes. =ec. E-. An! tract of land comprised under this title ma! be leased or sold, as the case ma! be, to an! person, corporation, or association authoriBed to purchase or lease public lands for agricultural purposes. 7 7 7. =ec. E.. #he 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 (resident, upon recommendation b! the =ecretar! of Agriculture, shall declare that the same are not necessary for the public service and are open to disposition under this chapter. #he lands included in class >d? may be disposed of by sale or lease under the provisions of this *ct.% $Emphasis supplied& =ection E. of CA No. .4. readopted, after the effectivit! of the ./18 Constitution, =ection 85 of Act No. ,504 prohibiting the sale of government reclaimed, foreshore and marsh! disposable lands of the public domain. All these lands are intended for residential, commercial, industrial or other non(agricultural purposes. As before, =ection E. allo ed onl! the lease of such lands to private parties. The government could sell to private parties onl! lands falling under =ection 8/ $d& of CA No. .4., or those lands for non( agricultural purposes not classified as government reclaimed, foreshore and marsh! disposable lands of the public domain. 3oreshore lands, ho ever, became inalienable under the ./18 Constitution hich onl! allo ed the lease of these lands to 6ualified private parties. =ection 85 of CA No. .4. e7pressl! 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.% @nder =ection .- of CA No. .4., the term %disposition% includes lease of the land. An! disposition of government reclaimed, foreshore and marsh! disposable lands for non(agricultural purposes must compl! ith Chapter *K, Title *** of CA No. .4., 84 unless a subse6uent la amended or repealed these provisions. *n his concurring opinion in the landmar# case of 4epublic 4eal )state +orporation v. +ourt of *ppeals,88Austice Re!nato =. Puno summariBed succinctl! the la on this matter, as follo s; %3oreshore lands are lands of public dominion intended for public use. =o too are lands reclaimed b! the government b! dredging, filling, or other means. Act .E84 mandated that the control and disposition of the foreshore and lands under ater remained in the national government. =aid la allo ed onl! the 'leasing' of reclaimed land. The Public >and Acts of ././ and ./1E also declared that the foreshore and lands reclaimed b! the government ere to be %disposed of to private parties b! lease onl! and not other ise.% Before leasing, ho ever, the Fovernor(Feneral, upon recommendation of the =ecretar! of Agriculture and Natural Resources, had first to determine that the land reclaimed as not necessar! for the public service. This re6uisite must have been met before the land could be disposed of. !ut even then. the foreshore and lands under water were not to be alienated and sold to private parties. #he disposition of the reclaimed land was only by lease. #he land remained property of the &tate.% $Emphasis supplied& As observed b! Austice Puno in his concurring opinion, %Common ealth Act No. .4. has remained in effect at present.%

The =tate polic! prohibiting the sale to private parties of government reclaimed, foreshore and marsh! alienable lands of the public domain, first implemented in ./-0 as thus reaffirmed in CA No. .4. after the ./18 Constitution too# effect. The prohibition on the sale of foreshore lands, ho ever, became a constitutional edict under the ./18 Constitution. 3oreshore lands became inalienable as natural resources of the =tate, unless reclaimed b! the government and classified as agricultural lands of the public domain, in hich case the! ould fall under the classification of government reclaimed lands. After the effectivit! of the ./18 Constitution, government reclaimed and marsh! disposable lands of the public domain continued to be onl! leased and not sold to private parties.8E These lands remained sui generis, as the onl! alienable or disposable lands of the public domain the government could not sell to private parties. =ince then and until no , the onl! a! the government can sell to private parties government reclaimed and marsh! disposable lands of the public domain is for the legislature to pass a la authoriBing such sale. CA No. .4. does not authoriBe the President to reclassif! government reclaimed and marsh! lands into other non(agricultural lands under =ection 8/ $d&. >ands classified under =ection 8/ $d& are the onl! alienable or disposable lands for non(agricultural purposes that the government could sell to private parties. Moreover, =ection E- of CA No. .4. e'pressly re6uires congressional authorit! before lands under =ection 8/ that the government previousl! transferred to government units or entities could be sold to private parties. =ection E- of CA No. .4. declares that N %=ec. E-. 7 7 7 The area so leased or sold shall be such as shall, in the "udgment of the =ecretar! of Agriculture and Natural Resources, be reasonabl! necessar! for the purposes for hich such sale or lease is re6uested, and shall not e7ceed one hundred and fort!(four hectares; Provided, ho ever, That this limitation shall not appl! to grants, donations, or transfers made to a province, municipalit! or branch or subdivision of the Fovernment for the purposes deemed b! said entities conducive to the public interestG but the land so granted. donated. or transferred to a province. municipality or branch or subdivision of the -overnment shall not be alienated. encumbered. or otherwise disposed of in a manner affecting its title. e'cept when authori,ed by +ongress ; 7 7 7.% $Emphasis supplied& The congressional authorit! re6uired in =ection E- of CA No. .4. mirrors the legislative authorit! re6uired in =ection 8E of Act No. ,504. +ne reason for the congressional authorit! is that =ection E- of CA No. .4. e7empted government units and entities from the ma7imum area of public lands that could be ac6uired from the =tate. These government units and entities should not "ust turn around and sell these lands to private parties in violation of constitutional or statutor! limitations. +ther ise, the transfer of lands for non(agricultural purposes to government units and entities could be used to circumvent constitutional limitations on o nership of alienable or

disposable lands of the public domain. *n the same manner, such transfers could also be used to evade the statutor! prohibition in CA No. .4. on the sale of government reclaimed and marsh! lands of the public domain to private parties. =ection E- of CA No. .4. constitutes b! operation of la a lien on these lands. 80 *n case of sale or lease of disposable lands of the public domain falling under =ection 8/ of CA No. .4., =ections E1 and E0 re6uire a public bidding. =ections E1 and E0 of CA No. .4. provide as follo s; %=ec. E1. ?henever it is decided that lands covered b! this chapter are not needed for public purposes, the )irector of >ands shall as# the =ecretar! of Agriculture and Commerce $no the =ecretar! of Natural Resources& for authorit! to dispose of the same. @pon receipt of such authorit!, the )irector of >ands shall give notice b! public advertisement in the same manner as in the case of leases or sales of agricultural public land, 7 7 7. =ec. E0. #he lease or sale shall be made by oral bidding@ and ad"udication shall be made to the highest bidder. 7 7 7.% $Emphasis supplied& Thus, CA No. .4. mandates the Fovernment to put to public auction all leases or sales of alienable or disposable lands of the public domain. 85 >i#e Act No. .E84 and Act No. ,504 before it, CA No. .4. did not repeal =ection 8 of the =panish >a of ?aters of .5EE. Private parties could still reclaim portions of the sea ith government permission. 2o ever, the reclaimed land could become private land only if classified as alienable agricultural land of the public domain open to disposition under CA No. .4.. The ./18 Constitution prohibited the alienation of all natural resources e7cept public agricultural lands. #he +ivil +ode of 8:5A The Civil Code of ./8- readopted substantiall! the definition of propert! of public dominion found in the Civil Code of .55/. Articles 4,- and 4,, of the Civil Code of ./8state that N %Art. 4,-. The follo ing things are propert! of public dominion; $.& Those intended for public use, such as roads, canals, rivers, torrents, ports and bridges constructed b! the =tate, ban#s, shores, roadsteads, and others of similar characterG $,& Those hich belong to the =tate, ithout being for public use, and are intended for some public service or for the development of the national ealth.

7 7 7. Art. 4,,. Propert! of public dominion, hen no longer intended for public use or for public service, shall form part of the patrimonial propert! of the =tate.% Again, the government must formall! declare that the propert! of public dominion is no longer needed for public use or public service, before the same could be classified as patrimonial propert! of the =tate. 8/ *n the case of government reclaimed and marsh! lands of the public domain, the declaration of their being disposable, as ell as the manner of their disposition, is governed b! the applicable provisions of CA No. .4.. >i#e the Civil Code of .55/, the Civil Code of ./8- included as propert! of public dominion those properties of the =tate hich, ithout being for public use, are intended for public service or the %development of the national wealth.% Thus, government reclaimed and marsh! lands of the =tate, even if not emplo!ed for public use or public service, if developed to enhance the national ealth, are classified as propert! of public dominion. 5ispositions under the 8:73 +onstitution The ./01 Constitution, hich too# effect on Aanuar! .0, ./01, li#e ise adopted the Regalian doctrine. =ection 5, Article K*D of the ./01 Constitution stated that N %=ec. 5. All lands of the public domain, aters, minerals, coal, petroleum and other mineral oils, all forces of potential energ!, fisheries, ildlife, and other natural resources of the Philippines belong to the =tate. 7ith the e'ception 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 e7ploration, development, e7ploitation, or utiliBation of an! of the natural resources shall be granted for a period e7ceeding t ent!(five !ears, rene able for not more than t ent!(five !ears, e7cept as to ater rights for irrigation, ater suppl!, fisheries, or industrial uses other than the development of ater po er, in hich cases, beneficial use ma! be the measure and the limit of the grant.% $Emphasis supplied& The ./01 Constitution prohibited the alienation of all natural resources ith the e7ception of %agricultural, industrial or commercial, residential, and resettlement lands of the public domain.% *n contrast, the ./18 Constitution barred the alienation of all natural resources e7cept %public agricultural lands.% 2o ever, the term %public agricultural lands% in the ./18 Constitution encompassed industrial, commercial, residential and resettlement lands of the public domain.E- *f the land of public domain ere neither timber nor mineral land, it ould fall under the classification of agricultural land of the public domain. !oth the 8:35 and 8:73 +onstitutions. therefore. prohibited the alienation of all natural resources e'cept agricultural lands of the public domain.

