SESINANDO MERIDA, Petitioner, versus PEOPLE OF THE PHILIPPINES, Respondent.

G.R. No. 158182 | 2008-06-12

DECISION
CARPIO, J.:
The Case
This is a petition for review[1] of the Decision[2] dated 28 June 2002 and the Resolution dated 14 May
2003 of the Court of Appeals. The 28 June 2002 Decision affirmed the conviction of petitioner Sesinando
Merida (petitioner) for violation of Section 68,[3] Presidential Decree No. 705 (PD 705),[4] as amended by
Executive Order No. 277. The Resolution dated 14 May 2003 denied admission of petitioner's motion for
reconsideration.[5]
The Facts
Petitioner was charged in the Regional Trial Court of Romblon, Romblon, Branch 81 (trial court) with
violation of Section 68 of PD 705, as amended, for "cut[ting], gather[ing], collect[ing] and remov[ing]" a
lone narra tree inside a private land in Mayod, Ipil, Magdiwang, Romblon (Mayod Property) over which
private
complainant
Oscar
M.
Tansiongco
(Tansiongco)
claims
ownership.[6]
The prosecution evidence showed that on 23 December 1998, Tansiongco learned that petitioner cut a
narra tree in the Mayod Property. Tansiongco reported the matter to Florencio Royo (Royo), the punong
barangay of Ipil. On 24 December 1998,[7] Royo summoned petitioner to a meeting with Tansiongco. When
confronted during the meeting about the felled narra tree, petitioner admitted cutting the tree but claimed
that he did so with the permission of one Vicar Calix (Calix) who, according to petitioner, bought the Mayod
Property from Tansiongco in October 1987 under a pacto de retro sale. Petitioner showed to Royo Calix's
written
authorization
signed
by
Calix's
wife.[8]
On 11 January 1999, Tansiongco reported the tree-cutting to the Department of Environment and Natural
Resources (DENR) forester Thelmo S. Hernandez (Hernandez) in Sibuyan, Romblon. When Hernandez
confronted petitioner about the felled tree, petitioner reiterated his earlier claim to Royo that he cut the
tree with Calix's permission. Hernandez ordered petitioner not to convert the felled tree trunk into lumber.
On 26 January 1999, Tansiongco informed Hernandez that petitioner had converted the narra trunk into
lumber. Hernandez, with other DENR employees and enforcement officers, went to the Mayod Property and
saw that the narra tree had been cut into six smaller pieces of lumber. Hernandez took custody of the
lumber,[9] deposited them for safekeeping with Royo, and issued an apprehension receipt to petitioner. A
larger portion of the felled tree remained at the Mayod Property. The DENR subsequently conducted an
investigation
on
the
matter.[10]
Tansiongco filed a complaint with the Office of the Provincial Prosecutor of Romblon (Provincial Prosecutor)
charging petitioner with violation of Section 68 of PD 705, as amended. During the preliminary
investigation, petitioner submitted a counter-affidavit reiterating his claim that he cut the narra tree with

Calix's permission. The Provincial Prosecutor[11] found probable cause to indict petitioner and filed the
Information
with
the
trial
court
(docketed
as
Criminal
Case
No.
2207).
During the trial, the prosecution presented six witnesses including Tansiongco, Royo, and Hernandez who
testified on the events leading to the discovery of and investigation on the tree-cutting. Petitioner testified
as the lone defense witness and claimed, for the first time, that he had no part in the tree-cutting.
The Ruling of the Trial Court
In its Decision dated 24 November 2000, the trial court found petitioner guilty as charged, sentenced him
to fourteen (14) years, eight (8) months and one (1) day to twenty (20) years of reclusion temporal and
ordered the seized lumber forfeited in Tansiongco's favor.[12] The trial court dismissed petitioner's defense
of denial in view of his repeated extrajudicial admissions that he cut the narra tree in the Mayod Property
with Calix's permission. With this finding and petitioner's lack of DENR permit to cut the tree, the trial court
held
petitioner
liable
for
violation
of
Section
68
of
PD
705,
as
amended.
Petitioner appealed to the Court of Appeals reiterating his defense of denial. Petitioner also contended that
(1) the trial court did not acquire jurisdiction over the case because it was based on a complaint filed by
Tansiongco and not by a forest officer as provided under Section 80 of PD 705 and (2) the penalty imposed
by the trial court is excessive.
The Ruling of the Court of Appeals
In its Decision dated 28 June 2002, the Court of Appeals affirmed the trial court's ruling but ordered the
seized lumber confiscated in the government's favor.[13] The Court of Appeals sustained the trial court's
finding that petitioner is bound by his extrajudicial admissions of cutting the narra tree in the Mayod
Property without any DENR permit. The Court of Appeals also found nothing irregular in the filing of the
complaint by Tansiongco instead of a DENR forest officer considering that the case underwent preliminary
investigation by the proper officer who filed the
Information with the trial
court.
On the imposable penalty, the Court of Appeals, in the dispositive portion of its ruling, sentenced petitioner
to 14 years, 8 months and 1 day to 17 years of reclusion temporal. However, in the body of its ruling, the
Court of Appeals held that "the penalty to be imposed on [petitioner] should be (14) years, eight (8)
months and one (1) day to twenty (20) years of reclusion temporal,"[14] the same penalty the trial court
imposed.
Petitioner sought reconsideration but the Court of Appeals, in its Resolution dated 14 May 2003, did not
admit
his
motion
for
having
been
filed
late.[15]
Hence, this petition. Petitioner raises the following issues:
I. WHETHER x x x SECTION 68 OF P.D. 705 AS AMENDED PROHIBITING THE CUTTING, GATHERING,
COLLECTING AND REMOVING TIMBER OR OTHER FOREST PRODUCTS FROM ANY FOREST LAND APPLIES TO
PETITIONER.
II. WHETHER x x x POSSESSION OF THE NARRA TREE CUT IN PRIVATE LAND CONTESTED BY VICAR CALIX

AND PRIVATE-COMPLAINANT OSCAR TANSIONGCO IS COVERED BY SECTION 80 OF P.D. 705 AS AMENDED.

III. WHETHER PRIVATE-COMPLAINANT CAN INITIATE THE CHARGE EVEN WITHOUT THE STANDING
AUTHORITY COMING FROM THE INVESTIGATING FOREST OFFICER OF THE DEPARTMENT OF ENVIRONMENT
AND NATURAL RESOURCES AS MANDATED BY SECTION 80 OF P.D. 705 AS AMENDED.
[IV.] WHETHER x x x THE TRIAL COURT ERRED IN TAKING COGNIZANCE OF THE CASE FILED BY PRIVATECOMPLAINANT BECAUSE IT WAS NOT THE INVESTIGATING OFFICER AS REQUIRED BY SECTION 80 OF P.D.
705 AS AMENDED WHO MUST BE THE ONE TO INSTITUTE THE FILING OF THE SAME.[16]
In its Comment to the petition, the Office of the Solicitor General (OSG) countered that (1) the trial court
acquired jurisdiction over the case even though Tansiongco, and not a DENR forest officer, filed the
complaint against petitioner and (2) petitioner is liable for violation of Section 68 of PD 705, as amended.
The Issues
The petition raises the following issues:[17]
1) Whether the trial court acquired jurisdiction over Criminal Case No. 2207 even though it was based on a
complaint
filed
by
Tansiongco
and
not
by
a
DENR
forest
officer;
and
2) Whether petitioner is liable for violation of Section 68 of PD 705, as amended.
The Ruling of the Court
The

petition

The
Criminal

Trial

has
Court
Case

no

Acquired

merit.

Jurisdiction

Over
2207

No.

We sustain the OSG's claim that the trial court acquired jurisdiction over Criminal Case No. 2207. The
Revised Rules of Criminal Procedure (Revised Rules) list the cases which must be initiated by a complaint
filed by specified individuals,[18] non-compliance of which ousts the trial court of jurisdiction from trying
such cases.[19] However, these cases concern only defamation and other crimes against chastity[20] and
not to cases concerning Section 68 of PD 705, as amended. Further, Section 80 of PD 705 does not prohibit
an interested person from filing a complaint before any qualified officer for violation of Section 68 of PD
705, as amended. Section 80 of PD 705 provides in relevant parts:
SECTION

80.

Arrest;

Institution

of

criminal

actions.

Reports and complaints regarding the commission of any of the offenses defined in this Chapter, not
committed in the presence of any forest officer or employee, or any of the deputized officers or officials,
shall immediately be investigated by the forest officer assigned in the area where the offense was
allegedly committed, who shall thereupon receive the evidence supporting the report or complaint.
If there is prima facie evidence to support the complaint or report, the investigating forest officer shall file

the necessary complaint with the appropriate official authorized by law to conduct a preliminary
investigation of criminal cases and file an information in Court. (Emphasis supplied)
We held in People v. CFI of Quezon[21] that the phrase "reports and complaints" in Section 80 refers to
"reports and complaints as might be brought to the forest officer assigned to the area by other forest
officers or employees of the Bureau of Forest Development or any of the deputized officers or officials, for
violations
of
forest
laws
not
committed
in
their
presence."[22]
Here, it was not "forest officers or employees of the Bureau of Forest Development or any of the deputized
officers or officials" who reported to Hernandez the tree-cutting in the Mayod Property but Tansiongco, a
private citizen who claims ownership over the Mayod Property. Thus, Hernandez cannot be faulted for not
conducting an investigation to determine "if there is prima facie evidence to support the complaint or
report."[23] At any rate, Tansiongco was not precluded, either under Section 80 of PD 705 or the Revised
Rules, from filing a complaint before the Provincial Prosecutor for petitioner's alleged violation of Section
68 of PD 705, as amended. For its part, the trial court correctly took cognizance of Criminal Case No. 2207
as
the
case
falls
within
its
exclusive
original
jurisdiction.[24]
Petitioner
Property

is

Liable

for

Cutting
Without

Timber

in

Private
Permit

Section 68, as amended, one of the 12 acts[25] penalized under PD 705, provides:
SECTION 68. Cutting, Gathering and/or Collecting Timber, or Other Forest Products Without License. - Any
person who shall cut, gather, collect, remove timber or other forest products from any forest land, or
timber from alienable or disposable public land, or from private land, without any authority, or possess
timber or other forest products without the legal documents as required under existing forest laws and
regulations, shall be punished with the penalties imposed under Articles 309 and 310 of the Revised Penal
Code: Provided, That in the case of partnerships, associations, or corporations, the officers who ordered the
cutting, gathering, collection or possession shall be liable, and if such officers are aliens, they shall, in
addition to the penalty, be deported without further proceedings on the part of the Commission on
Immigration and Deportation.
The court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed as well as the machinery, equipment,
implements and tools illegally used in the area where the timber or forest products are found. (Emphasis
supplied)
Section 68 penalizes three categories of acts: (1) the cutting, gathering, collecting, or removing of timber
or other forest products from any forest land without any authority; (2) the cutting, gathering, collecting, or
removing of timber from alienable or disposable public land, or from private land without any authority;
[26] and (3) the possession of timber or other forest products without the legal documents as required
under existing forest laws and regulations.[27] Petitioner stands charged of having "cut, gathered,
collected and removed timber or other forest products from a private land[28] without x x x the necessary
permit x x x " thus his liablity, if ever, should be limited only for "cut[ting], gather[ing], collect[ing] and
remov[ing] timber," under the second category. Further, the prosecution evidence showed that petitioner
did not perform any acts of "gathering, collecting, or removing" but only the act of "cutting" a lone narra

tree. Hence, this case hinges on the question of whether petitioner "cut x x x timber" in the Mayod
Property
without
a
DENR
permit.[29]
We

answer

in

the

affirmative

and

thus

affirm

the

lower

courts'

rulings.

On the question of whether petitioner cut a narra tree in the Mayod Property without a DENR permit,
petitioner adopted conflicting positions. Before his trial, petitioner consistently represented to the
authorities that he cut a narra tree in the Mayod Property and that he did so only with Calix's permission.
However, when he testified, petitioner denied cutting the tree in question. We sustain the lower courts'
rulings that petitioner's extrajudicial admissions bind him.[30] Petitioner does not explain why Royo and
Hernandez, public officials who testified under oath in their official capacities, would lie on the stand to
implicate petitioner in a serious criminal offense, not to mention that the acts of these public officers enjoy
the presumption of regularity. Further, petitioner does not deny presenting Calix's authorization to Royo
and Hernandez as his basis for cutting the narra tree in the Mayod Property. Petitioner has no use of Calix's
authorization if, as he claimed during the trial, he did not cut any tree in the Mayod Property.
We further hold that the lone narre tree petitioner cut from the Mayod Property constitutes "timber" under
Section 68 of PD 705, as amended. PD 705 does not define "timber," only "forest product" (which
circuitously includes "timber.")[31] Does the narra tree in question constitute "timber" under Section 68?
The closest this Court came to defining the term "timber" in Section 68 was to provide that "timber,"
includes "lumber" or "processed log."[32] In other jurisdictions, timber is termined by compliance with
specified dimensions[33] or certain "stand age" or "rotation age."[34] In Mustang Lumber, Inc. v. Court of
Appeals,[35] this Court was faced with a similar task of having to define a term in Section 68 of PD 705 "lumber" - to determine whether possession of lumber is punishable under that provision. In ruling in the
affirmative, we held that "lumber" should be taken in its ordinary or common usage meaning to refer to
"processed log or timber," thus:
The Revised Forestry Code contains no definition of either timber or lumber. While the former is included in
forest products as defined in paragraph (q) of Section 3, the latter is found in paragraph (aa) of the same
section in the definition of "Processing plant," which reads:
(aa) Processing plant is any mechanical set-up, machine or combination of machine used for the
processing of logs and other forest raw materials into lumber, veneer, plywood, wallboard, blackboard,
paper board, pulp, paper or other finished wood products.
This simply means that lumber is a processed log or processed forest raw material. Clearly, the Code uses
the term lumber in its ordinary or common usage. In the 1993 copyright edition of Webster's Third New
International Dictionary, lumber is defined, inter alia, as "timber or logs after being prepared for the
market." Simply put, lumber is a processed log or timber.
It is settled that in the absence of legislative intent to the contrary, words and phrases used in a statute
should be given their plain, ordinary, and common usage meaning. And in so far as possession of timber
without the required legal documents is concerned, Section 68 of PD No. 705, as amended, makes no
distinction between raw and procesed timber. Neither should we.[36] x x x x (Italicization in the original;
boldfacing supplied)

We see no reason why, as in Mustang, the term "timber" under Section 68 cannot be taken in its common
acceptation as referring to "wood used for or suitable for building or for carpentry or joinery."[37] Indeed,
tree saplings or tiny tree stems that are too small for use as posts, panelling, beams, tables, or chairs
cannot
be
considered
timber.[38]
Here, petitioner was charged with having felled a narra tree and converted the same into "several pieces
of sawn lumber, about three (3) pcs. 2x16x6 and three (3) pcs. 2x18x7 x x x consisting of 111 board feet x
x x." These measurements were indicated in the apprehension receipt Hernandez issued to petitioner on
26 January 1999 which the prosecution introduced in evidence.[39] Further, Hernandez testified that the
larger portion of the felled log left in the Mayod Property "measured 76 something centimeters [at the big
end] while the smaller end measured 65 centimeters and the length was 2.8 meters."[40] Undoubtedly,
the narra tree petitioner felled and converted to lumber was "timber" fit "for building or for carpentry or
joinery" and thus falls under the ambit of Section 68 of PD 705, as amended.
The

Penalty

Imposable

on

Petitioner

Violation of Section 68 of PD 705, as amended, is punishable as Qualified Theft under Article 310 in relation
to Article 309 of the Revised Penal Code (RPC), thus:
Art. 310. Qualified theft. - The crime of qualified theft shall be punished by the penalties next higher by two
degrees than those respectively specified in the next preceding article x x x.
Art.

309.

Penalties.

Any

person

guilty

of

theft

shall

be

punished

by:

1. The penalty of prision mayor in its minimum and medium periods, if the value of the thing stolen is more
than 12,000 pesos but does not exceed 22,000 pesos; but if the value of the thing stolen exceeds the
latter amount, the penalty shall be the maximum period of the one prescribed in this paragraph, and one
year for each additional ten thousand pesos, but the total of the penalty which may be imposed shall not
exceed twenty years. In such cases, and in connection with the accessory penalties which may be imposed
and for the purpose of the other provisions of this Code, the penalty shall be termed prision mayor or
reclusion
temporal,
as
the
case
may
be.
2. The penalty of prision correccional in its medium and maximum periods, if the value of the thing stolen
is
more
than
6,000
pesos
but
does
not
exceed
12,000
pesos.
3. The penalty of prision correccional in its minimum and medium periods, if the value of the property
stolen
is
more
than
200
pesos
but
does
not
exceed
6,000
pesos.
4. Arresto mayor in its medium period to prision correccional in its minimum period, if the value of the
property
stolen
is
over
50
pesos
but
does
not
exceed
200
pesos.
5. Arresto mayor to its full extent, if such value is over 5 pesos but does not exceed 50 pesos.
6. Arresto mayor in its minimum and medium periods, if such value does not exceed 5 pesos.

7. Arresto menor or a fine not exceeding 200 pesos, if the theft is committed under the circumstances
enumerated in paragraph 3 of the next preceding article and the value of the thing stolen does not exceed
5 pesos. If such value exceeds said amount, the provisions of any of the five preceding subdivisions shall
be
made
applicable.
.
8. Arresto menor in its minimum period or a fine not exceeding 50 pesos, when the value of the thing
stolen is not over 5 pesos, and the offender shall have acted under the impulse of hunger, poverty, or the
difficulty of earning a livelihood for the support of himself or his family.
The Information filed against petitioner alleged that the six pieces of lumber measuring 111 board feet
were valued at P3,330. However, if the value of the log left at the Mayod Property is included, the amount
increases to P20,930.40. To prove this allegation, the prosecution relied on Hernandez's testimony that
these amounts, as stated in the apprehension receipt he issued, are his "estimates" based on "prevailing
local
price."[41]
This evidence does not suffice. To prove the amount of the property taken for fixing the penalty imposable
against the accused under Article 309 of the RPC, the prosecution must present more than a mere
uncorroborated "estimate" of such fact.[42] In the absence of independent and reliable corroboration of
such estimate, courts may either apply the minimum penalty under Article 309 or fix the value of the
property taken based on the attendant circumstances of the case.[43] In People v. Dator[44] where, as
here, the accused was charged with violation of Section 68 of PD 705, as amended, for possession of
lumber without permit, the prosecution's evidence for the lumber's value consisted of an estimate made
by the apprehending authorities whose apparent lack of corroboration was compounded by the fact that
the transmittal letter for the estimate was not presented in evidence. Accordingly, we imposed on the
accused
the
minimum
penalty
under
Article
309(6)[45]
of
the
RPC.[46]
Applying Dator in relation to Article 310 of the RPC and taking into account the Indeterminate Sentence
Law, we find it proper to impose on petitioner, under the circumstances obtaining here, the penalty of four
(4) months and one (1) day of arresto mayor, as minimum, to three (3) years, four (4) months and twentyone
(21)
days
of
prision
correcional,
as
maximum.
WHEREFORE, we AFFIRM the Decision dated 28 June 2002 and the Resolution dated 14 May 2003 of the
Court of Appeals with the modification that petitioner Sesinando Merida is sentenced to four (4) months
and one (1) day of arresto mayor, as minimum, to
three (3) years, four (4) months and twenty-one (21) days of prision correcional, as maximum.
SO

ORDERED.

AUGUSTUS L. MOMONGAN, Regional Director, Department of Environment and Natural

Resources, Region VIII, Tacloban City, petitioner, vs. JUDGE RAFAEL B. OMIPON, 6th Municipal
Circuit Trial Court, Hinunangan Silago, Southern Leyte, respondent.
A.M. No. MTJ-93-874 | 1995-03-14
DECISION

ROMERO, J.:
At around 10:00 o'clock of November 14, 1992, police officers of the Municipality of Hinunangan, Southern
Leyte apprehended Dionisio Golpe while he was driving his truck loaded with illegally cut lumber. The truck

and logs were impounded. A complaint was filed against Basilio Cabig, the alleged owner of the logs. After
conducting the preliminary investigation, respondent Judge Rafael B. Omipon found that a prima facie case
exists against Mr. Cabig but he ordered the release of the truck inasmuch as the owner/driver, Mr. Golpe,
was not charged in the complaint.
Regional Director Augustus L. Momongan of the Department of Environment and Natural Resources filed
the instant complaint against the respondent Judge alleging that his order releasing the truck used in the
transport of illegally cut forest products violated Presidential Decree 705, as amended by Executive order
No. 277, Section 68 and 68-A 1 and Administrative Order No. 59, series of 1990. 2 Complaint claims that
respondent Judge has no authority to order the release of the truck despite the non-inclusion of Mr. Golpe
in the complaint. The truck should have been turned over to the Community Environment and Natural
Resources Office of San Juan, Southern Leyte for appropriate disposition as the same falls under the
administrative jurisdiction of the Department of Environment and Natural Resources Office.
In his comment, respondent Judge explained that after conducting the preliminary investigation, he found
that Golpe, the owner of the truck, is principally engaged in the hauling of sand and gravel and the
delivery of hollow blocks. On his way home after delivering hollow blocks in Barangay Sto. Nio II, he met
his friend Cabig who requested him to load sliced lumber and deliver the same at Brgy. Lungsod-daan,
Hinundayan to be used for the construction of a barangay high school building. They were apprehended
when the truck had a flat tire. After changing the tire, both the lumber and the truck were ordered
deposited at the police station of Hinunangan.
Respondent Judge observed that Golpe has a lesser participation in the crime of illegal logging and, being
a mere accessory, he might be utilized by the Acting Chief of Police as prosecution witness against Cabig.
More importantly, the fact that the complaint charged only Cabig, respondent Judge, in the exercise of his
sound discretion, ordered the release of the truck owned by Golpe.
The memorandum of the office of the Court Administrator recommended that a formal investigation be
conducted. An excerpt from its memorandum states:
"We find the explanation of respondent unsatisfactory. While he is authorized to conduct preliminary
investigation in all cases of violations of P.D. 705, as amended, otherwise known as the Revised Forestry
Code of the Philippines, Sec. 68-A thereof provides that it is the Department Head or his duly authorized
representative who may order the confiscation and disposition of the forest products illegally cut,
gathered, removed, or possessed or abandoned, and all conveyances used either by land, water or air in
the commission of the offense and to dispose of the same in accordance with pertinent laws, regulations or
policies on the matter.
There may be some facts that are not extant in the records which can only come out during a formal
investigation to better establish clear culpability or exoneration over the respondent.
In view thereof, and to give respondent an opportunity to clear himself, it is respectfully recommended
that this matter be referred to Acting Executive Judge Leandro T. Loyao, Jr., RTC, Branch 26, San Juan,
Southern Leyte, for investigation, report and recommendation within sixty days from receipt of the
records." 3

In the Resolution of November 8, 1993, the Court resolved to refer the case to Acting Executive Judge
Leandro T. Loyao, Jr., RTC, Branch 26, San Juan, Southern Leyte, for investigation, report and
recommendation, within sixty (60) days from receipt of the records. 4
During the first two hearing dates, complainant was unable to attend but sent his representatives, DENR
lawyer Constantino Esber and legal assistant Romeo Gulong. Respondent Judge appeared with his counsel.
However, on the third hearing date, respondent Judge failed to appear as he suffered a stroke and was
hospitalized. Thereafter, DENR counsel Esber manifested that their office has filed a motion for
reinvestigation and for the turnover of the jeep to the PNP and subsequently, to the DENR. He also
manifested that the complainant is submitting the administrative matter for resolution and
recommendation without adducing evidence against respondent. Respondent's counsel did not object to
complainant's manifestation. The counsel of both complainant and respondent jointly agreed to submit the
case for appropriate action.
The investigating Judge's confidential report, in part, states:
"In view of this development in the course of an intended investigation, this investigator could not elicit
additional facts than are found in the records, whether inculpatory or exculpatory. Respondent was given
an opportunity to explain the unfavorable circumstances against him but he was overtaken by a serious
illness. So much was expected from the complainant to supply the facts not extant in the records, but he
lost interest in substantiating his April 1993 report to the Supreme Court. In fact, he was submitting this
administrative matter for resolution without adducing evidence against respondent.
Except for the 21 January 1994 motion for reinvestigation of DENR counsel Esber which sought for the
inclusion of jeep owner and driver Dionisio Golpe in the criminal information, there is nothing new that can
be added to the facts found by the Honorable Deputy Court Administrator as reflected in his Memorandum
for the Honorable Chief Justice dated 12 October 1993.
There being no actual investigation conducted, no additional facts could be reported and consequently,
there is no basis for a recommendation on the basis of facts.
This investigator can only recommend appropriate action by the Supreme Court on the basis of the facts
already extant in the records with a prayer for reconsideration of respondent plight especially so since on
account of this investigation his health has deteriorated and may affect his efficiency output as a judge.
Perhaps, allowing him to bow out of the service with honor and corresponding benefits." 5
During the pendency of this case, respondent Judge filed for disability retirement. His application was
approved but his pension was not released pending the outcome of this case.
We find respondent Judge's order to release the truck owned and driven by Mr. Dionisio Golpe legally
justifiable, hence, he is not subject to any disciplinary sanction.
According to the Revised Penal Code, Art. 45, first paragraph: "[E]very penalty imposed for the commission
of a felony shall carry with it the forfeiture of the proceeds of the crime and the instrument or tools with
which it was committed." However, this cannot be done if such proceeds and instruments or tools "be the
property of a third person not liable for the offense." In this case, the truck, though used to transport the

10

illegally cut lumber, cannot be confiscated and forfeited in the event accused therein be convicted because
the truck owner/driver, Mr. Dionisio Golpe was not indicted. hence, there was no justification for
respondent Judge not to release the truck.
Complainant is correct in pointing out that based on Pres. Decree No. 705, Sec. 68-A and Adm. Order No.
59, the DENR Secretary or his duly authorized representative has the power to confiscate any illegally
obtained or gathered forest products and all conveyances used in the commission of the offense and to
dispose of the same in accordance with pertinent laws. However, as complainant himself likewise pointed
out, this power is in relation to the administrative jurisdiction of the DENR.
We do not find that when respondent Judge released the truck after he conducted the preliminary
investigation and satisfied himself that there was no reason to continue keeping the truck, he violated
Pres. Decree No. 705 and Adm. Order No. 59. The release of the truck did not render nugatory the
administrative authority of the DENR Secretary. The confiscation proceedings under Adm. Order No. 59 6 is
different from the confiscation under the Revised Penal Code, which is an additional penalty imposed in the
event of conviction. Despite the order of release, the truck can be seized again either by filling a motion for
reinvestigation and motion to include the truck owner/driver as co-accused, which complainant has done
as manifested before the lower court or by enforcing Adm. Order No. 59. Section 12 thereof categorically
states that "[t]he confiscation of the conveyance under these regulations shall be without prejudice to any
criminal action which shall be filed against the owner thereof or any person who used the conveyance in
the commission of the offense."
Petitioner is of the opinion that under the circumstances, respondent Judge should have turned over the
truck to the Community Environment and Natural Resources Office (CENRO) of San Juan, Southern Leyte
for appropriate disposition. No doubt, this would have simplified matters and prevented the present
situation from occurring wherein one government official files a complaint against another. Under Sec. 4 of
Adm. Order No. 59, if the apprehension is not made by DENR field offices, deputized military personnel and
officials of other agencies apprehending illegal logs and other forest products and their conveyances shall
notify the nearest DENR field offices and turn over said forest products and conveyances for proper action
and disposition. A period of about two weeks lapsed from the time the seizure was made before a
complaint was filed. During this period, the apprehending policemen had enough time to turn over the logs
and the truck to the nearest DENR field office for proper action and disposition since the duty to turn over
the truck to the nearest DENR field office rests on the officials apprehending the illegal logs. There being
no mandatory duty on the part of respondent Judge to turn over the truck, he should not be visited with
disciplinary sanction when he did not refer the same to the DENR field office in San Juan, Southern Leyte.
The Court takes this opportunity to enjoin the National Police, the DENR, the prosecutors, and the
members of the bench to coordinate with each other for a successful campaign against illegal logging. It
behooves all the concerned agencies to seriously strive for the attainment of the constitutionally-declared
policy to "protect and advance the right of the people to a balanced and healthful ecology in accord with
the rhythm and harmony of nature" 7 in order o preserve our natural resources for the benefit of the
generations still to come.
WHEREFORE, the complaint is DISMISSED.
SO ORDERED.

11

PROVIDENT TREE FARMS, INC., petitioner, vs. HON. DEMETRIO M. BATARIO, JR., Presiding Judge
Branch 48, Regional Trial Court of Manila, COMMISSIONER OF CUSTOMS and A. J.
INTERNATIONAL CORPORATION, respondents.
G.R. No. 92285 | 1994-03-28
DECISION

BELLOSILLO, J.:
PETITIONER PROVIDENT TREE FARMS, INC. (PTFI), is a Philippine corporation engaged in industrial tree
planting. It grows gubas trees in its plantations in Agusan and Mindoro which it supplies to a local match
manufacturer solely for production of matches. In consonance with the state policy to encourage qualified
persons to engage in industrial tree plantation, Sec. 36, par. (1), of the Revised Forestry Code 1 confers on
entities like PTFI a set of incentives among which is a qualified ban against importation of wood and "woodderivated" products.
On 5 April 1989, private respondent A. J. International Corporation (AJIC) imported four (4) containers of
matches from Indonesia, which the Bureau of Customs released on 12 April 1989, and two (2) more
containers of matches from Singapore on 19 April 1989. The records do not disclose when the second
shipment was released.
On 25 April 1989, upon request of PTFI, Secretary Fulgencio S. Factoran, Jr., of the Department of Natural
Resources and Environment issued a certification that "there are enough available softwood supply in the
Philippines for the match industry at reasonable price." 2
On 5 May 1989, PTFI filed with the Regional Court of Manila a complaint for injunction and damages with
prayer for a temporary restraining order against respondents Commissioner of Customs and AJIC to enjoin
the latter from importing matches and "wood-derivated" products, and the Collector of Customs from
allowing and releasing the importations. It was docketed as Civil Case No. 89-48836 and raffled to
respondent Judge Demetrio M. Batario, Jr. PTFI prays for an order directing the Commissioner of Customs to
impound the subject importations and the AJIC be directed to pay petitioner P250,000.00 in actual
damages, P1,000,000.00 in exemplary damages, and P50,000.00 as attorney's fees.
On 14 June 1989, AJIC moved to dismiss the complaint alleging that: (a) The Commissioner of Customs
under Sec. 1207 of the Tariff and Customs Code and not the regular court, has "exclusive jurisdiction to
determine the legality of an importation or ascertain whether the conditions prescribed by law for an
importation have been complied with . . . (and over cases of) seizure, detention or release of property

12

affected . . .;" 3 (b) The release of subject importations had rendered injunction moot and academic; 4 (c)
The prayer for damages has no basis as the questioned acts of the Commissioner are in accordance with
law and no damages may be awarded based on future acts; 5 and, (d) The complaint for injunction cannot
stand it being mainly a provisional relief and not a principal remedy. 6
PTFI opposed the motion to dismiss. On 28 July 1989, AJIC's motion to dismiss was denied. However, on 8
February 1990, on motion for reconsideration by AJIC and despite the opposition of PTFI, the Court
reconsidered its 28 July 1989 order and dismissed the case on the ground that it had "no jurisdiction to
determine what are legal or illegal importations." 7
In this present recourse, PTFI seeks to set aside the 8 February 1990 order of respondent court and prays
for the continuation of the hearing in Civil Case No. 89-48836. PTFI claims that what was brought before
the trial court was a civil case for injunction, i.e., "restraining the entry of safety matches into the country .
. . for the purpose of securing compliance with Sec. 36 (l) of the Forestry Code" and for damages, "to seek
redress of its right which has been clearly violated by the importation of safety matches . . . (which) is a
denial to the petitioner of the protection and incentive granted it by Section 36 (l) of the Forestry Code . . ."
8 PTFI asserts the inapplicability of the procedures outlined in R.A. No. 1125 relative to incidents before the
Court of Tax Appeals because the instant action is not a protest case where the aggrieved party is not an
importer. It then argues that since it could not avail of the remedies afforded by the Tariff and Customs
Code, resort to the courts is warranted, citing Commissioner of Customs v. Alikpala. 9
On the formal requirements, we hold that the claim of public respondent that the petition was filed late has
no basis. The records revealed that PTFI received the assailed order of 8 February 1990 on 20 February
1990, 10 hence, it had until 7 March 1990 to file petition for review on certiorari. On that date, PTFI filed a
motion for extension of fifteen (15) days within which to file the petition. 11 On 19 March 1990, this Court
granted PTFI a thirty (30)-day non-extendible period to file its petition, 12 thus resetting the new deadline
for the petition to 6 April 1990. On that date the petition was filed.
Petitioner anchors his complaint on a statutory privilege or incentive granted under Sec. 36, par. (l), of the
Revised Forestry Code. The only subject of this incentive is a ban against importation of wood, wood
products or wood-derivated products which is to be enforced by the Bureau of Customs since it has, under
the Tariff and Customs Code, the exclusive original jurisdiction over seizure and forfeiture cases 13 and, in
fact, it is the duty of the Collector of Customs to exercise jurisdiction over prohibited importations. 14
The enforcement of the importation ban under Sec. 36, par. (l), of the Revised Forestry Code is within the
exclusive realm of the Bureau of Customs, and direct recourse of petitioner to the Regional Trial Court to
compel the Commissioner of Customs to enforce the ban is devoid of any legal basis. To allow the regular
court to direct the Commissioner to impound the imported matches, as petitioner would, is clearly an
interference with the exclusive jurisdiction of the Bureau of Customs over seizure and forfeiture cases. An
order of a judge to impound, seize or forfeit must inevitably be based on his determination and declaration
of the invalidity of the importation, hence, an usurpation of the prerogative and an encroachment on the
jurisdiction of the Bureau of Customs. In other words, the reliefs directed against the Bureau of Customs 15
as well as the prayer for injunction against importation of matches by private respondent AJIC 16 may not
be granted without the court arrogating upon itself the exclusive jurisdiction of the Bureau of Customs.
The claim of petitioner that no procedure is outlined for the enforcement of the import ban under the Tariff

13

and Customs Code, if true, does not at all diminish the jurisdiction of the Bureau of Customs over the
subject matter. The enforcement of statutory rights is not foreclosed by the absence of a statutory
procedure. The Commissioner of Customs has the power to "promulgate all rules and regulations
necessary to enforce the provisions of this (Tariff and Customs) Code . . . subject to the approval of the
Secretary of Finance." 17 Moreover, it has been held that". . . (w)here the statute does not require any
particular method of procedure to be followed by an administrative agency, the agency may adopt any
reasonable method to carry out its functions." 18
But over and above the foregoing, PTFI's correspondence with the Bureau of Customs 19 contesting the
legality of match importations may already take the nature of an administrative proceeding the pendency
of which would preclude the court from interfering with it under the doctrine of primary jurisdiction. In
Presidential Commission on Good Government v. Pea, 20 we held that ---. . . under the sense-making and expeditious doctrine of primary jurisdiction . . . the courts cannot or will
not determine a controversy involving a question which is within the jurisdiction of an administrative
tribunal, where the question demands the exercise of sound administrative discretion requiring the special
knowledge, experience, and services of the administrative tribunal to determine technical and intricate
matters of fact, and a uniformity of ruling is essential to comply with the purposes of the regulatory statute
administered (Pambujan Sur United Mine Workers v. Samar Mining Co., Inc., 94 Phil. 932, 941 [1954].).
In this era of clogged court dockets, the need for specialized administrative boards or commissions with
the special knowledge, experience and capability to hear and determine promptly disputes on technical
matters or essentially factual matters, subject to judicial review in case of grave abuse of discretion, has
become well nigh indispensable . . .
Moreover, however cleverly the complaint may be worded, the ultimate relief sought by PTFI is to compel
the Bureau of Customs to seize and forfeit the match importations of AJIC. Since the determination to seize
or not to seize is discretionary upon the Bureau of Customs, the same cannot be subject of mandamus. But
this does not preclude recourse to the courts by way of the extraordinary relief of certiorari under Rule 65
of the Rules of Court if the Bureau of Customs should gravely abuse the exercise of its jurisdiction.
Otherwise stated, the court cannot compel an agency to do a particular act or to enjoin such act which is
within its prerogative, except when in the exercise of its authority it gravely abuses or exceeds its
jurisdiction. In the case at bench, we have no occasion to rule on the issue of grave abuse of discretion or
excess of jurisdiction as it is not before us.
The petitioner's claim for damages against AJIC being inextricably linked with the legality of the
importations, must necessarily rise or fall with the main action to bar the question that "(e)very
importation of matches by said defendant is a denial to plaintiff of the protection and incentives granted it
by Sec. 36 (l) of the Forestry Code," 21 merely indicates its reliance on the illegality of the importations for
its prayer for damages. In other words, if the importations were authorized, there would be no denial of the
plaintiff's protection and incentives under the Forestry Code. Necessarily, the claim for damages must
await the decision declaring the importations unlawful.
In Rosales v. Court of Appeals, we categorized a similar case for damages as premature since "(t)he finality
of the administrative case which gives life to petitioners' cause of action has not yet been reached." 22
The pendency of petitioner's request to the Bureau of Customs for the implementation of the ban against

14

the importation of matches under the Forestry Code is impliedly admitted; in fact, it is apparent from the
correspondence of counsel for petitioner that the Bureau is inclined to sustain the validity of the
importations. 23 Hence, as in Rosales, the order of the trial court granting the dismissal of the civil case
must be upheld.
WHEREFORE, finding no reversible error in the appealed Order of the Regional Trial Court of Manila in Civil
Case No. 89-48836 dated 8 February 1990, the same AFFIRMED and, consequently, the instant petition for
review is DENIED.

