9/3/2014 7:24:00 AM

TANADA V ANGARA
PANGANIBAN; May 2, 1997
FACTS
- Petition for Certiorari
- DTI secretary Rizalino Navarro signed the Final Act Embodying the Results
of the Uruguay Round of Multilateral Negotiations. (Final Act). By signing it,
he agreed on behalf of the Philippines
To submit the WTO agreement to competent authorities for their approval
Adopt the ministerial declarations and decisions
(Basically, the final act aims to liberalize and expand world trade and
strengthen the interrelationship between trade and economic policies
affecting growth and development.)
- The president then sent to the senate a letter which submits the Uruguay
Round Final Act for their concurrence
- Another letter was sent by the president. This time, he submits the
Uruguay Final Round Act, the Agreement Establishing the WTO, the
Ministerial Declarations and Decisions and the Understanding on
Commitments in Financial Services to the Senate for its concurrence.
- The Senate adopted Resolution number 97, which expresses their
concurrence in the ratification of the president of the Agreement Establishing
the WTO.
- The President signed the Instrument of Ratification of the Agreement
Establishing the WTO and the agreements and associated legal instruments
of that agreement.
- The final act signed by Secretary Navarro, on the other hand, embodies
not only the WTO agreement but also the ministerial declarations and
decisions and the understanding on commitments in financial services.
- Petitioners assail the constitutionality of the treaty. They also claim that
since the Senate only concurred with the WTO agreement and not on all the
contents of the Final act, they impliedly rejected the Final act.
ISSUES
WON the case is justiciable.

WON the parity provisions and national treatment clauses in the WTO
agreement violates Sec. 19 Article 2, Sec. 10 and 12 Article 12 of the
Constitution (economic nationalism clauses).
WON the WTO agreement unduly limits, restricts and impairs legislative
power of the Congress.
WON the WTO agreement intrudes on the power of the Supreme Court to
promulgate rules concerning pleading, practice and procedures.
WON the concurring of the senate only in the WTO agreement and not in the
final act implies rejection of the final act.
HELD
- Petition dismissed.
Yes.
- The judiciary has the duty and power to strike down grave abuse of
discretion on the part of any branch or instrumentality of government
including Congress
No
- The declaration of principles are not intended to be self-executing,
rather, they are just aid and guides by the judiciary in judicial
review, and by the legislature in enacting laws. These broad principles
need legislative enactments to implement them.
- The economic nationalism provisions should be read with other
constitutional mandates, especially Sec 1 and 13 of Article 12.
- The WTO protects the weak economies. There are specific provisos in the
agreement with respect to tariffs, domestic subsidies and protection from
unfair competition which are intended to help developing economies.
- The Constitution does not rule out foreign competition. Independence
refers to the freedom from undue foreign control of the national economy.
- The Constitution has not really shown any unbalanced bias in favor of any
business or enterprise, nor does it contain any specific pronouncement that
Filipino companies should be pampered with total prescription of foreign
competition.
- Constitutions are designed to meet not only the vagaries of contemporary
events. They should be interpreted to cover even future and unknown
circumstances.

No
- Sovereignty is not absolute because it is subject to restrictions and
voluntarily agreed to by the Philippines.
- The Constitution did not envision a hermit type isolation of the country.
- By their inherent nature, treaties really limit or restrict the absoluteness of
sovereignty
- There are certain restrictions to the Constitution
- Limitations imposed by the very nature of membership in the family of
nations.
- Limitations imposed by treaty stipulations
- When the Philippines join the UN, it consented to restrict its soverign rights
under the concept of auto-limitation. (Reagan vs Commission of Internal
Revenue)
- The underlying concept in the partial surrender of sovereignty is the
reciprocal commitment of the other contracting states granting the same
privilege and immunities to the Philippines, its officials and its citizens.
No.
- The burden of proof is not transferred in cases of patent infringement. It is
still on the patent owner to introduce evidence of the existence of the
alleged identical product.
- The new rule should not really present any problem in changing the rules
of evidence as the present law on the subject, RA 165 (Patent Law),
provides a similar presumption in cases of infringement of patent design.
- Conclusion in the third issue also applies.
No.
- The final act need not be ratified. It is not the treaty itself. Rather, it is just
a summary of the proceedings. The final act only required that the senate
concur with the WTO agreement, which they did.
- The Senate was well-aware of what it was concurring to as shown by the
members deliberations.