The ./01 Constitution, ho ever, limited the alienation of lands of the public domain to individuals ho ere citiBens of the Philippines. Private corporations, even if holl! o ned b! Philippine citiBens, ere no longer allo ed to ac6uire alienable lands of the public domain unli#e in the ./18 Constitution. =ection .., Article K*D of the ./01 Constitution declared that N %=ec. ... The Batasang Pambansa, ta#ing into account conservation, ecological, and development re6uirements of the natural resources, shall determine b! la the siBe of land of the public domain hich ma! be developed, held or ac6uired b!, or leased to, an! 6ualified individual, corporation, or association, and the conditions therefor. ;o private corporation or association may hold alienable lands of the public domain e'cept by lease not to e7ceed one thousand hectares in area nor ma! an! citiBen hold such lands b! lease in e7cess of five hundred hectares or ac6uire b! purchase, homestead or grant, in e7cess of t ent!(four hectares. No private corporation or association ma! hold b! lease, concession, license or permit, timber or forest lands and other timber or forest resources in e7cess of one hundred thousand hectares. 2o ever, such area ma! be increased b! the Batasang Pambansa upon recommendation of the National Economic and )evelopment Authorit!.% $Emphasis supplied& Thus, under the ./01 Constitution, private corporations could hold alienable lands of the public domain onl! through lease. +nl! individuals could no ac6uire alienable lands of the public domain, and private corporations became absolutely barred from acquiring any Bind of alienable land of the public domain . The constitutional ban e7tended to all #inds of alienable lands of the public domain, hile the statutor! ban under CA No. .4. applied onl! to government reclaimed, foreshore and marsh! alienable lands of the public domain. (5 ;o. 8A9< +reating the (ublic )states *uthority +n 3ebruar! 4, ./00, then President 3erdinand Marcos issued Presidential )ecree No. .-54 creating PEA, a holl! government o ned and controlled corporation ith a special charter. =ections 4 and 5 of P) No. .-54, vests PEA ith the follo ing purposes and po ers; %=ec. 4. Purpose. The Authorit! is hereb! created for the follo ing purposes; $a& #o reclaim land. including foreshore and submerged areas. by dredging. filling or other means. or to acquire reclaimed land@ $b& To develop, improve, ac6uire, administer, deal in, subdivide, dispose, lease and sell any and all Binds of lands, buildings, estates and other forms of real propert!, o ned, managed, controlled and<or operated b! the governmentG

$c& To provide for, operate or administer such service as ma! be necessar! for the efficient, economical and beneficial utiliBation of the above properties. =ec. 8. Po ers and functions of the Authorit!. The Authorit! shall, in carr!ing out the purposes for hich it is created, have the follo ing po ers and functions; $a&To prescribe its b!(la s. 777 $i& #o hold lands of the public domain in e7cess of the area permitted to private corporations b! statute. $"& #o reclaim lands and to construct atercourse, canal, ditch, flume 7 7 7. 777 $o& To perform such acts and e7ercise such functions as ma! be necessar! for the attainment of the purposes and ob"ectives herein specified.% $Emphasis supplied& P) No. .-54 authoriBes PEA to reclaim both foreshore and submerged areas of the public domain. 3oreshore areas are those covered and uncovered b! the ebb and flo of the tide.E. =ubmerged areas are those permanentl! under ater regardless of the ebb and flo of the tide.E, 3oreshore and submerged areas indisputabl! belong to the public domainE1 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 ./01 Constitution on private corporations from ac6uiring alienable lands of the public domain did not appl! to PEA since it as then, and until toda!, a full! o ned government corporation. The constitutional ban applied then, as it still applies no , onl! to %private corporations and associations.% P) No. .-54 e7pressl! empo ers ()* 3to hold lands of the public domain % even %in e7cess of the area permitted to private corporations b! statute.% #hus. ()* can hold title to private lands. as well as title to lands of the public domain. *n order for PEA to sell its reclaimed foreshore and submerged alienable lands of the public domain, there must be legislative authorit! empo ering PEA to sell these lands. This legislative authorit! is necessar! in vie of =ection E- of CA No..4., hich states N %=ec. E-. 7 7 7G but the land so granted, donated or transferred to a province, municipalit!, or branch or subdivision of the Fovernment shall not be alienated, encumbered or other ise disposed of in a manner affecting its title, e'cept when authori,ed by +ongressG 7 7 7.% $Emphasis supplied& or# across, or other ise, an! stream,

?ithout such legislative authorit!, PEA could not sell but onl! lease its reclaimed foreshore and submerged alienable lands of the public domain. Nevertheless, an! legislative authorit! granted to PEA to sell its reclaimed alienable lands of the public domain ould be sub"ect to the constitutional ban on private corporations from ac6uiring alienable lands of the public domain. 2ence, such legislative authorit! could onl! benefit private individuals. 5ispositions under the 8:97 +onstitution The ./50 Constitution, li#e the ./18 and ./01 Constitutions before it, has adopted the Regalian doctrine. The ./50 Constitution declares that all natural resources are % owned by the &tate,% and e7cept for alienable agricultural lands of the public domain, natural resources cannot be alienated. =ections , and 1, Article K** of the ./50 Constitution state that N %=ection ,. All lands of the public domain, aters, minerals, coal, petroleum and other mineral oils, all forces of potential energ!, fisheries, forests or timber, ildlife, flora and fauna, and other natural resources are owned by the &tate. 7ith the e'ception of agricultural lands. all other natural resources shall not be alienated. The e7ploration, development, and utiliBation of natural resources shall be under the full control and supervision of the =tate. 7 7 7. =ection 1. >ands of the public domain are classified into agricultural, forest or timber, mineral lands, and national par#s. Agricultural lands of the public domain ma! be further classified b! la according to the uses hich the! ma! be devoted. *lienable lands of the public domain shall be limited to agricultural lands. (rivate corporations or associations may not hold such alienable lands of the public domain e'cept by lease. for a period not e'ceeding twenty%five years. renewable for not more than twenty% five years. and not to e'ceed one thousand hectares in area . CitiBens of the Philippines ma! lease not more than five hundred hectares, or ac6uire not more than t elve hectares thereof b! purchase, homestead, or grant. Ta#ing into account the re6uirements of conservation, ecolog!, and development, and sub"ect to the re6uirements of agrarian reform, the Congress shall determine, b! la , the siBe of lands of the public domain hich ma! be ac6uired, developed, held, or leased and the conditions therefor.% $Emphasis supplied& The ./50 Constitution continues the =tate polic! in the ./01 Constitution banning private corporations fromacquiring any Bind of alienable land of the public domain . >i#e the ./01 Constitution, the ./50 Constitution allo s private corporations to hold alienable lands of the public domain only through lease. As in the ./18 and ./01 Constitutions, the general la governing the lease to private corporations of reclaimed, foreshore and marsh! alienable lands of the public domain is still CA No. .4..

#he 4ationale behind the +onstitutional !an The rationale behind the constitutional ban on corporations from ac6uiring, e7cept through lease, alienable lands of the public domain is not ell understood. )uring the deliberations of the ./5E Constitutional Commission, the commissioners probed the rationale behind this ban, thus; %3R. BERNA=; Mr. Dice(President, m! 6uestions have reference to page 1, line 8 hich sa!s; PNo private corporation or association ma! hold alienable lands of the public domain e7cept b! lease, not to e7ceed one thousand hectares in area.' *f e recall, this provision did not e7ist under the ./18 Constitution, but this as introduced in the ./01 Constitution. *n effect, it prohibits private corporations from ac6uiring alienable public lands. !ut it has not been very clear in "urisprudence what the reason for this is . *n some of the cases decided in ./5, and ./51, it was indicated that the purpose of this is to prevent large landholdings. *s that the intent of this provisionO MR. D*>>EFA=; * thin# that is the spirit of the provision. 3R. BERNA=; *n e7isting decisions involving the *glesia ni Cristo, there ere instances here the *glesia ni Cristo as not allo ed to ac6uire a mere 1.1( s6uare meter land here a chapel stood because the =upreme Court said it ould be in violation of this.% $Emphasis supplied& *n *yog v. +usi,E4 the Court e7plained the rationale behind this constitutional ban in this a!; %*ndeed, one purpose of the constitutional prohibition against purchases of public agricultural lands b! private corporations is to e6uitabl! diffuse land o nership or to encourage 'o ner(cultivatorship and the economic famil!(siBe farm' and to prevent a recurrence of cases li#e the instant case. 2uge landholdings b! corporations or private persons had spa ned social unrest.% 2o ever, if the constitutional intent is to prevent huge landholdings, the Constitution could have simpl! limited the siBe of alienable lands of the public domain that corporations could ac6uire. The Constitution could have follo ed the limitations on individuals, ho could ac6uire not more than ,4 hectares of alienable lands of the public domain under the ./01 Constitution, and not more than ., hectares under the ./50 Constitution.