THE PEOPLE OF THE PHILIPPINES, petitioner, vs. COURT OF FIRST INSTANCE OF QUEZON
(BRANCH VII), GODOFREDO ARROZAL AND LUIS FLORES, respondents.
G.R. No. L-46772 | 1992-02-13
DECISION

MEDIALDEA, J.:
This petition seeks the annulment of the order of the Court of First Instance (now Regional Trial Court) of
Quezon in Criminal Case No. 1591, entitled "People of the Philippines vs. Godofredo Arrozal, Luis Flores and
twenty other John Does," dismissing the information filed therein.
The antecedent facts are as follows:
The private respondents were charged with the crime of qualified theft of logs, defined and punished under
Section 68 of Presidential Decree No. 705, otherwise known as the Revised Forestry Code of the
Philippines, in an
information which read:

15

"That on or about the 28th, 29th and 30th days of July 1976, at Barangay Mahabang Lalim, Municipality of
General Nakar, Province of Quezon, Philippines, and within the jurisdiction of this Honorable Court, the
above-named accused, Godofredo Arrozal and Luis Flores, together with twenty (20) other John Does
whose identities are still unknown, the first-named accused being the administrator of the Infanta Logging
Corporation, with intent to gain, conspiring and confederating together and mutually helping one another,
did then and there willfully, unlawfully and feloniously enter the privately-owned land of one Felicitacion
Pujalte, titled in the name of her deceased father, Macario Prudente, under Original Certificate of Title No.
6026, and once inside, illegally cut, gather, take, steal and carry away therefrom, without the consent of
the said owner and without any authority under a license agreement, lease license or permit, sixty (60)
logs of different species, consisting of about 541.48 cubic meters, with total value of FIFTY THOUSAND
TWO HUNDRED FIVE PESOS and FIFTY TWO CENTAVOS (P50,205.52) including government charges, to the
damage and prejudice of the said owner in the aforesaid amount.
"Contrary to law.
Lucena City, 7 January 1977." (p. 17, Rollo).
On March 23, 1977, the named accused filed a motion to quash the information on two (2) grounds, to wit:
(1) that the facts charged do not constitute an offense; and, (2) that the information does not conform
substantially to the prescribed form.
On April 13, 1977, the trial court dismissed the information on the grounds invoked (pp. 32-42, Rollo). The
reconsideration sought was denied on August 9, 1977 (p. 42, Rollo).
On October 15, 1977, this petition was filed directly with this Court, raising the following questions of law:
(1) whether or not the information charged an offense; and (2) whether or not the trial court had
jurisdiction over the case.
On the first issue, the People alleged that, contrary to the allegation of the private respondents and the
opinion of the trial court, the information substantially alleged all the elements of the crime of qualified
theft of logs as described in Section 68 of P.D. 705. While it was admitted that the information did not
precisely allege that the taking of the logs in question was "without the consent of the state,"
nevertheless, said information expressly stated that the accused "illegally cut, gather, take, steal and carry
away therefrom, without the consent of said owner and without any authority under a license agreement,
lease, license or permit, sixty (60) logs of different species. . . ." Since only the state can grant the lease,
license, license agreement or permit for utilization of forest resources, including timber, then the allegation
in the information that the aspiration of the logs was "without any authority" under a license agreement,
lease, license or permit, is tantamount to alleging that the taking of the logs was without the consent of
the state.
We agree with the petitioner.
"SEC. 68. Cutting, gathering and/or collecting timber or other products without license. Any person who
shall cut, gather, collect or remove timber or other forest products from any forest land, or timber from
alienable and disposable public lands, or from private lands, without any authority under a license

16

agreement, lease, license or permit, shall be guilty of qualified theft as defined and punished under
Articles 309 and 310 of the Revised Penal Code . . .".
When an accused invokes in a motion to quash the ground that the facts charged do not constitute an
offense (Rule 117, Sec. 2[a] Rules of Court), the sufficiency of the Information hinges on the question of
whether the facts alleged, if hypothetically admitted, meet the essential elements of the offense defined in
the law (People v. Segovia, 103 Phil. 1162 [1958])" (People v. Abad, L-55132, August 30, 1988, 165 SCRA
57).
The elements of the crime of qualified theft of logs are: 1) That the accused cut, gathered, collected or
removed timber or other forest products; 2) that the timber of other forest products cut, gathered,
collected or removed belongs to the government or to any private individual; and 3) that the cutting,
gathering, collecting or removing was without authority under a license agreement, lease, license, or
permit granted by the state.
The Order dismissing the complaint concluded that the information was defective because:
". . ., it is noted that the Information alleges that the cutting, gathering and carrying away of the logs were
done without the consent of the owner of the land. While the prosecution admits that timber is a forest
product that belongs to the state, the information, however, fails to allege that the taking was without the
consent of the latter, for which reason the Information is patently defective." (P. 39, Rollo).
The failure of the information to allege that the logs taken were owned by the state is not fatal. It should
be noted that the logs subject of the complaint were taken not from a public forest but from a private
woodland registered in the name of complainant's deceased father, Macario Prudente. The fact that only
the state can grant a license agreement, license or lease does not make the state the owner of all the logs
and timber products produced in the Philippines including those produced in private woodlands. The case
of Santiago v. Basilan Company, G.R. No. L-15532, October 31, 1963, 9 SCRA 349, clarified the matter on
ownership of timber in private lands. This Court held therein:
"The defendant has appealed, claiming that it should not be held liable to the plaintiff because the timber
which it cut and gathered on the land in question belongs to the government and not to the plaintiff, the
latter having failed to
comply with a requirement of the law with respect to his property.
"The provision of law referred to by appellant is a section of the Revised Administrative Code, as amended,
which reads;
'SEC. 1829. Registration of title to private forest land. Every private owner of land containing timber,
firewood and other minor forest products shall register his title to the same with the Director of Forestry. A
list of such owners, with a statement of the boundaries of their property, shall be furnished by said Director
to the Collector of Internal Revenue, and the same shall be supplemented from time to time as occasion
may require.
'Upon application of the Director of Forestry the fiscal of the province in which any such land lies shall
render assistance in the examination of the title thereof with a view to its registration in the Bureau of

17

Forestry.'
"In the above provision of law, there is no statement to the effect that noncompliance with the requirement
would divest the owner of the land of his rights thereof and that said rights of ownership would be
transferred to the government. Of course, the land which had been registered and titled in the name of the
plaintiff under that Land Registration Act could no longer be the object of a forester license issued by the
Director of Forestry because ownership of said land includes also ownership of everything found on its
surface (Art. 437, New Civil Code).
"Obviously, the purpose of the registration required in section 1829 of the Administrative Code is to
exempt the title owner of the land from the payment of forestry charges as provided for under Section 266
of the National Internal Revenue Code, to wit:
'Charges collective on forest products cut, gathered and removed from unregistered private lands. The
charges above prescribed shall be collected on all forest products cut, gathered and removed from any
private land the title to which is not registered with the Director of Forestry as required by the Forest Law,
Provided, however, That in the absence of such registration, the owner who desires to cut, gather and
remove timber and other forest products from such land shall secure a license from the Director of Forestry
Law and Regulations The cutting, gathering and removing of timber and the other forest products from
said private lands without license shall be considered as unlawful cutting, gathering and removing of forest
products from public forests and shall be subject to the charges prescribed in such cases in this chapter.'
xxx xxx xxx
"On the other hand, while it is admitted that the plaintiff has failed to register the timber in his land as a
Private woodland in accordance with the oft-repeated provision of the Revised Administrative Code, he still
retained his rights of ownership, among which are his rights to the fruits of the land and to exclude any
person from the enjoyment and disposal thereof (Art. 429. New Civil Code) the very rights violated by the
defendant Basilan Lumber Company."
While it is only the state which can grant a license or authority to cut, gather, collect or remove forest
products it does not follow that all forest products belong to the state. In the just cited case, private
ownership of forest products grown in private lands is retained under the principle in civil law that
ownership of the land includes everything found on its surface.
Ownership is not an essential element of the offense as defined in Section 60 of P.D. No. 705. Thus, the
failure of the information to allege the true owner of the forest products is not material it was sufficient
that it alleged that the taking was without any authority or license from the government.
Anent the second issue raised, Section 80 of Presidential Decree 705, provides:
"SEC. 80. Arrest; Institution of Criminal Actions. A forest officer or employee of the Bureau shall arrest even
without warrant any person who has committed or is committing in his presence any of the offenses
defined in this Chapter. He shall also seize and confiscate, in favor of the Government, the tools and
equipment used in committing the offense, and the forest products cut, gathered or taken by the offender
in the process of committing the offense. The arresting forest officer or employee shall thereafter deliver

18

within six (6) hours from the time of arrest and seizure, the offender and the confiscated forest products,
tools and equipment to, and file the proper complaint with, the appropriate official designated by law to
conduct preliminary investigations and file informations in court.
"If the arrest and seizure are made in the forests, far from the authorities designated by law to conduct
preliminary investigations, the delivery to, and filing of the complaint with, the latter shall be done within a
reasonable time sufficient for ordinary travel from the place of arrest to the place of delivery The seized
products, materials and equipment shall be immediately disposed of in accordance with forestry
administrative orders promulgated by the Department Head.
"The Department Head may deputize any member or unit of the Philippine Constabulary, police agency,
barangay or barrio official, or any qualified person to protect the forest and exercise the power or authority
provided for in the preceding paragraph.
"Reports and complaints regarding the commission of any of the offenses defined in this Chapter, not
committed in the presence of any forest officer or employee, or any of the deputized officers or officials;
shall immediately be investigated by the forest officer assigned in the area where the offense was
allegedly committed, who shall thereupon receive the evidence supporting the report or complaint.
"If there is a prima facie evidence to support the complaint or report, the investigating forest officer shall
file the necessary complaint with the appropriate official authorized by law to conduct a preliminary
investigation of criminal cases and file an information in Court.
The above cited provision covers two (2) specific instances when a forest officer may commence a
prosecution for the violation of the Revised Forestry Code of the Philippines The first authorizes a forest
officer or employee of the Bureau of Forestry to arrest without a warrant. any person who has committed
or is committing, in his presence, any of the offenses described in the decree The second covers a
situation when an offense described in the decree is not committed in the presence of the forest officer or
employee and the commission is brought to his attention by a report or a complaint In both cases,
however, the forest officer or employee shall investigate the offender and file a complaint with the
appropriate official authorized by law to conduct a preliminary investigation and file the necessary
informations in court.
The circumstances in the instant case do not fall under any of the situations covered by Section 80 of P.D.
705. The alleged offense was committed not in the presence of a forest officer and neither was the alleged
commission reported to any forest officer. The offense was committed in a private land and the complaint
was brought by a private offended party to the fiscal.
The trial court erred in dismissing the case on the ground of lack of jurisdiction over the subject matter
because the information was filed not pursuant to the complaint of any forest officer as prescribed in
Section 80 of P.D. 705. We agree with the observation of the Solicitor General that:
". . ., the authority given to the forest officer to investigate reports and complaints regarding the
commission of offenses defined in P.D. No. 705 by the said last and penultimate paragraphs of Section 80
may be considered as covering only such reports and complaints as might be brought to the forest officer
assigned to the area by other forest officers or employees of the Bureau of Forest Development, or any of

19

the deputized officers or officials, for violations of forest laws not committed in their presence. Such
interpretation becomes cogent when we consider that the whole of Section 80 deals precisely with the
authority of forest officers or employees to make arrests and institute criminal actions involving offenses
defined in the Decree." (p. 26, Rollo).
Likewise, the Solicitor General was correct in insisting that P.D. 705 did not repeal Section 1687 of the
Administrative Code giving authority to the fiscal to conduct investigation into the matter of any crime or
misdemeanor and have the necessary information or complaint prepared or made against persons charged
with the commission of the crime.
"Sec. 1687. Authority of fiscal to conduct investigation in criminal matter. A provincial fiscal shall have
authority, if he deems it wise, to conduct an investigation into the matter of any crime or misdemeanor. To
this end, he may summon reputed witnesses and require them to appear and testify upon oath before
him . . . ."
With the exception of the so-called "private crimes" 1 and in election offenses 2 , prosecutions in Courts of
First Instance may be commenced by an information signed by a fiscal after conducting a preliminary
investigation Section 80 of P.D. 705 did not divest the fiscals of this general authority.
Neither did the said decree grant forest officers the right of preliminary investigations In both cases under
said Sec 80, namely, 1) after a forest officer had made the arrest (for offenses committed in his presence)
or; 2) after conducting an investigation of reports or complaints of violations of the decree (for violations
not committed in his presence) he is still required to file the proper complaint with the appropriate official
designated by law to conduct preliminary investigations in court. Said section should not be interpreted to
vest exclusive authority upon forest officers to conduct investigations regarding offenses described in the
decree rather, it should be construed as granting forest officers and employees special authority to arrest
and investigate offenses described in P.D. 705, to reinforce the exercise of such authority by those upon
whom it is vested by general law.
ACCORDINGLY, the petition is GRANTED. The questioned order of the trial court dismissing the information
is SET ASIDE. Criminal Case No. 1591 is reinstated. SO ORDERED.

20

DAYLINDA A. LAGUA, MANUEL P. LAGUA, HONORATO ACHANZAR and RESTITUTO DONGA,

petitioners, vs. HONORABLE VICENTE N. CUSI, JR., in his capacity as Presiding Judge of the
Court of First Instance of Davao City, Branch I, CONSTANCIO MAGLANA and the EASTCOAST
DEVELOPMENT ENTERPRISES, respondents.
G.R. No. L-44649 | 1988-04-15
DECISION

GUTIERREZ, JR., J.:

This petition for mandamus originated from a complaint for damages which was instituted by the
petitioners against the private respondents for closing a logging road without authority.
In their complaint, the petitioners, alleged, among others:
In Paragraph 5(a):
"a) On 1 January 1976, Atty. Ernesto Nombrado, legal counsel for defendants, issued a memorandum to the
Chief Security Guard of Defendant Eastcoast directing the latter to prevent the passage of Plaintiff Laguas'
hauling trucks loaded with logs for the Japanese vessel (there were no other trucks hauling logs at that
time) on the national highway loading towards where the vessel was berthed. In compliance with this
directive, the security force of Defendant Eastcoast closed the road to the use by plaintiffs trucks and other
equipments and effectively prevented their passage thereof while the vehicles and trucks of other people
were curiously not disturbed and were allowed passage on the same road. It resulted that the loading of
logs on the M/S 'Kyofuku Maru' was discontinued. A xeroxed copy of this Nombrado memorandum, the
original of which is however in the possession of defendants, is hereto attached as Annex 'C' and made an
integral part hereof."
In Paragraph 5(b):
"b) Upon representations made to Indalecio L. Aspiras, Acting Station Officer-in-Charge, BFD Lambajon
Forest Station, and in response to plaintiff Laguas' complaint, a letter dated 2 January 1976 was addressed
by Aspiras to the Resident Manager of Defendant Eastcoast with instructions to open and allow Plaintiff
Laguas' trucks and machineries to pass that road closed to them (but not to others) by Defendant
Eastcoast. A xeroxed copy of this letter is hereto attached as Annex 'D' and made a part hereof.

21

Accordingly, Sagrado Constantino, Resident Manager of Defendant Eastcoast, issued an order to their Chief
Security Guard for the latter to comply with the Aspiras letter. These events, however, took the whole day
of 2 January 1976 co that notwithstanding the biting of the road closure no hauling of logs could be made
by Plaintiff Laguas on that day."
In Paragraph 5(c):
"c) When Plaintiffs Laguas were already resuming the hauling operations of their logs towards the Japanese
Vessel on 3 January 1976, again that same road, only the day before ordered by the BFD to be opened for
use and passage by plaintiffs, was closed to them by Defendant Eastcoast's security men upon a radio
message order of Defendant Maglana. Even the vessel M/S 'Kyofuku Maru' was ordered by Defendant
Maglana to untie her anchor contrary to existing laws, rules and regulations of the Bureau of Customs and
the Philippine Coastguard. A xeroxed copy of the Maglana message, the original of which is in the
possession of the defendants, is hereto attached as Annex 'E" and made an integral part hereof."
And in paragraph 5(d):
"d) Given no recourse in the face of the blatant and illegal closure of the road in defiance of BFD orders to
the contrary by the Defendant Eastcoast through the order of Defendant Maglana, Plaintiff Laguas had to
depart posthaste to Mati, Davao Oriental, from Baganga where the shipment and the road closure were
made, to seek the assistance of the PC Command thereat. Thus on 5 January 1976, Provincial Commander
Alfonso Lumebao issued a directive to the PC Detachment Commander at Baganga to bit the illegal
checkpoint made by defendants. A xeroxed copy of this directive is hereto attached as Annex 'F' and made
a part hereof". (Rollo, pp. 57-58).
The private respondents filed a motion to dismiss on two grounds, namely: a) lack of jurisdiction, and (2)
lack of cause of action.
The private respondents contended that as the acts complained of by the petitioners arose out of the
legitimate exercise of respondent Eastcoast Development Enterprises, Inc., rights as a timber licensee,
more particularly in the use of its logging roads, therefore, the resolution of this question is properly and
legally within the Bureau of Forest Development, citing as authority Presidential Decree (P.D.) No. 705. The
private respondents also argued that petitioner Daylinda Laguas has no capacity to sue as her name was
not registered as an "agent" or "dealer" of logs in the Bureau of Forestry.
On August 3, 1976, the trial court issued the questioned order dismissing the petitioners' complaint on the
basis of the abovementioned grounds. It ruled:
"The Court agrees with the defendants that under the law, the Bureau of Forest Development has the
exclusive power to regulate the use of logging roads and to determine whether their use is in violation of
laws. Since the damages claimed to have been sustained by the plaintiffs arose from the alleged illegal
closure of a logging road ---- in the language of the defendants on page 3 of their motion to dismiss, 'The
simple fact is there was an illegal closure of the national highway affecting the private rights of the
plaintiffs who sustained damages and losses as a consequence thereof ---- the question whether or not the
road was illegally closed must first be determined by the Bureau of Forest Development. If the said Bureau
finds that the road was illegally closed, an action for damages may be filed in Court. Otherwise, no civil

22

action would prosper, for there would be no tortious act." (Rollo, pp. 58-59).
xxx xxx xxx
"After the logging road was closed for the first time, more so after the second time, by the defendant
Eastcoast Development Enterprises, Inc., the plaintiffs should have asked the Bureau of Forest
Development to determine the legality or illegality of the closure since they wanted to file, as they did file,
an action for damages based on the alleged illegal closure. The fact that the letter of January 2, 1976,
directed defendant Eastcoast Development Enterprises, Inc. to open the road does not necessarily mean
that the Bureau of Forest Development had found that the closure was illegal. There must be a positive
finding that the closure was illegal." . . . (Rollo, p. 60)
xxx xxx xxx
"As an attorney-in-fact, Daylinda A. Lagua is not entitled to, and cannot claim, damages in her personal
capacity. For she could not have sustained damages as a result of the alleged illegal closure of the road in
her personal capacity while acting in her representative capacity. So if she and her husband sustained
damages, it must have been because their legal rights were violated by a tortious act committed by the
defendants other then the alleged illegal closure of the road. But as stated elsewhere in this order, even
the plaintiffs admit that the damages they claimed to have sustained arose from the alleged illegal closure
of the logging road. Assuming, however, that another tortious act violated the legal rights of the Laguas,
still they could not joint Achanzar and Donga in this complaint for there would be misjoinder of parties.
(Rollo, pp. 61-62)
Hence, this petition for mandamus which we will treat as a petition for certiorari in the interest of justice.
The petitioners maintain that since their action is for damages, the regular courts have jurisdiction over
the same. According to them, the respondent court had no basis for holding that the Bureau of Forestry
Development must first determine that the closure of a logging road is illegal before an action for damages
can be instituted.
We agree.
P.D. No. 705 upon which the respondent court based its order does not vest any power in the Bureau of
Forest Development to determine whether or not the closure of a logging road is legal or illegal and to
make such determination a pre-requisite before an action for damages may be maintained. Moreover, the
complaint instituted by the petitioners is clearly for damages based on the alleged illegal closure of the
logging road. Whether or not such closure was illegal is a matter to be established on the part of the
petitioners and a matter to be disproved by the private respondents. This should appropriately be threshed
out in a judicial proceeding. It is beyond the power and authority of the Bureau of Forest Development to
determine the unlawful closure of a passage way, much less award or deny the payment of damages
based on such closure. Not every activity inside a forest area is subject to the jurisdiction of the Bureau of
Forest Development. As we have held in Ateneo de Manila University v. Court of Appeals (146 SCRA 100,
110):
"The issue in this court was whether or not the private respondents can recover damages as a result of the

23

dismissal of their son from the petitioner university. This is a purely legal question and nothing of an
administrative nature is to or can be done (Gonzalez v. Hechanova, 9 SCRA 230; Tapales v. University of
the Philippines, 7 SCRA 533; Limoico v. Board of Administrators (PJA) 133 SCRA 43; Malabanan v. Ramonte,
129 SCRA 369). The case was brought pursuant to the law on damages provided in the Civil Code. The
jurisdiction to try the case belong to the civil courts."
The private respondents, in their memorandum filed with the respondent court, alleged that the logs of
petitioner Achanzar were cut down and removed outside of the area granted to the latter under his Private
Timber License No. 2 and therefore inside the concession area of respondent company's Timber License
Agreement. This, apparently, was the reason why the respondent company denied to the petitioners the
use of the logging road. If we hold the respondents to their contention that the Bureau of Forest
Development has the power and authority not only to regulate the use or blockade of logging roads but
also to exclusively determine the legality of a closure of such roads, why then did they take it upon
themselves to initially close the disputed logging road before taking up the matter with the Bureau and
why did they close it again notwithstanding the Bureau's order to open it after the petitioners had duly
informed the said Bureau of the closure? To use the Bureau's authority which the respondents ignored to
now defeat the court's jurisdiction would be totally unacceptable. We, therefore, find that the trial court
committed grave abuse of discretion in dismissing the complaint on the ground of lack of jurisdiction over
the subject matter.
Anent the legal capacity to sue of the petitioners, spouses Laguas, we affirm the trial court's ruling that
since they were mere agents of petitioners Achanzar and Donga and were suing in their own behalf, they
did not have the capacity to sue for damages. They are not the real parties in interest. However, the
complaint can still be maintained. It cannot be dismissed because the real parties in interest, Achanzar and
Donga were also plaintiffs. Thus, the trial court should have ordered only the dropping of the names of the
spouses Laguas pursuant to Section 11, Rule 3 of the Revised Rules of Court but not the dismissal of the
complaint.
WHEREFORE, in view of the foregoing, the petition is hereby GRANTED. The questioned order of the
respondent court is SET ASIDE and this case is ordered remanded to the court of origin for trial on the
merits.
SO ORDERED.

ERNESTO AQUINO,Petitioner,versus PEOPLE OF THE PHILIPPINES,Respondent.

G.R. No. 165448 | 2009-07-27
DECISION

CARPIO, J.:

The Case

24

Before the Court is a petition for review[1] assailing the 5 June 1997 Decision[2] and 24 September 2004
Resolution[3] of the Court of Appeals in CA-G.R. CR No. 17534.
The Antecedent Facts
On behalf of Teachers' Camp, Sergio Guzman filed with the Department of Environment and Natural
Resources (DENR) an application to cut down 14 dead Benguet pine trees within the Teachers' Camp in
Baguio City. The trees, which had a total volume of 13.37 cubic meters, were to be used for the repairs of
Teachers' Camp.
On 19 May 1993, before the issuance of the permit, a team composed of members from the Community
Environment and Natural Resources Office (CENRO) and Michael Cuteng (Cuteng), a forest ranger of the
Forest Section of the Office of the City Architect and Parks Superintendent of Baguio City, conducted an
inspection of the trees to be cut.
Thereafter, Sabado T. Batcagan, Executive Director of the DENR, issued a permit allowing the cutting of 14
trees under the following terms and conditions:
2. That the cut timber shall be utilized as lumber and fuel-wood by the permittee;
3. As replacement, the permittee shall plant one hundred forty (140) pine seedlings in an appropriate place
within the area. In the absence of plantable area in the property, the same is required to plant within forest
area duly designated by CENRO concerned which shall be properly maintained and protected to
ensure/enhance growth and development of the planted seedlings;
4. Violation of any of the conditions set hereof is punishable under Section 68 of PD 705 as amended by
E.O. No. 277, Series of 1987; and
5. That non-compliance with any of the above conditions or violations of forestry laws and regulations shall
render this permit null and void without prejudice to the imposition of penalties in accordance with existing
laws and regulations.
This PERMIT is non-transferable and shall expire ten (10) days from issuance hereof or as soon as the
herein authorized volume is exhausted whichever comes first.[4]
On 23 July 1993, Forest Rangers Ramil Windo, Moises Sobrepea, Daniel Salamo, Pablo Guinawan, Antonio
Abellera, and Forester Paul Apilis received information that pine trees were being cut at Teachers' Camp
without proper authority. They proceeded to the site where they found Ernesto Aquino (petitioner), a forest
ranger from CENRO, and Cuteng supervising the cutting of the trees. They also found sawyers Benedicto
Santiago (Santiago) and Mike Masing (Masing) on the site, together with Clemente Salinas (Salinas) and
Andrew Nacatab (Nacatab), who were also supervising the cutting of the trees. The forest rangers found 23
tree stumps, out of which only 12 were covered by the permit. The volume of the trees cut with permit was
13.58 cubic meters while the volume of the trees cut without permit was 16.55 cubic meters. The market
value of the trees cut without permit was P182,447.20, and the forest charges were P11,833.25.
An Information for violation of Section 68 of Presidential Decree No. 705[5] (PD 705) was filed against

25

petitioner, Cuteng, Nacatab, Masing, and Santiago, as follows:

That on or about the 23rd day of July, 1993, and subsequent thereto, in the City of Baguio, Philippines, and
within the jurisdiction of this Honorable Court, the above-named accused, conspiring, confederating and
mutually aiding one another, and without any authority, license or permit, did then and there willfully,
unlawfully and feloniously cut nine (9) pine trees with a total volume and market price as P182,447.20
(Volume 16.55 M3 424 bd. ft./M3 and unit price - P26.00 bd. ft.) and with a total forest charge of
P11,833.25 or having a total sum of P194,280.45 at Teachers Camp, Baguio City, without the legal
documents as required under existing forest laws and regulations, particularly the Department of
Environment and Natural Resources Circular No. 05, Series of 1989, in violation of the aforecited law.[6]
Masing alleged that he was not aware of the limitations on the permit as he was not given a copy of the
permit. Masing stated that he cut 10 pine trees under the supervision of petitioner who claimed to be in
possession of the necessary permit. He stated that three of the trees were stumps about four or five feet
high and were not fit for lumber. He stated that while he was cutting trees, petitioner and Salinas were
present.
Santiago testified that he cut trees under petitioner's supervision. He stated that petitioner was in
possession of the permit. He stated that he cut 10 trees, six of which were cut into lumber while two were
stumps and two were rotten.
Salinas testified that Masing and Santiago were merely hired as sawyers and they merely followed
petitioner's instructions.
Cuteng testified that he was part of the team that inspected the trees to be cut before the permit was
issued. He stated that the trees cut by Santiago were covered by the permit.
Nacatab testified that he only went to Teachers' Camp on 13 July 1993 and he saw Santiago and Masing
cutting down the trees in petitioner's presence.
Petitioner alleged that he was sent to supervise the cutting of trees at Teachers' Camp. He allegedly
informed his superior, Paul Apilis, that he was not aware of the trees covered by the permit. However, he
still supervised the cutting of trees without procuring a copy of the vicinity map used in the inspection of
the trees to be cut. He claimed that he could not prevent the overcutting of trees because he was just
alone while Cuteng and Santiago were accompanied by three other men.
The Decision of the Trial Court
In its 26 May 1994 Decision,[7] the Regional Trial Court of Baguio City, Branch 5 (trial court), ruled as
follows:
WHEREFORE, the Court finds and declares the accused ERNESTO AQUINO y ESTIPULAR, MICHAEL CUTENG
y LESCAO and BENEDICTO SANTIAGO y DOCLES guilty beyond reasonable doubt of the crime charged and
hereby sentences EACH of them to suffer an indeterminate penalty of SIX (6) YEARS of prision correccional,
as minimum, to TWENTY (20) YEARS of reclusion temporal, as maximum; to indemnify, jointly and
severally, the Government in the amounts of P182,477.20 and P11,833.25, representing the market value

26

of and forest charges on the Benguet pine trees cut without permit; and to pay their proportionate shares
in the costs.
The chainsaw confiscated from the accused Santiago is hereby declared forfeited in favor of the
Government.
On the other hand, the accused ANDREW NACATAB y DODOY and MIKE MASING y GANAS are acquitted on
reasonable doubt, with costs de oficio, and the cash bonds they deposited for their provisional liberty in
the amount of P7,500.00 each under O.R. Nos. 139605 and 139646, dated February 4, 1996 and February
23, 1994, respectively, are ordered released to them upon proper receipt therefor.
SO ORDERED.[8]
The trial court ruled that the trees cut exceeded the allowed number of the trees authorized to be cut. The
trial court further ruled that the cutting of trees went beyond the period stated in the permit.
Petitioner, Cuteng and Santiago appealed from the trial court's Decision.
The Decision of the Court of Appeals
In its 5 June 1997 Decision, the Court of Appeals modified the trial court's Decision as follows:
WHEREFORE, the decision of the court a quo is MODIFIED. The accused-appellants Benedicto Santiago and
Michael Cuteng are hereby acquitted on reasonable doubt. The appellant Ernesto Aquino is found guilty,
and is hereby sentenced to suffer the indeterminate penalty of six (6) years and one (1) day of prision
mayor as minimum, to fourteen (14) years, eight (8) months, and one (1) day of reclusion temporal, as
maximum. The award of damages is deleted. No costs.
SO ORDERED.[9]
The Court of Appeals ruled that as a forest guard or ranger of the CENRO, DENR, petitioner had the duty to
supervise the cutting of trees and to ensure that the sawyers complied with the terms of the permit which
only he possessed. The Court of Appeals ruled that while it was Teachers' Camp which hired the sawyers,
petitioner had control over their acts. The Court of Appeals rejected petitioner's claim that he was
restrained from taking a bolder action by his fear of Santiago because petitioner could have informed his
superiors but he did not do so. The Court of Appeals further rejected petitioner's contention that the law
contemplated cutting of trees without permit, while in this case there was a permit for cutting down the
trees. The Court of Appeals ruled that the trees which were cut by the sawyers were not covered by the
permit.
The Court of Appeals ruled that conspiracy was not sufficiently proven. As such, the Court of Appeals found
that the prosecution failed to prove Cuteng's guilt beyond reasonable doubt. The Court of Appeals likewise
acquitted Santiago because he was only following orders as to which trees to cut and he did not have a
copy of the permit.
Petitioner filed a motion for reconsideration. In its 24 September 2004 Resolution, the Court of Appeals

27

denied the motion for lack of merit.

Hence, the petition before this Court.
The Issue
The only issue in this case is whether petitioner is guilty beyond reasonable doubt of violation of Section
68 of PD 705.
The Ruling of this Court
The petition has merit.
The Solicitor General alleges that the petition should be denied because petitioner only raises questions of
facts and not questions of law. We do not agree.
A question of law arises when there is doubt as to what the law is on a certain state of facts, while there is
a question of fact when the doubt arises as to the truth or falsity of the alleged facts.[10] For questions to
be one of law, the same must not involve an examination of the probative value of the evidence presented
by the litigants.[11] The resolution of the issue must rest solely on what the law provides on the given set
of circumstances.[12]
In this case, petitioner challenges his conviction under Section 68 of PD 705.
Section 68 of PD 705 provides:
Section 68. Cutting, Gathering and/or Collecting Timber or Other Forest Products Without License.-Any
person who shall cut, gather, collect, remove timber or other forest products from any forest land, or
timber from alienable or disposable public land, or from private land, without any authority, or possess
timber or other forest products without the legal documents as required under existing forest laws and
regulations, shall be punished with the penalties imposed under Articles 309 and 310 of the Revised Penal
Code: Provided, that in the case of partnerships, associations, or corporations, the officers who ordered the
cutting, gathering, collection or possession shall be liable, and if such officers are aliens, they shall, in
addition to the penalty, be deported without further proceedings on the part of the Commission on
Immigration and Deportation.
There are two distinct and separate offenses punished under Section 68 of PD 705, to wit:
(1) Cutting, gathering, collecting and removing timber or other forest products from any forest land, or
timber from alienable or disposable public land, or from private land without any authority; and
(2) Possession of timber or other forest products without the legal documents required under existing
forest laws and regulations.[13]
The provision clearly punishes anyone who shall cut, gather, collect or remove timber or other forest
products from any forest land, or timber from alienable or disposable public land, or from private land,

28

without any authority. In this case, petitioner was charged by CENRO to supervise the implementation of
the permit. He was not the one who cut, gathered, collected or removed the pine trees within the
contemplation of Section 68 of PD 705. He was not in possession of the cut trees because the lumber was
used by Teachers' Camp for repairs. Petitioner could not likewise be convicted of conspiracy to commit the
offense because all his co-accused were acquitted of the charges against them.
Petitioner may have been remiss in his duties when he failed to restrain the sawyers from cutting trees
more than what was covered by the permit. As the Court of Appeals ruled, petitioner could have informed
his superiors if he was really intimidated by Santiago. If at all, this could only make petitioner
administratively liable for his acts. It is not enough to convict him under Section 68 of PD 705.
Neither could petitioner be liable under the last paragraph of Section 68 of PD 705 as he is not an officer of
a partnership, association, or corporation who ordered the cutting, gathering, or collection, or is in
possession of the pine trees.
WHEREFORE, we GRANT the petition. We SET ASIDE the 5 June 1997 Decision and 24 September 2004
Resolution of the Court of Appeals in CA-G.R. CR No. 17534. Petitioner Ernesto Aquino is ACQUITTED of the
charge of violation of Section 68 of Presidential Decree No. 705. Costs de officio.