Death

9/3/2014 7:24:00 AM

Espina Vs. Zamora

Calls the court to exercise judicial review and determine the constitutionality
of the Retail Trade Liberalization Act of 2000assailed for breach of the
constitutional mandate of development of a self-reliant and independent
national economy effectively controlled by Filipinos
Facts:
Erap-Signed into law rep act 8762 known as retail trade liberalization act of
2000REPEALS R.A. 1180, which absolutely prohibited foreign nationals
from engaging in the retail trade business.
RA 8762 ALLOWS FOREIGN NATIONALS TO ENGAGE IN RETAIL TRADE
BUSINESS:
4 CATEGORIES.
Consitutionality of RA 8762 questioned:
-against sections 9, 19, 20 of art 2 of constitution
-american retailers will crush Filipino retailers
-implementation of such will lead to alien control of retail trade-loss of
control of economy
-world bank monetary fund imposed passage of ra on govt as condition for
the release of certain loans
-clear and present danger that law will promote monopolies

Rebutle:
1. NO legal standing-cannot invoke being taxpayers or members of congress
2. does not involve any justifiable controversy
3.SECTIONS 9, 19, 20 of art 2 are not self executing therefore are not
judicially justifiable
4.const mandates the regulation not the prohibition of foreign investments
ISSUES
1. WHETHER OR NOT LAWMAKERS HAVE THE LEGAL STANDING TO
CHALLENGE THE CONSITUTIONALITY OF THE RA

2. WHETHER OR NOT RA 8762 IS UNCONSITUTIONAL

Ruling:
1. no legal standing- the implementation of the retail trade liberalization act
does not prejudice petitioners as taxpayers nor lawmakers it is a matter of
TRANCENDENTAL importance
2.const req. the development of a self-reliant and independent national
economy effectively controlled by Filipinos BUT does not impose a policy of
Filipino monopoly of the economic environment
*const allows an exchange on the basis of equality and reciprocity frowning
only on foreign competition that is unfair
Control and regulation of trade in the interest of the public is an exercise of
police power of stateIn 1954 congress enacted retail trade nationalization
act that restricts the retail business to Filipinos
Court said that there is no showing that the law contravened the
constitutional mandate. Court is not convinced that the implementation of ra
8762 would eventually lead to alien control of retail trade business

9/3/2014 7:24:00 AM
MANILA PRINCE HOTEL V GSIS
BELLOSILLO; February 3, 1997
FACTS
- Respondent GSIS, pursuant to the privatization program of the Philippine
Government under Proclamation No. 50 dated 8 December 1986, decided to
sell through public bidding 30% to 51% of the issued and outstanding shares
of respondent MHC which owns the historic Manila Hotel. In a closed bidding
held on 18 September 1995 only two (2) bidders participated: petitioner
Manila Prince Hotel Corporation, a Filipino corporation, which offered to buy
51 % of the MHC or 15,300,000 shares at P41.58 per share, and Renong
Berhad, a Malaysian firm, with ITT Sheraton as its hotel operator, which bid
for the same number of shares at P44.00 per share, or P2.42 more than the
bid of petitioner.
- Pending the declaration of Renong Berhard as the winning bidder and the
execution of the necessary contracts, petitioner in a letter to respondent
GSIS dated 28 September 1995 matched the bid price of P44.00 per share
tendered by Renong Berhad. In a subsequent letter dated 10 October 1995
petitioner sent a manager's check issued by Philtrust Bank for Thirty-three
Million Pesos (P33-000,000.00) as Bid Security to match the bid of the
Malaysian Group, Messrs. Renong Berhad which respondent GSIS refused to
accept.
- On 17 October 1995, perhaps apprehensive that respondent GSIS has
disregarded the tender of the matching bid and that the sale of 51% of the
MHC may be hastened by respondent GSIS and consummated with Renong
Berhad, petitioner came to this Court on prohibition and mandamus. On 18
October 1995 the Court issued a temporary restraining order enjoining
respondents from perfecting and consummating the sale to the Malaysian
firm. On 10 September 1996 the instant case was accepted by the Court En
Banc after it was referred to it by the First Division.
- The petitioner argues the following:
1. Petitioner invokes Sec. 10, second Par., Art. XII, of the 1987 Constitution
and submits that the Manila Hotel has been identified with the Filipino nation
and has practically become a historical monument which reflects the
vibrancy of Philippines heritage and culture. To all intents and purpose, it
has become a part of the national patrimony.