*f the constitutional intent is to encourage economic famil!(siBe farms, placing the land in the name of a corporation ould be more effective in preventing the brea#(up of farmlands. *f the farmland is registered in the name of a corporation, upon the death of the o ner, his heirs ould inherit shares in the corporation instead of subdivided parcels of the farmland. This ould prevent the continuing brea#(up of farmlands into smaller and smaller plots from one generation to the ne7t. *n actual practice, the constitutional ban strengthens the constitutional limitation on individuals from ac6uiring more than the allo ed area of alienable lands of the public domain. ?ithout the constitutional ban, individuals ho alread! ac6uired the ma7imum area of alienable lands of the public domain could easil! set up corporations to ac6uire more alienable public lands. An individual could o n as man! corporations as his means ould allo him. An individual could even hide his o nership of a corporation b! putting his nominees as stoc#holders of the corporation. The corporation is a convenient vehicle to circumvent the constitutional limitation on ac6uisition b! individuals of alienable lands of the public domain. The constitutional intent, under the ./01 and ./50 Constitutions, is to transfer o nership of onl! a limited area of alienable land of the public domain to a 6ualified individual. This constitutional intent is safeguarded b! the provision prohibiting corporations from ac6uiring alienable lands of the public domain, since the vehicle to circumvent the constitutional intent is removed. The available alienable public lands are graduall! decreasing in the face of an ever(gro ing population. The most effective a! to insure faithful adherence to this constitutional intent is to grant or sell alienable lands of the public domain onl! to individuals. This, it ould seem, is the practical benefit arising from the constitutional ban. #he *mended Joint /enture *greement The sub"ect matter of the Amended ADA, as stated in its second ?hereas clause, consists of three properties, namel!; .. %9T:hree partiall! reclaimed and substantiall! eroded islands along Emilio Aguinaldo Boulevard in Parana6ue and >as Pinas, Metro Manila, ith a combined titled area of .,805,44. s6uare metersG% ,. %9A:nother area of ,,4,.,88/ s6uare meters contiguous to the three islandsG% and 1. %9A:t AMAR*'s option as approved b! PEA, an additional 18- hectares more or less to regulariBe the configuration of the reclaimed area.% E8 PEA confirms that the Amended ADA involves %the development of the 3reedom *slands and further reclamation of about ,8- hectares 7 7 7,% plus an option %granted to AMAR* to subse6uentl! reclaim another 18- hectares 7 7 7.%EE

*n short, the Amended ADA covers a reclamation area of 08- hectares. 1nly 857.9< hectares of the 75A%hectare reclamation pro"ect have been reclaimed. and the rest of the 5:=.85 hectares are still submerged areas forming part of anila !ay. @nder the Amended ADA, AMAR* ill reimburse PEA the sum of P.,5/4,.,/,,--.-- for PEA's %actual cost% in partiall! reclaiming the 3reedom *slands. AMAR* ill also complete, at its o n e7pense, the reclamation of the 3reedom *slands. AMAR* ill further shoulder all the reclamation costs of all the other areas, totaling 8/,..8 hectares, still to be reclaimed. AMAR* and PEA ill share, in the proportion of 0- percent and 1- percent, respectivel!, the total net usable area hich is defined in the Amended ADA as the total reclaimed area less 1- percent earmar#ed for common areas. Title to AMAR*'s share in the net usable area, totaling 1E0.8 hectares, ill be issued in the name of AMAR*. =ection 8., $c& of the Amended ADA provides that N %7 7 7, PEA shall have the dut! to e7ecute ithout dela! the necessar! deed of transfer or conve!ance of the title pertaining to AMAR*'s >and share based on the >and Allocation Plan. ()*. when requested in writing by * *4$. shall then cause the issuance and delivery of the proper certificates of title covering * *4$0s 6and &hare in the name of * *4$ , 7 7 7G provided, that if more than sevent! percent $0-Q& of the titled area at an! given time pertains to AMAR*, PEA shall deliver to AMAR* onl! sevent! percent $0-Q& of the titles pertaining to AMAR*, until such time hen a corresponding proportionate area of additional land pertaining to PEA has been titled.% $Emphasis supplied& $ndisputably. under the *mended J/* * *4$ will acquire and own a ma'imum of 367.5 hectares of reclaimed land which will be titled in its name. To implement the Amended ADA, PEA delegated to the unincorporated PEA(AMAR* "oint venture PEA's statutor! authorit!, rights and privileges to reclaim foreshore and submerged areas in Manila Ba!. =ection 1.,.a of the Amended ADA states that N %PEA hereb! contributes to the "oint venture its rights and privileges to perform Ra land Reclamation and 2oriBontal )evelopment as ell as o n the Reclamation Area, thereb! granting the Aoint Denture the full and e7clusive right, authorit! and privilege to underta#e the Pro"ect in accordance ith the Master )evelopment Plan.% The Amended ADA is the product of a renegotiation of the original ADA dated April ,8, .//8 and its supplemental agreement dated August /, .//8. #he #hreshold $ssue

The threshold issue is hether AMAR*, a private corporation, can ac6uire and o n under the Amended ADA 1E0.8 hectares of reclaimed foreshore and submerged areas in Manila Ba! in vie of =ections , and 1, Article K** of the ./50 Constitution hich state that; %=ection ,. All lands of the public domain, aters, minerals, coal, petroleum, and other mineral oils, all forces of potential energ!, fisheries, forests or timber, ildlife, flora and fauna, and other natural resources are o ned b! the =tate. 7ith the e'ception of agricultural lands. all other natural resources shall not be alienated. 7 7 7. 777 =ection 1. 7 7 7 Alienable lands of the public domain shall be limited to agricultural lands. (rivate corporations or associations may not hold such alienable lands of the public domain e'cept by lease, 7 7 7.%$Emphasis supplied& +lassification of 4eclaimed Foreshore and &ubmerged *reas PEA readil! concedes that lands reclaimed from foreshore or submerged areas of Manila Ba! are alienable or disposable lands of the public domain. *n its Memorandum, E0 PEA admits that N %@nder the Public >and Act $CA .4., as amended&, reclaimed lands are classified as alienable and disposable lands of the public domain ; '=ec. 8/. The lands disposable under this title shall be classified as follo s; $a& >ands reclaimed b! the government b! dredging, filling, or other meansG 7 7 7.'% $Emphasis supplied& >i#e ise, the >egal Tas# 3orceE5 constituted under Presidential Administrative +rder No. 1E8 admitted in its Report and Recommendation to then President 3idel D. Ramos, 3C4Declaimed lands are classified as alienable and disposable lands of the public domain.%E/ The >egal Tas# 3orce concluded that N %). Conclusion Reclaimed lands are lands of the public domain. 2o ever, b! statutor! authorit!, the rights of o nership and disposition over reclaimed lands have been transferred to PEA, b! virtue of hich PEA, as o ner, ma! validl! conve! the same to an! 6ualified person ithout violating the Constitution or an! statute.