SO ORDERED.

29

MUSTANG LUMBER, INC., petitioner, vs. HON. COURT OF APPEALS, HON. FULGENCIO S.
FACTORAN, JR., Secretary, Department of Environment and Natural Resources (DENR), and
ATTY. VINCENT A. ROBLES, Chief, Special Actions and Investigation Division, DENR,
respondents.
G.R. No. 104988 | 1996-06-18
DAVIDE,

JR.,

J.:

The first and third case, G.R. No. 104988 and G.R. No. 123784, were originally assigned to the Second and
Third Divisions of the Court, respectively. They were subsequently consolidated with the second, a case of
the
Court
en
banc.
Petitioner, a domestic corporation with principal office at Nos. 1350-1352 Juan Luna Street, Tondo, Manila,
and with a Lumberyard at Fortune Street, Fortune Village, Paseo de Blas, Valenzuela, Metro Manila, was
duly registered as a lumber dealer with the Bureau of Forest Development (BFD) under Certificate of
Registration No. NRD-4-092590-0469. Its permit as such was to expire on 25 September 1990.
Respondent Secretary Fulgencio S. Factoran, Jr., and respondent Atty. Vincent A. Robles were, during all the
time material to these cases, the Secretary of the Department of Environment and Natural Resources
(DENR) and the Chief of the Special Actions and Investigation Division (SAID) of the DENR, respectively.
The

material

operative

facts

are

as

follows:

On 1 April 1990, acting on an information that a huge stockpile of narra flitches, shorts, and slabs were
seen inside the lumberyard of the petitioner in Valenzuela, Metro Manila, the SAID organized a team of
foresters and policemen and sent it to conduct surveillance at the said lumberyard. In the course thereof,
the team members saw coming out from the lumberyard the petitioner's truck, with Plate No. CCK-322,
loaded with lauan and almaciga lumber of assorted sizes and dimensions. Since the driver could not
produce the required invoices and transport documents, the team seized the truck together with its cargo
and impounded them at the DENR compound at Visayas Avenue, Quezon City. 1 The team was not able to
gain
entry
into
the
premises
because
of
the
refusal
of
the
owner.
2
On 3 April 1990, the team was able to secure a search warrant from Executive Judge Adriano R. Osorio of
the Regional Trial Court (RTC) of Valenzuela, Metro Manila. By virtue thereof, the team seized on that date

30

from the petitioner's lumberyard four truckloads of narra shorts, trimmings, and slabs; a negligible number
of narra lumber; and approximately 200,000 board feet of lumber and shorts of various species including
almaciga
and
supa.
3
On 4 April 1990, the team returned to the premises of the petitioner's lumberyard in Valenzuela and placed
under administrative seizure the remaining stockpile of almaciga, supa, and lauan lumber with a total
volume of 311,000 board feet because the petitioner failed to produce upon demand the corresponding
certificate of lumber origin, auxiliary invoices, tally sheets, and delivery receipts from the source of the
invoices covering the lumber to prove the legitimacy of their source and origin. 4
Parenthetically, it may be stated that under an administrative seizure the owner retains the physical
possession of the seized articles. Only an inventory of the articles is taken and signed by the owner or his
representative. The owner is prohibited from disposing them until further orders. 5
On 10 April 1990, counsel for the petitioner sent a letter to Robles requesting an extension of fifteen days
from 14 April 1990 to produce the required documents covering the seized articles because some of them,
particularly the certificate of lumber origin, were allegedly in the Province of Quirino Robles denied the
motion on the ground that the documents being required from the petitioner must accompany the lumber
or
forest
products
placed
under
seizure.
6
On 11 April 1990, Robles submitted his memorandum-report recommending to Secretary Factoran the
following:
1. Suspension and subsequent cancellation of the lumber Dealer's Permit of Mustang Lumber, Inc. for
operating an unregistered lumberyard and resaw mill and possession of Almaciga Lumber (a banned
specie)
without
the
required
documents;
2. Confiscation of the lumber seized at the Mustang Lumberyard including the truck with Plate No. CCK-322
and the lumber loaded herein [sic] now at the DENR compound in the event its owner fails to submit
documents showing legitimacy of the source of said lumber within ten days from date of seizure;
3. Filing of criminal charges against Mr. Ri Chuy Po, owner of Mustang Lumber Inc. and Mr. Ruiz, or if the
circumstances warrant for illegal possession of narra and almaciga lumber and shorts if and when
recommendation
no.
2
pushes
through;
4. Confiscation of Trucks with Plate No. CCS-639 and CDV. 458 as well as the lumber loaded therein for
transport
lumber
using
"recycled"
documents.
7
On 23 April 1990, Secretary Factoran issued an order suspending immediately the petitioner's lumberdealer's permit No. NRD-4-092590-0469 and directing the petitioner to explain in writing within fifteen
days
why
its
lumber-dealer's
permit
should
not
be
cancelled.
On the same date, counsel for the petitioner sent another letter to Robles informing the latter that the
petitioner had already secured the required documents and was ready to submit them. None, however,
was
submitted.
8

31

On 3 May 1990, Secretary Factoran issued another order wherein, after reciting the events which took
place on 1 April and 3 April 1990, he ordered "CONFISCATED in favor of the government to be disposed of
in accordance with law" the approximately 311,000 board feet of lauan, supa, and almaciga lumber,
shorts,
and
sticks
found
inside
the
petitioner's
lumberyard.
9
On 11 July 1990, the petitioner filed with the RTC of Manila a petition for certiorari and prohibition with a
prayer for a restraining order or preliminary injunction against Secretary Fulgencio S. Factoran, Jr., and Atty.
Vincent A. Robles. The case (hereinafter, the FIRST CIVIL CASE) was docketed as Civil Case No. 90-53648
and assigned to Branch 35 of the said court. The petitioner questioned therein (a) the seizure on 1 April
1990, without any search and seizure order issued by a judge, of its truck with Plate No. CCK-322 and its
cargo of assorted lumber consisting of apitong, tanguile, and lauan of different sizes and dimensions with a
total value of P38,000.00; and (b) the orders of Secretary Factoran of 23 April 1990 for lack of prior notice
and hearing and of 3 May 1990 for violation of Section 2, Article III of the Constitution.
On 17 September 1990, in response to reports that violations of P.D. No. 705 (The Revised Forestry Code of
the Philippines), as amended, were committed and acting upon instruction of Robles and under Special
Order No. 897, series of 1990, a team of DENR agents went to the business premises of the petitioner
located at No. 1352 Juan Luna Street, Tondo, Manila. The team caught the petitioner operating as a lumber
dealer although its lumber-dealer's permit had already been suspended or 23 April 1990. Since the gate of
the petitioner's lumberyard was open, the team went inside and saw an owner-type jeep with a trailer
loaded with lumber. Upon investigation, the team was informed that the lumber loaded on the trailer was
to be delivered to the petitioner's customer. It also came upon the sales invoice covering the transaction.
The members of the team then introduced themselves to the caretaker, one Ms. Chua, who turned out to
be the wife of the petitioner's president and general manager, Mr. Ri Chuy Po, who was then out of town.
The team's photographer was able to take photographs of the stockpiles of lumber including newly cut
ones, fresh dust around sawing or cutting machineries and equipment, and the transport vehicles loaded
with lumber. The team thereupon effected a constructive seizure of approximately 20,000 board feet of
lauan lumber in assorted sizes stockpiled in the premises by issuing a receipttherefor. 10
As a consequence of this 17 September 1990 incident, the petitioner filed with the RTC of Manila a petition
for certiorari and prohibition. The case (hereinafter, the SECOND CIVIL CASE) was docketed as Civil Case
No.
90-54610
and
assigned
to
Branch
24
of
the
said
court.
In the meantime, Robles filed with the Department of Justice (DOJ) a complaint against the petitioner's
president and general manager, Ri Chuy Po, for violation of Section 68 of P.D. No. 705, as amended by E.O.
No. 277. After appropriate preliminary investigation, the investigating prosecutor, Claro Arellano, handed
down
a
resolution
11
whose
dispositive
portion
reads:
WHEREFORE, premises considered, it is hereby recommended that an information be filed against
respondent Ri Chuy Po for illegal possession of approximately 200,000 bd. ft. of lumber consisting of
almaciga and supa and for illegal shipment of almaciga and lauan in violation of Sec. 68 of PD 705 as
amended
by
E.O.
277,
series
of
1987.
It is further recommended that the 30,000 bd. ft. of narra shorts, trimmings and slabs covered by legal
documents
be
released
to
the
rightful
owner,
Malupa.
12

32

This resolution was approved by Undersecretary of Justice Silvestre H. Bello III, who served as Chairman of
the
Task
Force
on
Illegal
Logging."
13
On the basis of that resolution, an information was filed on 5 June 1991 by the DOJ with Branch 172 of the
RTC of Valenzuela, charging Ri Chuy Po with the violation of Section 58 of P.D. No. 705, as amended, which
was docketed as Criminal Case No. 324-V-91 (hereinafter, the CRIMINAL CASE). The accusatory portion of
the
information
reads
as
follows:
That on or about the 3rd day of April 1990, or prior to or subsequent thereto, within the premises and
vicinity of Mustang Lumber, Inc. in Fortune Village, Valenzuela, Metro Manila, and within the jurisdiction of
this Honorable Court, the above-named accused, did then and there wilfully, feloniously and unlawfully
have in his possession truckloads of almaciga and lauan and approximately 200,000 bd. ft. of lumber and
shorts of various species including almaciga and supa, without the legal documents as required under
existing
forest
laws
andregulations.
14
On 7 June 1991, Branch 35 of the RTC of Manila rendered its decision 15 in the FIRST CIVIL CASE, the
dispositive
portion
of
which
reads:
WHEREFORE,

judgment

in

this

case

is

rendered

as

follows:

1. The Order of Respondent Secretary of the DENR, the Honorable Fulgencio S. Factoran, Jr., dated 3 May
1990 ordering the confiscation in favor of the Government the approximately 311,000 board feet of Lauan,
supa, end almaciga Lumber, shorts and sticks, found inside and seized from the Lumberyard of the
petitioner at Fortune Drive, Fortune Village, Paseo de Blas, Valenzuela, Metro Manila, on April 4, 1990
(Exhibit 10), is hereby set aside and vacated, and instead the respondents are required to report and bring
to the Hon. Adriano Osorio, Executive Judge, Regional Trial Court, NCR, Valenzuela, Metro Manila, the said
311,000 board feet of Lauan, supa and almaciga Lumber, shorts and sticks, to be dealt with as directed by
Law;
2. The respondents are required to initiate and prosecute the appropriate action before the proper court
regarding the Lauan and almaciga lumber of assorted sizes and dimensions Loaded in petitioner's truck
bearing
Plate
No.
CCK-322
which
were
seized
on
April
1,
1990;
3. The Writ of Preliminary Injunction issued by the Court on August 2, 1990 shall be rendered functus oficio
upon compliance by the respondents with paragraphs 1 and 2 of this judgment;.
4. Action on the prayer of the petitioner that the Lauan, supa and almaciga lumber, shorts and sticks
mentioned above in paragraphs 1 and 2 of this judgment be returned to said petitioner is withheld in this
case until after the proper court has taken cognizance and determined how those Lumber, shorts and
sticks
should
be
disposed
of;
and
5.
SO

The

petitioner

is

ordered

to

pay

the

costs.
ORDERED.

In resolving the said case, the trial court held that the warrantless search and seizure on 1 April 1990 of

33

the petitioner's truck, which was moving out from the petitioner's lumberyard in Valenzuela, Metro Manila,
loaded with large volumes of lumber without covering document showing the legitimacy of its source or
origin did not offend the constitutional mandate that search and seizure must be supported by a valid
warrant. The situation fell under one of the settled and accepted exceptions where warrantless search and
seizure is justified, viz., a search of a moving vehicle. 16 As to the seizure of a large volume of almaciga,
supa, and lauan lumber and shorts effected on 4 April 1990, the trial court ruled that the said seizure was
a continuation of that made the previous day and was still pursuant to or by virtue of the search warrant
issued by Executive Judge Osorio whose validity the petitioner did not even question. 17 And, although the
search warrant did not specifically mention almaciga, supa, and lauan lumber and shorts, their seizure was
valid because it is settled that the executing officer is not required to ignore contrabands observed during
the
conduct
of
thesearch.
18
The trial court, however, set aside Secretary Factoran's order of 3 May 1990 ordering the confiscation of
the seized articles in favor of the Government for the reason that since the articles were seized pursuant to
the search warrant issued by Executive Judge Osorio they should have been returned to him in compliance
with
the
directive
in
the
warrant.
As to the propriety of the 23 April 1990 order of Secretary Factoran, the trial court ruled that the same had
been rendered moot and academic by the expiration of the petitioner's lumber dealer's permit on 25
September
1990,
a
fact
the
petitioner
admitted
in
its
memorandum.
The petitioner forthwith appealed from the decision in the FIRST CIVIL CASE to the Court of Appeals, which
docketed
the
appeal
as
CA-G.R.
SP
No.
25510.
On 7 July 1991, accused Ri Chuy Po filed in the CRIMINAL CASE a Motion to Quash and/or to Suspend
Proceedings based on the following grounds: (a) the information does not charge an offense, for possession
of lumber, as opposed to timber, is not penalized in Section 68 of P.D. No. 705, as amended, and even
granting arguendo that lumber falls within the purview of the said section, the same may not be used in
evidence against him for they were taken by virtue of an illegal seizure; and (b) Civil Case No. 90-53648 of
Branch 35 of the RTC of Manila, the FIRST CIVIL CASE, then pending before the Court of Appeals, which
involves
the
legality
of
the
seizure,
raises
a
prejudicial
question.
19
The prosecution opposed the motion alleging that lumber is included in Section 68 of P.D. No. 705, as
amended, and possession thereof without the required legal documents is penalized therein. It referred to
Section 3.2 of DENR Administrative Order No. 19, series of 1989, for the definitions of timber and lumber,
and then argued that exclusion of lumber from Section 68 would defeat the very purpose of the law, i.e., to
minimize, if not halt, illegal logging that has resulted in the rapid denudation of our forest resources. 20
In her order of 16 August 1991 in the CRIMINAL CASE, 21 respondent Judge Teresita Dizon-Capulong
granted the motion to quash and dismissed the case on the ground that "possession of lumber without the
legal
documents
required
by
forest
laws
and
regulations
is
not
a
crime.
22
Its motion for reconsideration having been denied in the order of 18 October 1991, 23 the People filed a
petition for certiorari with this Court in G.R. No. 106424, wherein it contends that the respondent Judge
acted with grave abuse of discretion in granting the motion to quash and in dismissing the case.

34

On 29 November 1991, the Court of Appeals rendered a decision 24 in CA-G.R. SP No. 25510 dismissing for
lack of merit the petitioner's appeal from the decision in the FIRST CIVIL CASE and affirming the trial
court's rulings on the issues raised. As to the claim that the truck was not carrying contraband articles
since there is no law punishing the possession of lumber, and that lumber is not timber whose possession
without the required legal documents is unlawful under P.D. No. 705, as amended, the Court of Appeals
held:
This undue emphasis on lumber or the commercial nature of the forest product involved has always been
foisted by those who claim to be engaged in the legitimate business of lumber dealership. But what is
important to consider is that when appellant was required to present the valid documents showing its
acquisition and lawful possession of the lumber in question, it failed to present any despite the period of
extension
granted
to
it.
25
The petitioner's motion to reconsider the said decision was denied by the Court of Appeals in its resolution
of 3 March 1992. 26 Hence, the petitioner came to this Court by way of a petition for review on certiorari in
G.R.
No.
104988,
which
was
filed
on
2
May
1992.
27
On 24 September 1992, Branch 24 of the RTC of Manila handed down a decision in the SECOND CIVIL CASE
dismissing the petition for certiorari and prohibition because (a) the petitioner did not exhaust
administrative remedies; (b) when the seizure was made on 17 September 1990 the petitioner could not
lawfully sell lumber, as its license was still under suspension; (c) the seizure was valid under Section 68-A
of P.D. No. 705, as amended; and (d) the seizure was justified as a warrantless search and seizure under
Section
80
of
P.D.
No.
705,
as
amended.
The petitioner appealed from the decision to the Court of Appeals, which docketed the appeal as CA-G.R.
SP
No.
33778.
In its decision 28 of 31 July 1995, the Court of Appeals dismissed the petitioner's appeal in CA-G.R. SP No.
33778 for lack of merit and sustained the grounds relied upon by the trial court in dismissing the SECOND
CIVIL CASE. Relying on the definition of "lumber" by Webster, viz., "timber or logs, especially after being
prepared for the market," and by the Random House Dictionary of the English Language, viz., "wood, esp.
when suitable or adapted for various building purposes," the respondent Court held that since wood is
included in the definition of forest product in Section 3(q) of P.D. No. 705, as amended, lumber is
necessarily
included
in
Section
68
under
the
term
forest
product.
The Court of Appeals further emphasized that a forest officer or employee can seize the forest product
involved in a violation of Section 68 of P.D. No. 705 pursuant to Section 80 thereof, as amended by P.D. No.
1775,
which
provides
in
part
as
follows:
Sec. 80. Arrest, Institution of Criminal Actions. -- A forest officer or employee of the Bureau or any
personnel of the Philippine Constabulary/Integrated National Police shall arrest even without warrant any
person who has committed or is committing in his presence any of the offenses defined in this chapter. He
shall also seize and confiscate, in favor of the Government, the tools and equipment used in committing
the offense, or the forest products cut, gathered or taken by the offender in the process of committing the
offense.

35

Among the offenses punished in the chapter referred to in said Section 80 are the cutting, gathering,
collection, or removal of timber or other forest products or possession of timber or other forest products
without
the
required
legal
documents.
Its motion to reconsider the decision having been denied by the Court of Appeals in the resolution of 6
February 1996, the petitioner filed with this Court on 27 February 1996 a petition for review on certiorari in
G.R.
No.
123784.
We shall now resolve these three cases starting with G.R. No. 106424 with which the other two were
consolidated.
G.R.

No.

106424

The petitioner had moved to quash the information in Criminal Case No. 324-V-91 on the ground that it
does not charge an offense. Respondent Judge Dizon-Capulong granted the motion reasoning that the
subject matter of the information in the CRIMINAL CASE is LUMBER, which is neither "timber" nor "other
forest product" under Section 68 of P.D. No. 705, as amended, and hence, possession thereof without the
required
legal
documents
is
not
prohibited
and
penalized
under
the
said
section.
Under paragraph (a), Section 3, Rule 117 of the Rules of Court, an information may be quashed on the
ground that the facts alleged therein do not constitute an offense. It has been said that "the test for the
correctness of this ground is the sufficiency of the averments in the information, that is, whether the facts
alleged, if hypothetically admitted, constitute the elements of theoffense, 29 and matters aliunde will not
be considered." Anent the sufficiency of the information, Section 6, Rule 110 of the Rules of Court requires,
inter alia, that the information state the acts or omissions complained of as constituting the offense.
Respondent Ri Chuy Po is charged with the violation of Section 68 of P.D. No. 705, as amended by E.O. No.
277,
which
provides:
Sec. 68. Cutting, Gathering and/or collecting Timber, or Other Forest Products Without License. -- Any
person who shall cut, gather, collect, remove timber or other forest products from any forest land, or
timber from alienable or disposable public land, or from private land, without any authority, or possess
timber or other forest products without the legal documents as required under existing forest laws and
regulations, shall be punished with the penalties imposed under Articles 309 and 310 of the Revised Penal
Code: Provided, That in the case of partnerships, associations, or corporations, the officers who ordered the
cutting, gathering, collection or possession shall be liable, and if such officers are aliens, they shall, in
addition to the penalty, be deported without further proceedings on the part of the Commission on
Immigration
and
Deportation.
The Court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed, as well as the machinery, equipment,
implements and tools illegally used in the area where the timber or forest products are found.
Punished then in this section are (1) the cutting, gathering, collection, or removal of timber or other forest
products from the places therein mentioned without any authority; and (b) possession of timber forest
products without the legal documents as required under existing forest laws and regulations.

36

Indeed, the word lumber does not appear in Section 68. But conceding ex gratia that this omission
amounts to an exclusion of lumber from the section's coverage, do the facts averred in the information in
the
CRIMINAL
CASE
validly
charge
a
violation
of
the
said
section?
A cursory reading of the information readily leads us to an infallible conclusion that lumber is not solely its
subject matter. It is evident therefrom that what are alleged to be in the possession of the private
respondent,
without
the
required
legal
documents,
are
truckloads
of
(1)

almaciga

and

lauan;

and

(2) approximately 200,000 bd. ft. of lumber and shorts of various species including almaciga and supa.
The "almaciga and lauan" specifically mentioned in no. (1) are not described as "lumber." They cannot
refer to the "lumber" in no. (2) because they are separated by the words "approximately 200,000 bd. ft."
with the conjunction "and," and not with the preposition "of." They must then be raw forest products or,
more specifically, timbers under Section 3(q) of P.D. No. 705, as amended, which reads:
Sec.
xxx

3.

Definitions.
xxx

-xxx

(q) Forest product means timber, firewood, bark, tree top, resin, gum, wood, oil, honey, beeswax, nipa,
rattan, or other forest plant, the associated water, fish game, scenic, historical, recreational and geological
resources
in
forest
lands.
It follows then that lumber is only one of the items covered by the information. The public and the private
respondents obviously miscomprehended the averments in the information. Accordingly, even if lumber is
not included in Section 68, the other items therein as noted above fall within the ambit of the said section,
and
as
to
them,
the
information
validly
charges
an
offense.
Our respected brother, Mr. Justice Jose C. Vitug, suggests in his dissenting opinion that this Court go
beyond the four corners of the information for enlightenment as to whether the information exclusively
refers to lumber. With the aid of the pleadings and the annexes thereto, he arrives at the conclusion that
"only
lumber
has
been
envisioned
in
the
indictment."
The majority is unable to subscribe to his view. First, his proposition violates the rule that only the facts
alleged in the information vis-a-vis the law violated must be considered in determining whether an
information
charges
an
offense.
Second, the pleadings and annexes he resorted to are insufficient to justify his conclusion. On the contrary,
the Joint Affidavit of Melencio Jalova, Jr., and Araman Belleng, which is one of the annexes he referred to,
30 cannot lead one to infer that what the team seized was all lumber. Paragraph 8 thereof expressly
states:
8. That when inside the compound, the team found approximately four (4) truckloads of narra shorts,

37

trimmings and slabs and a negligible amount of narra lumber, and approximately 200,000 bd. ft. of lumber
and shorts of various species including almaciga and supa which are classified as prohibited wood species.
In the same vein, the dispositive portion of the resolution 31 of the investigating prosecutor, which served
as the basis for the filing of the information, does not limit itself to lumber; thus:
WHEREFORE, premises considered, it is hereby recommended that an information be filed against
respondent Ri Chuy Po for illegal possession of 200,000 bd. ft. of lumber consisting of almaciga and supa
and for illegal shipment of almaciga and lauan in violation of Sec. 63 of PD 705 as amended by E.O. 277,
series
of
1987.
The foregoing disquisitions should not, in any manner, be construed as an affirmance of the respondent
Judge's conclusion that lumber is excluded from the coverage of Section 68 of P.D. No. 705, as amended,
and thus possession thereof without the required legal documents is not a crime. On the contrary, this
Court rules that such possession is penalized in the said section because lumber is included in the term
timber.
The Revised Forestry Code contains no definition of either timber or lumber. While the former is included in
forest products as defined in paragraph (q) of Section 3, the latter is found in paragraph (aa) of the same
section
in
the
definition
of
"Processing
plant,"
which
reads:
(aa) Processing plant is any mechanical set-up, machine or combination of machine used for the
processing of logs and other forest raw materials into lumber, veneer, plywood, wallbond, blockboard,
paper
board,
pulp,
paper
or
other
finished
wood
products.
This simply means that lumber is a processed log or processed forest raw material. Clearly, the Code uses
the term lumber in its ordinary or common usage. In the 1993 copyright edition of Webster's Third New
International Dictionary, lumber is defined, inter alia, as "timber or logs after being prepared for the
market."
32
Simply
put,
lumber
is
a
processed
log
or
timber.
It is settled that in the absence of legislative intent to the contrary, words and phrases used in a statute
should be given their plain, ordinary, and common usage meaning. 33 And insofar as possession of timber
without the required legal documents is concerned, Section 68 of P.D. No. 705, as amended, makes no
distinction between raw or processed timber. Neither should we. Ubi lex non distinguere debemus.
Indisputably, respondent Judge Teresita Dizon-Capulong of Branch 172 of the RTC of Valenzuela, Metro
Manila, committed grave abuse of discretion in granting the motion to quash the information in the
CRIMINAL
CASE
and
in
dismissing
the
said
case.
G.R.

No.

104988

We find this petition to be without merit. The petitioner has miserably failed to show that the Court of
Appeals committed any reversible error in its assailed decision of 29 November 1991.
It was duly established that on 1 April 1990, the petitioner's truck with Plate No. CCK-322 was coming out
from the petitioner's lumberyard loaded with lauan and almaciga lumber of different sizes and dimensions

38

which were not accompanied with the required invoices and transport documents. The seizure of such
truck and its cargo was a valid exercise of the power vested upon a forest officer or employee by Section
80
of
P.D.
No.
705,
as
amended
by
P.D.
No.
1775.
Then, too, as correctly held by the trial court and the Court of Appeals in the FIRST CIVIL CASE, the search
was conducted on a moving vehicle. Such a search could be lawfully conducted without a search warrant.
Search of a moving vehicle is one of the five doctrinally accepted exceptions to the constitutional mandate
34 that no search or seizure shall be made except by virtue of a warrant issued by a judge after personally
determining the existence of probable cause. The other exceptions are (3) search as an incident to a lawful
arrest, (2) seizure of evidence in plain view, (3) customs searches, and (4) consented warrantless search.
35
We also affirm the rulings of both the trial court and the Court of Appeals that the search on 4 April 1990
was a continuation of the search on 3 April 1990 done under and by virtue of the search warrant issued on
3 April 1990 by Executive Judge Osorio. Under Section 9, Rule 126 of the Rules of Court, a search warrant
has a lifetime of ten days. Hence, it could be served at any time within the said period, and if its object or
purpose cannot be accomplished in one day, the same may be continued the following day or days until
completed. Thus, when the search under a warrant on one day was interrupted, it may be continued under
the same warrant the following day, provided it is still within the ten-day period. 36
As to the final plea of the petitioner that the search was illegal because possession of lumber without the
required legal documents is not illegal under Section 68 of P.D. No. 705, as amended, since lumber is
neither specified therein nor included in the term forest product, the same hardly merits further discussion
in
view
of
our
ruling
in
G.R.
No.
106424.
G.R.

No.

123784

The allegations and arguments set forth in the petition in this case palpally fail to shaw prima facie that a
reversible error has been committed by the Court of Appeals in its challenged decision of 31 July 1995 and
resolution of 6 February 1996 in CA-G.R. SP No. 33778. We must, forthwith, deny it for utter want of merit.
There
is
no
need
to
require
the
respondents
to
comment
on
the
petition.
The Court of Appeals correctly dismissed the petitioner's appeal from the judgment of the trial court in the
SECOND CIVIL CASE. The petitioner never disputed the fact that its lumber-dealer's license or permit had
been suspended by Secretary Factoran on 23 April 1990. The suspension was never lifted, and since the
license had only a lifetime of up to 25 September 1990, the petitioner has absolutely no right to possess,
sell, or otherwise dispose of lumber. Accordingly, Secretary Factoran or his authorized representative had
the authority to seize the Lumber pursuant to Section 68-A of P.D. No. 705, as amended, which provides as
follows:
Sec. 68-A Administrative Authority of the Department Head or his Duly Authorized Representative to Order
Confiscation. -- In all cases of violations of this Code or other forest laws, rules and regulations, the
Department Head or his duly authorized representative may order the confiscation of any forest products
illegally
cut,
gathered,
removed,
or
possessed
or
abandoned.
.
.
.

39

The petitioner's insistence that possession or sale of lumber is not penalized must also fail view of our
disquisition and ruling on the same issue in G.R. No. 106424. Besides, the issue is totally irrelevant in the
SECOND CIVIL CASE which involves administrative seizure as a consequence of the violation of the
suspension
of
the
petitioner's
license
as
lumber
dealer.
All told then, G.R. No. 104988 and G.R. No. 123784 are nothing more than rituals to cover up blatant
violations of the Revised Forestry Code of the Philippines (P.D. No. 705), as amended. They are presumably
trifling attempts to block the serious efforts of the DENR to enforce the decree, efforts which deserve the
commendation of the public in light of the urgent need to take firm and decisive action against despoilers
of our forests whose continuous destruction only ensures to the generations to come, if not the present, an
inheritance of parched earth incapable of sustaining life. The Government must not tire in its vigilance to
protect the environment by prosecuting without fear or favor any person who dares to violate our laws for
the
utilization
and
protection
of
our
forests.
WHEREFORE,

judgment

is

hereby

rendered

1. (a) GRANTING the petition in G.R. No. 106424; (b) SETTING ASIDE and ANNULLING, for having been
rendered with grave abuse of discretion, the challenged orders of 16 August 1991 and 18 October 1991 of
respondent Judge Teresita Dizon-Capulong, Branch 172, Regional Trial Court of Valenzuela, Metro Manila, in
Criminal Case No. 324-V-91, entitled "People of the Philippines vs. Ri Chuy Po"; (c) REINSTATING the
information in the said criminal case; and (d) DIRECTING the respondent Judge or her successor to hear
and
decide
the
case
with
purposeful
dispatch;
and
2. DENYING the petitions in G.R. No. 104988 and in G. R. No. 123784 for utter failure of the petitioner to
show that the respondent Court of Appeals committed any reversible error in the challenged decisions of
29 November 1991 in CA-G.R. SP No. 25510 in the FIRST CIVIL CASE and of 31 July 1995 in CA-G.R. SP No.
33778
on
the
SECOND
CIVIL
CASE.
Costs
SO

40

against

the

petitioner

in

each

of

these

three

cases.
ORDERED.