2. Petitioner also argues that since 51% of the shares of the MHC carries
with it the ownership of the business of the hotel which is owned by
respondent GSIS, the hotel business of respondent GSIS being a part of the
tourism industry is unquestionably a part of the national economy. Thus, any
transaction involving 51% of the shares of stock of the MHC is clearly
covered by the term national economy, to which Sec. 10, second par., Art.
XII, 1987 Constitution, applies.
3. It is also the thesis of petitioner that since Manila Hotel is part of the
national patrimony and its business also unquestionably part of the national
economy petitioner should be preferred after it has matched the bid offer of
the Malaysian firm. For the bidding rules mandate that if for any reason, the
Highest Bidder cannot be awarded the Block of Shares, GSIS may offer this
to the other Qualified Bidders that have validly submitted bids provided that
these Qualified Bidders are willing to match the highest bid in terms of price
per share.
- Respondents maintain that:
1. Sec. 10, second par., Art. XII, of the 1987 Constitution is merely a
statement of principle and policy since it is not a self-executing provision and
requires implementing legislation(s). Thus, for the said provision to operate,
there must be existing laws "to lay down conditions under which business
may be done."
2. Granting that this provision is self-executing, Manila Hotel does not fall
under the term national patrimony which only refers to lands of the public
domain, waters, minerals, coal, petroleum and other mineral oils, all forces
of potential energy, fisheries, forests or timber, wildlife, flora and fauna and
all marine wealth in its territorial sea, and exclusive marine zone as cited in
the first and second paragraphs of Sec. 2, Art. XII, 1987 Constitution. While
petitioner speaks of the guests who have slept in the hotel and the events
that have transpired therein which make the hotel historic, these alone do
not make the hotel fall under the patrimony of the nation. What is more, the
mandate of the Constitution is addressed to the State, not to respondent
GSIS which possesses a personality of its own separate and distinct from the
Philippines as a State.
3. Granting that the Manila Hotel forms part of the national patrimony, the
constitutional provision invoked is still inapplicable since what is being sold is
only 51% of the outstanding shares of the corporation, not the hotel building

nor the land upon which the building stands. Certainly, 51% of the equity of
the MHC cannot be considered part of the national patrimony. Moreover, if
the disposition of the shares of the MHC is really contrary to the
Constitution, petitioner should have questioned it right from the beginning
and not after it had lost in the bidding.
4. The reliance by petitioner on par. V., subpar. J. I., of the bidding rules
which provides that if for any reason, the Highest Bidder cannot be awarded
the Block of Shares, GSIS may offer this to the other Qualified Bidders that
have validly submitted bids provided that these Qualified Bidders are willing
to match the highest bid in terms of price per share, is misplaced.
Respondents postulate that the privilege of submitting a matching bid has
not yet arisen since it only takes place if for any reason, the Highest Bidder
cannot be awarded the Block of Shares.
5. The prayer for prohibition grounded on grave abuse of discretion should
fail since respondent GSIS did not exercise its discretion in a capricious,
whimsical manner, and if ever it did abuse its discretion it was not so patent
and gross as to amount to an evasion of a positive duty or a virtual refusal
to perform a duty enjoined by law. Similarly, the petition for mandamus
should fail as petitioner has no clear legal right to what it demands and
respondents do not have an imperative duty to perform the act required of
them by petitioner.
ISSUES
1. WON Sec. 10, 2nd par., Art. XII, of the 1987 Constitution is non-selfexecuting
2. WON the Manila Hotel falls under the term national patrimony
3. WON 51% of the equity of MHC can be considered part of national
patrimony
4. WON petitioner should be allowed to match the highest bid
5. WON GSIS committed grave abuse of discretion
HELD
1. NO. A provision which is complete in itself and becomes operative without
the aid of supplementary or enabling legislation, or that which supplies
sufficient rule by means of which the right it grants may be enjoyed or
protected, is self-executing. Unless the contrary is clearly intended, the