The constitutional provision prohibiting private corporations from holding public land, e7cept b! lease $=ec. 1, Art. KD**,0- ./50 Constitution&, does not appl! to reclaimed lands hose o nership has passed on to PEA b! statutor! grant.% @nder =ection ,, Article K** of the ./50 Constitution, the foreshore and submerged areas of Manila Ba! are part of the %lands of the public domain, aters 7 7 7 and other natural resources% and conse6uentl! %o ned b! the =tate.% As such, foreshore and submerged areas %shall not be alienated,% unless the! are classified as %agricultural lands% of the public domain. The mere reclamation of these areas b! PEA does not convert these inalienable natural resources of the =tate into alienable or disposable lands of the public domain. There must be a la or presidential proclamation officiall! classif!ing 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 la has reserved them for some public or 6uasi(public use. 0. =ection 5 of CA No. .4. provides that %onl! those lands shall be declared open to disposition or concession hich have been officially delimited and classified .%0, The President has the authorit! to classif! inalienable lands of the public domain into alienable or disposable lands of the public domain, pursuant to =ection E of CA No. .4.. *n >aurel vs. Farcia,01 the E7ecutive )epartment attempted to sell the Roppongi propert! in To#!o, Aapan, hich as ac6uired b! the Philippine Fovernment for use as the Chancer! of the Philippine Embass!. Although the Chancer! had transferred to another location thirteen !ears earlier, the Court still ruled that, under Article 4,, 04of the Civil Code, a propert! of public dominion retains such character until formall! declared other ise. The Court ruled that N %The fact that the Roppongi site has not been used for a long time for actual Embass! service does not automaticall! convert it to patrimonial propert!. An! such conversion happens onl! if the propert! is ithdra n from public use $Cebu +7!gen and Acet!lene Co. v. Bercilles, EE =CRA 45. 9./08:. * property continues to be part of the public domain. not available for private appropriation or ownership 0until there is a formal declaration on the part of the government to withdraw it from being such0 $*gnacio v. )irector of >ands, .-5 Phil. 118 9./E-:.% $Emphasis supplied& P) No. .-58, issued on 3ebruar! 4, ./00, authoriBed the issuance of special land patents for lands reclaimed b! PEA from the foreshore or submerged areas of Manila Ba!. +n Aanuar! ./, ./55 then President CoraBon C. A6uino issued =pecial Patent No. 18.0 in the name of PEA for the .80.54 hectares comprising the partiall! reclaimed 3reedom *slands. =ubse6uentl!, on April /, ./// the Register of )eeds of the Municipalit! of Parana6ue issued TCT Nos. 01-/, 01.. and 01., in the name of PEA pursuant to =ection .-1 of P) No. .8,/ authoriBing the issuance of certificates of title corresponding to land patents. To this da!, these certificates of title are still in the name of PEA. P) No. .-58, coupled ith President A6uino's actual issuance of a special patent covering the 3reedom *slands, is e6uivalent to an official proclamation classif!ing the

3reedom *slands as alienable or disposable lands of the public domain. P) No. .-58 and President A6uino's issuance of a land patent also constitute a declaration that the 3reedom *slands are no longer needed for public service. #he Freedom $slands are thus alienable or disposable lands of the public domain. open to disposition or concession to qualified parties. At the time then President A6uino issued =pecial Patent No. 18.0, PEA had alread! reclaimed the 3reedom *slands although subse6uentl! there ere partial erosions on some areas. The government had also completed the necessar! surve!s on these islands. Thus, the 3reedom *slands ere no longer part of Manila Ba! but part of the land mass. =ection 1, Article K** of the ./50 Constitution classifies lands of the public domain into %agricultural, forest or timber, mineral lands, and national par#s.% Being neither timber, mineral, nor national par# lands, the reclaimed 3reedom *slands necessaril! fall under the classification of agricultural lands of the public domain. @nder the ./50 Constitution, agricultural lands of the public domain are the onl! natural resources that the =tate ma! alienate to 6ualified private parties. All other natural resources, such as the seas or ba!s, are % aters 7 7 7 o ned b! the =tate% forming part of the public domain, and are inalienable pursuant to =ection ,, Article K** of the ./50 Constitution. AMAR* claims that the 3reedom *slands are private lands because C)CP, then a private corporation, reclaimed the islands under a contract dated November ,-, ./01 ith the Commissioner of Public 2igh a!s. AMAR*, citing Article 8 of the =panish >a of ?aters of .5EE, argues that %if the o nership of reclaimed lands ma! be given to the part! constructing the or#s, then it cannot be said that reclaimed lands are lands of the public domain hich the =tate ma! not alienate.% 08 Article 8 of the =panish >a of ?aters reads as follo s; %Article 8. >ands reclaimed from the sea in conse6uence of or#s constructed b! the =tate, or b! the provinces, pueblos or private persons, with proper permission, shall become the propert! of the part! constructing such or#s, unless otherwise provided by the terms of the grant of authority .% $Emphasis supplied& @nder Article 8 of the =panish >a of ?aters of .5EE, private parties could reclaim from the sea onl! ith %proper permission% from the =tate. Private parties could o n the reclaimed land onl! if not %other ise provided b! the terms of the grant of authorit!.% This clearl! meant that no one could reclaim from the sea ithout permission from the =tate because the sea is propert! of public dominion. *t also meant that the =tate could grant or ithhold o nership of the reclaimed land because an! reclaimed land, li#e the sea from hich it emerged, belonged to the =tate. Thus, a private person reclaiming from the sea ithout permission from the =tate could not ac6uire o nership of the reclaimed land hich ould remain propert! of public dominion li#e the sea it replaced. 0E Article 8 of the =panish >a of ?aters of .5EE adopted the time(honored principle of land o nership that %all lands that ere not ac6uired from the government, either b! purchase or b! grant, belong to the public domain.%00

Article 8 of the =panish >a of ?aters must be read together ith la s subse6uentl! enacted on the disposition of public lands. *n particular, CA No. .4. re6uires 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 6uasi( public purposes.05 Moreover, the contract bet een C)CP and the government as e7ecuted after the effectivit! of the ./01 Constitution hich barred private corporations from ac6uiring an! #ind of alienable land of the public domain. This contract could not have converted the 3reedom *slands into private lands of a private corporation. Presidential )ecree No. 1(A, issued on Aanuar! .., ./01, revo#ed all la s authoriBing the reclamation of areas under ater and revested solel! in the National Fovernment the po er to reclaim lands. =ection . of P) No. 1(A declared that N %#he provisions of any law to the contrary notwithstanding , the reclamation of areas under ater, hether foreshore or inland, shall be limited to the ;ational -overnment or any person authori,ed by it under a proper contract. $Emphasis supplied& 7 7 7.% P) No. 1(A repealed =ection 8 of the =panish >a of ?aters of .5EE because reclamation of areas under ater could no be underta#en onl! b! the National Fovernment or b! a person contracted b! the National Fovernment. Private parties ma! reclaim from the sea onl! under a contract ith the National Fovernment, and no longer b! grant or permission as provided in =ection 8 of the =panish >a of ?aters of .5EE. E7ecutive +rder No. 8,8, issued on 3ebruar! .4, ./0/, designated PEA as the National Fovernment's implementing arm to underta#e %all reclamation pro"ects of the government,% hich %shall be undertaBen by the ()* or through a proper contract e'ecuted by it with any person or entity .% @nder such contract, a private part! receives compensation for reclamation services rendered to PEA. Pa!ment to the contractor ma! be in cash, or in #ind consisting of portions of the reclaimed land, sub"ect to the constitutional ban on private corporations from ac6uiring alienable lands of the public domain. The reclaimed land can be used as pa!ment in #ind onl! 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 ADA covers not onl! the 3reedom *slands, but also an additional 8/,..8 hectares hich are still submerged and forming part of Manila Ba!. #here is no legislative or (residential act classifying these submerged areas as alienable or disposable lands of the public domain open to disposition . These submerged areas are not covered b! an! 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. @ntil reclaimed from the sea, these submerged areas are, under the Constitution, % aters 7 7 7 o ned b! the =tate,% forming part of the public domain and conse6uentl! inalienable. +nl! hen actuall!

reclaimed from the sea can these submerged areas be classified as public agricultural lands, hich under the Constitution are the onl! natural resources that the =tate ma! alienate. +nce reclaimed and transformed into public agricultural lands, the government ma! then officiall! classif! these lands as alienable or disposable lands open to disposition. Thereafter, the government ma! declare these lands no longer needed for public service. +nl! then can these reclaimed lands be considered alienable or disposable lands of the public domain and ithin the commerce of man. The classification of PEA's reclaimed foreshore and submerged lands into alienable or disposable lands open to disposition is necessar! because PEA is tas#ed under its charter to underta#e public services that re6uire the use of lands of the public domain. @nder =ection 8 of P) No. .-54, the functions of PEA include the follo ing; %9T:o o n or operate railroads, tram a!s and other #inds of land transportation, 7 7 7G 9T:o construct, maintain and operate such s!stems of sanitar! se ers as ma! be necessar!G 9T:o construct, maintain and operate such storm drains as ma! be necessar!.% PEA is empo ered to issue %rules and regulations as ma! be necessar! for the proper use b! private parties of any or all of the highways. roads. utilities. buildings andEor 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 b! the PEA ould actuall! be needed for public use or service since man! of the functions imposed on PEA b! its charter constitute essential public services. Moreover, =ection . of E7ecutive +rder No. 8,8 provides that PEA %shall be primaril! responsible for integrating, directing, and coordinating all reclamation pro"ects for and on behalf of the National Fovernment.% The same section also states that %9A:ll reclamation pro"ects shall be approved b! the President upon recommendation of the PEA, and shall be underta#en b! the PEA or through a proper contract e7ecuted b! it ith an! person or entit!G 7 7 7.% Thus, under E+ No. 8,8, in relation to P) No. 1(A and P) No..-54, PEA became the primar! implementing agenc! of the National Fovernment to reclaim foreshore and submerged lands of the public domain. E+ No. 8,8 recogniBed PEA as the government entit! %to underta#e the reclamation of lands and ensure their ma7imum utiliBation in promoting public welfare and interests .%0/ =ince large portions of these reclaimed lands ould obviousl! 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. )*wphi)(n+t =ection 1 of E+ No. 8,8, b! declaring that all lands reclaimed b! PEA %shall belong to or be o ned b! the PEA,% could not automaticall! operate to classif! inalienable lands into alienable or disposable lands of the public domain. +ther ise, reclaimed foreshore and submerged lands of the public domain ould automaticall! become alienable once reclaimed b! PEA, hether or not classified as alienable or disposable. The Revised Administrative Code of ./50, a later la than either P) No. .-54 or E+ No. 8,8, vests in the )epartment of Environment and Natural Resources $%)ENR% for brevit!& the follo ing po ers and functions; %=ec. 4. Po ers and 3unctions. The )epartment shall;