ALEJANDRO TAN, ISMAEL RAMILO and FRED MORENO, petitioners, vs. THE PEOPLE OF THE
PHILIPPINES and THE COURT OF APPEALS, respondents.
G.R. No. 115507 | 1998-05-19
DECISION
PANGANIBAN, J:
In denying this petition, the Court reiterates that the gathering, collection and/or possession, without
license, of lumber, which is considered timber or forest product, are prohibited and penalized under the
Forestry Reform Code, as amended.
The Case
In this petition for review on certiorari under Rule 45 of the Rules of Court, petitioners seek to set aside the
Decision 1 of the Court of Appeals 2 in CA-GR No. CR-12815 promulgated on July 30, 1993, and its
Resolution 3 promulgated on April 28, 1994. The assailed Decision affirmed the judgment 4 of the Regional
Trial Court of Romblon, Branch 81, 5 which, in the complaint against petitioners for violation of Section 68,
PD 705 (Forestry Reform Code) as amended, disposed as follows:

41

"WHEREFORE, this Court finds:

a) the accused ALEJANDRO TAN, ISMAEL RAMILO and FRED MORENO GUILTY beyond reasonable doubt of
the crime of illegal possession of lumber under the Information, dated March 16, 1990, under Section 68,
P.D. No. 705, as amended by Executive Order No. 277, and sentences each of them to an indeterminate
sentence of SIX (6) MONTHS, as minimum, to FOUR (4) YEARS and TWO (2) MONTHS, as maximum, with
the accessory penalties of the law, and to pay the costs, and
b) the accused ALEJANDRO TAN, ISMAEL RAMILO and CRISPIN CABUDOL GUILTY beyond reasonable doubt
of the crime of illegal possession of lumber under the Information, dated March 16, 1990, under Section
68, P.D. No. 705, as amended by Executive Order No. 277, and sentences each of them to an
indeterminate sentence of SIX (6) MONTHS, as minimum, to FOUR (4) YEARS and TWO (2) MONTHS, as
maximum, with the accessory penalties of the law, and to pay the costs.
The two (2) terms of imprisonment of each of the accused shall be served successively under Article 70,
RPC.
The preventive imprisonment which any of the accused may have suffered is credited in his favor to its full
extent.
The Court further orders the confiscation of the lumber described in the aforesaid Informations in favor of
the government.
SO ORDERED."
The Facts
On October 26, 1989, about 6:30 p.m., in the town proper of Cajidiocan, Sibuyan Island, Romblon, Forest
Guards Joseph Panadero and Eduardo Rabino intercepted a dump truck loaded with narra and white lauan
lumber. The truck was driven by Petitioner Fred Moreno, an employee of A & E Construction. Again, about
8:00 p.m. on October 30, 1989, this time in Barangay Cambajao, Forest Guards Panadero and Rabino
apprehended another dump truck with Plate No. DEK-646 loaded with tanguile lumber. Said truck was
driven by Crispin Cabudol, also an employee of A & E Construction. Both motor vehicles, as well as the
construction firm, were owned by Petitioner Alejandro Tan. In both instances, no documents showing legal
possession of the lumber were, upon demand, presented to the forest guards; thus, the pieces of lumber
were confiscated.
On March 16, 1990, Tan and Moreno, together with Ismael Ramilo, caretaker and timekeeper of A & E
Construction, were charged by First Assistant Provincial Prosecutor Felix R. Rocero with violation of Section
68, 6 PD No. 705, as amended by EO No. 277, in an Information 7 which reads:
"That on or about the 26th day of October, 1989, at around 6:30 o'clock in the evening, in the Poblacion,
municipality of Cajidiocan, province of Romblon, Philippines, and within the jurisdiction of this Honorable
Court, the said accused, conspiring, confederating and mutually helping one another, with intent of gain
and without the legal documents as required under existing forest laws and regulations, did then and there

42

wilfully, unlawfully and feloniously have in their possession and under their custody and control 13 pieces
narra lumber about 171 board feet and 41 pieces tanguile lumber about 834 board feet valued at
P8,724.00, Philippine currency, to the damage and prejudice of the government in the aforestated
amount."
In another Information, 8 Tan and Ramilo, together with Crispin Cabudol, were also charged for the same
violation in connection with the October 30, 1989 incident.
On April 26, 1990, all the accused, assisted by counsel, were arraigned on the basis of the aforementioned
Informations; each pleaded not guilty. 9 The cases were thence jointly tried, pursuant to Section 14, Rule
119 of the Rules of Court. 10
During the trial, the defense did not contest the above factual circumstances except to deny that the forest
guards demanded, on either of the two occasions, papers or documents showing legal possession of the
lumber. Additionally, Prisco Marin, who claimed to have been the officer-in-charge (OIC) of the Bureau of
Forest Development of Sibuyan, testified that the seized pieces of lumber were bought by Tan's Cajidiocan
Trading, one of the licensed lumber dealers in the island, from Matzhou Development Corporation
("Matzhou") which thus delivered to the former Auxiliary Invoice No. 763850 11 dated March 19, 1987
issued by the Bureau of Internal Revenue office in Romblon. According to Marin, the director of forestry had
granted Matzhou a Tree Recovery Permit covering the entire island of Sibuyan. He added that he had
inspected the lumber in question in the compound of A & E Construction or Cajidiocan Trading, where he
was shown the auxiliary invoice covering the subject. 12
Ruling of the Trial Court
The trial court brushed aside the version of the defense and ruled that the confiscated pieces of lumber
which were admittedly owned by Accused Tan were not legitimate deliveries but aborted nocturnal
haulings. It convicted all the accused as charged, for their failure to comply with the Forestry Reform Code,
which requires the following legal documents: (1) an auxiliary invoice, (2) a certificate of origin, (3) a sales
invoice, (4) scale/tally sheets and (5) a lumber dealer permit.
Ruling of Respondent Court of Appeals
On appeal, the accused assigned to the trial court these ten errors: (1) holding them liable under Section
68 of EO 277; (2) ruling that their possession of the lumber were unauthorized or illegal; (3) retroactively
applying E.O. 277; (4) ruling that the accused did not have the necessary documents to make their
possession legal; (5) convicting them despite the absence of the corpus delicti; (6) admitting in evidence
the alleged seizure receipts or, assuming their admissibility, considering them as evidence of corpus
delicti; (7) finding that the deliveries were aborted nocturnal haulings; (8) convicting Alejandro Tan on the
ground of conspiracy; (9) ruling that the guilt of the accused was proved beyond reasonable doubt; and
(10) sustaining the constitutionality of EO 277. 13
As regards the first assigned error, the Court of Appeals held petitioners' "artful distinction between timber
and lumber" "to be fallacious and utterly unmeritorious." It thereby upheld the solicitor general's
manifestation that "forest products" include "wood" which is defined by Webster's Dictionary as "the hard
fibrous substance beneath the back of trees and shrubs." Respondent Court succinctly ruled that to

43

construe "sawn lumber" as not covered by "sawn timber" would defeat the evident intent and purpose of
the law, for "what would prevent an illegal logger [from bringing] with him a portable saw and having the
timber illegally cut/gathered [and] sawn right on the spot, thus gaining immunity for himself[?]" 14
As to the next three assigned errors which relied heavily on Prisco Marin's testimony, Respondent Court
dismissed the said witness' account as "anything but credible." It added that Marin's testimony largely
focused on a certification he made stating that, five years ago, he inspected the same confiscated lumber
which were to be used for the repair of school buildings by A & E Construction in Sibuyan. But during the
cross-examination, he admitted that he made the inspection in December 1989. The appellate tribunal
noted that, by then, he had already been relieved of his position as OIC of the Bureau of Forest
Development in Romblon; hence, he had no business inspecting the lumberyard of Petitioner Tan. In fact,
he admitted that in December 1989, it was Romulae Gadaoni who was already the highest forest officer in
the island. 15
As to the fifth and sixth alleged errors, Respondent Court ruled that corpus delicti does not refer literally to
the object of the crime - in this case, the forest products possessed without the required legal documents.
The fact that the crimes charged were perpetrated by the petitioners was credibly and amply proven by
the detailed testimonies of the prosecution witnesses, including the admission of Defense Witness Ismael
Ramilo. The seizure receipts merely served to corroborate their testimonies. 16
The seventh and ninth assigned errors were deemed answered in the foregoing discussions. As to the
eighth, no other than the admission of his caretaker or katiwala, Co-Accused Ramilo, proved that Tan was
involved in the conspiracy. Ramilo testified that the deliveries of lumber on the subject dates (October 26
and 30, 1989) were made pursuant to the instruction of Tan; and that the latter owned said lumber, the
trucks and the construction firm. The two accused truck drivers who were caught in flagrante delicto were
mere employees of Tan. 17
The last assigned error was set aside by Respondent Court as unnecessary. Absolutely of no concern to the
petitioners, who were caught in possession of lumber without the required legal documents, was the
alleged unconstitutionality of the inclusion of "firewood, bark, honey, beeswax, and even grass, shrub, 'the
associated water' or fish" in EO 277. There being other grounds to resolve the case, the constitutionality of
said phrase was not passed upon. 18
In their motion for reconsideration, petitioners raised these additional grounds: (1) the Forestry Reform
Code and the laws and regulations of the Department of Environment and Natural Resources (DENR)
distinguish between timber and lumber and between lumber and other forest products; (2) the
Informations alleged and the facts proved that lumber is not covered by the provision supposedly violated;
(3) judicial interpretation or construction may not be resorted to in order to fill a gap or clear an ambiguity
in penal statutes and, assuming the propriety thereof, construction should be in favor of the accused; (4)
lack of documents for possession of lumber is not punishable under the law; and (5) the perceived
weakness in the testimony of Defense Witness Prisco Marin should not strengthen the case for the
prosecution. In its April 28, 1994 Resolution, Respondent Court found "no cogent reason for the reversal or
modification" of its Decision. Hence, this petition. 19
The Issues

44

Petitioners now ask this Court to likewise pass upon their foregoing submissions. Many of the errors raised,
however, involve factual questions, the review of which is not within the ambit of this Court's functions,
particularly in this case where the findings of the trial court were affirmed by the appellate court and
where petitioners failed to show any misappreciation of the evidence presented. 20 We shall therefore limit
our review only to questions of law.
Accordingly, we shall rule on the following legal issues: (1) the constitutionality of Section 68 of EO 277, (2)
the treatment by the lower courts of lumber as timber and/or forest product within the contemplation of PD
705, as amended, and (3) the alleged retroactive application of EO 277.
The Court's Ruling
The petition is not meritorious.
Preliminary Issue:
Constitutionality of Sec. 68, E.O. 277
The impugned legal provision reads:
"Sec. 68. Cutting, Gathering and/or Collecting Timber, or other Forest Products Without License. - Any
person who shall cut, gather, collect, remove timber or other forest products from any forest land, or
timber from alienable or disposable public land, or from private land without any authority, or possess
timber or other forest products without the legal documents as required under existing forest laws and
regulations, shall be punished with the penalties imposed under Articles 309 and 310 of the Revised Penal
Code: Provided, That in the case of partnerships, associations or corporations, the officers who ordered the
cutting, gathering, collection or possession shall be liable and if such officers are aliens, they shall, in
addition to the penalty, be deported without further proceedings on the part of the Commission on
Immigration and Deportation.
The Court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed, as well as the machinery, equipment,
implements and tools illegally used in the area where the timber or forest products are found."
Petitioners aver that the above provision is violative of substantive due process, because it requires the
possession of certain legal documents to justify "mere possession" of forest products which, under Section
3(q) of PD 705, includes, among others, "firewood, bark, honey, beeswax, and even grass, shrub, flowering
plant, 'the associated water' or fish" and penalizes failure to present such required documents.
One of the essential requisites for a successful judicial inquiry into the constitutionality of a law is the
existence of an actual case or controversy involving a conflict of legal rights susceptible of judicial
determination. 21 As Respondent Court of Appeals correctly pointed out, petitioners were not "charged
with the [unlawful] possession of 'firewood, bark, honey, beeswax, and even grass, shrub, 'the associated
water' or fish"; thus, the inclusion of any of these enumerated items in EO 277 "is absolutely of no
concern" to petitioners. They are not asserting a legal right for which they are entitled to a judicial
determination at this time. Besides, they did not present any convincing evidence of a clear and

45

unequivocal breach of the Constitution that would justify the nullification of said provision. 22 A statute is
always presumed to be constitutional, and one who attacks it on the ground of unconstitutionality must
convincingly prove its invalidity. 23
Main Issue: Under PD 705 and EO 277, Is Lumber Considered Timber or Forest Product?
Petitioners contend that possession of manufactured lumber is not punishable under the Forestry Reform
Code, as amended. As explicitly provided in Section 68 of both PD 705 and EO 277 (the law that amended
the former), only the cutting, gathering, collecting and/or possession, without license, of timber and other
forest products are prohibited. As expressly defined under Section 3(q) of PD 705, lumber is not timber or a
forest product. It is only in Section 79 of the same law where the sale of lumber, without compliance with
established grading rules and standards, is prohibited. Petitioners submit that the forest laws and
regulations sufficiently differentiate between timber and lumber; therefore, courts should not construe
lumber as timber.
The question of whether lumber is excluded from the coverage of Section 68 of PD 705, as amended, has
been settled in Mustang Lumber, Inc. vs. Court of Appeals, 24 in which this Court expressly ruled that
"lumber is included in the term timber." 25 We quote at length the Court's discussion:
"The Revised Forestry Code contains no definition of either timber or lumber. While the former is included
in forest products as defined in paragraph (q) of Section 3, the latter is found in paragraph (aa) of the
same section in the definition of 'Processing plant,' which reads:
(aa) Processing plant is any mechanical set-up, machine or combination of machine used for the
processing of logs and other forest raw materials into lumber, veneer, plywood, wallboard, blackboard,
paper board, pulp, paper or other finished wood products.
This simply means that lumber is a processed log or processed forest raw material. Clearly, the Code uses
the term lumber in its ordinary or common usage. In the 1993 copyright edition of Webster's Third New
International Dictionary, lumber is defined, inter alia, as 'timber or logs after being prepared for the
market.' Simply put, lumber is a processed log or timber.
It is settled that in the absence of legislative intent to the contrary, words and phrases used in a statute
should be given their plain, ordinary, and common usage meaning. And insofar as possession of timber
without the required legal documents is concerned, Section 68 of P.D. No. 705, as amended, makes no
distinction between raw or processed timber. Neither do we. Ubi lex non distinguit nec nos distinguire
debemus." 26
Mustang was recently reiterated in Lalican vs. Vergara, 27 where we also said that '[t]o exclude possession
of 'lumber' from the acts penalized in Sec. 68 would certainly emasculate the law itself. . . . After all, the
phrase 'forest products' is broad enough to encompass lumber which, to reiterate, is manufactured
timber." Indeed, to mention lumber in the aforesaid section would simply result in tautology.
In addition, under American Jurisprudence, lumber has been legally accepted as a term referring to the
manufactured product of logs 28 or to timber sawed or split into marketable form, especially for use in
buildings. 29

46

Consistent with Mustang, we find no error in the holding of both lower courts. Clearly, petitioners are liable
for violation of Section 68 of the Forestry Reform Code, as amended.
Corollary Issue: No Retroactive Application of EO 277
Petitioners insist that EO 277 is not applicable to them, because the seized lumber had been lawfully
possessed by Cajidiocan Trading since March 1987, while the amendatory law was issued only on July 25,
1987, and took effect fifteen days after publication. This strained reasoning deserves scant consideration.
First, at no time during the apprehensions did petitioners claim that the lumber belonged to Cajidiocan
Trading. In fact, Petitioner Ramilo and the drivers openly claimed that the lumber and the trucks belonged
to A & E Construction which was, in turn, owned by Petitioner Tan. It was only during the course of the trial,
through the testimony of Prisco Marin (characterized by the appellate court as "anything but credible"),
that the alleged ownership thereof by Cajidiocan Trading was brought out. Second, the supposed sale of
the subject lumber by Matzhou to Cajidiocan Trading, as evidence by the auxillary invoice, occurred in
March 1987, or more than two and a half years prior to the apprehension and seizure that gave rise to this
case. It is highly doubtful if the lumber bought at the earlier date was the very same lumber confiscated in
October 1989. No evidence was presented to overcome this veritable doubt. Third and most important,
assuming that indeed they were the very same lumber, forest laws and regulations also require the
following documents: (1) certificate of lumber origin, (2) sales invoice, (3) delivery receipt, (4) tally sheet,
and (5) certificate of transport agreement. 30 None of these documents were proffered in court or
elsewhere.
Petitioners' unlawful possession of the subject lumber occurred in October 1989. EO 277, which specifically
included "possession" of timber and other forest products within the contemplation of PD 705, had already
been issued and in effect more than two years previous thereto. Nothing will prevent the indictment of
petitioners for violation of EO 277 at the time they were caught by the forest guards in flagrante delicto.
The prohibited act is a malum prohibitum, and absence of malice or criminal intent will not save the day
for them. 31
WHEREFORE, the petition is DENIED for utter lack of merit. The questioned Decision of the Court of Appeals
is hereby AFFIRMED. Costs against petitioners.
SO ORDERED.

47

Amado Taopa, Petitioner vs People of the Philippines, Respondent

Present:

PUNO, C.J., Chairperson,

CARPIO,
CORONA,
AZCUNA and
TINGA, JJ.*
G.R. No. 184098 | 2008-11-25
FIRST DIVISION

RESOLUTION
CORONA, J.:
On April 2, 1996, the Community Environment and Natural Resources Office of Virac, Catanduanes seized a
truck loaded with illegally-cut lumber and arrested its driver, Placido Cuison. The lumber was covered with
bundles of abaca fiber to prevent detection. On investigation, Cuison pointed to petitioner Amado Taopa
and a certain Rufino Ogalesco as the owners of the seized lumber.
Taopa, Ogalesco and Cuison were thereafter charged with violating Section 68 of Presidential Decree (PD)
No. 705,[1] as amended, in the Regional Trial Court (RTC) of Virac, Catanduanes. The information against
them read:

48

That on or about the 2nd day of April 1996 at around 9:00 oclock in the morning at Barangay Capilihan,
Municipality of Virac, Province of Catanduanes, Philippines, and within the jurisdiction of this Honorable
Court, the above-named accused, with intent to possess, conspiring, confederating and helping one
another, did then and there, willfully, unlawfully, criminally possess, transport in a truck bearing Plate No.
EAS 839 and have in their control forest products, particularly one hundred thirteen (113) pieces of lumber
of Philippine Mahogany Group and Apitong species with an aggregate net volume of One Thousand Six
Hundred Eighty Four (1,684) board feet with an approximate value of Ninety-Nine Thousand One Hundred
Twenty (Php99,120.00) Pesos, Philippine Currency, without any authority and/or legal documents as
required under existing forest laws and regulations, prejudicial to the public interest.
ACTS CONTRARY TO LAW.[2]

Taopa, Ogalesco and Cuison pleaded not guilty on arraignment. After trial on the merits, the RTC found
them guilty as charged beyond reasonable doubt.[3]
Only Taopa and Cuison appealed the RTC decision to the Court of Appeals (CA). Cuison was acquitted
but Taopas conviction was affirmed.[4] The dispositive portion of the CA decision read:
WHEREFORE, the Decision appealed from is REVERSED with respect to accused-appellant Placido
Cuison, who is ACQUITTED of the crime charged on reasonable doubt, and MODIFIED with respect to
accused-appellants Amado Taopa and Rufino Ogalesco by reducing the penalty imposed on them to four
(4) years, nine (9) months and eleven (11) days of prision correccional, as minimum, to ten (10) years of
prision mayor, as maximum.

SO ORDERED.[5]

In this petition,[6] Taopa seeks his acquittal from the charges against him. He alleges that the
prosecution failed to prove that he was one of the owners of the seized lumber as he was not in the truck
when the lumber was seized.
We deny the petition.
Both the RTC and the CA gave scant consideration to Taopas alibi because Cuisons testimony
proved Taopas active participation in the transport of the seized lumber. In particular, the RTC and the CA
found that the truck was loaded with the cargo in front of Taopas house and that Taopa and Ogalesco were
accompanying the truck driven by Cuison up to where the truck and lumber were seized. These facts
proved Taopas (and Ogalescos) exercise of dominion and control over the lumber loaded in the truck. The
acts of Taopa (and of his co-accused Ogalesco) constituted possession of timber or other forest products
without the required legal documents. Moreover, the fact that Taopa and Ogalesco ran away at the mere
sight of the police was likewise largely indicative of guilt. We are thus convinced that Taopa and Ogalesco
were owners of the seized lumber.
However, we disagree with both the RTC and CA as to the penalty imposed on Taopa.

49

Section 68 of PD 705, as amended,[7] refers to Articles 309 and 310 of the Revised Penal Code (RPC) for
the penalties to be imposed on violators. Violation of Section 68 of PD 705, as amended, is punished as
qualified theft.[8] The law treats cutting, gathering, collecting and possessing timber or other forest
products without license as an offense as grave as and equivalent to the felony of qualified theft.
Articles 309 and 310 read:
Art. 309. Penalties. Any person guilty of theft shall be punished by:
1.
The penalty of prision mayor in its minimum and medium periods, if the value of the thing stolen is
more 12,000 pesos but does not exceed 22,000 pesos; but if the value of the thing stolen exceeds the
latter amount, the penalty shall be the maximum period of the one prescribed in this paragraph, and one
year for each additional ten thousand pesos, but the total of the penalty which may be imposed shall not
exceed twenty years. In such cases, and in connection with the accessory penalties which may be imposed
and for the purpose of the other provisions of this Code, the penalty shall be termed prision mayor or
reclusion temporal, as the case may be. (emphasis supplied)
2.

xxx

Art. 310. Qualified theft. The crime of theft shall be punished by the penalties next higher by two degrees
than those respectively specified in the next preceding articles xxx (emphasis supplied).

The actual market value of the 113 pieces of seized lumber was P67,630.[9] Following Article 310 in
relation to Article 309, the imposable penalty should be reclusion temporal in its medium and maximum
periods or a period ranging from 14 years, eight months and one day to 20 years plus an additional period
of four years for the excess of P47,630.
The minimum term of the indeterminate sentence[10] imposable on Taopa shall be the penalty next lower
to that prescribed in the RPC. In this case, the minimum term shall be anywhere between 10 years and one
day to 14 years and eight months or prision mayor in its maximum period to reclusion temporal in its
minimum period.
The maximum term shall be the sum of the additional four years and the medium period[11] of reclusion
temporal in its medium and maximum periods or 16 years, five months and 11 days to 18 years, two
months and 21 days of reclusion temporal. The maximum term therefore may be anywhere between 16
years, five months and 11 days of reclusion temporal to 22 years, two months and 21 days of reclusion
perpetua.
WHEREFORE, the petition is hereby DENIED. The January 31, 2008 decision and July 28, 2008 resolution of
the Court of Appeals in CA-G.R. CR No. 30380 are AFFIRMED with MODIFICATION. Petitioner Amado Taopa is
hereby found GUILTY beyond reasonable doubt for violation of Section 68 of PD No. 705, as amended, and
sentenced to suffer the indeterminate penalty of imprisonment from 10 years and one day of prision

50

mayor, as minimum, to 20 years of reclusion temporal as maximum, with the accessory penalties provided
for by law.
SO ORDERED.

GALO MONGE, Petitioner, versus PEOPLE OF THE PHILIPPINES, Respondent.

G.R. No. 170308 | 2008-03-07
RESOLUTION

Tinga, J.:
This is a Petition for Review[1] under Rule 45 of the Rules of Court whereby petitioner Galo Monge
(petitioner) assails the Decision[2] of the Court of Appeals dated 28 June 2005 which affirmed his
conviction as well as the discharge of accused Edgar Potencio (Potencio) as a state witness.
The factual antecedents follow. On 20 July 1994, petitioner and Potencio were found by barangay tanods
Serdan and Molina in possession of and transporting three (3) pieces of mahogany lumber in Barangay
Santo Domingo, Iriga City. Right there and then, the tanods demanded that they be shown the requisite

51

permit and/or authority from the Department of Environment and Natural Resources (DENR) but neither
petitioner nor Potencio was able to produce any.[3] Petitioner fled the scene in that instant whereas
Potencio was brought to the police station for interrogation, and thereafter, to the DENR-Community
Environment and Natural Resources Office (DENR-CENRO).[4] The DENR-CENRO issued a seizure receipt for
the three pieces of lumber indicating that the items, totaling 77 board feet of mahogany valued at
P1,925.00, had been seized from Potencio.[5] Later on, petitioner was arrested, but Potencio's
whereabouts had been unknown since the time of the seizure[6] until he surfaced on 3 January 1998.[7]
An information was filed with the Regional Trial Court of Iriga City, Branch 35 charging petitioner and
Potencio with violation of Section 68[8] of Presidential Decree (P.D.) No. 705,[9] as amended by Executive
Order (E.O.) No. 277, series of 1997. The inculpatory portion of the information reads:
That on or about the 20th day of [July 1994], at about 9:30 o'clock in the morning, in Barangay Sto.
Domingo, Iriga City, Philippines and within the jurisdiction of this Honorable Court, the above-named
accused, conspiring, confederating with each other, without any authority of law, nor armed with
necessary permit/license or other documents, with intent to gain, did then and there willfully, unlawfully
and feloniously, transport and have in their possession three (3) pieces of Mahogany of assorted
[dimension] with a[n] appropriate volume of seventy-seven (77) board feet or point eighteen (0.18) cubic
meter with a total market value of P1,925.00, Philippine currency, to the damage and prejudice of the
DENR in the aforesaid amount.
CONTRARY TO LAW.[10]
At the 26 November 1996 arraignment, petitioner entered a negative plea.[11]
Trial ensued. On 17 June 1997, Serdan testified on the circumstances of the apprehension but for failing to
appear in court for cross examination, his testimony was stricken out.[12] On 16 January 1998, Potencio
was discharged to be used as a state witness on motion of the prosecutor.[13] Accordingly, he testified on
the circumstances of the arrest but claimed that for a promised fee he was merely requested by petitioner,
the owner of the log, to assist him in hauling the same down from the mountain. Potencio's testimony was
materially corroborated by Molina.[14] Petitioner did not contest the allegations, except that it was not he
but Potencio who owned the lumber. He lamented that contrary to what Potencio had stated in court, it
was the latter who hired him to bring the log from the site to the sawmill where the same was to be sawn
into pieces.[15]
The trial court found petitioner guilty as charged. Petitioner was imposed nine (9) years, four (4) months
and one (1) day to ten (10) years and eight (8) months of prision mayor in its medium and maximum
periods and ordered to pay the costs.[16]
Aggrieved, petitioner elevated the case to the Court of Appeals where he challenged the discharge of
Potencio as a state witness on the ground that the latter was not the least guilty of the offense and that
there was no absolute necessity for his testimony.[17] The appellate court dismissed this challenge and
affirmed the findings of the trial court. However, it modified the penalty to an indeterminate prison
sentence of six (6) years of prision correccional as minimum to ten (10) years and eight (8) months of
prision mayor as maximum.[18] His motion for reconsideration was denied, hence the present appeal
whereby petitioner reiterates his challenge against the discharge of Potencio.

52

The petition is utterly unmeritorious.

Petitioner and Potencio were caught in flagrante delicto transporting, and thus in possession of, processed
mahogany lumber without proper authority from the DENR. Petitioner has never denied this fact. But in his
attempt to exonerate himself from liability, he claims that it was Potencio, the owner of the lumber, who
requested his assistance in hauling the log down from the mountain and in transporting the same to the
sawmill for processing. The contention is unavailing.
Section 68 of P.D. No. 705, as amended by E.O. No. 277, criminalizes two distinct and separate offenses,
namely: (a) the cutting, gathering, collecting and removing of timber or other forest products from any
forest land, or timber from alienable or disposable public land, or from private land without any authority;
and (b) the possession of timber or other forest products without the legal documents required under
existing laws and regulations.[19] DENR Administrative Order No. 59 series of 1993 specifies the
documents required for the transport of timber and other forest products. Section 3 thereof materially
requires that the transport of lumber be accompanied by a certificate of lumber origin duly issued by the
DENR-CENRO. In the first offense, the legality of the acts of cutting, gathering, collecting or removing
timber or other forest products may be proven by the authorization duly issued by the DENR. In the second
offense, however, it is immaterial whether or not the cutting, gathering, collecting and removal of forest
products are legal precisely because mere possession of forest products without the requisite documents
consummates the crime.[20]
It is thus clear that the fact of possession by petitioner and Potencio of the subject mahogany lumber and
their subsequent failure to produce the requisite legal documents, taken together, has already given rise to
criminal liability under Section 68 of P.D. No. 705, particularly the second act punished thereunder. The
direct and affirmative testimony of Molina and Potencio as a state witness on the circumstances
surrounding the apprehension well establishes petitioner's liability. Petitioner cannot take refuge in his
denial of ownership over the pieces of lumber found in his possession nor in his claim that his help was
merely solicited by Potencio to provide the latter assistance in transporting the said lumber. P.D. No. 705 is
a special penal statute that punishes acts essentially malum prohibitum. As such, in prosecutions under its
provisions, claims of good faith are by no means reliable as defenses because the offense is complete and
criminal liability attaches once the prohibited acts are committed.[21] In other words, mere possession of
timber or other forest products without the proper legal documents, even absent malice or criminal intent,
is illegal.[22] It would therefore make no difference at all whether it was petitioner himself or Potencio who
owned the subject pieces of lumber.
Considering the overwhelming body of evidence pointing to nothing less than petitioner's guilt of the
offense charged, there is no cogent reason to reverse his conviction.
Petitioner's challenge against Potencio's discharge as a state witness must also fail. Not a few cases
established the doctrine that the discharge of an accused so he may turn state witness is left to the
exercise of the trial court's sound discretion[23] limited only by
the requirements set forth in Section 17,[24] Rule 119 of the Rules of Court. Thus, whether the accused
offered to be discharged appears to be the least guilty and whether there is objectively an absolute
necessity for his testimony are questions that lie within the domain of the trial court, it being competent to

53

resolve issues of fact. The discretionary judgment of the trial court with respect this highly factual issue is
not to be interfered with by the appellate courts except in case of grave abuse of discretion.[25] No such
grave abuse is present in this case. Suffice it to say that issues relative to the discharge of an accused
must be raised in the trial court as they cannot be addressed for the first time on appeal.[26]
Moreover and more importantly, an order discharging an accused from the information in order that he
may testify for the prosecution has the effect of an acquittal.[27] Once the discharge is ordered by the trial
court, any future development showing that any or all of the conditions provided in Section 17, Rule 119
have not actually been fulfilled will not affect the legal consequence of an acquittal.[28] Any witting or
unwitting error of the prosecution, therefore, in moving for the discharge and of the court in granting the
motion-no question of jurisdiction being involved-will not deprive the discharged accused of the benefit of
acquittal and of his right against double jeopardy. A contrary rule would certainly be unfair to the
discharged accused because he would then be faulted for a failure attributable to the prosecutor. It is
inconceivable that the rule has adopted the abhorrent legal policy of placing the fate of the discharged
accused at the mercy of anyone who may handle the prosecution.[29] Indeed, the only instance where the
testimony of a discharged accused may be disregarded is when he deliberately fails to testify truthfully in
court in accordance with his commitment,[30] as provided for in Section 18, Rule 119. Potencio lived up to
his commitment and for that reason, petitioner's challenge against his discharge must be dismissed.
WHEREFORE, the petition is DENIED and the assailed decision of the Court of Appeals is AFFIRMED.
SO ORDERED.

54

RODOLFO TIGOY, Petitioner, versus COURT OF APPEALS AND PEOPLE OF THE PHILIPPINES,
Respondents.
G.R. No. 144640 | 2006-06-26
DECISION
AZCUNA, J.:
This is a petition for review under Rule 45 of the Rules of Court assailing the decision and resolution, dated
March 6, 2000 and August 23, 2000, respectively, of the Court of Appeals in CA-G.R. CR No. 20864 entitled
"People of the Philippines v. Nestor Ong and Rodolfo Tigoy," acquitting Nestor Ong for insufficiency of
evidence, while convicting Rodolfo Tigoy for violating Section 68 of Presidential Decree (P.D.) No. 705 or
the Revised Forestry Code of the Philippines, as amended by Executive Order (E.O.) No. 277, Series of
1987, in relation to Articles 309 and 310 of the Revised Penal Code.
The facts of the case are as follows:
On August 3, 1993, Nestor Ong, who had been engaged in the trucking business in Iligan City since 1986,
was allegedly introduced by his friend Gamad Muntod to Lolong Bertodazo who signified his intent to rent
the trucks of Ong to transport construction materials from Larapan, Lanao del Norte to Dipolog City. A
Contract to Transport was supposedly entered into between Ong and Bertodazo, the salient portions of
which state:
1. That the party of the First Part is an owner of Cargo Trucks with place of business at Iligan City;
2. That the party of the Second Part is a businessman dealing in buy and sell of General Merchandise, dry
goods and construction materials;
3. That the party of the Second Part will engage the services of the two (2) cargo trucks of the party of the
First Part;
4. That the services agreed upon should be rendered by the party of the First Part on August 3, 1993 from
Larapan, Linamon, Lanao del Norte to Dipolog City for an agreed amount of TEN THOUSAND (P10,000.00)
Pesos per truck or a total of TWENTY THOUSAND (P20,000.00) Pesos, Philippine Currency for the carriage
of cement and other merchandise owned by the party of the Second Part;
5. That any legal controversy involving the cargo or of and when the cargo trucks are not actually used for
the purpose herein stipulated, it is agreed that the same is the sole responsibility of the party of the
Second Part without any liability of the party of the First Part.[1]
In the evening of October 3, 1993, Ong allegedly ordered Nestor Sumagang and petitioner Rodolfo Tigoy
who had been employed by him as truck drivers for two (2) years and ten (10) years, respectively, to bring
the two trucks to Lolong Bertodazo in Larapan, Lanao del Norte which is about fifteen (15) minutes away
from Iligan City. He instructed the two drivers to leave the trucks in Larapan for the loading of the
construction materials by Lolong Bertodazo, and to go back at dawn for the trip to Dipolog City. Thus, after
meeting with Bertodazo, Sumagang and petitioner Tigoy allegedly went home to return to Larapan at four
o'clock in the morning the next day. When they arrived, the trucks had been laden with bags of cement
and were half-covered with canvas.[2] Before departing, they allegedly checked the motor oil, water,
engine and tires of the trucks to determine if the same were in good condition.
That same morning of October 4, 1993, Senior Inspector Rico Lacay Tome (then Deputy Chief of Police of
Ozamis City), while escorting Provincial Director Dionisio Coloma at the ICC Arts Center in Ozamis City,
along with the members of the Special Operation Group, received a dispatch from the 466th PNP Company
situated at Barangay Bongbong, Ozamis City, informing him that two trucks, a blue and green loaded with

55

cement, that were going towards Ozamis City did not stop at the checkpoint. Upon receiving the report,
Tome, along with PO2 Peter Paul Nuqui and PO3 Bienvenido Real, boarded their patrol vehicle, a mini
cruiser jeep, to intercept the two trucks at Lilian Terminal, Ozamis City.[3]
At the Lilian Terminal, PO2 Nuqui, who was the only one in uniform among the police officers, flagged down
the two trucks but the same just sped away and proceeded towards the direction of Oroquieta City. Aboard
their patrol vehicle, they chased the trucks and overtook the same at Barangay Manabay. They blocked the
road with their vehicle causing the two trucks to stop.
According to Senior Inspector Tome, he asked the driver who had alighted from the green truck why he did
not stop at the checkpoint but the latter did not answer. When he inquired what was loaded in the truck,
the driver replied that there is "S.O.P," which means grease money in street parlance.[4] This raised the
suspicion of Tome that the trucks were loaded with "hot items."
Meanwhile, the blue truck which had been speeding behind the green truck and was being driven by
Sumagang was intercepted by PO3 Real. Upon inspection, the police officers discovered piles of sawn
lumber beneath the cement bags in both trucks. Tome inquired if the drivers had a permit for the lumber
but the latter could not produce any.
The drivers were brought and turned over to the investigator at the City Hall in Ozamis City. The truckmen,
namely, Felix Arante and Doro Lopez, and another passenger whom Tigoy identified as Lolong Bertodazo,
who were riding with them in the trucks, were not investigated. According to Nuqui, they did not notice
that the group had left. It was later learned that they were instructed by Sumagang to inform Nestor Ong
of the incident.
Afterwards, the group of Tome proceeded back to the ICC Arts Center and informed the Provincial Director
of the apprehension. Meanwhile, the drivers, Tigoy and Sumagang, were detained at the Ozamis City Police
Station while Arante and Lopez were released.[5]
Meanwhile, Ermelo delos Santos, Chief of the Department of Environment and Natural Resources Community and Environment and Natural Resources Office (DENR-CENRO),[6] after receiving a call from
the Ozamis City Police Station that two trucks were apprehended transporting sawn lumber without a
permit and were brought to the City Hall, sent Rolando Dingal, Forester of the DENR, together with Teodoro
Echavez, Juanito Taruc and Lucio Penaroya, to investigate.
Petitioner Tigoy and Sumagang presented to Dingal the registration papers of the two trucks and
appearing therein was the name of Nestor Ong as the owner. After ascertaining that the sawn lumber
loaded on the two trucks did not have supporting documents, Dingal and his companions scaled the
subject lumber and prepared a tally sheet. Loaded in the blue Nissan ten-wheeler truck were 229 pieces of
lumber with a total volume of 6,232.46 board feet; and, in the green Isuzu eight-wheeler truck, 333 pieces
of lumber with a total volume of 5,095.5 board feet.[7] Consequently, the lumber and the vehicles were
seized upon the order of the DENR Regional Executive Director.[8]
On October 6, 1993, an Information was filed against Nestor Ong, Sumagang, Lolong Bertodazo and
petitioner Tigoy for possession of forest products without legal permit, thus:
That on or about the 4th day of August, 1993 at Barangay Catadman, Ozamiz City, Philippines, and within
the jurisdiction of this Honorable Court, the above-named accused, conspiring and confederating together
and mutually helping each other, for a common design, did then and there willfully, unlawfully, feloniously
and illegally possess and transport without the necessary legal documents nor permit from the lawful
authorities, sawn dipterocarp lumbers (Philippine Mahogany), in the following manner, to wit: accused
Nestor Ong, being the owner of 2 ten wheeler trucks with Plate Nos. GDA-279 and PNH-364 facilitated and
allowed the use and transport of above-stated sawn [lumber] from Larapan, Lanao del Norte, but
intercepted by the PNP authorities in Ozamiz City; while the accused Lolong Bertodazo facilitated the
loading and transport of said sawn lumbers, while accused Nestor Sumagang y Lacson drove the Nissan 10
wheeler cargo truck bearing Plate No. GDA-279 which was loaded with 333 pieces of said sawn dipterocarp
lumbers (Philippine Mahogany) of assorted sizes equivalent [to] 5,095.5 board feet which was concealed
under piled bags of cement, which lumbers [were] valued at P134, 242.36; while accused Rodolfo Tigoy
drove the 8 wheeler Isuzu truck bearing Plate No. ONH-364, which was loaded and transported with 229

56

pieces of sawn dipterocarp lumbers (Philippine Mahogany) of assorted sizes equivalent to 6,232.46 board
feet which was concealed under piled bags of cement which lumbers [were] valued at P92,316.77 or total
value of P226,559.13, without, however, causing damage to the government, inasmuch as the aforestated
lumbers were recovered.
CONTRARY to Section 68 of Presidential Decree 705, as amended by Executive Order No. 277, Series of
1987, in relation to Article 309 and 310 of the Revised Penal Code.[9]
Ong and petitioner Tigoy entered pleas of not guilty during the arraignment. Sumagang died after the case
was filed while the other co-accused, Lolong Bertodazo, was not arrested and has remained at large.
On October 11, 1996, the Regional Trial Court rendered its Decision, the dispositive portion of which reads:
WHEREFORE, finding accused Nestor Ong and Rodolfo Tigoy [GUILTY] beyond reasonable doubt of
possession of dipterocarp lumber [VALUED] at more than P22,000.00 without the legal documents as
required by existing laws and regulations, penalized as qualified theft, this Court sentences them to an
indeterminate penalty of ten (10) years and one (1) day of prision mayor to eighteen (18) years and three
(3) months of reclusion temporal. The lumber and the conveyances used are forfeited in favor of the
government. With costs.
The DENR is ordered to sell/dispose of the lumber and conveyances in accordance with the existing laws,
WITHOUT DELAY. Let the Court of Appeals, Fourteenth Division, before which accused Ong's appeal of this
Court's denial of his action for replevin relative to his trucks is pending, be furnished with a copy of this
judgment.
With costs.
SO ORDERED.[10]
Declaring that "constructive possession" of unlicensed lumber is not within the contemplation of Section
68 of P.D. No. 705, and for failure by the prosecution to prove the complicity of Ong, the Court of Appeals
rendered its decision on March 6, 2000 modifying the ruling of the lower court, thus:
WHEREFORE, the judgment appealed from is hereby MODIFIED in that accused-appellant Nestor Ong is
acquitted for insufficiency of evidence and his two (2) trucks are ordered returned to him. The conviction of
Rodolfo Tigoy is upheld and the decision dated October 11, 1996 is AFFIRMED in all respects.
SO ORDERED.[11]
On March 24, 2000, petitioner filed with the Court of Appeals a Motion for Reconsideration praying for his
acquittal but the same was denied on August 23, 2000.
Hence, this petition, with the following assignment of errors:
I
THE COURT OF APPEALS ERRED IN FINDING "COLLUSION" BETWEEN LOLONG BERTODAZO AND PETITIONER
TIGOY;
II
THE COURT OF APPEALS ERRED IN COMPLETELY DISREGARDING THE AFFIDAVIT OF LOLONG BERTODAZO
AGAINST HIS PENAL INTEREST;
III
THE COURT OF APPEALS ERRED IN FINDING PETITIONER TIGOY TO HAVE KNOWLEDGE OF THE LUMBER HE
WAS TRANSPORTING; AND,