provisions of the Constitution should be considered self-executing, as a

contrary rule would give the legislature discretion to determine when, or
whether, they shall be effective. Sec. 10, second par., of Art. XII is couched
in such a way as not to make it appear that it is non-self-executing but
simply for purposes of style. The argument of respondents that the non-selfexecuting nature of Sec. 10, second par. of Art. XII is implied from the tenor
of the first and third paragraphs of the same section which undoubtedly are
not self-executing is flawed. If the first and third paragraphs are not selfexecuting because Congress is still to enact measures to encourage the
formation and operation of enterprises fully owned by Filipinos, as in the first
paragraph, and the State still needs legislation to regulate and exercise
authority over foreign investments within its national jurisdiction, as in the
third paragraph, then a fortiori, by the same logic, the second paragraph can
only be self-executing as it does not by its language require any legislation
in order to give preference to qualified Filipinos in the grant of rights,
privileges and concessions covering the national economy and patrimony. A
constitutional provision may be self-executing in one part and non-selfexecuting in another. Sec. 10, second par., Art. XII of the 1987 Constitution
is a mandatory, positive command which is complete in itself and which
needs no further guidelines or implementing laws or rules for its
enforcement. From its very words the provision does not require any
legislation to put it in operation. It is per se judicially enforceable.
2. YES. In its plain and ordinary meaning, the term patrimony pertains to
heritage. When the Constitution speaks of national patrimony, it refers not
only to the natural resources of the Philippines, as the Constitution could
have very well used the term natural resources, but also to the cultural
heritage of the Filipinos. Manila Hotel has become a landmark - a living
testimonial of Philippine heritage. Its existence is impressed with public
interest; its own historicity associated with our struggle for sovereignty,
independence and nationhood. Verily, Manila Hotel has become part of our
national economy and patrimony.
3. YES. 51% of the equity of the MHC comes within the purview of the
constitutional shelter for it comprises the majority and controlling stock, so
that anyone who acquires or owns the 51% will have actual control and
management of the hotel. In this instance, 51% of the MHC cannot be
disassociated from the hotel and the land on which the hotel edifice stands.

Respondents further argue that the constitutional provision is addressed to

the State, not to respondent GSIS which by itself possesses a separate and
distinct personality. In constitutional jurisprudence, the acts of persons
distinct from the government are considered "state action" covered by the
Constitution (1) when the activity it engages in is a "public function"; (2)
when the government is so significantly involved with the private actor as to
make the government responsible for his action; and, (3) when the
government has approved or authorized the action. It is evident that the act
of respondent GSIS in selling 51% of its share in respondent MHC comes
under the second and third categories of "state action." Therefore the
transaction, although entered into by respondent GSIS, is in fact a
transaction of the State and therefore subject to the constitutional
command.
4. YES. It should be stressed that while the Malaysian firm offered the higher
bid it is not yet the winning bidder. The bidding rules expressly provide that
the highest bidder shall only be declared the winning bidder after it has
negotiated and executed the necessary contracts, and secured the requisite
approvals. Since the Filipino First Policy provision of the Constitution bestows
preference on qualified Filipinos the mere tending of the highest bid is not an
assurance that the highest bidder will be declared the winning bidder.
Resultantly, respondents are not bound to make the award yet, nor are they
under obligation to enter into one with the highest bidder. For in choosing
the awardee respondents are mandated to abide by the dictates of the 1987
Constitution the provisions of which are presumed to be known to all the
bidders and other interested parties. Paragraph V. J. I of the bidding rules
provides that [i]f for any reason the Highest Bidder cannot be awarded the
Block of Shares, GSIS may offer this to other Qualified Bidders that have
validly submitted bids provided that these Qualified Bidders are willing to
match the highest bid in terms of price per share. The constitutional
mandate itself is reason enough not to award the block of shares
immediately to the foreign bidder notwithstanding its submission of a higher,
or even the highest, bid. Where a foreign firm submits the highest bid in a
public bidding concerning the grant of rights, privileges and concessions
covering the national economy and patrimony, thereby exceeding the bid of
a Filipino, there is no question that the Filipino will have to be allowed to
match the bid of the foreign entity. And if the Filipino matches the bid of a