$.& 7 7 7 777 $4& )'ercise supervision and control over forest lands, alienable and disposable public lands, mineral resources and, in the process of e7ercising such control, impose appropriate ta7es, fees, charges, rentals and an! such form of lev! and collect such revenues for the e7ploration, development, utiliBation or gathering of such resourcesG 777 $.4& (romulgate rules. regulations and guidelines on the issuance of licenses. permits. concessions. lease agreements and such other privileges concerning the development. e'ploration and utili,ation of the country0s marine. freshwater. and bracBish water and over all aquatic resources of the country and shall continue to oversee. supervise and police our natural resourcesG cancel or cause to cancel such privileges upon failure, non(compliance or violations of an! regulation, order, and for all other causes hich are in furtherance of the conservation of natural resources and supportive of the national interestG $.8& )'ercise e'clusive "urisdiction on the management and disposition of all lands of the public domain and serve as the sole agency responsible for classification, sub(classification, surve!ing and titling of lands in consultation ith appropriate agencies.%5- $Emphasis supplied& As manager, conservator and overseer of the natural resources of the =tate, )ENR e7ercises %supervision and control over alienable and disposable public lands.% )ENR also e7ercises %e7clusive "urisdiction on the management and disposition of all lands of the public domain.% Thus, )ENR decides hether areas under ater, li#e foreshore or submerged areas of Manila Ba!, should be reclaimed or not. This means that PEA needs authoriBation from )ENR before PEA can underta#e reclamation pro"ects in Manila Ba!, or in an! part of the countr!. )ENR also e7ercises e7clusive "urisdiction over the disposition of all lands of the public domain. 2ence, )ENR decides hether reclaimed lands of PEA should be classified as alienable under =ections E5. and 05, of CA No. .4.. +nce )ENR decides that the reclaimed lands should be so classified, it then recommends to the President the issuance of a proclamation classif!ing the lands as alienable or disposable lands of the public domain open to disposition. ?e note that then )ENR =ecretar! 3ulgencio =. 3actoran, Ar. countersigned =pecial Patent No. 18.0 in compliance ith the Revised Administrative Code and =ections E and 0 of CA No. .4..

*n short, )ENR is vested ith the po er to authoriBe the reclamation of areas under ater, hile PEA is vested ith the po er to underta#e the ph!sical reclamation of areas under ater, hether directl! or through private contractors. )ENR is also empo ered to classif! lands of the public domain into alienable or disposable lands sub"ect to the approval of the President. +n the other hand, PEA is tas#ed to develop, sell or lease the reclaimed alienable lands of the public domain. Clearl!, the mere ph!sical act of reclamation b! PEA of foreshore or submerged areas does not ma#e the reclaimed lands alienable or disposable lands of the public domain, much less patrimonial lands of PEA. >i#e ise, the mere transfer b! the National Fovernment of lands of the public domain to PEA does not ma#e the lands alienable or disposable lands of the public domain, much less patrimonial lands of PEA. Absent t o official acts N 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 b! PEA remain inalienable lands of the public domain. +nl! 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 * and Title ***51of CA No. .4. and other applicable la s.54 ()*0s *uthority to &ell 4eclaimed 6ands PEA, li#e the >egal Tas# 3orce, argues that as alienable or disposable lands of the public domain, the reclaimed lands shall be disposed of in accordance ith CA No. .4., the Public >and Act. PEA, citing =ection E- of CA No. .4., admits that reclaimed lands transferred to a branch or subdivision of the government %shall not be alienated, encumbered, or other ise disposed of in a manner affecting its title, e'cept when authori,ed by +ongress; 7 7 7.%58 $Emphasis b! PEA& *n 6aurel vs. -arcia,5E the Court cited =ection 45 of the Revised Administrative Code of ./50, hich states that N %=ec. 45. +fficial AuthoriBed to Conve! Real Propert!. ?henever real propert! of the Fovernment is authori,ed by law to be conveyed , the deed of conve!ance shall be e7ecuted in behalf of the government b! the follo ing; 7 7 7.% Thus, the Court concluded that a la is needed to conve! an! real propert! belonging to the Fovernment. The Court declared that ( %*t is not for the President to conve! real propert! of the government on his or her o n sole ill. *ny such conveyance must be authori,ed and approved by a law enacted by the +ongress . *t re6uires e7ecutive and legislative concurrence.% $Emphasis supplied&

PEA contends that P) No. .-58 and E+ No. 8,8 constitute the legislative authorit! allo ing PEA to sell its reclaimed lands. P) No. .-58, issued on 3ebruar! 4, ./00, provides that N %#he land reclaimed in the foreshore and offshore area of anila !ay pursuant to the contract for the reclamation and construction of the Manila( Cavite Coastal Road Pro"ect bet een the Republic of the Philippines and the Construction and )evelopment Corporation of the Philippines dated November ,-, ./01 and<or an! other contract or reclamation covering the same area is hereby transferred. conveyed and assigned to the ownership and administration of the (ublic )states *uthority established pursuant to P) No. .-54G Provided, ho ever, That the rights and interests of the Construction and )evelopment Corporation of the Philippines pursuant to the aforesaid contract shall be recogniBed and respected. 2enceforth, the Public Estates Authorit! shall e7ercise the rights and assume the obligations of the Republic of the Philippines $)epartment of Public 2igh a!s& arising from, or incident to, the aforesaid contract bet een the Republic of the Philippines and the Construction and )evelopment Corporation of the Philippines. *n consideration of the foregoing transfer and assignment, the Public Estates Authorit! shall issue in favor of the Republic of the Philippines the corresponding shares of stoc# in said entit! ith an issued value of said shares of stoc# $ hich& shall be deemed full! paid and non(assessable. The =ecretar! of Public 2igh a!s and the Feneral Manager of the Public Estates Authorit! shall e7ecute such contracts or agreements, including appropriate agreements ith the Construction and )evelopment Corporation of the Philippines, as ma! be necessar! to implement the above. &pecial land patentEpatents shall be issued by the &ecretary of ;atural 4esources in favor of the (ublic )states *uthority without pre"udice 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. 1n the basis of such patents. the 6and 4egistration +ommission shall issue the corresponding certificate of title.% $Emphasis supplied& +n the other hand, =ection 1 of E+ No. 8,8, issued on 3ebruar! .4, ./0/, provides that ( %=ec. 1. *ll lands reclaimed by ()* shall belong to or be owned by the ()* hich shall be responsible for its administration, development, utiliBation or disposition in accordance ith the provisions of Presidential )ecree No. .-54. An! and all income that the PEA ma! derive from the sale, lease or use of reclaimed

lands shall be used in accordance .-54.%

ith the provisions of Presidential )ecree No.

properties, does not e7empt PEA from the re6uirement of public auction. E+ No. E84 merel! authoriBes PEA to decide the mode of pa!ment, hether in #ind and in installment, but does not authoriBe PEA to dispense ith public auction. Moreover, under =ection 0/ of P) No. .448, other ise #no n as the Fovernment Auditing Code, the government is re6uired to sell valuable government propert! through public bidding. =ection 0/ of P) No. .448 mandates that N %=ection 0/. 7hen government property has become unserviceable for an! cause, or is no longer needed, it shall, upon application of the officer accountable therefor, be inspected b! the head of the agenc! or his dul! authoriBed representative in the presence of the auditor concerned and, if found to be valueless or unsaleable, it ma! be destro!ed in their presence. $f found to be valuable. it may be sold at public auction to the highest bidder under the supervision of the proper committee on a ard or similar bod! in the presence of the auditor concerned or other authoriBed representative of the Commission, after advertising by printed notice in the 1fficial -a,ette. or for not less than three consecutive days in any newspaper of general circulation, or here the value of the propert! does not arrant the e7pense of publication, b! notices posted for a li#e period in at least three public places in the localit! here the propert! is to be sold. $n the event that the public auction fails. the property may be sold at a private sale at such price as may be fi'ed by the same committee or body concerned and approved by the +ommission.% *t is onl! hen the public auction fails that a negotiated sale is allo ed, in hich case the Commission on Audit must approve the selling price. /- The Commission on Audit implements =ection 0/ of the Fovernment Auditing Code through Circular No. 5/( ,/E/. dated Aanuar! ,0, ./5/. This circular emphasiBes that government assets must be disposed of onl! through public auction, and a negotiated sale can be resorted to onl! in case of %failure of public auction.% At the public auction sale, onl! Philippine citiBens are 6ualified 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 an! #ind of alienable land of the public domain. PEA originall! scheduled a public bidding for the 3reedom *slands on )ecember .-, .//.. PEA imposed a condition that the inning bidder should reclaim another ,8- hectares of submerged areas to regulariBe the shape of the 3reedom *slands, under a E-(4- sharing of the additional reclaimed areas in favor of the inning bidder. /,No one, ho ever, submitted a bid. +n )ecember ,1, .//4, the Fovernment Corporate Counsel advised PEA it could sell the 3reedom *slands through negotiation, ithout need of another public bidding, because of the failure of the public bidding on )ecember .-, .//.. /1 2o ever, the original ADA dated April ,8, .//8 covered not onl! the 3reedom *slands and the additional ,8- hectares still to be reclaimed, it also granted an option to AMAR* to