57

IV
THE COURT OF APPEALS ERRED IN FINDING THAT PETITIONER TIGOY HAD ACTUAL AND PHYSICAL
POSSESSION OF THE UNDOCUMENTED LUMBER.[12]
Stated otherwise, the core issue presented is whether or not petitioner Tigoy is guilty of conspiracy in
possessing or transporting lumber without the necessary permit in violation of the Revised Forestry Code
of the Philippines.
Section 68 of P.D. No. 705, as amended by E.O. No. 277, otherwise known as the Revised Forestry Code of
the Philippines, provides:
Section 68. Cutting, Gathering and/or Collecting Timber or Other Forest Products Without License. - Any
person who shall cut, gather, collect, remove timber or other forest products from any forest land, or
timber from alienable or disposable public land, or from private land, without any authority, or possess
timber or other forest products without the legal documents as required under existing forest laws and
regulations, shall be punished with the penalties imposed under Articles 309 and 310 of the Revised Penal
Code. . . .
There are two ways of violating Section 68 of the above Code: 1) by cutting, gathering and/or collecting
timber or other forest products without a license; and, 2) by possessing timber or other forest products
without the required legal documents.
Petitioner was charged with and convicted of transporting lumber without a permit which is punishable
under Section 68 of the Code. He, Sumagang and the rest of their companions were apprehended by the
police officers in flagrante delicto as they were transporting the subject lumber from Larapan to Dipolog
City.
Petitioner maintains that he could not have conspired with Lolong Bertodazo as he did not know about the
unlicensed lumber in the trucks. He believed that what he was transporting were bags of cement in view of
the contract between Ong and Bertodazo. Also, he was not around when Bertodazo loaded the trucks with
the lumber hidden under the bags of cement.
This contention by petitioner, however, was not believed by the lower court. In declaring that petitioner
connived with Bertodazo in transporting the subject lumber, the court a quo noted:
x x x The evidence of the prosecution established that the two drivers of accused Ong refused to stop at a
checkpoint, a fact admitted by both in their affidavit, Exhs. "E" and "E-2". Likewise, the two drivers refused
to stop on the national highway near a bus terminal when required by a uniformed policeman. When finally
accosted, one of the drivers, whom witness Tome identified as the driver of the green truck, Sumagang,
but who actually was Tigoy (as he was the driver of the green truck and who came to the road block first,
being the lead driver) offered "S.O.P." which to witness Tome meant that the trucks were carrying "hot
items."
Why would the drivers refuse to stop when required? Did they fear inspection of their cargo? Why would
"S.O.P." (which in street parlance is grease money) be offered to facilitate the passage of the trucks? The
only logical answer to all these questions is that the drivers knew that they were carrying contraband
lumber. This Court believes that the drivers had knowledge of the fact that they were transporting and
were in possession of undocumented lumber in violation of law.[13]
In offenses considered as mala prohibita or when the doing of an act is prohibited by a special law such as
in the present case, the commission of the prohibited act is the crime itself. It is sufficient that the offender
has the intent to perpetrate the act prohibited by the special law, and that it is done knowingly and
consciously.[14]

58

Direct proof of previous agreement to commit an offense is not necessary to prove conspiracy.[15]
Conspiracy may be proven by circumstantial evidence.[16] It may be deduced from the mode, method and
manner by which the offense is perpetrated, or inferred from the acts of the accused when such acts point
to a joint purpose and design, concerted action and community of interest.[17] It is not even required that
the participants have an agreement for an appreciable period to commence it.[18]
Petitioner's actions adequately show that he intentionally participated in the commission of the offense for
which he had been charged and found guilty by both the trial court and the Court of Appeals.
Finding that petitioner's conviction was reached without arbitrariness and with sufficient basis, this Court
upholds the same. The Court accords high respect to the findings of facts of the trial court, its calibration of
the collective testimonies of the witnesses, its assessment of the probative weight of the evidence of the
parties as well as its conclusions[19] especially when these are in agreement with those of the Court of
Appeals, which is the case here. As a matter of fact, factual findings of the trial court, when adopted and
confirmed by the Court of Appeals, are generally final and conclusive.[20]
WHEREFORE, the petition is DENIED and the Decision and Resolution, dated March 6, 2000 and August
23, 2000, respectively, of the Court of Appeals in CA-G.R. CR No. 20864 are hereby AFFIRMED.
Costs against petitioner.
PERFECTO PALLADA, petitioner, vs. PEOPLE OF THE PHILIPPINES, respondent.
G.R. No. 131270 | 2000-03-17
DECISION
MENDOZA, J.:
This is a petition for review of the decision1 [Per Justice Minerva P. Gonzaga-Reyes (now Associate Justice
of this Court), concurred in by Justices B.A. Adefuin-Dela Cruz and Demetrio C. Demetria.] of the Court of
Appeals affirming petitioner's conviction of illegal possession of lumber in violation of 682 [Renumbered
78 by Republic Act No. 7161.] of the Revised Forestry Code3 [Cutting, Gathering and/or Collecting
Timber, or Other Forest Products Without License. - Any person who shall cut, gather, collect, remove
timber or other forest products from any forest land, or timber from alienable or disposable public land, or
from private land, without any authority, or possess timber or other forest products without the legal
documents as required under existing forest laws and regulations, shall be punished with the penalties
imposed under Article 309 and 310 of the Revised Penal Code: Provided, That in the case of partnerships,
associations, or corporations, the officers who ordered the cutting, gathering, collection or possession shall
be liable, and if such officers are aliens, they shall, in addition to the penalty, be deported without further
proceedings on the part of the Commission on Immigration and Deportation.
The Court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed, as well as the machinery, equipment,
implements and tools illegally used in the area where the timber or forest products are found. (As
amended by PD No.1559, and by EO No. 277, prom, July 25, 1987, emphasis added).] (P.D. No. 705, as
amended) by the Regional Trial Court, Branch 8, Malaybalay, Bukidnon.

59

The facts are as follows:

Sometime in the latter part of 1992, the Department of Environment and Natural Resources (DENR) office
in Bukidnon received reports that illegally cut lumber was being delivered to the warehouse of the Valencia
Golden Harvest Corporation in Valencia, Bukidnon. The company is engaged in rice milling and trading.
DENR officers, assisted by elements of the Philippine National Police, raided the company's warehouse in
Poblacion, Valencia on the strength of a warrant issued by the Regional Trial Court, Branch 8, Malaybalay,
Bukidnon and found a large stockpile of lumber of varying sizes cut by a chain saw. As proof that the
company had acquired the lumber by purchase, petitioner produced two receipts issued by R.L. Rivero
Lumberyard of Maramag, Bukidnon, dated March 6 and 17, 1992. The DENR officers did not, however, give
credit to the receipts considering that R. L. Rivero Lumberyard's permit to operate had long been
suspended. What is more, the pieces of lumber were cut by chain saw and thus could not have come from
a licensed sawmill operator.
The team made an inventory of the seized lumber which, all in all, constituted 29,299.25 board feet, worth
P488,334.45 in total. The following day, September 29, 1992, the first batch of lumber, consisting of 162
pieces measuring 1,954.66 board feet, was taken and impounded at the FORE stockyard in Sumpong,
Malaybalay, Bukidnon. The seizure order4 [Records, p. 28.] was served on petitioner Perfecto Pallada as
general manager of the company, but he refused to acknowledge it.
On October 1, 1992, the raiding team returned for the remaining lumber. Company president Francisco
Tankiko and a certain Isaias Valdehueza, who represented himself to be a lawyer, asked for a suspension of
the operations to enable them to seek a lifting of the warrant. The motion was filed with the court which
issued the warrant but, on October 5, 1992, the motion was denied.5 [Id., p. 136-C.] Accordingly, the
remaining lumber was confiscated. By October 9, 1992, all the lumber in the warehouse had been seized.
As before, however, petitioner Pallada refused to sign for the seizure orders issued by the DENR officers
(Exhs. E, F & G).
On February 23, 1993, petitioner, as general manager, together with Noel Sy, as assistant operations
manager, and Francisco Tankiko, as president of the Valencia Golden Harvest Corporation, and Isaias
Valdehueza, were charged with violation of 68 of P.D .No. 705, as amended. The Information alleged:6
[Id., p. 1.]
That on or about the 1st day of October, 1992, and prior thereto at the Valencia Golden Harvest
Corporation Compound, municipality of Valencia, province of Bukidnon, Philippines, and within the
jurisdiction of this Honorable Court, the above-named accused, conspiring, confederating and mutually
helping one another, with intent of gain, did then and there willfully, unlawfully and criminally possess
2,115 pieces [of] lumber of different dimensions in the total volume of 29,299 .25 board feet or equivalent
to 69.10 cubic meters with an estimated value of FOUR HUNDRED EIGHTY EIGHT THOUSAND THREE
HUNDRED THIRTY FOUR PESOS AND 45/100 (P488,334.45) Philippine Currency, without any authority,
license or legal documents from the government, to the damage and prejudice of the government in the
amount of P488,334.45.
Contrary to and in violation of Section 68, P.D. 705 as amended by E.O. 277.

60

As all the accused pleaded not guilty, trial ensued. Then on July 27, 1994, judgment was rendered as
follows:7 [Id., p. 255.]
WHEREFORE, judgment is hereby rendered finding accused Perfecto Pallada and Francisco Tankiko guilty
beyond reasonable doubt of having in their possession timber products worth of P488,334.45 without the
legal documents as charged in the information in violation of Section 68 of Presidential Decree 705, as
amended and are, therefore, each sentenced to suffer imprisonment of TEN (10) YEARS of prision mayor as
minimum to TWENTY (20) YEARS of Reclusion temporal as maximum. The lumber subject of the crime are
confiscated in favor of the government.
Accused Isaias Valdehueza and Noel Sy are ACQUITTED for lack of evidence against them.
Petitioner and Francisco Tankiko appealed to the Court of Appeals, which, on October 31, 1997, affirmed
petitioner's conviction but acquitted Tankiko for lack of proof of his participation in the purchase or
acquisition of the seized lumber.8 [CA Decision, p. 14; Rollo, p. 28.]
Hence this petition which raises the following issues:9 [Petition, p. 2; Id., p. 4.]
I. WHETHER OR NOT THE HONORABLE COURT OF APPEALS WAS CORRECT IN UPHOLDING THE RULING OF
THE TRIAL COURT THAT THE PROSECUTION HAD PROVED BEYOND REASONABLE DOUBT THE GUILT OF THE
ACCUSED-PETITIONER PALLADA.
II. WHETHER OR NOT THE HONORABLE COURT OF APPEALS WAS CORRECT IN UPHOLDING THE DECISION
OF THE TRIAL COURT THAT THE CERTIFICATE OF TIMBER ORIGIN WAS NOT THE PROPER DOCUMENT TO
JUSTIFY PETITIONER'S POSSESSION OF THE SQUARED TIMBER OR FLITCHES.
III. WHETHER OR NOT THE HONORABLE COURT OF APPEALS WAS CORRECT IN UPHOLDING THE RULING OF
THE TRIAL COURT THAT THE PRESENCE OF ERASURES IN THE CERTIFICATE OF TIMBER ORIGIN RENDER
THEM VALUELESS AS EVIDENCE.
First. During the trial, the defense presented the following documents, as summarized by the trial court, to
establish that Valencia Golden Harvest Corporation's possession of the seized lumber was legal:10 [RTC
Decision, pp. 3-5; Records, pp. 249-251.]
1. Exh. 6 - Certificate of Timber Origin (CTO for short), dated December 15, 1991, for 56 pieces of flitches
equivalent to 12.23 cubic meters, transported from Bombaran, Lanao del Sur of the Autonomous Region of
Muslim Mindanao. Taken from the forest area of Wahab and H.D. Pangcoga
Exh. 6-A - Auxiliary Invoice
Exh. 6-B - Certificate of Transport Agreement (CTA, for short)
Exh. 6-C - Tally Sheet, dated December 14, 1992, for 463 pieces of lumber equivalent to 5,056.94 board
feet

61

Exh. 6-D - Delivery Receipt, dated December 16, 1991, from WHP Enterprises of Maguing, Lanao del Sur, to
the Corporation for the lumber mentioned in Exh. "6-C"
Exh. 6-F - Cash Voucher for P58,832.45 in payment to WHP Enterprises, dated December 16, 1991, for the
5,056.94 board feet of lumber
Exh. 6-D-1 - [C]arbon copy of Exh. "6-D" above
2. Exh. 7 - CTO, (undated), for 961 pieces of log equivalent to 25.4 cubic meter[s] taken from the forest
area of a certain Somira M. Ampuan in Lama Lico, Bombaran of the ARMM
Exh. 7-A - Auxiliary Invoice
Exh. 7-B - CTA
Exh. 7-C - Tally Sheet, dated February 6, 1992, for 961 pieces of lumber equal to 10,758.2 board feet
Exh. 7-D - Delivery Receipt to Golden Harvest Corporation issued by SMA Trading Company, dated February
6, 1992
Exh. 7-E - Official Receipt for environmental fee issued to Somira M. Ampuan, dated August 9, 1991
Exh. 7-F - Cash Voucher for P126,562.05 issued by the Corporation in payment to SMA Trading Company
for 10,758.02 board feet of lumber, dated February 6, 1992
3. Exh. 8 - CTO for 678 pieces of chain-sawn lumber with an equivalent volume of 18.93 cubic meter from
the forest area of Wahab Pangcoga and H.D. Pangcoga, dated February 25, 1992
Exh. 8-A - Auxiliary Invoice
Exh. 8-B - CTA
Exh. 8-C - Tally Sheet for the 678 pieces of lumber
Exh. 8-D - Delivery Receipt to Golden Harvest Corporation issued by WHP Enterprises,
Exh. 8-E - Official Receipt for environmental fee
Exh. 8-F - Cash Voucher for P93,614.50 in payment for 8,024.99 board feet of lumber issued by the
Corporation payable to WHP Enterprises
4. Exh. 9 - CTO for 426 pieces of logs (?) with an equivalent volume of 12.24 cubic meters from licensee
Somira M. Ampuan of Lama Lico, Bombaran, Lanao del Sur, consigned to the Corporation, (undated).
Stamped "Release 3/2/92"
Exh. 9-A - Auxiliary Invoice

62

Exh. 9-B - CTA, dated March 20, 1992

Exh. 9-C - Tally Sheet, dated March 20, 1992
Exh. 9-D - Delivery Receipt issued by SMA Trading Company to the Corporation, dated March 20, 1992
Exh. 9-E - Official Receipt for environmental fee
Exh. 9-F - Cash Voucher, for P64,299.50 to pay [for] 5,189 board feet of lumber
Exh. 9-D-1 - Xerox copy of Exh. "9-D"
The trial court acted correctly in not giving credence to the Certificates of Timber Origin presented by
petitioner since the lumber held by the company should be covered by Certificates of Lumber Origin.11
[Id., p. 5; Id., p. 251.] For indeed, as BFD Circular No. 10-8312 [Issued on February 28, 1983, now
superseded by DENR Administrative Order No. 07, issued on February 17, 1994.] states in pertinent parts:
In order to provide an effective mechanism to pinpoint accountability and responsibility for shipment of
lumber . . . and to have uniformity in documenting the origin thereof, the attached Certificate of Lumber
Origin (CLO) . . . which form[s] part of this circular [is] hereby adopted as accountable forms for official use
by authorized BFD officers. . . .
5. Lumber . . . transported/shipped without the necessary Certificate of Lumber Origin (CLO) . . . as herein
required shall be considered as proceeding from illegal sources and as such, shall be subject to
confiscation and disposition in accordance with LOI 1020 and BFD implementing guidelines.
Petitioner contends that the term "timber" includes lumber and, therefore, the Certificates of Timber Origin
and their attachments should have been considered in establishing the legality of the company's
possession of the lumber.13 [Petition, pp. 5-6; Rollo, pp. 7-8.] In support of his contention, petitioner
invokes our ruling in Mustang Lumber, Inc. v. Court of Appeals.14 [257 SCRA 430 (1996).]
The contention has no merit. The statement in Mustang Lumber that lumber is merely processed timber
and, therefore, the word "timber" embraces lumber, was made in answer to the lower court's ruling in that
case that the phrase "possess timber or other forest products" in 68 of P.D. No. 705 means that only
those who possess timber and forest products without the documents required by law are criminally liable,
while those who possess lumber are not liable. On the other hand, the question in this case is whether
separate certificates of origin should be issued for lumber and timber. Indeed, different certificates of
origin are required for timber, lumber and non-timber forest products.15 [DENR Administrative Circular No.
07, 2&17 (series of 1994).] As already noted, the opening paragraph of BFD Circular No. 10-83
expressly states that the issuance of a separate certificate of origin for lumber is required in order to
"pinpoint accountability and responsibility for shipment of lumber . . . and to have uniformity in
documenting the origin thereof."
Even assuming that a Certificate of Timber Origin could serve as a substitute for Certificate of Lumber
Origin, the trial court and the Court of Appeals were justified in convicting petitioner, considering the

63

numerous irregularities and defects found in the documents presented by the latter. According to the trial
court:16 [RTC Decision, pp. 5-6; Records, p. 251-252 (emphasis in the original).]
Although the CTO marked Exh. "6" mentions 56 pieces of flitches, the supporting documents, like the Tally
Sheet, the Delivery Receipt from the lumber dealer and the Cash Voucher describe 463 pieces of lumber. . .
.
In like manner, Exh. "7" and Exh. "9" mention 961 and 420 pieces of log, respectively. But the supporting
documents describe the forest product[s] as lumber.
The CTO marked Exh. "[8]" reveals a half-truth: it mentions 678 pieces of hand-sawn lumber. Its Auxiliary
Invoice also states the same load of lumber. Someone may have noticed the "mistake" of mentioning
lumber in the Auxiliary Invoice and so the words "flitches 87 pieces" were written down and enclosed in
parenthesis.
The said exhibits also appear to be questionable, [t]hus[:]
The CTO marked Exh. "6" is consigned to "any buyer (sic) Cagayan de Oro", but its Auxiliary Invoice (Exh.
"6-A") mentions Valencia Golden Harvest Corporation as the consignee. Moreover, the CTO states (at the
back page) that the same is covered by Auxiliary Invoice No. 00491; in fact, the Auxiliary Invoice (Exh. 6-A)
has invoice number 000488.
In the CTO marked Exhibit "7", the original typewritten name of the consignee was clearly erased and
changed to "Valencia Golden Harvest Corporation, Valencia, Bukidnon". In the Auxiliary Invoice (Exh. "7-A")
the blank space for the name and address of the consignee was smudged with a typewriter correction fluid
(the better to erase what was originally typewritten in it?) and changed to "Valencia Golden Harvest
Corporation, Valencia, Bukidnon".
The CTO marked Exh. "9" and its Auxiliary Invoice marked Exh. "9-A" [were] "doctored" in the same
manner as Exh. "[7]" and Exh. "[7-A]".17 [The original consignee's name, still legible, reads: "NORTHWEST
FOOD PROCESSING CORPORATION, ______, TAGOLCAN, MIS. OR."]
Additionally, all the Auxiliary Invoice were not properly accomplished: the data required to be filled are left
in blank.
Indeed, aside from the fact that the Certificate of Timber Origin in Exh. 7 bears no date, the dorsal side
bears the certification that the logs were "scaled on August 7, 1991," while the receipt attached to that
Certificate is dated February 6, 1992. Moreover, the four delivery receipts list the sizes and volume of the
lumber sold, indicating that the company purchased cut lumber from the dealers, thus belying the
testimony of petitioner that when the company bought the forest products, they were still in the form of
flitches and logs, and they were cut into lumber by the company.18 [TSN, pp. 10, 13 & 22, March 12,
1994.]
These irregularities and discrepancies make the documents in which they are found not only questionable
but invalid and, thus, justified the trial court in giving no credence to the same.19 [Compare DENR
Administrative Order No. 59-93, series of 1993, 6 in relation to 2.8, which provides that certificates of

64

origin with erased or tampered vital entries, such as the name and address of consignee, are void (now
superseded by DENR Administrative Order No.07, series of 1994.)]
It is argued that the irregularities in the documentary exhibits should not be taken against petitioner
because the documents came from lumber dealers. In addition, it is contended that the CTOs and Auxiliary
Receipts, being public documents, should be accorded the presumption of regularity in their execution.20
[Petition, pp. 6-10; Rollo, pp. 8-12.]
This contention is untenable. What render these documents without legal effect are the patent
irregularities found on their faces. That petitioner may not have any responsibility for such irregularity is
immaterial. In any case, as the corporate officer in charge of the purchase of the lumber, petitioner should
have noticed such obvious irregularities, and he should have taken steps to have them corrected. He
cannot now feign ignorance and assert that, as far as he is concerned, the documents are regular and
complete.21 [Id., pp. 8-10; Id., pp. 10-12.]
The presence of such glaring irregularities negates the presumption that the CTOs were regularly executed
by the DENR officials concerned. The presumption invoked by petitioner applies only when the public
documents are, on their faces, regular and properly accomplished.22 [See Veloso v. Sandiganbayan, 187
SCRA 504 (1990).]
Second. The penalty imposed should be modified. Art. 309 of the Revised Penal Code, made applicable to
the offense by P.D. No. 705, 68, provides:
ART. 309. Penalties.- Any person guilty of theft shall be punished by:
1. The penalty of prision mayor in its minimum and medium periods, if the value of the thing stolen is more
than P12,000 pesos but does not exceed P22,000 pesos; but if the value of the thing stolen exceeds the
latter amount, the penalty shall be the maximum period of the one prescribed in this paragraph, and one
year for each additional ten thousand pesos, but the total of the penalty which may be imposed shall not
exceed twenty years. In such cases, and in connection with the accessory penalties which may be imposed
and for the purpose of the other provisions of this Code, the penalty shall be termed prision mayor or
reclusion temporal, as the case may be. . . .
As the lumber involved in this case is worth P488,334.45, and applying the Indeterminate Sentence Law,23
[People v. Simon, 234 SCRA 555 (1994).] the penalty to be imposed should be six (6) years of prision
correccional to twenty (20) years of reclusion temporal.
WHEREFORE, the decision of the Court of Appeals, dated October 31, 1997, is AFFIRMED with the
MODIFICATION that petitioner is sentenced to six (6) years of prision correccional, as minimum, to twenty
(20) years of reclusion temporal, as maximum.
SO ORDERED.

65

PEOPLE OF THE PHILIPPINES, plaintiff-appellee,

vs.
WILSON B. QUE, accused-appellant
G.R. No. 120365 | 1996-12-17
PUNO,

J.:

Accused-appellant Wilson B. Que appeals from his conviction for violation of Section 68 of Presidential
Decree
(P.D.)
705
1
as
amended
by
Executive
Order
(E.O.)
277.
2
The facts show that two weeks before March 8, 1994, SPO1 Dexter Corpuz, a member of the Provincial Task
Force on Illegal Logging, received an information that a ten-wheeler truck bearing plate number PAD-548
loaded with illegally cut lumber will pass through Ilocos Norte. Acting on said information, members of the
Provincial Task Force went on patrol several times within the vicinity of General Segundo Avenue in Laoag
City.
3
On March 8, 1994, SPO1 Corpuz, together with SPO1 Zaldy Asuncion and SPO1 Elmer Patoc went on patrol
around the area. At about 1:00 in the morning, they posted themselves at the corner of General Segundo
Avenue and Rizal Street. Thirty minutes later, they saw a ten-wheeler truck with plate number PAD-548
pass
by.
They
followed
the
truck
and
apprehended
it
at
the
Marcos
Bridge.
4
There were three persons on board the truck: driver Wilfredo Cacao, accused-appellant Wilson Que, and an
unnamed person. The driver identified accused- appellant as the owner of the truck and the cargo. 5
SPO1 Corpuz checked the cargo and found that it contained coconut slabs. When interviewed, accusedappellant told SPO1 Corpuz that there were sawn lumber inserted in between the coconut slabs. 6
SPO1 Corpuz asked accused-appellant for the cargo's supporting documents, specifically: (1) certificate of
lumber origin, (2) certificate of transport agreement, (3) auxiliary invoice, (4) receipt from the DENR, and
(5) certification from the forest ranger regarding the origin of the coconut slabs. Accused-appellant failed
to present any of these documents . All he could show was a certification 7 from the Community
Environment and Natural Resources Office (CENRO), Sanchez Mira, Cagayan that he legally acquired the
coconut slabs. The certification was issued to facilitate transport of the slabs from Sanchez Mira, Cagayan
to
San
Vicente,
Urdaneta,
Pangasinan.
7

66

SPO1 Corpuz brought accused-appellant to the office of the Provincial Task Force at the provincial capitol.
Again, accused-appellant admitted to the members of the Provincial Task Force that there were sawn
lumber
under
the
coconut
slabs.
9
At 10:00 o'clock in the morning, the members of the Provincial Task Force, together with three CENRO
personnel examined the cargo. The examination confirmed that the cargo consisted of coconut slabs and
sawn tanguile lumber. The coconut slabs were piled at the sides of the truck, concealing the tanguile
lumber. 10 When the CENRO personnel inventoried and scaled the seized forest products, they counted
two hundred fifty eight (258) pieces of tanguile lumber with a total volume of 3,729.3 board feet (8.79
cubic
meters)
and
total
assessed
value
of
P93,232.50.
11
On June 23, 1994, accused-appellant was charged before the Regional Trial Court of Laoag with violation of
Section
68
of
P.D.
705
as
amended
by
E.O.
277.
The

Information

alleged:

That on or about the 8th day of March, 1994, in the City of Laoag, Philippines, and within the
jurisdiction of this Honorable Court, the above-named accused, being then the owner of an I(s)uzu
Ten wheeler Truck bearing Plate No. PAD-548, with intent of gain, did then and there willfully,
unlawfully and feloniously have in possession, control and custody 258 pieces of various sizes of
Forest Products chainsawn lumber (species of Tanguile) with a total volume of 3,729.3 bd. ft. or
equivalent to 8.79 cubic meters valued in the total amount of P93,232.50 at P25.00/bd. ft., necessary
permit, license or authority to do so from the proper authorities, thus violating the aforecited
provision
of
the
law,
to
the
damage
and
prejudice
of
the
government.
CONTRARY

TO

LAW.

12

Accused-appellant denied the charge against him. He claimed that he acquired the 258 pieces of tanguile
lumber from a legal source. During the trial, he presented the private land timber permits (PLTP) issued by
the Department of Environment and Natural Resources (DENR) to Enrica Cayosa 13 and Elpidio Sabal. 14
The PLTP authorizes its holder to cut, gather and dispose timber from the forest area covered by the
permit. He alleged that the tanguile lumber came from the forest area covered by the PLTP's of Cayosa and
Sabal and that they were given to him by Cayosa and Sabal as payment for his hauling services. 15
Accused-appellant also objected to the admission of the 258 pieces of lumber as evidence against him. He
contended that they were fruits of an illegal search and seizure and of an uncounselled extrajudicial
admission.
The trial court found accused-appellant guilty and sentenced him to reclusion perpetua. It also ordered the
confiscation of the seized lumber and the ten-wheeler truck owned by accused-appellant. The dispositive
portion of the Decision 16 states:

67

WHEREFORE, judgment is hereby rendered declaring accused Wilson B. Que guilty beyond reasonable
doubt of the violation of Section 68 of PD 705, as amended by Executive Order No. 277 and he is hereby
sentenced to suffer the penalty of RECLUSION PERPETUA, plus all the accessory penalties provided by law.
The
bail
bond
filed
for
the
provisional
liberty
of
the
accused
is
CANCELLED.
The two hundred fifty-eight (258) pieces of lumber (tanguile specie) and the ten-wheeler truck bearing
plate No. PAD-548 which was used in the commission of the crime are hereby ordered confiscated in favor
of
the
government
to
be
disposed
of
in
accordance
with
law.
Costs

against

the

accused.

SO ORDERED. 17

Appellant

now

comes

before

us

with

the

following

assignment

oferrors:

18

1. It was error for the Court to convict accused under Section 68, PD 705 as amended by EO 277 for
possessing timber or other forest products without the legal documents as required under existing
forest laws and regulations on the ground that since it is only in EO No. 277 where for the first time
mere possession of timber was criminalized, there are no existing forest laws and regulations which
required certain legal documents for possession of timber and other forest products.
2. The Court erred in allowing evidence secured in violation of the constitutional rights of accused
against
unlawful
searches
and
seizures.
3. The Court erred in allowing evidence secured in violation of the constitutional rights of accused
under
custodial
investigation.

On the first assignment of error, appellant argues that he cannot be convicted for violation of Section 68 of
P.D. 705 because E.O. 277 which amended Section 68 to penalize the possession of timber or other forest
products without the proper legal documents did not indicate the particular documents necessary to make
the possession legal. Neither did the other forest laws and regulations existing at the time of its
enactment.
Appellant's argument deserves scant consideration. Section 68 of P.D. 705 provides:
Sec. 68. Cutting, Gathering and/or Collecting Timber, or other Forest Products Without License. Any person
who shall cut, gather, collect, remove timber or other forest products from any forest land, or timber from
alienable or disposable public land, or from private land without any authority, or possess timber or other
forest products without the legal documents as required under existing forest laws and regulations, shall
be punished with the penalties imposed under Articles 309 and 310 of the Revised Penal Code: Provided,
That in the case of partnerships, associations, or corporations, the officers who ordered the cutting,
gathering, collection or possession shall be liable and if such officers are aliens, they shall, in addition to
the penalty, be deported without further proceedings on the part of the Commission on Immigration and
Deportation.

68

The Court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed, as well as the machinery, equipment,
implements and tools illegally used in the area where the timber or forest products are found.

Appellant interprets the phrase "existing forest laws and regulations" to refer to those laws and regulations
which were already in effect at the time of the enactment of E.O. 277. The suggested interpretation is
strained and would render the law inutile. Statutory construction should not kill but give life to the law.
The phrase should be construed to refer to laws and regulations existing at the time of possession of
timber or other forest products. DENR Administrative Order No. 59 series of 1993 specifies the documents
required for the transport of timber and other forest products. Section 3 of the Administrative Order
provides:

Section

3.

Documents

Required.

Consistent with the policy stated above, the movement of logs, lumber, plywood, veneer, non-timber forest
products and wood-based or nonwood-based products/commodities shall be covered with appropriate
Certificates of Origin, issued by authorized DENR officials, as specified in the succeeding sections.
Xxx

xxx

xxx

3.3 Lumber. Unless otherwise herein provided, the transport of lumber shall be accompanied by a
CERTIFICATE OF LUMBER ORIGIN (CLO) issued by the CENRO or his duly authorized representative which
has jurisdiction over the processing plant producing the said lumber or the lumber firm authorized to deal
in such commodities. In order to be valid, the CLO must be supported by the company tally sheet or
delivery
receipt,
and
in
case
of
sale,
a
lumber
sales
invoice.
Xxx

xxx

xxx

When apprehended on March 8, 1994, accused-appellant failed to present any certificate of origin of the
258
pieces
of
tanguile
lumber.
The
trial
court
found:
xxx

xxx

xxx

. . . When apprehended by the police officers, the accused admittedly could not present a single document
to justify his possession of the subject lumber. . . .
Significantly, at the time the accused was apprehended by the police offices, he readily showed documents
to justify his possession of the coconut slabs. Thus, he showed a certification issued by Remigio B. Rosario,
Forest Ranger, of the DENR, CENRO, Sanchez Mira, Cagayan (Exhibit "E") and a xerox copy of the original
certificate of title covering the parcel of land where the coconut slabs were cut.(Exhibit "F").
It is worthy to note that the certification dated March 7, 1994 states:
THIS IS TO CERTIFY that the one (1) truckload of coconut slabs to be transported by Mr. Wilson Que on
board truck bearing Plate No. PAD 548 were derived from matured coconut palms gathered inside the

69

private land of Miss Bonifacia Collado under OCT No. P-11614(8) located at Nagrangtayan, Sanchez Mira,
Cagayan.
This certification is being issued upon the request of Mr. Wilson Que for the purpose of facilitating the
transportation of said coconut slabs from Sanchez Mira, Cagayan to San Vicente, Urdaneta, Pangasinan
and is valid up to March 11, 1994 or upon discharge of its cargoes at its final destination, whichever comes
first.
It is crystal clear, therefore, that the accused was given permit by the DENR to transport one (1) truckload
of coconut slabs only between March 7 to 11, 1994. The accused was apprehended on March 8, 1994
aboard his truck bearing plate number PAD-548 which was loaded not only with coconut slabs but with
chainsawn lumber as well. Admittedly, the lumber could not be seen from the outside. The lumber were
placed in the middle and not visible unless the coconut slabs which were placed on the top, sides and rear
of
the
truck
were
removed.
Under these circumstances, the Court has no doubt that the accused was very much aware that he needed
documents to possess and transport the lumber (b)ut could not secure one and, therefore, concealed the
lumber by placing the same in such a manner that they could not be seen by police authorities by merely
looking
at
the
cargo.
In this regard, the Court cannot give credence to his alleged letter dated March 3, 1994 addressed to the
OIC CENRO Officer, CENRO, Sanchez Mira, Cagayan informing the CENRO that he would be transporting
the subject lumber on March 7, 1994 from Sanchez Mira, Cagayan to Sto. Domingo, Ilocos Sur but was
returned to him for the reason that he did not need a permit to transport the subject lumber. (Exhibits "8",
"8-A").
While it is true that the letter indicates that it was received by CENRO on March 4, 1994, the Court has
doubts that this was duly filed with the concerned office. According to the accused, he filed the letter in the
morning of March 4 and returned in the afternoon of the same day. He was then informed by an employee
of the CENRO whom he did not identify that he did not need a permit to transport the lumber because the
lumber would be for personal used (sic) and ". . . came from PLTP." (Ibid) The letter-request was returned to
him.
The fact that the letter-request was returned to him creates doubts on the stance of the accused.
Documents or other papers, i.e., letter-request of this kind filed with a government agency are not
returned. Hence, when a person files or submits any document to a government agency, the agency gets
the original copy. The filer only gets a duplicate copy to show that he has filed such document with the
agency. Moreover, his avoidance as regards the identity of the employee of the CENRO who allegedly
returned the letter-request to him also creates doubts on his stance. Thus, on cross-examination, the
accused, when asked about the identity of the employee of the CENRO who returned the letter-request to
him answered that he could recognize the person ". . . but they were already reshuffled." (TSN, February 8,
1995, p. 104) At one point, the accused also said that he did not know if that person was an employee of
the
DENR.
(Ibid,
p.
105)
Be that as it may, the Court finds significance in the last paragraph of this letter-request, to wit:

70

xxx

xxx

xxx

Please consider this as my Certificate of Transport Agreement in view of the fact that I am hauling and
transporting my own lumber for my own needs.