foreign firm the award should go to the Filipino. It must be so if we are to

give life and meaning to the Filipino First Policy provision of the 11987
Constitution. The argument of respondents that petitioner is now estopped
from questioning the sale to Renong Berhad since petitioner was well aware
from the beginning that a foreigner could participate in the bidding is
meritless. Undoubtedly, Filipinos and foreigners alike were invited to the
bidding. But foreigners may be awarded the sale only if no Filipino qualifies,
or if the qualified Filipino fails to match the highest bid tendered by the
foreign entity. In the case before us, while petitioner was already preferred
at the inception of the bidding because of the constitutional mandate,
petitioner had not yet matched the bid offered by Renong Berhad. Only after
it had matched the bid of the foreign firm and the apparent disregard by
respondent GSIS of petitioner's matching bid did the latter have a cause of
action.
5. YES. Since petitioner has already matched the bid price tendered by
Renong Berhad pursuant to the bidding rules, respondent GSIS is left with
no alternative but to award to petitioner the block of shares of MHC and to
execute the necessary agreements and documents to effect the sale in
accordance not only with the bidding guidelines and procedures but with the
Constitution as well. The refusal of respondent GSIS to execute the
corresponding documents with petitioner as provided in the bidding rules
after the latter has matched the bid of the Malaysian firm clearly constitutes
grave abuse of discretion.
Voting Regalado, Davide, Jr., Romero, Kapunan, Francisco, and
Hermosisima, Jr., JJ., concur with the main opinion.
Narvasa, C.J, joins Justice Puno in his dissent.
SEPARATE OPINION
PADILLA [concur]
- Under the 1987 Constitution, "national patrimony" consists of the natural
resources provided by Almighty God (Preamble) in our territory (Article 1)
consisting of land, sea, and air. The concept of national patrimony has been
viewed as referring not only to our rich natural resources but also to the
cultural heritage of our race. The Manila Hotel is very much a part of our

national patrimony and, as such, deserves constitutional protection as to

who shall own it and benefit from its operation. This institution has played
an important role in our nation's history, having been the venue of many a
historical event, and serving as it did, and as it does, as the Philippine Guest
House for visiting foreign heads of state, dignitaries, celebrities, and others.
- "Preference to qualified Filipinos," to be meaningful, must refer not only to
things that are peripheral, collateral, or tangential. It must touch and affect
the very "heart of the existing order." In the field of public bidding in the
acquisition of things that pertain to the national patrimony, preference to
qualified Filipinos must allow a qualified Filipino to match or equal the higher
bid of a non-Filipino; the preference shall not operate only when the bids of
the qualified Filipino and the non-Filipino are equal in which case, the award
should undisputedly be made to the qualified Filipino. The Constitutional
preference should give the qualified Filipino an opportunity to match or equal
the higher bid of the non-Filipino bidder if the preference of the qualified
Filipino bidder is to be significant at all.

9/3/2014 7:24:00 AM
LA BUGAL TRIBAL ASSOCIATION V WESTERN MINING
CORPORATION PHILIPPINES
CARPIO-MORALES; January 29, 2004
FACTS
- Marivic M.V.F. Leonen, et. al for petitioners
- SPECIAL CIVIL ACTION in Supreme Court. Mandamus and Prohibition.
- Assailed is the constitutionality of RA 7942, otherwise known as the
PHILIPPINE MINING ACT OF 1995, along with the Implementing Rules and
Regulations issued pursuant thereto, Department of Environment and
Natural Resources (DENR) Administrative Order 96-40, and of the Financial
and Technical Assistance Agreement (FTAA) entered into on March 30, 1995
by the Republic of the Philippines and Western Mining Corporation
(Philippines), Inc. (WMCP), a corporation organized under Philippine laws.
- July 25, 1987 President Aquino issued EO 279 authorizing the DENR
Secretary to accept, consider and evaluate proposals from foreign-owned
corporations or foreign investors for contracts of agreements involving either
technical or financial assistance for large-scale exploration, development,
and utilization of minerals, which, upon appropriate recommendation of the
Secretary, the President may execute with the foreign proponent. In
entering into such proposals, the President shall consider the real
contributions to the economic growth and general welfare of the country that
will be realized, as well as the development and use of local scientific and
technical resources that will be promoted by the proposed contract or
agreement. Until Congress shall determine otherwise, large-scale mining, for
purpose of this Section, shall mean those proposals for contracts or
agreements for mineral resources exploration, development, and utilization
involving a committed capital in a single mining unit project of at least Fifty
Million Dollars in United States currency (US $50,000,000.00).
- March 3, 1995 President Ramos approved 7942 to govern the exploration,
development, utilization and processing of all mineral resources. RA 7942
defines modes of mineral agreements for mining operations, outlines the
procedure for filing and approval, assignment/transfer, and withdrawal, and
fixes their terms. These also apply to FTAAs.
- The law also prescribes the contractors qualifications, grants certain rights
such as timber, water, easement rights and right to possess explosives.