There is no e7press authorit! under either P) No. .-58 or E+ No. 8,8 for PEA to sell its reclaimed lands. P) No. .-58 merel! transferred %o nership and administration% of lands reclaimed from Manila Ba! to PEA, hile E+ No. 8,8 declared that lands reclaimed b! PEA %shall belong to or be o ned b! PEA.% E+ No. 8,8 e7pressl! states that PEA should dispose of its reclaimed lands %in accordance ith the provisions of Presidential )ecree No. .-54,% the charter of PEA. PEA's charter, ho ever, e7pressl! tas#s PEA %to develop, improve, ac6uire, administer, deal in, subdivide, dispose, lease and sell any and all Binds of lands 7 7 7 o ned, managed, controlled and<or operated b! the government.% 50 $Emphasis supplied& #here is. therefore. legislative authority granted to ()* to sell its lands. whether patrimonial or alienable lands of the public domain . PEA ma! sell to private parties its patrimonial properties in accordance ith the PEA charter free from constitutional limitations. The constitutional ban on private corporations from ac6uiring alienable lands of the public domain does not appl! to the sale of PEA's patrimonial lands. PEA ma! also sell its alienable or disposable lands of the public domain to private individuals since, ith the legislative authorit!, there is no longer an! statutor! prohibition against such sales and the constitutional ban does not appl! to individuals. PEA, ho ever, cannot sell an! of its alienable or disposable lands of the public domain to private corporations since =ection 1, Article K** of the ./50 Constitution e7pressl! prohibits such sales. The legislative authorit! benefits onl! individuals. Private corporations remain barred from ac6uiring an! #ind of alienable land of the public domain, including government reclaimed lands. The provision in P) No. .-58 stating that portions of the reclaimed lands could be transferred b! PEA to the %contractor or his assignees% $Emphasis supplied& ould not appl! to private corporations but onl! to individuals because of the constitutional ban. +ther ise, the provisions of P) No. .-58 ould violate both the ./01 and ./50 Constitutions. #he 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 ould have to conduct a public bidding in selling or leasing these lands. PEA must observe the provisions of =ections E1 and E0 of CA No. .4. re6uiring public auction, in the absence of a la e7empting PEA from holding a public auction. 55 =pecial Patent No. 18.0 e7pressl! states that the patent is issued b! authorit! of the Constitution and P) No. .-54, %supplemented b! Common ealth Act No. .4., as amended.% This is an ac#no ledgment that the provisions of CA No. .4. appl! to the disposition of reclaimed alienable lands of the public domain unless other ise provided b! la . E7ecutive +rder No. E84, 5/ hich authoriBes PEA %to determine the #ind and manner of pa!ment for the transfer% of its assets and

reclaim another 18- hectares. The original ADA, a negotiated contract, enlarged the reclamation area to 75A hectares./4 The failure of public bidding on )ecember .-, .//., involving onl! 4-0.54 hectares, /8 is not a valid "ustification for a negotiated sale of 08hectares, almost double the area publicl! auctioned. Besides, the failure of public bidding happened on )ecember .-, .//., more than three !ears before the signing of the original ADA on April ,8, .//8. The economic situation in the countr! had greatl! improved during the intervening period. 4eclamation under the !1# 6aw and the 6ocal -overnment +ode The constitutional prohibition in =ection 1, Article K** of the ./50 Constitution is absolute and clear; %Private corporations or associations ma! not hold such alienable lands of the public domain e7cept b! lease, 7 7 7.% Even Republic Act No. E/80 $%B+T >a ,% for brevit!&, cited b! PEA and AMAR* as legislative authorit! to sell reclaimed lands to private parties, recogniBes the constitutional ban. =ection E of RA No. E/80 states N %=ec. E. Repa!ment =cheme. ( 3or the financing, construction, operation and maintenance of an! infrastructure pro"ects underta#en through the build(operate( and(transfer arrangement or an! of its variations pursuant to the provisions of this Act, the pro"ect proponent 7 7 7 ma! li#e ise be repaid in the form of a share in the revenue of the pro"ect or other non(monetar! pa!ments, such as, but not limited to, the grant of a portion or percentage of the reclaimed land, sub"ect to the constitutional requirements with respect to the ownership of the land; 7 7 7.% $Emphasis supplied& A private corporation, even one that underta#es the ph!sical reclamation of a government B+T pro"ect, cannot ac6uire reclaimed alienable lands of the public domain in vie of the constitutional ban. =ection 1-, of the >ocal Fovernment Code, also mentioned b! PEA and AMAR*, authoriBes local governments in land reclamation pro"ects to pa! the contractor or developer in #ind consisting of a percentage of the reclaimed land, to it; %=ection 1-,. 3inancing, Construction, Maintenance, +peration, and Management of *nfrastructure Pro"ects b! the Private =ector. 7 7 7 777 *n case of land reclamation or construction of industrial estates, the repa!ment plan ma! consist of the grant of a portion or percentage of the reclaimed land or the industrial estate constructed.% Although =ection 1-, of the >ocal Fovernment Code does not contain a proviso similar to that of the B+T >a , the constitutional restrictions on land o nership automaticall! appl! even though not e7pressl! mentioned in the >ocal Fovernment Code.

Thus, under either the B+T >a or the >ocal Fovernment Code, the contractor or developer, if a corporate entit!, can onl! be paid ith leaseholds on portions of the reclaimed land. *f the contractor or developer is an individual, portions of the reclaimed land, not e7ceeding ., hectares /E of non(agricultural lands, ma! be conve!ed to him in o nership in vie of the legislative authorit! allo ing such conve!ance. This is the onl! a! these provisions of the B+T >a and the >ocal Fovernment Code can avoid a direct collision ith =ection 1, Article K** of the ./50 Constitution. 4egistration of lands of the public domain 3inall!, PEA theoriBes that the %act of conve!ing the o nership of the reclaimed lands to public respondent PEA transformed such lands of the public domain to private lands.% This theor! is echoed b! AMAR* hich maintains that the %issuance of the special patent leading to the eventual issuance of title ta#es the sub"ect land a a! from the land of public domain and converts the propert! into patrimonial or private propert!.% *n short, PEA and AMAR* contend that ith the issuance of =pecial Patent No. 18.0 and the corresponding certificates of titles, the .80.54 hectares comprising the 3reedom *slands have become private lands of PEA. *n support of their theor!, PEA and AMAR* cite the follo ing rulings of the Court; .. $umail '( ,udge of "-I of "otabato,/0 here the Court held N

%+nce the patent as granted and the corresponding certificate of title as issued, the land ceased to be part of the public domain and became private propert! over hich the )irector of >ands has neither control nor "urisdiction.% ,. !ee .ong .o/ '( Da'id,/5 here 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 thereb! automaticall! comes under the operation of Republic Act 4/E sub"ect to all the safeguards provided therein.%1. .eirs of 0regorio Tengco '( .eirs of ,ose Aliwalas ,// here the Court ruled ( %?hile the )irector of >ands has the po er to revie homestead patents, he ma! do so onl! so long as the land remains part of the public domain and continues to be under his e7clusive controlG 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 propert! over hich the )irector of >ands has neither control nor "urisdiction.% 4. Manalo '( Intermediate Appellate "ourt,.-- here the Court held N %?hen the lots in dispute ere certified as disposable on Ma! ./, ./0., and free patents ere issued covering the same in favor of the private respondents, the

said lots ceased to be part of the public domain and, therefore, the )irector of >ands lost "urisdiction over the same.% 8.Republic v. Court of Appeals,.-. here the Court stated N