Thus, the accused through this letter considered the same as his certificate of transport agreement. Why
then, if he was telling the truth, did he not take this letter with him when he transported the lumber on
March
7,
1994?
All

these

circumstances

clearly

xxx

show

that

the

letter

comes

from

polluted

xxx

source.

19

xxx

Accused-appellant's possession of the subject lumber without any documentation clearly constitutes an
offense
under
Section
68
of
P.D.
705.
We also reject appellant's argument that the law only penalizes possession of illegal forest products and
that the possessor cannot be held liable if he proves that the cutting, gathering, collecting or removal of
such
forest
products
is
legal.
There are two (2) distinct and separate offenses punished under Section 68 of P.D. 705, to wit:
(1) Cutting, gathering, collecting and removing timber or other forest products from any forest land,
or timber from alienable or disposable public land, or from private land without any authority; and
(2) Possession of timber or other forest products without the legal documents required under existing
forest
laws
and
regulations.

In the first offense, one can raise as a defense the legality of the acts of cutting, gathering, collecting or
removing timber or other forest products by presenting the authorization issued by the DENR. In the
second offense, however, it is immaterial whether the cutting, gathering, collecting and removal of the
forest products is legal or not. Mere possession of forest products without the proper documents
consummates the crime. Whether or not the lumber comes from a legal source is immaterial because E.O
277 considers the mere possession of timber or other forest products without the proper legal documents
as
malum
prohibitum.
On the second and third assignment of error, appellant contends that the seized lumber are inadmissible in
evidence
for
being
"fruits
of
a
poisonous
tree".
Appellant avers that these pieces of lumber were obtained in violation of his constitutional right against
unlawful
searches
and
seizures
as
well
as
his
right
to
counsel.
We

71

do

not

agree.

The rule on warrantless search and seizure of a moving vehicle was summarized by this court in People vs.
Bagista, 20 thus:
The general rule regarding searches and seizures can be stated in this manner: no person shall be
subjected to a search of his person, personal effects or belongings, or his residence except by virtue
of a search warrant or on the occasion of a lawful arrest. The basis for the rule can be found in Article
III, Section 2 of the 1987 Constitution, which states:
The right of the people to be secure in their persons, houses, papers, and effects against
unreasonable searches and seizures of whatever nature and for any purpose, shall be inviolable, and
no search warrant or warrant of arrest shall issue except upon probable cause to be determined
personally by the judge after examination under oath or affirmation of the complainant and
witnesses he may produce, and particularly describing the place to be searched, and the person or
things to be seized.
Article III, Section 3 (2) further ordains that any evidence obtained in violation of the aforementioned
right shall, among others, "be inadmissible for any purpose in any proceeding."

The constitutional proscription against warrantless searches and seizures admits of certain exceptions.
Aside from a search incident to a lawful arrest, a warrantless search had been upheld in cases of moving
vehicles,
and
the
seizure
of
evidence
in
plain
view.
With regard to the search of moving vehicles, this had been justified on the ground that the mobility of
motor vehicles makes it possible for the vehicle to be searched to move out of the locality or jurisdiction in
which
the
warrant
must
be
sought.
This in no way, however, gives the police officers unlimited discretion to conduct warrantless searches of
automobiles in the absence of probable cause. When a vehicle is stopped and subjected to an extensive
search, such a warrantless search has been held to be valid as long as the officers conducting the search
have reasonable or probable cause to believe before search that they will find the instrumentality or
evidence pertaining to a crime, in the vehicle to be searched. (citations omitted; emphasis supplied)
As in Bagista, the police officers in the case at bar had probable cause to search appellant's truck. A
member of the Provincial Task Force on Illegal Logging received a reliable information that a ten-wheeler
truck bearing plate number PAD-548 loaded with illegal lumber would pass through Ilocos Norte. Two
weeks later, while members of the Provincial Task Force were patrolling along General Segundo Avenue,
they saw the ten-wheeler truck described by the informant. When they apprehended it at the Marcos
Bridge, accused-appellant, the owner of the truck and the cargo, admitted that there were sawn lumber in
between the coconut slabs. When the police officers asked for the lumber's supporting documents,
accused-appellant could not present any. The foregoing circumstances are sufficient to prove the existence
of probable cause which justified the extensive search of appellant's truck even without a warrant. Thus,
the 258 pieces of tanguile lumber were lawfully seized and were thus properly admitted as evidence to
prove
the
guilt
of
accused-appellant.

72

The foregoing disquisition renders unnecessary the issue of whether appellant's right to counsel under
custodial investigation was violated. The Resolution of the issue will not affect the finding of guilt of
appellant.
IN VIEW WHEREOF, the instant appeal is DISMISSED. The Decision appealed from is AFFIRMED. Costs
against
appellant.
SO ORDERED.

LT. GEN. ALFONSO P. DAGUDAG (Ret.), Complainant, versus JUDGE MAXIMO G.W. PADERANGA,
Regional Trial Court, Branch 38, Cagayan de Oro City, Respondent.
A.M. No. RTJ-06-2017 | 2008-06-18
DECISION

PER CURIAM:
This is a complaint for gross ignorance of the law and conduct unbecoming a judge filed by retired Lt. Gen.
Alfonso P. Dagudag (Gen. Dagudag), Head of Task Force Sagip Kalikasan, against Judge Maximo G. W.
Paderanga (Judge Paderanga), Presiding Judge of the Regional Trial Court, Branch 38, Cagayan de Oro City.
On or about 30 January 2005, the Region VII Philippine National Police Regional Maritime Group (PNPRMG)
received information that MV General Ricarte of NMC Container Lines, Inc. was shipping container vans
containing illegal forest products from Cagayan de Oro to Cebu. The shipments were falsely declared as
cassava meal and corn grains to avoid inspection by the Department of Environment and Natural
Resources (DENR).[1]
On 30 and 31 January 2005, a team composed of representatives from the PNPRMG, DENR, and the
Philippine Coast Guard inspected the container vans at a port in Mandaue City, Cebu. The team discovered
the undocumented forest products and the names of the shippers and consignees:
Container Van No. Shipper Consignee
NCLU - 2000492-22GI Polaris Chua Polaris Chua
IEAU - 2521845-2210 Polaris Chua Polaris Chua

73

NOLU - 2000682-22GI Rowena Balangot Rowena Balangot

INBU - 3125757-BB2210 Rowena Balangot Rowena Balangot
NCLU - 20001591-22GI Jovan Gomez Jovan Gomez
GSTU - 339074-US2210 Jovan Gomez Jovan Gomez
CRXU - 2167567 Raffy Enriquez Raffy Enriquez
NCLU - 2001570-22GI Raffy Enriquez Raffy Enriquez
The crew of MV General Ricarte failed to produce the certificate of origin forms and other pertinent
transport documents covering the forest products, as required by DENR Administrative Order No. 07-94.
Gen. Dagudag alleged that, since nobody claimed the forest products within a reasonable period of time,
the DENR considered them as abandoned and, on 31 January 2005, the Provincial Environment and Natural
Resources Office (PENRO) Officer-in-Charge (OIC), Richard N. Abella, issued a seizure receipt to NMC
Container Lines, Inc.[2]
On 1 February 2005, Community Environment and Natural Resources Office (CENRO) OIC Loreto A. Rivac
(Rivac) sent a notice to NMC Container Lines, Inc. asking for explanation why the government should not
confiscate the forest products.[3] In an affidavit[4] dated 9 February 2005, NMC Container Lines, Inc.'s
Branch Manager Alex Conrad M. Seno stated that he did not see any reason why the government should
not confiscate the forest products and that NMC Container Lines, Inc. had no knowledge of the actual
content of the container vans.
On 2, 9, and 15 February 2005, DENR Forest Protection Officer Lucio S. Canete, Jr. posted notices on the
CENRO and PENRO bulletin boards and at the NMC Container Lines, Inc. building informing the unknown
owner about the administrative adjudication scheduled on 18 February 2005 at the Cebu City CENRO.
Nobody appeared during the adjudication.[5] In a resolution[6] dated 10 March 2005, Rivac, acting as
adjudication officer, recommended to DENR Regional Executive Director Clarence L. Baguilat that the forest
products be confiscated in favor of the government.
In a complaint[7] dated 16 March 2005 and filed before Judge Paderanga, a certain Roger C. Edma (Edma)
prayed that a writ of replevin be issued ordering the defendants DENR, CENRO, Gen. Dagudag, and others
to deliver the forest products to him and that judgment be rendered ordering the defendants to pay him
moral damages, attorney's fees, and litigation expenses. On 29 March 2005, Judge Paderanga issued a writ
of replevin[8] ordering Sheriff Reynaldo L. Salceda to take possession of the forest products.
In a motion to quash the writ of replevin,[9] the defendants DENR, CENRO, and Gen. Dagudag prayed that
the writ of replevin be set aside: (1) Edma's bond was insufficient; (2) the forest products were falsely
declared as cassava meal and corn grains; (3) Edma was not a party-in-interest; (4) the forest products
were not covered by any legal document; (5) nobody claimed the forest products within a reasonable
period of time; (6) the forest products were already considered abandoned; (7) the forest products were
lawfully seized under the Revised Forestry Code of the Philippines; (8) replevin was not proper; (9) courts

74

could not take cognizance of cases pending before the DENR; (10) Edma failed to exhaust administrative
remedies; and (11) the DENR was the agency responsible for the enforcement of forestry laws. In a motion
to dismiss ad cautelam[10] dated 12 April 2005, the defendants prayed that the complaint for replevin and
damages be dismissed: (1) the real defendant is the Republic of the Philippines; (2) Edma failed to exhaust
administrative remedies; (3) the State cannot be sued without its consent; and (4) Edma failed to allege
that he is the owner or is entitled to the possession of the forest products.
In an order[11] dated 14 April 2005, Judge Paderanga denied the motion to quash the writ of replevin for
lack of merit.
Gen. Dagudag filed with the Office of the Court Administrator (OCA) an affidavit-complaint[12] dated 8 July
2005 charging Judge Paderanga with gross ignorance of the law and conduct unbecoming a judge. Gen.
Dagudag stated that: During the x x x hearing, [Judge Paderanga] showed manifest partiality in favor of x x
x Edma. DENR's counsel was lambasted, cajoled and intimidated by [Judge Paderanga] using words such
as "SHUT UP" and "THAT'S BALONEY."
xxxx
Edma in the replevin case cannot seek to recover the wood shipment from the DENR since he had not
sought administrative remedies available to him. The prudent thing for [Judge Paderanga] to have done
was to dismiss the replevin suit outright.
xxxx
[Judge Paderanga's] act[s] of taking cognizance of the x x x replevin suit, issuing the writ of replevin and
the subsequent denial of the motion to quash clearly demonstrates [sic] ignorance of the law.
In its 1st Indorsement[13] dated 1 August 2005, the OCA directed Judge Paderanga to comment on the
affidavit-complaint. In his comment[14] dated 6 September 2005, Judge Paderanga stated that he
exercised judicial discretion in issuing the writ of replevin and that he could not delve into the issues raised
by Gen. Dagudag because they were related to a case pending before him.
In its Report[15] dated 10 July 2006, the OCA found that Judge Paderanga (1) violated the doctrine of
exhaustion of administrative remedies; (2) violated the doctrine of primary jurisdiction; and (3) used
inappropriate language in court. The OCA recommended that the case be re-docketed as a regular
administrative matter; that Judge Paderanga be held liable for gross ignorance of the law and for violation
of Section 6, Canon 6 of the New Code of Judicial Conduct for the Philippine Judiciary;[16] and that he be
fined P30,000.
In its Resolution[17] dated 16 August 2006, the Court re-docketed the case as a regular administrative
matter and required the parties to manifest whether they were willing to submit the case for decision
based on the pleadings already filed. Judge Paderanga manifested his willingness to submit the case for
decision based on the pleadings already filed.[18] Since Gen. Dagudag did not file any manifestation, the
Court considered him to have waived his compliance with the 16 August 2006 Resolution.[19]
The Court finds Judge Paderanga liable for gross ignorance of the law and for conduct unbecoming a

75

judge.
The DENR is the agency responsible for the enforcement of forestry laws. Section 4 of Executive Order No.
192 states that the DENR shall be the primary agency responsible for the conservation, management,
development, and proper use of the country's natural resources.
Section 68 of Presidential Decree No. 705, as amended by Executive Order No. 277, states that possessing
forest products without the required legal documents is punishable. Section 68-A states that the DENR
Secretary or his duly authorized representatives may order the confiscation of any forest product illegally
cut, gathered, removed, possessed, or abandoned.
In the instant case, the forest products were possessed by NMC Container Lines, Inc. without the required
legal documents and were abandoned by the unknown owner. Consequently, the DENR seized the forest
products.
Judge Paderanga should have dismissed the replevin suit outright for three reasons. First, under the
doctrine of exhaustion of administrative remedies, courts cannot take cognizance of cases pending before
administrative agencies. In Factoran, Jr. v. Court of Appeals,[20] the Court held that:
The doctrine of exhaustion of administrative remedies is basic. Courts, for reasons of law, comity and
convenience, should not entertain suits unless the available administrative remedies have first been
resorted to and the proper authorities have been given an appropriate opportunity to act and correct their
alleged errors, if any, committed in the administrative forum. (Emphasis ours)
In Dy v. Court of Appeals,[21] the Court held that a party must exhaust all administrative remedies before
he can resort to the courts. In Paat v. Court of Appeals,[22] the Court held that:
This Court in a long line of cases has consistently held that before a party is allowed to seek the
intervention of the court, it is a pre-condition that he should have availed of all the means of
administrative processes afforded him. Hence, if a remedy within the administrative machinery can still be
resorted to by giving the administrative officer concerned every opportunity to decide on a matter that
comes within his jurisdiction then such remedy should be exhausted first before court's judicial power can
be sought. The premature invocation of court's intervention is fatal to one's cause of action. Accordingly,
absent any finding of waiver or estoppel the case is susceptible of dismissal for lack of cause of action.
(Emphasis ours)
In the instant case, Edma did not resort to, or avail of, any administrative remedy. He went straight to
court and filed a complaint for replevin and damages. Section 8 of Presidential Decree No. 705, as
amended, states that (1) all actions and decisions of the Bureau of Forest Development Director are
subject to review by the DENR Secretary; (2) the decisions of the DENR Secretary are appealable to the
President; and (3) courts cannot review the decisions of the DENR Secretary except through a special civil
action for certiorari or prohibition. In Dy,[23] the Court held that all actions seeking to recover forest
products in the custody of the DENR shall be directed to that agency - not the courts. In Paat,[24] the Court
held that:
Dismissal of the replevin suit for lack of cause of action in view of the private respondents' failure to

76

exhaust administrative remedies should have been the proper course of action by the lower court instead
of assuming jurisdiction over the case and consequently issuing the writ [of replevin]. Exhaustion of the
remedies in the administrative forum, being a condition precedent prior to one's recourse to the courts and
more importantly, being an element of private respondents' right of action, is too significant to be waylaid
by the lower court.
xxxx
Moreover, the suit for replevin is never intended as a procedural tool to question the orders of confiscation
and forfeiture issued by the DENR in pursuance to the authority given under P.D. 705, as amended. Section
8 of the said law is explicit that actions taken by the Director of the Bureau of Forest Development
concerning the enforcement of the provisions of the said law are subject to review by the Secretary of
DENR and that courts may not review the decisions of the Secretary except through a special civil action
for certiorari or prohibition. (Emphasis ours)
Second, under the doctrine of primary jurisdiction, courts cannot take cognizance of cases pending before
administrative agencies of special competence. The DENR is the agency responsible for the enforcement of
forestry laws. The complaint for replevin itself stated that members of DENR's Task Force Sagip Kalikasan
took over the forest products and brought them to the DENR Community Environment and Natural
Resources Office. This should have alerted Judge Paderanga that the DENR had custody of the forest
products, that administrative proceedings may have been commenced, and that the replevin suit had to be
dismissed outright. In Tabao v. Judge Lilagan[25] - a case with a similar set of facts as the instant case - the
Court held that:
The complaint for replevin itself states that the shipment x x x [was] seized by the NBI for verification of
supporting documents. It also states that the NBI turned over the seized items to the DENR "for official
disposition and appropriate action." x x x To our mind, these allegations [should] have been sufficient to
alert respondent judge that the DENR has custody of the seized items and that administrative proceedings
may have already been commenced concerning the shipment. Under the doctrine of primary jurisdiction,
courts cannot take cognizance of cases pending before administrative agencies of special competence. x x
x The prudent thing for respondent judge to have done was to dismiss the replevin suit outright. (Emphasis
ours)
In Paat,[26] the Court held that:
[T]he enforcement of forestry laws, rules and regulations and the protection, development and
management of forest lands fall within the primary and special responsibilities of the Department of
Environment and Natural Resources. By the very nature of its function, the DENR should be given a free
hand unperturbed by judicial intrusion to determine a controversy which is well within its jurisdiction. The
assumption by the trial court, therefore, of the replevin suit filed by private respondents constitutes an
unjustified encroachment into the domain of the administrative agency's prerogative. The doctrine of
primary jurisdiction does not warrant a court to arrogate unto itself the authority to resolve a controversy
the jurisdiction over which is initially lodged with an administrative body of special competence.
(Emphasis ours)
Third, the forest products are already in custodia legis and thus cannot be the subject of replevin. There

77

was a violation of the Revised Forestry Code and the DENR seized the forest products in accordance with
law. In Calub v. Court of Appeals,[27] the Court held that properties lawfully seized by the DENR cannot be
the subject of replevin:
Since there was a violation of the Revised Forestry Code and the seizure was in accordance with law, in our
view the [properties seized] were validly deemed in custodia legis. [They] could not be subject to an action
for replevin. For it is property lawfully taken by virtue of legal process and considered in the custody of the
law, and not otherwise. (Emphasis ours)
Judge Paderanga's acts of taking cognizance of the replevin suit and of issuing the writ of replevin
constitute gross ignorance of the law. In Tabao,[28] the Court held that:
Under the doctrine of primary jurisdiction, courts cannot take cognizance of cases pending before
administrative of special competence. x x x [T]he plaintiff in the replevin suit who [sought] to recover the
shipment from the DENR had not exhausted the administrative remedies available to him. The prudent
thing for respondent judge to have done was to dismiss the replevin suit outright.
Under Section 78-A of the Revised Forestry Code, the DENR secretary or his authorized representatives
may order the confiscation of forest products illegally cut, gathered, removed, or possessed or abandoned.
xxxx
Respondent judge's act of taking cognizance of the x x x replevin suit clearly demonstrates ignorance of
the law. x x x [J]udges are expected to keep abreast of all laws and prevailing jurisprudence. Judges are
duty bound to have more than just a cursory acquaintance with laws and jurisprudence. Failure to follow
basic legal commands constitutes gross ignorance of the law from which no one may be excused, not even
a judge. (Emphasis ours)
Canon 6 of the New Code of Judicial Conduct for the Philippine Judiciary states that competence is a
prerequisite to the due performance of judicial office. Section 3 of Canon 6 states that judges shall take
reasonable steps to maintain and enhance their knowledge necessary for the proper performance of
judicial duties. Judges should keep themselves abreast with legal developments and show acquaintance
with laws.[29]
The rule that courts cannot prematurely take cognizance of cases pending before administrative agencies
is basic. There was no reason for Judge Paderanga to make an exception to this rule. The forest products
were in the custody of the DENR and Edma had not availed of any administrative remedy. Judge Paderanga
should have dismissed the replevin suit outright. In Espaol v. Toledo-Mupas,[30] the Court held that:
Being among the judicial front-liners who have direct contact with the litigants, a wanton display of utter
lack of familiarity with the rules by the judge inevitably erodes the confidence of the public in the
competence of our courts to render justice. It subjects the judiciary to embarrassment. Worse, it could
raise the specter of corruption.
When the gross inefficiency springs from a failure to consider so basic and elemental a rule, a law, or a
principle in the discharge of his or her duties, a judge is either too incompetent and undeserving of the

78

exalted position and title he or she holds, or the oversight or omission was deliberately done in bad faith
and in grave abuse of judicial authority.
The OCA found Judge Paderanga liable for using inappropriate language in court: "We x x x find
respondent's intemperate use of "Shut up!" and "Baloney!" well nigh inappropriate in court proceedings.
The utterances are uncalled for."[31]
Indeed, the 14 and 22 April 2005 transcripts of stenographic notes show that Judge Paderanga was
impatient, discourteous, and undignified in court:
Atty. Luego: Your Honor, we want to have this motion because that is...
Judge Paderanga: I am asking you why did you not make any rejoinder[?]
xxxx
Atty. Luego: I apologize, Your Honor. We are ready to...
Judge Paderanga: Ready to what? Proceed.
Atty. Luego: Yes, Your Honor. We filed this motion to quash replevin, Your Honor, on the grounds, first and
foremost, it is our contention, Your Honor, with all due respect of [sic] this Honorable Court, that the writ of
replevin dated March 29, 2005 was improper, Your Honor, for the reasons that the lumber, subject matter
of this case,were apprehended in accordance with...
Judge Paderanga: Where is your proof that it was apprehended? Where is your proof? Is that apprehension
proven by a seizure receipt? Where is your seizure receipt?
Atty. Luego: Under the rules...
Judge Paderanga:
Where is your seizure receipt? You read your rules. What does [sic] the rules say? Where in your rules does
it say that it does not need any seizure receipt? You look at your rules. You point out the rules. You take out
your rules and then you point out.Do you have the rules?
xxxx
Atty. Luego: Your Honor, there was no seizure receipt, but during the apprehension, Your Honor, there was
no claimant.
Judge Paderanga: Answer me. Is there a seizure receipt?
Atty. Luego: But during the apprehension, Your Honor, no owner has [sic] appeared.
xxxx

79

Atty. Luego: According to [the] rules, Your Honor, if there is no...

Judge Paderanga: Whom are you seizing it from? To [sic] whom are you taking it from?
Atty. Luego: From the shipping company, Your Honor.
xxxx
Atty. Luego: Your Honor please, the shipping company denied he ownership of that lumber.
xxxx
Atty. Luego: But the shipping company, Your Honor,...
Judge Paderanga: Shut up. That's baloney. You are seizing it from nobody.Then how can you seize it from
the shipping company. Are you not? You are a lawyer.Who is in possession of the property? The shipping
company. Why did you not issue [a] seizure receipt to the shipping company?
Atty. Luego: But the... May I continue, Your Honor?
xxxx
Judge Paderanga: Stop talking about the shipping company. Still you did not issue a seizure receipt here.
Well, I'm telling you you should have issued [a] seizure receipt to the shipping company.
xxxx
Judge Paderanga: You are a lawyer.You should know how to write pleadings.You write the pleadings the way
it should be, not the way you think it should be.
Atty. Luego: I'm sorry, Your Honor.
Judge Paderanga: You are an officer of the court.You should be careful with your language. You say that I
am wrong.It's you who are [sic] wrong because you do not read the law.
xxxx
Judge Paderanga: Then you read the law. How dare you say that the Court is wrong.
xxxx
Judge Paderanga: Are you not representing [the DENR]?
Atty. Luego: Yes, in this case, Your Honor.

80

Judge Paderanga: Then you are representing them.They are your clients.What kind of a lawyer are you?
[32]
xxxx
Atty. Tiamson: Specifically it was stated in the [Factoran] versus Court of Appeals [case] that the Court
should not interfere, Your Honor.
Judge Paderanga: No.
xxxx
Judge Paderanga: The problem with you people is you do not use your heads.
Atty. Tiamson: We use our heads, your Honor.
xxxx
Atty. Tiamson: Your Honor, we would like to put on record that we use our heads, your Honor.[33]
(Emphasis ours)
Section 6, Canon 6 of the New Code of Judicial Conduct for the Philippine Judiciary states that judges shall
be patient, dignified, and courteous in relation to lawyers. Rule 3.04, Canon 3 of the Code of Judicial
Conduct states that judges should be patient and courteous to lawyers, especially the inexperienced. They
should avoid the attitude that the litigants are made for the courts, instead of the courts for the litigants.
Judicial decorum requires judges to be temperate in their language at all times. They must refrain from
inflammatory, excessively rhetoric, or vile language.[34] They should (1) be dignified in demeanor and
refined in speech; (2) exhibit that temperament of utmost sobriety and self-restraint; and (3) be
considerate, courteous, and civil to all persons who come to their court.[35] In Juan de la Cruz v. Carretas,
[36] the Court held that:
A judge who is inconsiderate, discourteous or uncivil to lawyers x x x who appear in his sala commits an
impropriety and fails in his duty to reaffirm the people's faith in the judiciary. He also violates Section 6,
Canon 6 of the New Code of Judicial Conduct for the Philippine Judiciary.
xxxx
It is reprehensible for a judge to humiliate a lawyer x x x. The act betrays lack of patience, prudence and
restraint.Thus, a judge must at all times be temperate in his language. He must choose his words x x x
with utmost care and sufficient control. The wise and just man is esteemed for his discernment. Pleasing
speech increases his persuasiveness.
Equanimity and judiciousness should be the constant marks of a dispenser of justice. A judge should
always keep his passion guarded. He can never allow it to run loose and overcome his reason. He descends
to the level of a sharp-tongued, ill-mannered petty tyrant when he utters harsh words x x x. As a result, he

81

degrades the judicial office and erodes public confidence in the judiciary.
Judge Paderanga's refusal to consider the motion to quash the writ of replevin, repeated interruption of the
lawyers, and utterance of "shut up," "that's baloney," "how dare you say that the court is wrong," "what
kind of a lawyer are you?," and "the problem with you people is you do not use your heads" are undignified
and very unbecoming a judge. In Office of the Court Administrator v. Paderanga,[37] the Court already
reprimanded Judge Paderanga for repeatedly saying "shut up," being arrogant, and declaring that he had
"absolute power" in court. He has not changed.
Section 8, Rule 140 of the Rules of Court classifies gross ignorance of the law as a serious offense. It is
punishable by (1) dismissal from the service, forfeiture of benefits, and disqualification from reinstatement
to any public office; (2) suspension from office without salary and other benefits for more than three
months but not exceeding six months; or (3) a fine of more than P20,000 but not exceeding P40,000.[38]
Section 10 of Rule 140 classifies conduct unbecoming a judge as a light offense. It is punishable by (1) a
fine of not less than P1,000 but not exceeding P10,000; (2) censure; (3) reprimand; or (4) admonition with
warning.[39]
The Court notes that this is Judge Paderanga's third offense. In Office of the Court Administrator v.
Paderanga,[40] the Court held him liable for grave abuse of authority and simple misconduct for
unceremoniously citing a lawyer in contempt while declaring himself as having "absolute power" and for
repeatedly telling a lawyer to "shut up." In Beltran, Jr. v. Paderanga,[41] the Court held him liable for undue
delay in rendering an order for the delay of nine months in resolving an amended formal offer of exhibits.
In both cases, the Court sternly warned Judge Paderanga that the commission of another offense shall be
dealt with more severely. The instant case and the two cases decided against him demonstrate Judge
Paderanga's arrogance, incorrigibility, and unfitness to become a judge.
Judge Paderanga has two other administrative cases pending against him - one[42] for gross ignorance of
the law, knowingly rendering an unjust judgment, and grave abuse of authority, and the other[43] for gross
misconduct, grave abuse of authority, and gross ignorance of the law.
The Court will not hesitate to impose the ultimate penalty on those who have fallen short of their
accountabilities. It will not tolerate any conduct that violates the norms of public accountability and
diminishes the faith of the people in the judicial system.[44]
WHEREFORE, the Court finds Judge Maximo G.W. Paderanga, Regional Trial Court, Branch 38, Cagayan de
Oro City, GUILTY of GROSS IGNORANCE OF THE LAW and UNBECOMING CONDUCT. Accordingly, the Court
DISMISSES him from the service, with forfeiture of all retirement benefits, except accrued leave credits,
and with prejudice to reinstatement or appointment to any public office, including government-owned or
controlled corporations.
SO ORDERED.

82

PROSECUTOR LEO C. TABAO, Regional Chairman, Special Task Force on Environment and
Natural Resources (STF-ENR) of Region 8, Tacloban City, complainant, vs. JUDGE FRISCO T.
LILAGAN, Presiding Judge, Regional Trial Court, Leyte, Branch 34, and SHERIFF IV LEONARDO V.
AGUILAR, Office of the Clerk of Court, Regional Trial Court, Tacloban City, respondents.
A.M. No. RTJ-01-1651 | 2001-09-04
DECISION
QUISUMBING, J.:
This is an administrative complaint filed by Atty. Leo C. Tabao, Assistant City Prosecutor of Tacloban, in his
capacity as Regional Chairman of the Region 8 Special Task Force on Environment and Natural Resources,
against (1) Judge Frisco T. Lilagan, presiding judge of the Leyte Regional Trial Court, Branch 34, for gross
ignorance of the law, gross abuse of judicial authority, and willful disobedience to settled jurisprudence;
and (2) Sheriff IV Leonardo V. Aguilar of the Leyte RTC, Office of the Clerk of Court, for gross irregularity in
the performance of official duties, giving unwarranted benefits to a private individual, violation of Section
1(b) and (c) of P.D. No. 1829, and conduct prejudicial to the best interest of the service.
The records of this case reveal the following facts.
On February 24, 1998, a water craft registered under the name M/L Hadija, from Bongao, Tawi-tawi, was
docked at the port area of Tacloban City with a load of around 100 tons of tanbark. Due to previous
irregular and illegal shipments of tanbark from Bongao, agents of the National Bureau of Investigation in
Region 8 (NBI-EVRO #8) decided to verify the shipment's accompanying documents as the M/L Hadija was
unloading its cargo to its consignee, a certain Robert Hernandez.
The NBI agents found the documents irregular and incomplete, and consequently they ordered the
unloading of the cargo stopped. The tanbark, the boat M/L Hadija, and three cargo trucks were seized and
impounded.

83

On March 5, 1998, NBI-EVRO #8 Regional Director Carlos S. Caabay filed a criminal complaint for violation
of Section 68 (now Section 78) of P.D. No. 705,[1] the Forestry Reform Code of the Philippines (as
amended), against the captain and crew of the M/L Hadija, Robert Hernandez, Tandico Chion, Alejandro K.
Bautista, and Marcial A. Dalimot. Bautista was a forester while Dalimot was a Community Environment and
Natural Resources Officer (CENRO) of the Department of Environment and Natural Resources (DENR) office
in Tacloban City. Bautista and Dalimot were, thus, also charged with violation of Section 3(e) of R.A. No.
3019 or the Anti-Graft and Corrupt Practices Act,[2] along with Habi A. Alih and Khonrad V. Mohammad of
the CENRO-Bongao, Tawi-tawi. The complaint was docketed as I.S. No. 98-296 at the Prosecutor's Office of
Tacloban City.
In an order dated March 6, 1998,[3] complainant directed the seizure by the DENR of the M/L Hadija, its
cargo, and the three trucks pending preliminary investigation of the case. DENR thus took possession of
the aforesaid items on March 10, 1998, with notice to the consignee Robert Hernandez and the NBI
Regional Director.
On March 11, 1998, Hernandez filed in the Regional Trial Court of Leyte a case for replevin to recover the
items seized by the DENR. The case was raffled off to Branch 34 of said court and docketed as Civil Case
No. 98-03-42.
On March 16, 1998, subpoenas were issued to the respondents in I.S. No. 98-296. On March 17, 1998,
confiscation proceedings were conducted by the Provincial Environment and Natural Resources Office
(PENRO)-Leyte, with both Hernandez and his counsel present.
On March 19, 1998, herein respondent Judge Frisco T. Lilagan issued a writ of replevin and directed
respondent Sheriff IV Leonardo V. Aguilar to take possession of the items seized by the DENR and to deliver
them to Hernandez after the expiration of five days.[4] Respondent sheriff served a copy of the writ to the
Philippine Coast Guard station in Tacloban City at around 5:45 p.m. of March 19, 1998.
Thus, the filing of this administrative complaint against respondents via a letter addressed to the Chief
Justice and dated April 13, 1998, by Atty. Tabao.
Complainant avers that replevin is not available where the properties sought to be recovered are involved
in criminal proceedings for illegal logging. He points out that this is a well-settled issue and cites several
decisions[5] of this Court and the Court of Appeals on the matter. He argues that respondent judge should
have known of the existing jurisprudence on this issue, particularly since they are subject to mandatory
judicial notice per Section 1, Rule 129 of the Revised Rules of Court.
Complainant submits that respondent judge is either grossly ignorant of the law and jurisprudence or
purposely disregarded them. But he avers that it is respondent judge's duty to keep abreast of
developments in law and jurisprudence.
Complainant claims that respondent judge cannot claim ignorance of the proceedings in I.S. No. 98-296 for
the following reasons: (1) the defendants in the replevin case were all DENR officers, which should have
alerted respondent judge to the possibility that the items sought to be recovered were being held by the
defendants in their official capacities; and (2) the complaint for replevin itself states that the items were

84

intercepted by the NBI for verification of supporting documents, which should have made respondent judge
suspect that the same were being held by authority of law.
As regards respondent sheriff Leonardo V. Aguilar, complainant states that it was incumbent upon Aguilar
to safeguard the M/L Hadija and prevent it from leaving the port of Tacloban City, after he had served a
writ of seizure therefor on the Philippine Coast Guard. However, on March 19, 1998, the vessel left the port
of Tacloban City, either through respondent sheriff's gross negligence or his direct connivance with
interested parties, according to complainant. As of the time of the filing of the complaint, according to
complainant, the whereabouts of the vessel and its crew were unknown.
Moreover, complainant points out that respondent sheriff released the seized tanbark to Hernandez on
March 20 and 21, 1998, or within the five-day period that he was supposed to keep it under the terms of
the writ. Complainant argues that the tanbark formed part of the people's evidence in the criminal
complaint against Hernandez and the others. By his act, respondent sheriff effectively altered, suppressed,
concealed, or destroyed the integrity of said evidence. For this act, complainant contends that respondent
sheriff may be held liable under Section 1(b) of P.D. 1829, Penalizing Obstruction of Apprehension and
Prosecution of Criminal Offenders.[6] Respondent sheriff's acts also constitute gross irregularity in the
performance of his duty as a court employee.
Complainant notes that respondent sheriff was absent from his office from March 20 to March 24, 1998.
This period included the dates he was supposed to have released the tanbark to Hernandez. Complainant
contends that respondent sheriff not only unlawfully released the tanbark, he also made it appear that he
was not physically present when such act was done.
In separate indorsements dated September 9, 1998, then Court Administrator Alfredo L. Benipayo referred
this administrative matter to both respondents for comment.
In his comment dated October 12, 1998,[7] respondent judge calls the attention of the Office of the Court
Administrator to a pending motion to dismiss filed by the defendants in the replevin case that effectively
prevented him from commenting on the issue. The discussions that would have to be included in the
comment, he says, would also resolve the pending motion to dismiss. Respondent judge contends that
complainant should have been prudent enough to wait for the resolution of the motion to dismiss before
filing the instant administrative case.
Respondent judge claims that he was unaware of the existence of I.S. No. 98-296. He only learned of the
criminal case from an urgent manifestation dated March 20, 1998, filed by complainant. He argues that he
issued an order dated March 25, 1998, suspending the transfer to Hernandez of possession of the subject
items, pending resolution of the urgent manifestation.
Respondent judge stresses that the writ of replevin was issued in strict compliance with the requirements
laid down in Rule 60 of the Revised Rules of Court. He also points out that said writ was issued provisionally
and was not intended to be the final disposition of the replevin case.
Respondent judge avers that the charge of gross ignorance of the law is premature since he has not made
a ruling yet on the motion to dismiss filed in the replevin case. He contends that it was too much to ask
from him to take note of the fact that the defendants in said case were officials of DENR and make

85

assumptions based on such fact. Moreover, respondent judge submits that while the complaint alleged
that the cargo of tanbark was intercepted by the NBI, it also alleged that the consignee thereof produced
documents to prove that the shipment was legal.
In conclusion, respondent judge points out that no apprehension report was issued by the NBI regarding
the shipment. Neither did the DENR issue a seizure report. Respondent judge contends that the validity of
the seizure of the subject items by the DENR is a matter that will have to be resolved in relation to the
motion to dismiss.
For his part, respondent sheriff submits[8] that he served the writ of replevin on the Coast Guard precisely
to prevent the departure of the subject vessel, since he does not have the means to physically prevent
said vessel from sailing. The Coast Guard commander should have examined the vessel and its crew after
being served the writ, to determine whether or not they were engaged in any illegal activity.
Respondent sheriff narrates that no cargo was on board the vessel when he served the writ on the Coast
Guard. He verified the cargo's status with DENR, which furnished him a copy of a fax transmission stating
that the tanbark came from legitimate sources except that the shipment documents were not in order.[9]
Respondent sheriff contends that it was his ministerial duty to serve the writ of replevin, absent any
instruction to the contrary. He argues further that since the items subject of the writ are in the custody of
the court and could be disposed of only through court order, there could not be any unwarranted benefit to
a private individual as claimed by complainant.
Noting that the questioned shipment of tanbark was not covered by either an NBI apprehension report or a
DENR seizure report, respondent sheriff contends that complainant should have taken steps to protect the
integrity of the shipment instead of heaping blame upon others for his own negligence. Respondent sheriff
avers that it was not his intention to obstruct the apprehension and prosecution of criminal offenders,
contrary to complainant's claim.
Respondent sheriff refutes complainant's claim that he was absent from his office from March 20 to March
24, 1998, and alleges that it was complainant who was absent from court hearings on several occasions, in
violation of his duty as a prosecutor.
Respondent submitted two supplemental comments dated October 30, 1998,[10] and May 3, 1999,[11] (1)
reiterating his contention that the tanbark seized by the DENR and subject of the replevin case had been
found to come from a legitimate source, per an order signed by the Regional Director (Region 8) of the
DENR,[12] and (2) informing the OCA that the main replevin case was dismissed per an order of
respondent judge dated November 27, 1998.[13]
As required by resolution of the Court dated January 24, 2001, the parties herein separately manifested
that they are willing to have the present case resolved based on the record on hand.
We note that in its report dated April 8, 1999, the OCA, after reviewing the case, recommended that
respondent judge be fined in the amount of P15,000.00 for gross ignorance of the law. At the same time,
the OCA recommended that the charges against respondent sheriff be dismissed for lack of merit.