Surface owners or occupants are forbidden from preventing holders of

mining rights from entering private lands and concession areas. A procedure
for settlement of conflicts is also provided for.
- The Act restricts conditions for exploration, quarry and other permits. It
regulates the transport, sale and processing of minerals, and promotes the
development of mining communities, science and mining technology, and
safety and environmental protection.
- The governments share in the agreements is spelled out and allocated,
taxes and fees are imposed, incentives granted. Aside from penalizing
certain acts, the law likewise specifies grounds for the cancellation,
revocation and termination of agreements and permits.
- April 9, 1995 RA 7942 took effect.
- March 30, 1995 Shortly before RA 7942 took effect, the President entered
into and FTAA with WMCP covering 99,387 hectares of land in South
Cotabato, Sultan Kudarat, Davao del Sur and North Cotabato.
- August 15, 1995 DENR Secretary Ramos issued DENR Administrative
Order (DAO) 95-23, s. 1995, otherwise known as the Implementing Rules
and Regulations of RA 7942. This was later repealed by DAO 96-40, s. 1996
which was adopted on December 20, 1996.
- January 10, 1997 Counsels for petitioners sent letter to DENR Secretary
demanding that they stop the implementation of RA 7942 and DAO 96-40,
giving them 15 days from receipt to act thereon. DENR has yet to respond or
act on petitioners letter.
- Hence, this petition for prohibition and mandamus, with a prayer for a
temporary restraining order.
- Petitioners claim that the DENR Secretary without or in excess of
jurisdiction:
In signing and promulgating DAO 96-40 implementing RA 7942, the latter
being unconstitutional in that:
It allows fully foreign owned corporations to explore, develop, utilize and
exploit mineral resources in a manner contrary to Art. XII, sec. 2, par. 4,
1987 Constitution
It allows the taking of private property without the determination of public
use and for just compensation
It violates Art. III, sec. 1

It allows enjoyment by foreign citizens as well as fully foreign owned

corporations of the nations marine wealth contrary to Art. XII, sec. 2, par. 2
It allows priority to foreign and fully foreign owned corporations in the
exploration, development and utilization of mineral resources contrary to
Art. XII
In recommending approval of and implementing the FTAA between the
President and WMCP because the same is illegal and constitutional
- They pray that the Court issue an order permanently enjoining the
respondents from acting on any application for an FTAA; declaring RA 7942,
DAO 96-40 and all other similar administrative issuances as unconstitutional
and null and void; and, canceling the FTAA issued to WMCP as
unconstitutional, illegal and null and void.
- Respondents, aside from meeting petitioners contentions, argue that the
requisites for judicial inquiry have not been met, the petition does not
comply with the criteria for prohibition and mandamus, and there has been a
violation of the rule on hierarchy of courts.
- WMCP subsequently filed a Manifestation dated September 25, 2002
alleging that on January 23, 2001 WMC sold all its shares in WMCP to
Sagittarius Mines, Inc. (Sagittarius), a corporation organized under
Philippine laws, 60% of the equity of which is owned by Filipinos and/or
Filipino-owned corporations while about 40% is owned by Indophil Resources
NL, an Australian company.
- Because of this, the DENR Secretary, by Order of December 18, 2001,
approved the transfer and registration of the subject FTAA from WMCP to
Sagittarius. Said Order, however, was appealed by Lepanto Consolidated
Mining Co. (Lepanto). Because there is no final judgment yet, the case
cannot be considered moot.
ISSUES
1. WON case is justiciable
2. WON EO 279 took effect
3. WON the WMCP FTAA is constitutional
4. WON RA 7942 is constitutional
HELD
1. Case is justiciable.