Aurisprudence holding that upon the grant of the patent or issuance of the certificate of title the alienable land of the public domain automaticall! becomes private land cannot appl! to government units and entities li#e PEA. The transfer of the 3reedom *slands to PEA as made sub"ect to the provisions of CA No. .4. as e7pressl! stated in =pecial Patent No. 18.0 issued b! then President A6uino, to it; %N+?, T2ERE3+RE, HN+? IE, that b! authorit! of the Constitution of the Philippines and in conformit! ith the provisions of Presidential )ecree No. .-54 . supplemented by +ommonwealth *ct ;o. 8<8. as amended , there are hereb! granted and conve!ed unto the Public Estates Authorit! the aforesaid tracts of land containing a total area of one million nine hundred fifteen thousand eight hundred ninet! four $.,/.8,5/4& s6uare metersG the technical description of hich are hereto attached and made an integral part hereof.% $Emphasis supplied& Thus, the provisions of CA No. .4. appl! to the 3reedom *slands on matters not covered b! P) No. .-54. =ection E- of CA No. .4. prohibits, %e7cept hen authoriBed b! Congress,% the sale of alienable lands of the public domain that are transferred to government units or entities. =ection E- of CA No. .4. constitutes, under =ection 44 of P) No. .8,/, a %statutor! lien affecting title% of the registered land even if not annotated on the certificate of title..-4Alienable lands of the public domain held b! government entities under =ection E- of CA No. .4. remain public lands because the! cannot be alienated or encumbered unless Congress passes a la authoriBing their disposition. Congress, ho ever, cannot authoriBe the sale to private corporations of reclaimed alienable lands of the public domain because of the constitutional ban. +nl! individuals can benefit from such la . The grant of legislative authorit! to sell public lands in accordance ith =ection E- of CA No. .4. does not automaticall! convert alienable lands of the public domain into private or patrimonial lands. The alienable lands of the public domain must be transferred to 6ualified private parties, or to government entities not tas#ed to dispose of public lands, before these lands can become private or patrimonial lands. +ther ise, the constitutional ban ill become illusor! if Congress can declare lands of the public domain as private or patrimonial lands in the hands of a government agenc! tas#ed to dispose of public lands. This ill allo private corporations to ac6uire directl! from government agencies limitless areas of lands hich, prior to such la , are concededl! public lands. @nder E+ No. 8,8, PEA became the central implementing agency of the National Fovernment to reclaim foreshore and submerged areas of the public domain. Thus, E+ No. 8,8 declares that N %EKEC@T*DE +R)ER N+. 8,8 )esignating the Public Estates Authorit! as the Agenc! Primaril! Responsible for all Reclamation Pro"ects

%Proclamation No. 18-, dated +ctober /, ./8E, of President Magsa!sa! legall! effected a land grant to the Mindanao Medical Center, Bureau of Medical =ervices, )epartment of 2ealth, of the hole lot, validl! sufficient for initial registration under the >and Registration Act. =uch land grant is constitutive of a 'fee simple' title or absolute title in favor of petitioner Mindanao Medical Center. Thus, =ection .,, of the Act, hich governs the registration of grants or patents involving public lands, provides that '?henever public lands in the Philippine *slands belonging to the Fovernment of the @nited =tates or to the Fovernment of the Philippines are alienated, granted or conve!ed to persons or to public or private corporations, the same shall be brought forth ith under the operation of this Act $>and Registration Act, Act 4/E& 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 uniforml! hold that the )irector of >ands has no "urisdiction over private lands or that upon issuance of the certificate of title the land automaticall! comes under the Torrens =!stem. The fifth case cited involves the registration under the Torrens =!stem of a .,.5(hectare public land granted b! the National Fovernment to Mindanao Medical Center, a government unit under the )epartment of 2ealth. The National Fovernment transferred the .,.5(hectare public land to serve as the site for the hospital buildings and other facilities of Mindanao Medical Center, hich performed a public service. The Court affirmed the registration of the .,.5(hectare public land in the name of Mindanao Medical Center under =ection .,, of Act No. 4/E. This fifth case is an e7ample of a public land being registered under Act No. 4/E ithout the land losing its character as a propert! of public dominion. *n the instant case, the onl! patent and certificates of title issued are those in the name of PEA, a holl! government o ned corporation performing public as ell as proprietar! functions. No patent or certificate of title has been issued to an! private part!. No one is as#ing the )irector of >ands to cancel PEA's patent or certificates of title. *n fact, the thrust of the instant petition is that PEA's certificates of title should remain ith PEA, and the land covered b! these certificates, being alienable lands of the public domain, should not be sold to a private corporation. Registration of land under Act No. 4/E or P) No. .8,/ does not vest in the registrant private or public o nership of the land. Registration is not a mode of ac6uiring o nership but is merel! evidence of o nership previousl! conferred b! an! of the recogniBed modes of ac6uiring o nership. Registration does not give the registrant a better right than hat the registrant had prior to the registration. .-, The registration of lands of the public domain under the Torrens s!stem, b! itself, cannot convert public lands into private lands..-1

?hereas, there are several reclamation pro"ects hich are ongoing or being proposed to be underta#en in various parts of the countr! hich need to be evaluated for consistenc! ith national programsG ?hereas, there is a need to give further institutional support to the Fovernment's declared polic! to provide for a coordinated, economical and efficient reclamation of landsG ?hereas, Presidential )ecree No. 1(A re6uires that all reclamation of areas shall be limited to the National Fovernment or an! person authoriBed b! it under proper contractG 7hereas. a central authority is needed to act on behalf of the ;ational -overnment which shall ensure a coordinated and integrated approach in the reclamation of lands@ 7hereas. (residential 5ecree ;o. 8A9< creates the (ublic )states *uthority as a government corporation to undertaBe reclamation of lands and ensure their ma'imum utili,ation in promoting public welfare and interestsG and ?hereas, Presidential )ecree No. .4.E provides the President ith continuing authorit! to reorganiBe the national government including the transfer, abolition, or merger of functions and offices. N+?, T2ERE3+RE, *, 3ER)*NAN) E. MARC+=, President of the Philippines, b! virtue of the po ers vested in me b! the Constitution and pursuant to Presidential )ecree No. .4.E, do hereb! order and direct the follo ing; =ection .. #he (ublic )states *uthority >()*? shall be primarily responsible for integrating. directing. and coordinating all reclamation pro"ects for and on behalf of the ;ational -overnment . All reclamation pro"ects shall be approved b! the President upon recommendation of the PEA, and shall be underta#en b! the PEA or through a proper contract e7ecuted b! it ith an! person or entit!G Provided, that, reclamation pro"ects of an! national government agenc! or entit! authoriBed under its charter shall be underta#en in consultation ith the PEA upon approval of the President. 7 7 7 .% As the central implementing agenc! tas#ed to underta#e reclamation pro"ects nation ide, ith authorit! to sell reclaimed lands, PEA too# the place of )ENR as the government agenc! charged ith leasing or selling reclaimed lands of the public domain. The reclaimed lands being leased or sold b! PEA are not private lands, in the same manner that )ENR, hen it disposes of other alienable lands, does not dispose of private lands but

alienable lands of the public domain. +nl! hen 6ualified private parties ac6uire these lands ill the lands become private lands. $n the hands of the government agency tasBed and authori,ed to dispose of alienable of disposable lands of the public domain. these lands are still public. not private lands . 3urthermore, PEA's charter e7pressl! states that PEA % shall hold lands of the public domain% as ell as %an! and all #inds 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 li#e the 3reedom *slands are transferred to PEA and issued land patents or certificates of title in PEA's name does not automaticall! ma#e such lands private. To allo vast areas of reclaimed lands of the public domain to be transferred to PEA as private lands ill sanction a gross violation of the constitutional ban on private corporations from ac6uiring an! #ind of alienable land of the public domain. PEA ill simpl! turn around, as ()* has now done under the *mended J/* , and transfer several hundreds of hectares of these reclaimed and still to be reclaimed lands to a single private corporation in onl! one transaction. This scheme ill effectivel! nullif! the constitutional ban in =ection 1, Article K** of the ./50 Constitution hich as intended to diffuse e6uitabl! the o nership of alienable lands of the public domain among 3ilipinos, no numbering over 5- million strong. This scheme, if allo ed, can even be applied to alienable agricultural lands of the public domain since PEA can %ac6uire 7 7 7 an! and all #inds of lands.% This ill open the floodgates to corporations and even individuals ac6uiring 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 ill result in corporations amassing huge landholdings never before seen in this countr! ( creating the ver! evil that the constitutional ban as designed to prevent. This ill completel! reverse the clear direction of constitutional development in this countr!. The ./18 Constitution allo ed private corporations to ac6uire not more than .,-,4 hectares of public lands. .-8 The ./01 Constitution prohibited private corporations from ac6uiring an! #ind of public land, and the ./50 Constitution has une6uivocall! reiterated this prohibition. The contention of PEA and AMAR* that public lands, once registered under Act No. 4/E or P) No. .8,/, automaticall! become private lands is contrar! to e7isting la s. =everal la s authoriBe lands of the public domain to be registered under the Torrens =!stem or Act No. 4/E, no P) No. .8,/, ithout losing their character as public lands. =ection .,, of Act No. 4/E, and =ection .-1 of P) No. .8,/, respectivel!, provide as follo s; Act No. 4/E %=ec. .,,. ?henever public lands in the Philippine *slands belonging to the 7 7 7 Fovernment of the Philippine *slands are alienated, granted, or conve!ed to persons or the public or private corporations, the same shall be brought forth ith under the operation of this Act and shall become registered lands.%