86

The recommendation of the OCA is well taken, except for the amount of the fine to be imposed on said
respondent judge.
The complaint for replevin itself states that the shipment of tanbark as well as the vessel on which it was
loaded were seized by the NBI for verification of supporting documents.[14] It also states that the NBI
turned over the seized items to the DENR "for official disposition and appropriate action."[15] A copy of the
document evidencing the turnover to DENR was attached to the complaint as Annex "D".[16] To our mind,
these allegations would have been sufficient to alert respondent judge that the DENR has custody of the
seized items and that administrative proceedings may have already been commenced concerning the
shipment. Under the doctrine of primary jurisdiction, courts cannot take cognizance of cases pending
before administrative agencies of special competence.[17] Note, too, that the plaintiff in the replevin suit
who seeks to recover the shipment from the DENR had not exhausted the administrative remedies
available to him.[18] The prudent thing for respondent judge to have done was to dismiss the replevin suit
outright.
Under Section 78-A of the Revised Forestry Code, the DENR secretary or his authorized representatives
may order the confiscation of forest products illegally cut, gathered, removed, or possessed or abandoned,
including the conveyances used in the commission of the offense.
In this regard, we declared in Paat v. Court of Appeals:
"...the enforcement of forestry laws, rules and regulations and the protection, development and
management of forest lands fall within the primary and special responsibilities of the Department of
Environment and Natural Resources. By the very nature of its function, the DENR should be given a free
hand unperturbed by judicial intrusion to determine a controversy which is well within its jurisdiction. The
assumption by the trial court, therefore, of the replevin suit filed by private respondents constitutes an
unjustified encroachment into the domain of the administrative agency's prerogative. The doctrine of
primary jurisdiction does not warrant a court to arrogate unto itself the authority to resolve a controversy
the jurisdiction over which is initially lodged with an administrative body of special competence. xxx"[19]
Respondent judge's act of taking cognizance of the subject replevin suit clearly demonstrates ignorance of
the law. He has fallen short of the standard set forth in Canon 1, Rule 1.01 of the Code of Judicial Conduct,
that a judge must be the embodiment of competence, integrity, and independence. To measure up to this
standard, judges are expected to keep abreast of all laws and prevailing jurisprudence.[20] Judges are duty
bound to have more than just a cursory acquaintance with laws and jurisprudence. Failure to follow basic
legal commands constitutes gross ignorance of the law from which no one may be excused, not even a
judge.[21]
We find, however, that respondent judge had already vacated the Writ of Seizure he issued on March 19,
1998, in a subsequent Order dated November 27, 1998, dismissing the Civil Complaint for replevin filed by
Robert Hernandez against the Regional Director of the DENR and other officers. He also directed in said
order the sheriff to return to CENRO, Tacloban City, all the chattels confiscated by virtue of the Writ of
Seizure.[22]
Further, we find that Sheriff Aguilar in his Final Return of the Writ, dated December 15, 1998, had already
delivered to CENRO the 102 tons and 120 kilos of tanbark duly receipted by CENRO representative Marcial

87

A. Dalimot on the same date.[23]

The OCA recommends that respondent judge be fined in the amount of P15,000.00. Under the
circumstances, considering that this is the first complaint against him, we deem a fine of P10,000.00 to be
sufficient.
Regarding the charges against respondent sheriff, we agree with the OCA that they should be dismissed.
Respondent sheriff merely complied with his ministerial duty to serve the writ with reasonable celerity and
to execute it promptly in accordance with its mandates.[24]
WHEREFORE, respondent Judge Frisco T. Lilagan is hereby found liable for gross ignorance of the law and is
accordingly ordered to pay a FINE of P10,000.00, with a WARNING that a repetition of the same or a similar
offense will be dealt with more severely. The complaint against respondent Sheriff IV Leonardo V. Aguilar is
DISMISSED for lack of merit.
SO ORDERED.

88

FELIPE CALUB and RICARDO VALENCIA, DEPARTMENT of ENVIRONMENT and NATURAL RESOURCES (DENR),
CATBALOGAN, SAMAR, petitioners, vs. COURT OF APPEALS, MANUELA T. BABALCON, and CONSTANCIO
ABUGANDA, respondents.
G.R. No. 115634 | 2000-04-27
Tagged under keywords

Discussions citing this case are available.

Replevin (Rule 60) (Provisional Remedies)
Political Law; Constitutional Law; General Considerations; State Immunity
DECISION

QUISUMBING, J.:
For review is the decision.1 [Rollo, pp. 22-27.] dated May 27, 1994, of the Court of Appeals in CA-G.R. SP
No. 29191, denying the petition filed by herein petitioners for certiorari, prohibition and mandamus, in
order to annul the Order dated May 27, 1992, by the Regional Trial Court of Catbalogan, Samar. Said Order
had denied petitioners' (a) Motion to Dismiss the replevin case filed by herein private respondents, as well
as (b) petitioners' Motion for Reconsideration of the Order of said trial court dated April 24, 1992, granting
an application for a Writ of replevin..2 [CA Records, p. 43.]
The pertinent facts of the case, borne by the records, are as follows:
On January 28, 1992, the Forest Protection and Law Enforcement Team of the Community Environment and
Natural Resources Office (CENRO) of the DENR apprehended two (2) motor vehicles, described as follows:
"1. Motor Vehicle with Plate No. HAK-733 loaded with one thousand and twenty six (1,026) board feet of
illegally sourced lumber valued at P8,544.75, being driven by one Pio Gabon and owned by [a certain] Jose
Vargas.
2. Motor Vehicle with Plate No. FCN-143 loaded with one thousand two hundred twenty four and ninety
seven (1,224.97) board feet of illegally-sourced lumber valued at P9,187.27, being driven by one
Constancio Abuganda and owned by [a certain] Manuela Babalcon. ".3 [Rollo, p. 23.
Constancio Abuganda and Pio Gabon, the drivers of the vehicles, failed to present proper documents
and/or licenses. Thus, the apprehending team seized and impounded the vehicles and its load of lumber at
the DENR-PENR (Department of Environment and Natural Resources-Provincial Environment and Natural
Resources) Office in Catbalogan..4 [Id. at 23.] Seizure receipts were issued but the drivers refused to
accept the receipts..5 [Id. at 74.] Felipe Calub, Provincial Environment and Natural Resources Officer, then
filed before the Provincial Prosecutor's Office in Samar, a criminal complaint against Abuganda, in Criminal

89

Case No. 3795, for violation of Section 68 [78), Presidential Decree 705 as amended by Executive Order
277, otherwise known as the Revised Forestry Code..6 [Sec. 78. Cutting, Gathering, and/or Collecting
Timber, or Other Forest Products without License. Any person who shall cut, gather, collect, remove timber
or other forest products from any forestland, or timber from alienable or disposable public land, or from
private land, without any authority, or possess timber or other forest products without the legal documents
as required under existing forest laws and regulations, shall be punished with the penalties imposed under
Articles 309 and 310 of the Revised Penal Code. . .
The Court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed, as well as the machinery, equipment,
implements and tools illegally used in the area where the timber or forest products are found. (Emphasis
supplied.)]
On January 31, 1992, the impounded vehicles were forcibly taken by Gabon and Abuganda from the
custody of the DENR, prompting DENR Officer Calub this time to file a criminal complaint for grave coercion
against Gabon and Abuganda. The complaint was, however, dismissed by the Public Prosecutor..7 [Rollo, p.
70.]
On February 11, 1992, one of the two vehicles, with plate number FCN 143, was again apprehended by a
composite team of DENR-CENR in Catbalogan and Philippine Army elements of the 802nd Infantry Brigade
at Barangay Buray, Paranas, Samar. It was again loaded with forest products with an equivalent volume of
1,005.47 board feet, valued at P10,054.70. Calub duly filed a criminal complaint against Constancio
Abuganda, a certain Abegonia, and several John Does, in Criminal Case No. 3625, for violation of Section
68 [78], Presidential Decree 705 as amended by Executive Order 277, otherwise known as the Revised
Forestry Code..8 [Id. at 23, 78.]
In Criminal Cases Nos. 3795 and 3625, however, Abegonia and Abuganda were acquitted on the ground of
reasonable doubt. But note the trial court ordered that a copy of the decision be furnished the Secretary of
Justice, in order that the necessary criminal action may be filed against Noe Pagarao and all other persons
responsible for violation of the Revised Forestry Code. For it appeared that it was Pagarao who chartered
the subject vehicle and ordered that cut timber be loaded on it..9 [Id. at 75, 85.]
Subsequently, herein private respondents Manuela Babalcon, the vehicle owner, and Constancio
Abuganda, the driver, filed a complaint for the recovery of possession of the two (2) impounded vehicles
with an application for replevin against herein petitioners before the RTC of Catbalogan. The trial court
granted the application for replevin and issued the corresponding writ in an Order dated April 24, 1992..10
[CA Records, p. 43.] Petitioners filed a motion to dismiss which was denied by the trial court..11 [Supra,
note 4.]
Thus, on June 15, 1992, petitioners filed with the Supreme Court the present Petition for Certiorari,
Prohibition and Mandamus with application for Preliminary Injunction and/or a Temporary Restraining Order.
The Court issued a TRO, enjoining respondent RTC judge from conducting further proceedings in the civil
case for replevin; and enjoining private respondents from taking or attempting to take the motor vehicles
and forest products seized from the custody of the petitioners. The Court further instructed the petitioners
to see to it that the motor vehicles and other forest products seized are kept in a secured place and
protected from deterioration, said property being in custodia legis and subject to the direct order of the

90

Supreme Court..12 Id. at 18-19.

12 In a Resolution issued on September 28, 1992, the Court referred said petition to respondent appellate
court for appropriate disposition..13 [Id. at 21.]
On May 27, 1994, the Court of Appeals denied said petition for lack of merit. It ruled that the mere seizure
of a motor vehicle pursuant to the authority granted by Section 68 [78] of P.D. No. 705 as amended by E.O.
No. 277 does not automatically place said conveyance in custodia legis. According to the appellate court,
such authority of the Department Head of the DENR or his duly authorized representative to order the
confiscation and disposition of illegally obtained forest products and the conveyance used for that purpose
is not absolute and unqualified. It is subject to pertinent laws, regulations, or policies on that matter,
added the appellate court. The DENR Administrative Order No. 59, series of 1990, is one such regulation,
the appellate court said. For it prescribes the guidelines in the confiscation, forfeiture and disposition of
conveyances used in the commission of offenses penalized under Section 68 [78] of P.D. No. 705 as
amended by E.O. No. 277..14 [Id. at 26-A.]
Additionally, respondent Court of Appeals noted that the petitioners failed to observe the procedure
outlined in DENR Administrative Order No. 59, series of 1990. They were unable to submit a report of the
seizure to the DENR Secretary, to give a written notice to the owner of the vehicle, and to render a report
of their findings and recommendations to the Secretary. Moreover, petitioners' failure to comply with the
procedure laid down by DENR Administrative Order No. 59, series of 1990, was confirmed by the admission
of petitioners' counsel that no confiscation order has been issued prior to the seizure of the vehicle and the
filing of the replevin suit. Therefore, in failing to follow such procedure, according to the appellate court,
the subject vehicles could not be considered in custodia legis..15 [Id. at 25-27.]
Respondent Court of Appeals also found no merit in petitioners' claim that private respondents' complaint
for replevin is a suit against the State. Accordingly, petitioners could not shield themselves under the
principle of state immunity as the property sought to be recovered in the instant suit had not yet been
lawfully adjudged forfeited in favor of the government. Moreover, according to respondent appellate court,
there could be no pecuniary liability nor loss of property that could ensue against the government. It
reasoned that a suit against a public officer who acted illegally or beyond the scope of his authority could
not be considered a suit against the State; and that a public officer might be sued for illegally seizing or
withholding the possession of the property of another..16 [Id. at 27.]
Respondent court brushed aside other grounds raised by petitioners based on the claim that the subject
vehicles were validly seized and held in custody because they were contradicted by its own findings..17
[Ibid.] Their petition was found without merit..18 [Ibid.]
Now, before us, the petitioners assign the following errors:.19 [Id. at 6.]
(1) THE COURT OF APPEALS ERRED IN HOLDING THAT MERE SEIZURE OF A CONVEYANCE PURSUANT TO
SECTION 68-A [78-A] OF P.D. NO. 705 AS AMENDED BY EXECUTIVE ORDER 277 DOES NOT PLACE SAID
CONVEYANCE IN CUSTODIA LEGIS;
(2) THE COURT OF APPEALS ERRED IN NOT HOLDING THAT THE OPERATIVE ACT GIVING RISE FOR THE
SUBJECT CONVEYANCE TO BE IN CUSTODIA LEGIS IS ITS LAWFUL SEIZURE BY THE DENR PURSUANT TO

91

SECTION 68-A [78-A] OF P.D. NO. 705, AS AMENDED BY E.O. NO. 277; AND
(3) THE COURT OF APPEALS ERRED IN HOLDING THAT THE COMPLAINT FOR REPLEVIN AGAINST THE
PETITIONERS IS NOT A SUIT AGAINST THE STATE.
In brief, the pertinent issues for our consideration are:
(1) Whether or not the DENR-seized motor vehicle, with plate number FCN 143, is in custodia legis.
(2) Whether or not the complaint for the recovery of possession of impounded vehicles, with an application
for replevin, is a suit against the State.
We will now resolve both issues.
The Revised Forestry Code authorizes the DENR to seize all conveyances used in the commission of an
offense in violation of Section 78. Section 78 states:
Sec. 78. Cutting, Gathering, and or Collecting Timber, or Other Forest Products without License. Any person
who shall cut, gather, collect, remove timber or other forest products from any forestland, or timber from
alienable or disposable public land, or from private land, without any authority, or possess timber or other
forest products without the legal documents as required under existing forest laws and regulations, shall
be punished with the penalties imposed under Articles 309 and 310 of the Revised Penal Code.
The Court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed, as well as the machinery, equipment,
implements and tools illegally used in the area where the timber or forest products are found.
This provision makes mere possession of timber or other forest products without the accompanying legal
documents unlawful and punishable with the penalties imposed for the crime of theft, as prescribed in
Articles 309-310 of the Revised Penal Code. In the present case, the subject vehicles were loaded with
forest products at the time of the seizure. But admittedly no permit evidencing authority to possess and
transport said load of forest products was duly presented. These products, in turn, were deemed illegally
sourced. Thus there was a prima facie violation of Section 68 [78] of the Revised Forestry Code, although
as found by the trial court, the persons responsible for said violation were not the ones charged by the
public prosecutor.
The corresponding authority of the DENR to seize all conveyances used in the commission of an offense in
violation of Section 78 of the Revised Forestry Code is pursuant to Sections 78-A and 89 of the same Code.
They read as follows:
Sec. 78-A. Administrative Authority of the Department Head or His Duly Authorized Representative to Order
Confiscation. -- In all cases of violation of this Code or other forest laws, rules and regulations, the
Department Head or his duly authorized representative, may order the confiscation of any forest products
illegally cut, gathered, removed, or possessed or abandoned, and all conveyances used either by land,
water or air in the commission of the offense and to dispose of the same in accordance with pertinent laws,
regulations or policies on the matter.

92

Sec. 89. Arrest; Institution of criminal actions. -- A forest officer or employee of the Bureau [Department] or
any personnel of the Philippine Constabulary/Philippine National Police shall arrest even without warrant
any person who has committed or is committing in his presence any of the offenses defined in this
Chapter. He shall also seize and confiscate, in favor of the Government, the tools and equipment used in
committing the offense... [Emphasis supplied.]
Note that DENR Administrative Order No. 59, series of 1990, implements Sections 78-A and 89 of the
Forestry Code, as follows:
Sec. 2. Conveyances Subject to Confiscation and Forfeiture. -- All conveyances used in the transport of any
forest product obtained or gathered illegally whether or not covered with transport documents, found
spurious or irregular in accordance with Sec. 68-A [78-A] of P.D. No. 705, shall be confiscated in favor of the
government or disposed of in accordance with pertinent laws, regulations or policies on the matter.
Sec. 4. Who are Authorized to Seize Conveyance. -- The Secretary or his duly authorized representative
such as the forest officers and/or natural resources officers, or deputized officers of the DENR are
authorized to seize said conveyances subject to policies and guidelines pertinent thereto. Deputized
military personnel and officials of other agencies apprehending illegal logs and other forest products and
their conveyances shall notify the nearest DENR field offices, and turn over said forest products and
conveyances for proper action and disposition. In case where the apprehension is made by DENR field
officer, the conveyance shall be deposited with the nearest CENRO/PENRO/RED Office as the case may be,
for safekeeping wherever it is most convenient and secured. [Emphasis supplied.]
Upon apprehension of the illegally-cut timber while being transported without pertinent documents that
could evidence title to or right to possession of said timber, a warrantless seizure of the involved vehicles
and their load was allowed under Section 78 and 89 of the Revised Forestry Code.
Note further that petitioners' failure to observe the procedure outlined in DENR Administrative Order No.
59, series of 1990 was justifiably explained. Petitioners did not submit a report of the seizure to the
Secretary nor give a written notice to the owner of the vehicle because on the 3rd day following the
seizure, Gabon and Abuganda, drivers of the seized vehicles, forcibly took the impounded vehicles from
the custody of the DENR. Then again, when one of the motor vehicles was apprehended and impounded
for the second time, the petitioners, again were not able to report the seizure to the DENR Secretary nor
give a written notice to the owner of the vehicle because private respondents immediately went to court
and applied for a writ of replevin. The seizure of the vehicles and their load was done upon their
apprehension for a violation of the Revised Forestry Code. It would be absurd to require a confiscation
order or notice and hearing before said seizure could be effected under the circumstances.
Since there was a violation of the Revised Forestry Code and the seizure was in accordance with law, in our
view the subject vehicles were validly deemed in custodia legis. It could not be subject to an action for
replevin. For it is property lawfully taken by virtue of legal process and considered in the custody of the
law, and not otherwise..20 [Bagalihog v. Fernandez, 198 SCRA 614, 621 (1991)]
In Mamanteo, et. al. v. Deputy Sheriff Magumun, A.M. No. P-98-1264, promulgated on July 28, 1999, the
case involves property to be seized by a Deputy Sheriff in a replevin suit. But said property were already

93

impounded by the DENR due to violation of forestry laws and, in fact, already forfeited in favor of the
government by order of the DENR. We said that such property was deemed in custodia legis. The sheriff
could not insist on seizing the property already subject of a prior warrant of seizure. The appropriate action
should be for the sheriff to inform the trial court of the situation by way of partial Sheriff's Return, and wait
for the judge's instructions on the proper procedure to be observed.
Note that property that is validly deposited in custodia legis cannot be the subject of a replevin suit. In
Mamanteo v. Deputy Sheriff Magumun, we elucidated further:
". . . the writ of replevin has been repeatedly used by unscrupulous plaintiffs to retrieve their chattel earlier
taken for violation of the Tariff and Customs Code, tax assessment, attachment or execution. Officers of
the court, from the presiding judge to the sheriff, are implored to be vigilant in their execution of the law
otherwise, as in this case, valid seizure and forfeiture proceedings could easily be undermined by the
simple devise of a writ of replevin...".21 [Mamanteo, et. al. v. Deputy Sheriff Magumun, A.M. No. P-98-1264,
July 28, 1999, citing Pacis v. Hon. Averia,18 SCRA 907 (1966)]
On the second issue, is the complaint for the recovery of possession of the two impounded vehicles, with
an application for replevin, a suit against the State?
Well established is the doctrine that the State may not be sued without its consent..22 [CONST., Art. XVI,
sec. 3.] And a suit against a public officer for his official acts is, in effect, a suit against the State if its
purpose is to hold the State ultimately liable..23 [De Leon, The Law on Public Officers and Election Law,
2nd ed., 1994, pp. 228-229.] However, the protection afforded to public officers by this doctrine generally
applies only to activities within the scope of their authority in good faith and without willfulness, malice or
corruption..24 [Philippine Racing Club, Inc., et al. v. Bonifacio, et al., 109 Phil. 233, 241 (1960)] In the
present case, the acts for which the petitioners are being called to account were performed by them in the
discharge of their official duties. The acts in question are clearly official in nature..25 [Sanders v. Veridiano
II, 162 SCRA 88, 96 (1988)] In implementing and enforcing Sections 78-A and 89 of the Forestry Code
through the seizure carried out, petitioners were performing their duties and functions as officers of the
DENR, and did so within the limits of their authority. There was no malice nor bad faith on their part.
Hence, a suit against the petitioners who represent the DENR is a suit against the State. It cannot prosper
without the State's consent.
Given the circumstances in this case, we need not pursue the Office of the Solicitor General's line for the
defense of petitioners concerning exhaustion of administrative remedies. We ought only to recall that
exhaustion must be raised at the earliest time possible, even before filing the answer to the complaint or
pleading asserting a claim, by a motion to dismiss..26 [Section 1, Rule 16, 1997 Rules of Court.
SECTION 1. Grounds. -- Within the time for but before filing the answer to the complaint or pleading
asserting a claim, a motion to dismiss may be made on any of the following grounds:
(a) That the court has no jurisdiction over the person of the defending party;
(b) That the court has no jurisdiction over the subject matter of the claim;
(c) That venue is improperly laid;
(d) That the plaintiff has no legal capacity to sue;
(e) That there is another action pending between the same parties for the same cause;

94

(f) That the cause of action is barred by a prior judgment or by the statute of limitations;
(g) That the pleading asserting the claim states no cause of action;
(h) That the claim or demand set forth in the plaintiff's pleading has been paid, waived, abandoned, or
otherwise extinguished;
(i) That the claim on which the action is founded is unenforceable under the provisions of the statute of
frauds; and
(j) That a condition precedent for filing the claim has not been complied with.] If not invoked at the proper
time, this ground for dismissal could be deemed waived and the court could take cognizance of the case
and try it..27 [Soto v. Jareno, 144 SCRA 116, 119 [1986). See also Section 1[j), Rule 16, 1997 Rules of
Court.]
ACCORDINGLY, the Petition is GRANTED, and the assailed Decision of the Court of Appeals in CA-G.R. SP
No. 29191 is SET ASIDE. Consequently, the Order issued by the Regional Trial Court of Catbalogan, dated
May 27, 1992, and the Writ of replevin issued in the Order dated April 24, 1992, are ANNULLED. The Sheriff
of the Regional Trial Court of Catbalogan, Branch 29, is directed to take possession of the subject motor
vehicle, with plate number FCN 143, for delivery to the custody of and appropriate disposition by
petitioners. Let a copy of this decision be provided the Honorable Secretary of Justice for his appropriate
action, against any and all persons responsible for the abovecited violation of the Revised Forestry Code.
Costs against private respondents.
SO ORDERED.

FULGENCIO S. FACTORAN, JR., Secretary, Department of Environment and Natural Resources,

VICENTE A. ROBLES and NESTOR GAPUZAN, petitioners, vs. COURT OF APPEALS (Third
Division), Hon. BENIGNO T. DAYAW,as, Judge, Regional Trial Court of Quezon City, Branch 80,
JESUS SY and LILY FRANCISCO UY, respondents.
G.R. No. 93540 | 1999-12-13

95

DECISION
DE

LEON,

JR.,

J.:

Before us is a petition for review on certiorari of the Decision and Resolution of the Court of Appeals dated
March 30, 1990 and May 18, 1990, respectively, dismissing petitioners' charge that Honorable Benigno T.
Dayaw, Presiding Judge of Branch 80 of the Regional Trial Court (RTC) of Quezon City, committed grave
abuse of discretion in ordering them to deliver to private respondents the six-wheeler truck and its cargo,
some 4,000 board feet of narra lumber which were confiscated by the Department of Environment and
Natural
Resources
(DENR)
and
forfeited
in
favor
of
the
government.[1]
The antecedent facts:
On August 9, 1988, two (2) police officers of the Marikina Police Station, Sub-Station III, intercepted a sixwheeler truck, with Plate No. NJT-881, carrying 4,000 board feet of narra lumber as it was cruising along
the Marcos Highway. They apprehended the truck driver, private respondent Jesus Sy, and brought the
truck and its cargo to the Personnel Investigation Committee/Special Actions and Investigation Division
(PIC/SAID) of the DENR Office in Quezon City. There, petitioner Atty. Vicente Robles of the PIC/SAID
investigated them, and discovered the following discrepancies in the documentation of the narra lumber:
[2]
"a. What were declared in the documents (Certificate of Timber Origin, Auxiliary Invoices and various
Certifications) were narra flitches, while the cargo of the truck consisted of narra lumber;
"b. As appearing in the documents, the Plate Numbers of the truck supposed to carry the forest products
bear the numbers BAX-404, PEC-492 or NSN-267, while the Plate Number of the truck apprehended is NVT881;
"c. Considering that the cargo is lumber, the transport should have been accompanied by a Certificate of
Lumber Origin, scale sheet of said lumber and not by a Certificate of Timber Origin, which merely covers
only
transport
of
logs
and
flitches;
"d. The Log Sale Purchase Agreement presented is between DSM Golden Cup International as the seller
and Bonamy Enterprises as the buyer/consignee and not with Lily Francisco Lumber and Hardware,"[3]
which are in violation of Bureau of Forestry Development (BFD) Circular No. 10. The said BFD Circular
requires possession or transportation of lumber to be supported by the following documents: (1) Certificate
of Lumber Origin (CLO) which shall be issued only by the District Forester, or in his absence, the Assistant
District Forester; (2) Sales Invoice; (3) Delivery Receipt; and (4) Tally Sheets.[4] Such omission is
punishable under Sec. 68 of Presidential Decree (P.D.) No. 705 otherwise known as the Revised Forestry
Code.[5] Thus, petitioner Atty. Robles issued a temporary seizure order and seizure receipt for the narra
lumber
and
the
six-wheeler
truck.[6]
On January 20, 1989, petitioner Fulgencio S. Factoran, then Secretary of Environment and Natural
Resources (hereinafter referred to as petitioner Secretary) issued an order for the confiscation of the narra
lumber
and
the
six-wheeler
truck.[7]

96

Private respondents neither asked for reconsideration of nor appealed, the said order to the Office of the
President. Consequently, the confiscated narra lumber and six-wheeler truck were forfeited in favor of the
government. They were subsequently advertised to be sold at public auction on March 20, 1989.[8]
On March 17, 1989, private respondents filed a complaint with prayer for the issuance of writs of replevin
and preliminary injunction and/or temporary restraining order for the recovery of the confiscated lumber
and six-wheeler truck, and to enjoin the planned auction sale of the subject narra lumber, respectively.[9]
Said complaint was docketed as Civil Case No. Q-89-2045 and raffled to Branch 80 of the RTC of Quezon
City.
On the same day, the trial court issued an Order directing petitioners to desist from proceeding with the
planned auction sale and setting the hearing for the issuance of the writ of preliminary injunction on March
27,
1989.[10]
On March 20, 1989, the scheduled date of the auction sale, private respondents filed an Ex-Parte Motion
for Release and Return of Goods and Documents (Replevin) supported by an Affidavit for Issuance of Writ
of Replevin and Preliminary Injunction and a Replevin Bond in the amount of P180,000.00.[11] The trial
court granted the writ of replevin on the same day and directed the petitioners "to deliver the xxx [n]arra
lumber, original documents and truck with plate no. NJT 881 to the custody of the plaintiffs and/or their
representative
x
x
x".[12]
On March 22, 1989, the trial court issued a writ of seizure. However, petitioners refused to comply
therewith.[13] David G. Brodett, Sheriff of Branch 80 of the RTC of Quezon City (hereinafter referred to as
the Sheriff) reported that petitioners prevented him from removing the subject properties from the DENR
Compound and transferring them to the Mobil Unit Compound of the Quezon City Police Force. To avoid any
unwarranted confrontation between them, he just agreed to a constructive possession of the properties in
question.[14] In the afternoon of the same day, petitioners filed a Manifestation stating their intention to
file a counterbond under Rule 60 of the Rules of Court to stay the execution of the writ of seizure and to
post a cash bond in the amount of P180,000.00. But the trial court did not oblige petitioners for they failed
to serve a copy of the Manifestation on private respondents. Petitioners then immediately made the
required service and tendered the cash counterbond in the amount of P180,000.00, but it was refused,
petitioners' Manifestation having already been set for hearing on March 30, 1989. [15]
On March 27, 1989, petitioners made another attempt to post a counterbond which was, however, denied
for
the
same
reason.
[16]
On the same day, private respondents filed a motion to declare petitioners in contempt for disobeying the
writ of seizure.[17] The trial court gave petitioners twenty-four (24) hours to answer the motion. Hearing
thereon
was
scheduled
on
March
30,
1989.
However, on March 29, 1989, petitioners filed with the Court of Appeals a Petition for Certiorari, Prohibition
and/or Mandamus to annul the Orders of the trial court dated March 20, 1989 and March 27, 1989.[18]
On March 30, 1989, the Court of Appeals granted petitioners temporary relief in the form of a temporary
restraining
order
(TRO).

97

On September 11, 1989, the Court of Appeals converted the TRO into a writ of preliminary injunction upon
filing
by
petitioners
of
a
bond
in
the
amount
of
P180,000.00.[19]
However, on March 30, 1990, the Court of Appeals lifted the writ of preliminary injunction and dismissed
the petition. It declared that as the complaint for replevin filed by private respondents complied with the
requirements of an affidavit and bond under Secs. 1 and 2 of Rule 60 of the Revised Rules of court,
issuance
of
the
writ
of
replevin
was
mandatory.[20]
As for the contempt charges against petitioners, the Court of Appeals believed the same were sufficiently
based on a written charge by private respondents and the report submitted by the Sheriff.[21]
On April 25, 1990, petitioners filed a motion for reconsideration of the foregoing decision. However, that
motion was denied by the Court of Appeals in its Resolution dated May 18, 1990.[22]
Hence

this

petition.

On the one hand, petitioners contend, thus:

(1)

"Confiscated

lumber

cannot

be

subject

of

replevin".[23]

(2) "Petitioners not compelled to criminally prosecute private respondents but may opt only to confiscate
lumber".[24]
(3)

"Private

respondent

charged

criminally

in

court".[25]

and

(4) "Writ of Replevin issued in contravention of PD #605".[26]

On the other hand, private respondents argue that:
(1) "The respondent Judge had jurisdiction to take cognizance of the complaint for recovery of personal
property and, therefore, had jurisdiction to issue the necessary orders in connection therewith."[27]
(2) "The issuance of the order for the delivery of personal property upon application, affidavit and filing of
replevin bond by the plaintiff is mandatory and not discretionary, hence, no abuse of discretion can be
committed
by
the
trial
court
in
the
issuance
thereof."[28]
(3) "The Order of March 20, 1989 was in accordance with Section 4, Rule 60 of the Rules of Court and is,
therefore,
valid."[29]
(4) "The private respondents have not been proven to have violated Section 68 of the Revised Forestry
Code."[30]
(5) "The petitioners do not have the authority to keep private respondents' property for an indefinite
period, more so, to dispose of the same without notice and hearing or without due process."[31]

98

(6) "Contrary to the allegation of petitioners, no formal investigation was conducted by the PIC with
respect
to
the
subject
lumber
in
this
case."[32]
(7) "The alleged Order dated January 20, 1989 of the petitioner Secretary Fulgencio Factoran, Jr. of the
DENR is not valid and does not make the issuance of the order of replevin illegal."[33] and
(8) "The subject properties were not in custody of the law and may be replevied."[34]
At the outset we observe that herein respondents never appealed the confiscation order of petitioner
Secretary to the Office of the President as provided for in Sec. 8 of P.D. No. 705 which reads:
"All actions and decisions of the Director are subject to review, motu propio or upon appeal of any person
aggrieved thereby, by the Department Head whose decision shall be final and executory after the lapse of
thirty (30) days from receipt by the aggrieved party of said decision unless appealed to the President x x x.
The decision of the Department Head may not be reviewed by the courts except through a special civil
action for certiorari and prohibition."
The doctrine of exhaustion of administrative remedies is basic. Courts, for reasons of law, comity and
convenience, should not entertain suits unless the available administrative remedies have first been
resorted to and the proper authorities have been given an appropriate opportunity to act and correct their
alleged errors, if any, committed in the administrative forum.[35] As to the application of this doctrine in
cases involving violations of P.D. No. 705, our ruling in Paat v. Court of Appeals, is apropos:
"Moreover, it is important to point out that the enforcement of forestry laws, rules and regulations and the
protection, development and management of forest lands fall within the primary and special
responsibilities of the Department of Environment and Natural Resources. By the very nature of its
function, the DENR should be given a free hand unperturbed by judicial intrusion to determine a
controversy which is well within its jurisdiction. The assumption by the trial court, therefore, of the replevin
suit filed by private respondents constitutes an encroachment into the domain of the administrative
agency's prerogative. The doctrine of primary jurisdiction does not warrant a court to arrogate unto itself
the authority to resolve a controversy the jurisdiction over which is initially lodged with an administrative
body of special competence. In Felipe Ismael, Jr. and Co. vs. Deputy Executive Secretary, which was
reiterated in the recent case of Concerned Officials of MWSS vs. Vasquez, this Court held:
'Thus, while the administration grapples with the complex and multifarious problems caused by unbridled
exploitation of these resources, the judiciary will stand clear. A long line of cases establish the basic rule
that the courts will not interfere in matters which are addressed to the sound discretion of government
agencies entrusted with the regulation of activities coming under the special technical knowledge and
training of such agencies.'"[36]
However, petitioners did not file a motion to dismiss based on the ground of non-exhaustion of
administrative
remedies.
Thus,
it
is
deemed
waived.[37]
Nonetheless, the petition is impressed with merit.
First. A writ of replevin does not just issue as a matter of course upon the applicant's filing of a bond and

99

affidavit, as the Court of Appeals has wrongly put it. The mere filing of an affidavit, sans allegations therein
that satisfy the requirements of Sec. 2, Rule 60 of the Revised Rules of Court, cannot justify the issuance of
a writ of replevin. Said provision reads:
"Affidavit and bond. - Upon applying for such order the plaintiff must show by his own affidavit or that of
some
other
person
who
personally
knows
the
facts:
"(a) That the plaintiff is the owner of the property claimed, particularly describing it, or entitled to the
possession
thereof;
"(b) That the property is wrongfully detained by the defendant, alleging the cause of detention thereof to
his
best
knowledge,
information,
and
belief;
"(c) That it has not been taken for a tax assessment or fine pursuant to law, or seized under an execution,
or an attachment against the property of the plaintiff, or, if so seized, that it is exempt from such seizure;
and
"(d)

The

actual

value

of

the

property.