Ratio In cases involving constitutional questions, the Court is not concerned

with whether petitioners are real parties in interest, but with whether they
have legal standing.
- Petitioners traverse a wide range of sectors. Among them are La Bugal
BLaan Tribal Association, Inc., a farmers and indigenous peoples
cooperative organized under Philippine laws representing a community
actually affected by the mining activities of WMCP, members of said
cooperative, as well as other residents of areas also affected by the mining
activities of WMCP. Even if they are not the actual parties in the contract,
they claim that they will suffer irremediable displacement as a result of the
FTAA allowing WMCP to conduct mining activities in their area of residence.
- And although RA 7942 and DAO 96-40 were not in force when the subject
FTAA was entered into, the question as to their validity is ripe for
adjudication. RA 7942 explicitly makes certain provisions apply to preexisting arrangements. The WMCP FTAA also provides that any term and
condition favorable to FTAA contractors resulting from a law or regulation
shall be considered part of the agreement.
- The petition for prohibition and mandamus is also the appropriate remedy.
Public respondents, in behalf of the Government, have obligations to fulfill
under said contract. Petitioners seek to prevent them from fulfilling such
obligations on the theory that the contract is unconstitutional and, therefore,
void.
- The contention that the filing of the petition violates the rule on hierarchy
of courts does not likewise lie. The repercussions of the issues in this case
on the Philippine mining industry, if not the national economy, as well as the
novelty thereof, constitute exceptional and compelling circumstances to
justify resort to this Court in the first instance. Indeed, when the issues
raised are of paramount importance to the public, this Court may brush
aside technicalities of procedure.
2. YES.
Ratio When the issues raised are of paramount importance to the public,
the Court may brush aside technicalities of procedure.
- Petitioners contend that EO 279 did not take effect because its supposed
date of effectivity came after President Aquino had already lost her
legislative powers under the Provisional Constitution. But it was explained
that the convening of the first Congress merely precluded the exercise of

legislative powers by the President it did not prevent the effectivity of laws
she had previously enacted.
3. NO.
Ratio The convening of the first Congress merely precluded the exercise of
legislative powers by the President and did not prevent the effectivity of laws
she had previously enacted.
In accordance with Art. XII, sec. 2 of the constitution, FTAAs should be
limited to technical or financial assistance only. However, contrary to the
language of the Constitution, the WMCP FTAA allows WMCP, a fully foreignowned mining corporation, to extend more than mere financial or technical
assistance to the State, for it permits WMCP to manage and operate every
aspect of the mining activity.
- WMCP nevertheless submits that the word technical encompasses a
broad number of possible services, perhaps, scientific and/or technological in
basis. It thus posits that it may well include the area of management and
operations. The Court is not persuaded. Casus omisus pro omisso habendus
est a person, object or thing omitted from an enumeration must be held to
have been omitted intentionally. Moreover, the management or operation of
mining activities by foreign contractors, which is the primary feature of
service contracts, was precisely the evil that the drafters of the 1987
Constitution sought to eradicate.
- Respondents insist that agreements involving technical or financial
assistance is just another term for service contracts. The proceedings of the
CONCOM indicate that the members used the terms interchangeably. The
Court is likewise not persuaded. While certain commissioners may have
mentioned the term service contracts, they may have been using the term
loosely and not in the context of the 1973 Constitution. Also, the phrase
service contracts has been deleted in the 1987 Constitutions Article on
National Economy and Patrimony. If the CONCOM intended to retain the
concept of service contracts under the 1973 Constitution, it could have
simply adapted the old terminology instead of employing new and unfamiliar
terms (agreements involving either technical or financial assistance).
- The UP Law Draft and Article XII, as adopted, uses the same terminologies.
And the UP Law draft proponents viewed service contracts under the 1973
Constitution as grants of beneficial ownership of the countrys natural
resources to foreign owned corporations. While, in theory, the State owns

these natural resources and Filipino citizens, their beneficiaries service

contracts actually vested foreigners with the right to dispose, explore for,
develop, exploit, and utilize the same. This arrangement is clearly
incompatible with the constitutional ideal of nationalization of natural
resources. But the proponents nevertheless acknowledged the need for
capital and technical know-how in the large-scale exploitation, development
and utilization of natural resources. Hence, they proposed a compromise
technical or financial agreements.
4. NO, insofar as said Act authorizes service contracts.
Ratio Financial or technical agreements as contemplated in Art. XII, sec. 2
shall refer to financial agreements and/or technical agreements only and not
to service contracts.
- Although the statute employs the phrase financial and technical
agreements, it actually treats these agreements as service contracts that
grant beneficial ownership to foreign contractors contrary to fundamental
law.
Decision WHEREFORE, the petition is granted. The Court hereby declares
unconstitutional and void:
The following provision of RA 7942
The proviso in Section 3 (aq)
Section 23,
Section 33 to 41,
Section 56,
The second and third paragraphs of Section 81, and
Section 90.
All provisions of DAO 96-40, s. 1996 which are not in conformity with this
Decision, and
The FTAA between the Government of the Republic of the Philippines and
WMC Philippines, Inc.
Voting 8 concur including ponente, 5 dissent, 1 took no part