P) No. .8,/ %=ec. .-1. Certificate of Title to Patents. ?henever public land is b! the Fovernment alienated, granted or conve!ed to any person, the same shall be brought forth ith under the operation of this )ecree.% $Emphasis supplied& Based on its legislative histor!, the phrase %conve!ed to an! person% in =ection .-1 of P) No. .8,/ includes conve!ances of public lands to public corporations. Alienable lands of the public domain %granted, donated, or transferred to a province, municipalit!, or branch or subdivision of the Fovernment,% as provided in =ection E- of CA No. .4., ma! be registered under the Torrens =!stem pursuant to =ection .-1 of P) No. .8,/. =uch registration, ho ever, is e7pressl! sub"ect to the condition in =ection E- of CA No. .4. that the land %shall not be alienated, encumbered or other ise disposed of in a manner affecting its title. e'cept when authori,ed by +ongress .% This provision refers to government reclaimed, foreshore and marsh! lands of the public domain that have been titled but still cannot be alienated or encumbered unless e7pressl! authoriBed b! Congress. The need for legislative authorit! prevents the registered land of the public domain from becoming private land that can be disposed of to 6ualified private parties. The Revised Administrative Code of ./50 also recogniBes that lands of the public domain ma! be registered under the Torrens =!stem. =ection 45, Chapter .,, Boo# * of the Code states N %=ec. 45. +fficial AuthoriBed to Conve! Real Propert!. ?henever real propert! of the Fovernment is authoriBed b! la to be conve!ed, the deed of conve!ance shall be e7ecuted in behalf of the government b! the follo ing; $.& 7 7 7 $,& For property belonging to the 4epublic of the (hilippines. but titled in the name of any political subdivision or of any corporate agency or instrumentality, b! the e7ecutive head of the agenc! or instrumentalit!.% $Emphasis supplied& Thus, private propert! purchased b! the National Fovernment for e7pansion of a public harf ma! be titled in the name of a government corporation regulating port operations in the countr!. Private propert! purchased b! the National Fovernment for e7pansion of an airport ma! also be titled in the name of the government agenc! tas#ed to administer the airport. Private propert! donated to a municipalit! for use as a to n plaBa or public school site ma! li#e ise be titled in the name of the municipalit!. .-E All these properties become properties of the public domain, and if alread! registered under Act No. 4/E or P) No. .8,/, remain registered land. There is no re6uirement or provision in an! e7isting la for the de(registration of land from the Torrens =!stem.

Private lands ta#en b! the Fovernment for public use under its po er of eminent domain become un6uestionabl! part of the public domain. Nevertheless, =ection 58 of P) No. .8,/ authoriBes the Register of )eeds to issue in the name of the National Fovernment ne certificates of title covering such e7propriated lands. =ection 58 of P) No. .8,/ states N %=ec. 58. >and ta#en b! eminent domain. ?henever an! registered land, or interest therein, is e7propriated or ta#en b! eminent domain, the National Fovernment, province, cit! or municipalit!, or an! other agenc! or instrumentalit! e7ercising such right shall file for registration in the proper Registr! a certified cop! of the "udgment hich shall state definitel! b! an ade6uate description, the particular propert! or interest e7propriated, the number of the certificate of title, and the nature of the public use. A memorandum of the right or interest ta#en shall be made on each certificate of title b! the Register of )eeds, and here the fee simple is ta#en, a new certificate shall be issued in favor of the ;ational -overnment. province. city. municipality , or an! other agenc! or instrumentalit! e7ercising such right for the land so ta#en. The legal e7penses incident to the memorandum of registration or issuance of a ne certificate of title shall be for the account of the authorit! ta#ing the land or interest therein.% $Emphasis supplied& Conse6uentl!, lands registered under Act No. 4/E or P) No. .8,/ are not e7clusivel! private or patrimonial lands. >ands of the public domain ma! also be registered pursuant to e7isting la s. AMAR* ma#es a parting shot that the Amended ADA is not a sale to AMAR* of the 3reedom *slands or of the lands to be reclaimed from submerged areas of Manila Ba!. *n the ords of AMAR*, the Amended ADA %is not a sale but a "oint venture ith a stipulation for reimbursement of the original cost incurred b! PEA for the earlier reclamation and construction or#s performed b! the C)CP under its ./01 contract ith the Republic.% ?hether the Amended ADA is a sale or a "oint venture, the fact remains that the Amended ADA re6uires PEA to %cause the issuance and deliver! of the certificates of title conve!ing AMAR*'s >and =hare in the name of AMAR*.%.-0 This stipulation still contravenes =ection 1, Article K** of the ./50 Constitution hich provides that private corporations %shall not hold such alienable lands of the public domain e7cept b! lease.% The transfer of title and o nership to AMAR* clearl! means that AMAR* ill %hold% the reclaimed lands other than b! lease. The transfer of title and o nership is a %disposition% of the reclaimed lands, a transaction considered a sale or alienation under CA No. .4., .-5 the Fovernment Auditing Code,.-/ and =ection 1, Article K** of the ./50 Constitution. The Regalian doctrine is deepl! implanted in our legal s!stem. 3oreshore and submerged areas form part of the public domain and are inalienable. >ands reclaimed from foreshore and submerged areas also form part of the public domain and are also inalienable, unless converted pursuant to la into alienable or disposable lands of the public domain.

2istoricall!, lands reclaimed b! the government are sui generis, not available for sale to private parties unli#e other alienable public lands. Reclaimed lands retain their inherent potential as areas for public use or public service. Alienable lands of the public domain, increasingl! becoming scarce natural resources, are to be distributed e6uitabl! among our ever(gro ing population. To insure such e6uitable distribution, the ./01 and ./50 Constitutions have barred private corporations from ac6uiring an! #ind of alienable land of the public domain. Those ho attempt to dispose of inalienable natural resources of the =tate, or see# to circumvent the constitutional ban on alienation of lands of the public domain to private corporations, do so at their o n ris#. ?e can no summariBe our conclusions as follo s;

Clearl!, the Amended ADA violates glaringl! =ections , and 1, Article K** of the ./50 Constitution. @nder Article .4-/.., of the Civil Code, contracts hose %ob"ect or purpose is contrar! to la ,% or hose %ob"ect is outside the commerce of men,% are %ine7istent and void from the beginning.% The Court must perform its dut! to defend and uphold the Constitution, and therefore declares the Amended J/* null and void ab initio. &eventh issue: whether the +ourt is the proper forum to raise the issue of whether the *mended J/* is grossly disadvantageous to the government. Considering that the Amended ADA is null and void ab initio, there is no necessit! 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. ?2ERE3+RE, the petition is GRANTE&. The Public Estates Authorit! and Amari Coastal Ba! )evelopment Corporation are PERMANENT!" ENJOINE& from implementing the Amended Aoint Denture Agreement hich is hereb! declared NU!! and VOI& ab initio. =+ +R)ERE). Da'ide1 ,r(1 "(,(1 2ellosillo1 Puno1 3itug1 4apunan1 Mendo5a1 Panganiban1 6uisumbing1 7nares8$antiago1 $ando'al80utierre51 Austria8Martine51 and "orona1 ,,(1 concur.

.. The .80.54 hectares of reclaimed lands comprising the 3reedom *slands, no covered b! certificates of title in the name of PEA, are alienable lands of the public domain. PEA ma! lease these lands to private corporations but ma! not sell or transfer o nership of these lands to private corporations. PEA ma! onl! sell these lands to Philippine citiBens, sub"ect to the o nership limitations in the ./50 Constitution and e7isting la s. ,. The 8/,..8 hectares of submerged areas of Manila Ba! 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 ma#e such classification and declaration onl! after PEA has reclaimed these submerged areas. +nl! then can these lands 6ualif! as agricultural lands of the public domain, hich are the onl! natural resources the government can alienate. *n their present state, the 8/,..8 hectares of submerged areas are inalienable and outside the commerce of man. 1. =ince the Amended ADA see#s to transfer to AMAR*, a private corporation, o nership of 00.14 hectares ..- of the 3reedom *slands, such transfer is void for being contrar! to =ection 1, Article K** of the ./50 Constitution hich prohibits private corporations from ac6uiring an! #ind of alienable land of the public domain. 4. =ince the Amended ADA also see#s to transfer to AMAR* o nership of ,/-..8E hectares... of still submerged areas of Manila Ba!, such transfer is void for being contrar! to =ection ,, Article K** of the ./50 Constitution hich prohibits the alienation of natural resources other than agricultural lands of the public domain. PEA ma! reclaim these submerged areas. Thereafter, the government can classif! the reclaimed lands as alienable or disposable, and further declare them no longer needed for public service. =till, the transfer of such reclaimed alienable lands of the public domain to AMAR* ill be void in vie of =ection 1, Article K** of the ./50 Constitution hich prohibits private corporations from ac6uiring an! #ind of alienable land of the public domain.

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