"x x x x x x x x x ."
Wrongful detention by the defendant of the properties sought in an action for replevin must be
satisfactorily established. If only a mechanistic averment thereof is offered, the writ should not be issued.
In the case at bar, the subject narra lumber and six-wheeler truck were confiscated by petitioner Secretary
pursuant to Section 68-A of P.D. No. 705, as amended by Executive Order (E.O.) No. 277, to wit:
"SEC. 68-A. Administrative Authority of the Department Head or His Duly Authorized Representative to
Order Confiscation. - In all cases of violations of this Code or other forest laws, rules and regulations, the
Department Head or his duly authorized representative, may order the confiscation of any forest products
illegally cut, gathered, removed, or possessed or abandoned, and all conveyances used either by land,
water, or air in the commission of the offense and to dispose of the same in accordance with pertinent
laws, regulations or policies on the matter."[38]
As the petitioner Secretary's administrative authority to confiscate is clearly provided by law, the taking of
the subject properties is not wrongful and does not warrant the issuance of a writ of replevin prayed for by
private
respondents.
Second. Issuance of the confiscation order by petitioner Secretary was a valid exercise of his power under
Sec. 68-A of P.D. No. 705. By virtue of said order, the narra lumber and six-wheeler truck of private
respondents were held in custodia legis and hence, beyond the reach of replevin.
Property lawfully taken by virtue of legal process is deemed to be in custodia legis.[39] When a thing is in
official custody of a judicial or executive officer in pursuance of his execution of a legal writ, replevin will
not lie to recover it.[40] Otherwise, there would be interference with the possession before the function of
law had been performed as to the process under which the property was taken.[41] So basic is this

100

doctrine that it found inclusion in the 1997 amendments introduced to the Rules of Civil Procedure. Thus,
Sec. 2(c), Rule 60 of the 1997 Rules of Civil Procedure provides that:
"Affidavit and bond. - Upon applying for such order the plaintiff must show by his own affidavit or that of
some
other
person
who
personally
knows
the
facts:
"x

x;

"(c) That the property has not been distrained or taken for a tax assessment or fine pursuant to law, or
seized under a writ of execution, or preliminary attachment or otherwise placed under custodia legis, or if
so
seized,
that
it
is
exempt
from
such
seizure
or
custody;
x
x
x
"x x x x x x x x x."[42]
Third. Petitioner Secretary's authority to confiscate forest products under Sec. 68-A of P.D. No. 705 is
distinct from and independent of the confiscation of forest products in a criminal action provided for in
Section 68 of P.D. No. 705. Thus, in Paat, we held that:
"'x x x precisely because of the need to make forestry laws 'more responsive to present situations and
realities' and in view of the 'urgency to conserve the remaining resources of the country,' that the
government opted to add Section 68-A. This amendatory provision is an administrative remedy totally
separate and distinct from criminal proceedings. x x x. The preamble of EO 277 that added Section 68-A to
PD 705- is most revealing:
'WHEREAS, there is an urgency to conserve the remaining forest resources of the country for the benefit
and
welfare
of
the
present
and
future
generations
of
Filipinos;
WHEREAS, our forest resources may be effectively conserved and protected through the vigilant
enforcement
and
implementation
of
our
forestry
laws,
rules
and
regulations;
WHEREAS, the implementation of our forestry laws suffers from technical difficulties, due to certain
inadequacies in the Penal provisions of the Revised Forestry Code of the Philippines; and
WHEREAS, to overcome this [sic] difficulties, there is a need to penalize certain acts more responsive to
present situations and realities;'
'It is interesting to note that Section 68-A is a new provision authorizing the DENR to confiscate, not only
'conveyances' but forest products as well. On the other hand, confiscation of forest products by the 'court'
in a criminal action has long been provided for in Section 68. If as private respondents insist, the power of
confiscation cannot be exercised except only through the court under Section 68, then Section 68-A would
have no purpose at all. Simply put, Section 68-A would not have provided any solution to the problem
perceived in EO 277, x x x.'"[43]
Sec. 68-A was added precisely to supplant the inadequacies and supplement criminal enforcement of
forestry
laws.

101

Fourth. Sec. 80 of P. D. No. 705 which requires delivery of the seized forest products within six (6) hours
from the time of the seizure to the appropriate official designated by law to conduct preliminary
investigations applies only to criminal prosecutions provided for in Sec. 68, and not to administrative
confiscation
provided
for
in
Section
68-A.
Sec. 80 of P.D. No. 705 provides:
"SEC. 80. Arrest; Institution of criminal actions. - A forest officer or employee of the Bureau shall arrest
even without a warrant any person who has committed or is committing in his presence any of the
offenses defined in this Chapter. He shall also seize and confiscate, in favor of the Government, the tools
and equipment used in committing the offense, and the forest products cut, gathered or taken by the
offender in the process of committing the offense. The arresting officer or employee shall thereafter deliver
within six (6) hours from the time of arrest and seizure, the offender and the confiscated forest products,
tools and equipment to, and file the proper complaint with, the appropriate official designated by law to
conduct
preliminary
investigations
and
file
informations
in
court.
"x x x x x x x x x."
The title of Sec. 80 - "Arrest; Institution of Criminal Actions" - bespeaks this intendment of the law. The fact,
too, that Secs. 68 and 80 were co-existing prior to the introduction of Sec. 68-A, proves that Sec. 80
applies to the criminal prosecutions subject of Sec. 68 and not to the administrative confiscation subject of
Sec. 68-A. Sec. 68-A, therefore, should not be interpreted in relation to Sec. 80 as to require that criminal
charges be filed with and seized forest products be immediately delivered to, the fiscal in case of
administrative confiscation, for this renders nugatory the purpose sought to be achieved thereby. Statutes
should always be construed in the light of the object to be achieved and the evil or mischief to be
suppressed, and they should be given such interpretation as will advance the object, suppress the
mischief,
and
secure
the
benefits
intended.[44]
Fifth. Nothing in the records supports private respondents' allegation that their right to due process was
violated as no investigation was conducted prior to the confiscation of their properties.
On the contrary, by private respondents' own admission, private respondent Sy who drove the six-wheeler
truck was properly investigated by petitioner Atty. Robles at the PIC/SAID Office of the DENR. Thereafter,
private respondent Sy and his witnesses were given full opportunity to explain the deficiencies in the
documents.[45] Private respondents categorically stated that they made a "continuous and almost daily
follow-up and plea x x x with the PIC for the return of the truck and lumber x x x."[46] Finally in a letter
dated December 30, 1989, private respondent Lily Francisco Uy requested petitioner Secretary for
"immediate
resolution
and
release
of
the
impounded
narra
sawn
lumber."[47]
Undoubtedly, private respondents were afforded an opportunity to be heard before the order of
confiscation was issued. There was no formal or trial type hearing but the same is not, in all instances,
essential in administrative proceedings. It is settled that due process is satisfied when the parties are
afforded fair and reasonable opportunity to explain their side of the controversy or an opportunity to move
for
a
reconsideration
of
the
action
or
ruling
complained
of.[48]
Moreover, respondents claim that the order of confiscation was antedated and not the product of the

102

investigation supposedly conducted by the PIC of the DENR. However, they proffer no proof to support that
allegation. On the other hand, there is the legal presumption that official duty has been regularly
performed. The presumption of regularity in the performance of official duties is even particularly strong
with respect to administrative agencies like the DENR which are vested with quasi-judicial powers in
enforcing the laws affecting their respective fields of activity, the proper regulation of which requires of
them such technical mastery of all relevant conditions obtaining in the nation.[49]
Finally. The writ of seizure and the writ of replevin were issued by the trial court in grave abuse of its
discretion. Thus, disobedience thereto cannot constitute indirect contempt of court which presupposes that
the court order thereby violated was valid and legal. Without a lawful order having been issued, no
contempt
of
court
could
be
committed.[50]
WHEREFORE, the instant petition is hereby GRANTED. The Decision of the Court of Appeals dated March
30, 1990 and its Resolution dated May 18, 1990 in CA-G.R. SP No. 17194 are hereby SET ASIDE and
REVERSED. Respondent Presiding Judge Benigno T. Dayaw, of the Regional Trial Court of Quezon City, is
PERMANENTLY ENJOINED from enforcing the Orders dated March 20, 1989 and March 22, 1989 in Civil Case
No. Q-89-2045, or if said orders have already been enforced, the said respondent Judge is directed to
render judgment of forfeiture on the replevin bond filed by private respondents. Finally, the said
respondent Judge is PERMANENTLY ENJOINED from further acting on the Motion for Contempt filed by
private
respondents
against
the
petitioners.
Costs

against

SO

private

respondents.
ORDERED.

LOEONARDO A. PAAT, in his capacity as Officer-in-Charge (OIC), Regional Executive Director

(RED), Region 2 and JOVITO LAYUGAN, JR., in his capacity as Community Environment and
Natural Resources Officer (CENRO), both of the Department of Environment and Natural
Resources (DENR), petitioners,
vs.
COURT OF APPEALS, HON. RICARDO A. BACULI in his capacity as Presiding Judge of Branch 2,
Regional Trial Court at Tuguegarao, Cagayan, and SPOUSES BIENVENIDO and VICTORIA DE
GUZMAN, respondents.

103

G.R. No. 111107 | 1997-01-10

Tagged under keywords

DECISION
TORRES,

JR.,

J.:

Without violating the principle of exhaustion of administrative remedies, may an action for replevin prosper
to recover a movable property which is the subject matter of an administrative forfeiture proceeding in the
Department of Environment and Natural Resources pursuant to Section 68-A of P.D. 705, as amended,
entitled
The
Revised
Forestry
Code
of
the
Philippines?
Are the Secretary of DENR and his representatives empowered to confiscate and forfeit conveyances used
in
transporting
illegal
forest
products
in
favor
of
the
government?
These

are

two

fundamental

questions

presented

before

us

for

our

resolution.

The controversy on hand had its incipiency on May 19, 1989 when the truck of private respondent Victoria
de Guzman while on its way to Bulacan from San Jose, Baggao, Cagayan, was seized by the Department of
Environment and Natural Resources (DENR, for brevity) personnel in Aritao, Nueva Vizcaya because the
driver could not produce the required documents for the forest products found concealed in the truck.
Petitioner Jovito Layugan, the Community Environment and Natural Resources Officer (CENRO) in Aritao,
Cagayan, issued on May 23, 1989 an order of confiscation of the truck and gave the owner thereof fifteen
(15) days within which to submit an explanation why the truck should not be forfeited. Private
respondents, however, failed to submit the required explanation. On June 22, 1989, 1 Regional Executive
Director Rogelio Baggayan of DENR sustained petitioner Layugan's action of confiscation and ordered the
forfeiture of the truck invoking Section 68-A of Presidential Decree No. 705 as amended by Executive Order
No. 277. Private respondents filed a letter of reconsideration dated June 28, 1989 of the June 22, 1989
order of Executive Director Baggayan, which was, however, denied in a subsequent order of July 12, 1989.
2 Subsequently, the case was brought by the petitioners to the Secretary of DENR pursuant to private
respondents' statement in their letter dated June 28, 1989 that in case their letter for reconsideration
would be denied then "this letter should be considered as an appeal to the Secretary." 3 Pending resolution
however of the appeal, a suit for replevin, docketed as Civil Case 4031, was filed by the private
respondents against petitioner Layugan and Executive Director Baggayan 4 with the Regional Trial Court,
Branch 2 of Cagayan, 5 which issued a writ ordering the return of the truck to private respondents. 6
Petitioner Layugan and Executive Director Baggayan filed a motion to dismiss with the trial court
contending, inter alia, that private respondents had no cause of action for their failure to exhaust
administrative remedies. The trial court denied the motion to dismiss in an order dated December 28,
1989. 7 Their motion for reconsideration having been likewise denied, a petition for certiorari was filed by
the petitioners with the respondent Court of Appeals which sustained the trial court's order ruling that the
question involved is purely a legal question. 8 Hence, this present petition, 9 with prayer for temporary
restraining order and/or preliminary injunction, seeking to reverse the decision of the respondent Court of
Appeals was filed by the petitioners on September 9, 1993. By virtue of the Resolution dated September
27, 1993, 10 the prayer for the issuance of temporary restraining order of petitioners was granted by this

104

Court.
Invoking the doctrine of exhaustion of administrative remedies, petitioners aver that the trial court could
not legally entertain the suit for replevin because the truck was under administrative seizure proceedings
pursuant to Section 68-A of P.D. 705, as amended by E.O. 277. Private respondents, on the other hand,
would seek to avoid the operation of this principle asserting that the instant case falls within the exception
of the doctrine upon the justification that (1) due process was violated because they were not given the
chance to be heard, and (2) the seizure and forfeiture was unlawful on the grounds: (a) that the Secretary
of DENR and his representatives have no authority to confiscate and forfeit conveyances utilized in
transporting illegal forest products, and (b) that the truck as admitted by petitioners was not used in the
commission
of
the
crime.
Upon a thorough and delicate scrutiny of the records and relevant jurisprudence on the matter, we are of
the
opinion
that
the
plea
of
petitioners
for
reversal
is
in
order.
This Court in a long line of cases has consistently held that before a party is allowed to seek the
intervention of the court, it is a pre-condition that he should have availed of all the means of
administrative processes afforded him. Hence, if a remedy within the administrative machinery can still be
resorted to by giving the administrative officer concerned every opportunity to decide on a matter that
comes within his jurisdiction then such remedy should be exhausted first before court's judicial power can
be sought, The premature invocation of court's intervention is fatal to one's cause of action. 11
Accordingly, absent any finding of waiver or estoppel the case is susceptible of dismissal for lack of cause
ofaction. 12 This doctrine of exhaustion of administrative remedies was not without its practical and legal
reasons, for one thing, availment of administrative remedy entails lesser expenses and provides for a
speedier disposition of controversies. It is no less true to state that the courts of justice for reasons of
comity and convenience will shy away from a dispute until the system of administrative redress has been
completed and complied with so as to give the administrative agency concerned every opportunity to
correct its error and to dispose of the case. However, we are not amiss to reiterate that the principle of
exhaustion of administrative remedies as tested by a battery of cases is not an ironclad rule. This doctrine
is a relative one and its flexibility is called upon by the peculiarity and uniqueness of the factual and
circumstantial settings of a case. Hence, it is disregarded (1) when there is a violation of due process, 13
(2) when the issue involved is purely a legal question, 14 (3) when the administrative action is patently
illegal amounting to lack or excess of jurisdiction, 15 (4) when there is estoppel on the part of the
administrative agency concerned, 16 (5) when there is irreparable injury, 17 (6) when the respondent is a
department secretary whose acts as an alter ego of the President bears the implied and assumed approval
of the latter, 18 (7) when to require exhaustion of administrative remedies would be unreasonable, 19 (8)
when it would amount to a nullification of a claim, 20 (9) when the subject matter is a private land in land
case proceedings, 21 (10) when the rule does not provide a plain, speedy and adequate remedy, and (11)
when
there
are
circumstances
indicating
the
urgency
of
judicial
intervention.
22
In the case at bar, there is no question that the controversy was pending before the Secretary of DENR
when it was forwarded to him following the denial by the petitioners of the motion for reconsideration of
private respondents through the order of July 12, 1989. In their letter of reconsideration dated June 28,
1989, 23 private respondents clearly recognize the presence of an administrative forum to which they seek
to avail, as they did avail, in the resolution of their case. The letter, reads, thus:

105

xxx

xxx

xxx

If this motion for reconsideration does not merit your favorable action, then this letter should be
considered
as
an
appeal
to
theSecretary.
24
It was easy to perceive then that the private respondents looked up to the Secretary for the review and
disposition of their case. By appealing to him, they acknowledged the existence of an adequate and plain
remedy still available and open to them in the ordinary course of the law. Thus, they cannot now, without
violating the principle of exhaustion of administrative remedies, seek court's intervention by filing an
action for replevin for the grant of their relief during the pendency of an administrative proceedings.
Moreover, it is important to point out that the enforcement of forestry laws, rules and regulations and the
protection, development and management of forest lands fall within the primary and special
responsibilities of the Department of Environment and Natural Resources. By the very nature of its
function, the DENR should be given a free hand unperturbed by judicial intrusion to determine a
controversy which is well within its jurisdiction. The assumption by the trial court, therefore, of the replevin
suit filed by private respondents constitutes an unjustified encroachment into the domain of the
administrative agency's prerogative. The doctrine of primary jurisdiction does not warrant a court to
arrogate unto itself the authority to resolve a controversy the jurisdiction over which is initially lodged with
an administrative body of special competence. 25 In Felipe Ismael, Jr. and Co. vs. Deputy Executive
Secretary, 26 which was reiterated in the recent case of Concerned Officials of MWSS vs. Vasquez, 27 this
Court
held:
Thus, while the administration grapples with the complex and multifarious problems caused by unbriddled
exploitation of these resources, the judiciary will stand clear. A long line of cases establish the basic rule
that the courts will not interfere in matters which are addressed to the sound discretion of government
agencies entrusted with the regulation of activities coming under the special technical knowledge and
training
of
such
agencies.
To sustain the claim of private respondents would in effect bring the instant controversy beyond the pale of
the principle of exhaustion of administrative remedies and fall within the ambit of excepted cases
heretofore stated. However, considering the circumstances prevailing in this case, we can not but rule out
these assertions of private respondents to be without merit. First, they argued that there was violation of
due process because they did not receive the May 23, 1989 order of confiscation of petitioner Layugan.
This contention has no leg to stand on. Due process does not necessarily mean or require a hearing, but
simply an opportunity or right to be heard. 28 One may be heard, not solely by verbal presentation but
also, and perhaps many times more creditably and practicable than oral argument, through pleadings. 29
In administrative proceedings moreover, technical rules of procedure and evidence are not strictly applied;
administrative process cannot be fully equated with due process in its strict judicial sense. 30 Indeed,
deprivation of due process cannot be successfully invoked where a party was given the chance to be heard
on his motion for reconsideration, 31 as in the instant case, when private respondents were undisputedly
given the opportunity to present their side when they filed a letter of reconsideration dated June 28, 1989
which was, however, denied in an order of July 12, 1989 of Executive Director Baggayan, In Navarro III vs.
Damasco,
32
we
ruled
that
:
The essence of due process is simply an opportunity to be heard, or as applied to administrative

106

proceedings, an opportunity to explain one's side or an opportunity to seek a reconsideration of the action
or ruling complained of. A formal or trial type hearing is not at all times and in all instances essential. The
requirements are satisfied when the parties are afforded fair and reasonable opportunity to explain their
side of the controversy at hand. What is frowned upon is the absolute lack of notice or hearing.
Second, private respondents imputed the patent illegality of seizure and forfeiture of the truck because the
administrative officers of the DENR allegedly have no power to perform these acts under the law. They
insisted that only the court is authorized to confiscate and forfeit conveyances used in transporting illegal
forest products as can be gleaned from the second paragraph of Section 68 of P.D. 705, as amended by
E.O.
277.
The
pertinent
provision
reads
as
follows:
Sec.
Xxx

68.

.
xxx

.
xxx

The court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed, as well as the machinery, equipments,
implements and tools illegaly [sic] used in the area where the timber or forest products are found.
A reading, however, of the law persuades us not to go along with private respondents' thinking not only
because the aforequoted provision apparently does not mention nor include "conveyances" that can be the
subject of confiscation by the courts, but to a large extent, due to the fact that private respondents'
interpretation of the subject provision unduly restricts the clear intention of the law and inevitably reduces
the
other
provision
of
Section
68-A,
which
is
quoted
herein
below:
Sec. 68-A. Administrative Authority of the Department or His Duly Authorized Representative To Order
Confiscation. In all cases of violation of this Code or other forest laws, rules and regulations, the
Department Head or his duly authorized representative, may order the confiscation of any forest products
illegally cut, gathered, removed, or possessed or abandoned, and all conveyances used either by land,
water or air in the commission of the offense and to dispose of the same in accordance with pertinent laws,
regulations
and
policies
on
the
matter.
(Emphasis
ours)
It is, thus, clear from the foregoing provision that the Secretary and his duly authorized representatives are
given the authority to confiscate and forfeit any conveyances utilized in violating the Code or other forest
laws, rules and regulations. The phrase "to dispose of the same" is broad enough to cover the act of
forfeiting conveyances in favor of the government. The only limitation is that it should be made "in
accordance with pertinent laws, regulations or policies on the matter." In the construction of statutes, it
must be read in such a way as to give effect to the purpose projected in the statute. 33 Statutes should be
construed in the light of the object to be achieved and the evil or mischief to be suppressed, and they
should be given such construction as will advance the object, suppress the mischief, and secure the
benefits intended. 34 In this wise, the observation of the Solicitor General is significant, thus:
But precisely because of the need to make forestry laws "more responsive to present situations and
realities" and in view of the "urgency to conserve the remaining resources of the country," that the
government opted to add Section 68-A. This amendatory provision is an administrative remedy totally
separate and distinct from criminal proceedings. More than anything else, it is intended to supplant the

107

inadequacies that characterize enforcement of forestry laws through criminal actions. The preamble of EO
277-the
law
that
added
Section
68-A
to
PD
705-is
most
revealing:
"WHEREAS, there is an urgency to conserve the remaining forest resources of the country for the benefit
and
welfare
of
the
present
and
future
generations
of
Filipinos;
WHEREAS, our forest resources may be effectively conserved and protected through the vigilant
enforcement
and
implementation
of
our
forestry
laws,
rules
and
regulations;
WHEREAS, the implementation of our forestry laws suffers from technical difficulties, due to certain
inadequacies in the penal provisions of the Revised Forestry Code of the Philippines; and
WHEREAS, to overcome this difficulties, there is a need to penalize certain acts more responsive to present
situations
and
realities;"
It is interesting to note that Section 68-A is a new provision authorizing the DENR to confiscate, not only
"conveyances," but forest products as well. On the other hand, confiscation of forest products by the
"court" in a criminal action has long been provided for in Section 68. If as private respondents insist, the
power on confiscation cannot be exercised except only through the court under Section 68, then Section
68-A would have no Purpose at all. Simply put, Section 68-A would not have provided any solution to the
problem
perceived
in
EO
277,
supra.
35
Private respondents, likewise, contend that the seizure was illegal because the petitioners themselves
admitted in the Order dated July 12, 1989 of Executive Director Baggayan that the truck of private
respondents was not used in the commission of the crime. This order, a copy of which was given to and
received
by
the
counsel
of
private
respondents,
reads
in
part,
viz.:
. . . while it is true that the truck of your client was not used by her in the commission of the crime, we
uphold your claim that the truck owner is not liable for the crime and in no case could a criminal case be
filed against her as provided under Article 309 and 310 of the Revised Penal Code. . . 36
We observed that private respondents misread the content of the aforestated order and obviously
misinterpreted the intention of petitioners. What is contemplated by the petitioners when they stated that
the truck "was not used in the commission of the crime" is that it was not used in the commission of the
crime of theft, hence, in no case can a criminal action be filed against the owner thereof for violation of
Article 309 and 310 of the Revised Penal Code. Petitioners did not eliminate the possibility that the truck
was being used in the commission of another crime, that is, the breach of Section 68 of P.D. 705 as
amended by E.O. 277. In the same order of July 12, 1989, petitioners pointed out:
. . . However, under Section 68 of P.D. 705 as amended and further amended by Executive Order No. 277
specifically provides for the confiscation of the conveyance used in the transport of forest products not
covered by the required legal documents. She may not have been involved in the cutting and gathering of
the product in question but the fact that she accepted the goods for a fee or fare the same is therefor
liable.
.
.
37
Private respondents, however, contended that there is no crime defined and punishable under Section 68

108

other than qualified theft, so that, when petitioners admitted in the July 12, 1989 order that private
respondents could not be charged for theft as provided for under Articles 309 and 310 of the Revised Penal
Code, then necessarily private respondents could not have committed an act constituting a crime under
Section 68. We disagree. For clarity, the provision of Section 68 of P.D. 705 before its amendment by E.O.
277 and the provision of Section 1 of E.O. No. 277 amending the aforementioned Section 68 are
reproduced
herein,
thus:
Sec. 68. Cutting, gathering and/or collecting timber or other products without license. Any person who
shall cut, gather, collect, or remove timber or other forest products from any forest land, or timber from
alienable and disposable public lands, or from private lands, without any authority under a license
agreement, lease, license or permit, shall be guilty of qualified theft as defined and punished under
Articles 309 and 310 of the Revised Penal Code . . . (Section 68, P.D. 705 before its amendment by E.O.
277)
Sec. 1. Section 68 of Presidential Decree No. 705, as amended, is hereby amended to read as follows:
Sec. 68. Cutting, gathering and/or collecting timber or other forest products without license. Any person
who shall cut, gather, collect, remove timber or other forest products from any forest land, or timber from
alienable or disposable public land, or from private land, without any authority, or possess timber or other
forest products without the legal documents as required under existing forest laws and regulations, shall
be punished with the penalties imposed under Articles 309 and 310 of the Revised Penal Code . . . (Section
1,
E.O.
No.
277
amending
Section
68,
P.D.
705
as
amended)
With the introduction of Executive Order No. 277 amending Section 68 of P.D. 705, the act of cutting,
gathering, collecting, removing, or possessing forest products without authority constitutes a distinct
offense independent now from the crime of theft under Articles 309 and 310 of the Revised Penal Code,
but the penalty to be imposed is that provided for under Article 309 and 310 of the Revised Penal Code.
This is clear from the language of Executive Order No. 277 when it eliminated the phrase "shall be guilty of
qualified theft as defined and punished under Articles 309 and 310 of the Revised Penal Code" and
inserted the words "shall be punished with the penalties imposed under Article 309 and 310 of the Revised
Penal Code". When the statute is clear and explicit, there is hardly room for any extended court
ratiocination
or
rationalization
of
the
law.
38
From the foregoing disquisition, it is clear that a suit for replevin can not be sustained against the
petitioners for the subject truck taken and retained by them for administrative forfeiture proceedings in
pursuant to Section 68-A of the P.D. 705, as amended. Dismissal of the replevin suit for lack of cause of
action in view of the private respondents' failure to exhaust administrative remedies should have been the
proper course of action by the lower court instead of assuming jurisdiction over the case and consequently
issuing the writ ordering the return of the truck. Exhaustion of the remedies in the administrative forum,
being a condition precedent prior to one's recourse to the courts and more importantly, being an element
of private respondents' right of action, is too significant to be waylaid by the lower court.
It is worth stressing at this point, that a suit for replevin is founded solely on the claim that the defendant
wrongfully withholds the property sought to be recovered. It lies to recover possession of personal chattels
that are unlawfully detained. 39 "To detain" is defined as to mean "to hold or keep in custody," 40 and it
has been held that there is tortious taking whenever there is an unlawful meddling with the property, or an

109

exercise or claim of dominion over it, without any pretense of authority or right; this, without manual
seizing of the property is sufficient. 41 Under the Rules of Court, it is indispensable in replevin proceeding
that the plaintiff must show by his own affidavit that he is entitled to the possession of property, that the
property is wrongfully detained by the defendant, alleging the cause of detention, that the same has not
been taken for tax assessment, or seized under execution, or attachment, or if so seized, that it is exempt
from such seizure, and the actual value of the property. 42 Private respondents miserably failed to
convince this Court that a wrongful detention of the subject truck obtains in the instant case. It should be
noted that the truck was seized by the petitioners because it was transporting forest products without the
required permit of the DENR in manifest contravention of Section 68 of P.D. 705 as amended by E.O 277.
Section 68-A of P.D. 705, as amended, unquestionably warrants the confiscation as well as the disposition
by the Secretary of DENR or his duly authorized representatives of the conveyances used in violating the
provision of forestry laws. Evidently, the continued possession or detention of the truck by the petitioners
for administrative forfeiture proceeding is legally permissible, hence, no wrongful detention exists in the
case
at
bar.
Moreover, the suit for replevin is never intended as a procedural tool to question the orders of confiscation
and forfeiture issued by the DENR in pursuance to the authority given under P.D. 705, as amended. Section
8 of the said law is explicit that actions taken by the Director of the Bureau of Forest Development
concerning the enforcement of the provisions of the said law are subject to review by the Secretary of
DENR and that courts may not review the decisions of the Secretary except through a special civil action
for
certiorari
or
prohibition.
It
reads:
Sec. 8. REVIEW All actions and decisions of the Director are subject to review, motu propio or upon appeal
of any person aggrieved thereby, by the Department Head whose decision shall be final and executory
after the lapse of thirty (30) days from the receipt of the aggrieved party of said decision, unless appealed
to the President in accordance with Executive Order No. 19, Series of 1966. The Decision of the
Department Head may not be reviewed by the courts except through a special civil action for certiorari or
prohibition.
WHEREFORE, the Petition is GRANTED; the Decision of the respondent Court of Appeals dated October 16,
1991 and its Resolution dated July 14, 1992 are hereby SET ASIDE AND REVERSED; the Restraining Order
promulgated on September 27, 1993 is hereby made permanent; and the Secretary of DENR is directed to
resolve the controversy with utmost dispatch. SO ORDERED

BASILIO P. MAMANTEO, FLORENTINO B. TRINIDAD, BONIFACIO MANGANIP and EDGAR S.

SALLIDAO, complainants, vs. DEPUTY SHERIFF MANUEL M. MAGUMUN,[1] respondent.
A.M. No. P-98-1264 | 1999-07-28
DECISION

110

BELLOSILLO, J.:
What should the sheriff do when he is informed by the defendant in a replevin that the property to be
seized is in custodia legis and in fact already forfeited in favor of the government by order of another
government agency?
This question assumes importance in light of the charges of grave misconduct filed by complainants Basilio
P. Mamanteo, Provincial Environment and Natural Resources (PENR) Officer; Florentino B. Trinidad,
Community Environment and Natural Resources (CENR) Officer; and Bonifacio Manganip and Edgar S.
Sallidao, both DENR forestry employees stationed in Tabuk, Kalinga, against Deputy Sheriff Manuel M.
Magumun of the Regional Trial Court, Br. 4, Tuguegarao, Cagayan.
On 12 April 1996 forestry employees of the DENR, Cordillera Administrative Region, Tabuk, Kalinga, tasked
with the enforcement of forestry laws, intercepted a San Miguel Corporation van with Plate No. PJC-321
loaded with narra flitches wrapped in nylon sacks and covered with empty beer bottles and cartons.
Confronted by the forestry employees, Villamor Martinez, driver of the van, could not produce any legal
permit authorizing him to transport the narra lumber. Hence, after issuing seizure receipts, the vehicle and
its load of narra flitches were confiscated by the DENR forestry employees.
On 24 May 1996 a criminal complaint against driver Villamor Martinez was filed before the Provincial
Prosecutors Office of Tabuk, Kalinga, for violation of Sec. 78 of P.D. 705[2] as amended, and implemented
by DENR Administrative Order 59.[3] On 24 July 1996, after due notice and opportunity to be heard, an
order of forfeiture of the vehicle and its load was issued by the DENR Regional Office pursuant to its quasijudicial authority to administratively order the confiscation and forfeiture of lumber possessed without
permit including its conveyance.
Thereafter, San Miguel Corporation, the owner of the vehicle, through its agent Aimardo V. Interior, filed a
case for recovery of personal property and damages with application for writ of replevin with the Regional
Trial Court, Br. 4, Tuguegarao, Cagayan, against herein complainants. The trial court issued a warrant of
seizure of personal property directing its sheriff to take hold of the van and its contents.
On 1 August 1996 Deputy Sheriff Manuel M. Magumun, escorted by Sheriff Jacinto Contapay of RTC-Br. 1,
Tabuk, Kalinga, and agents of the Philippine National Police, went to the office of the DENR in Tabuk,
Kalinga, to enforce the warrant issued by the trial court but the forestry employees and officials refused to
release the van on the ground that it had already been forfeited in favor of the government and was now in
custodia legis. Despite this explanation, on 7 August 1996, Deputy Sheriff Magumun accompanied this
time by Sheriff John Dongui-is Jr. of the Office of the Clerk of Court of Tabuk, Kalinga, and twenty (20) other
persons, took the van without permission of the employees and officials of the DENR. On 13 August 1996,
after the lapse of the five-day period prescribed by law for filing an opposition to the writ, the vehicle was
delivered to Aimardo V. Interior, agent of SMC.
In his comment, Deputy Sheriff Magumun explained that it was his ministerial duty to execute the warrant
in accordance with its mandate and his duties as sheriff under the Rules of Court and the Manual for Clerks
of Court.[4] He conceded that he was informed by the forestry employees and officials of the forfeiture of
the vehicle subject of the warrant of seizure but he reasoned that it was not within his discretion to
withhold the implementation of the warrant.[5] The execution of a warrant of seizure on a vehicle allegedly

111

forfeited in favor of the government was a question of law too technical for him to resolve[6] and faced
with such a dilemma he opted to follow the order of the court and execute the warrant in accordance with
its mandate.
On 20 October 1997 the complaint was referred to the Office of the Court Administrator (OCA) for
evaluation, report and recommendation. The OCA observed that Deputy Sheriff Magumun made a very
literal interpretation of Sec. 4, Rule 60, of the Rules of Court as amended.[7] The OCA noted that while Rule
60 was silent on what should be done when the sheriff is informed by the defendant in the replevin that
the personal property to be seized has been forfeited in favor of the government and is already in custodia
legis, Deputy Sheriff Magumun should not have insisted on seizing the property subject of the warrant of
seizure.[8] The appropriate action should have been for respondent to inform his judge of the situation by
way of partial Sheriff's Return and wait for instructions on the proper procedure to be observed.[9] For such
ignorance of proper procedure the OCA recommended that Sheriff Magumun be penalized in the amount of
P5,000.00 at the very least.[10]
We agree. Respondent was placed in a difficult situation where the vehicle subject of the warrant of seizure
had already been confiscated by another government agency and forfeited in favor of the government.
However, the novelty of his predicament did not call for him to use his discretion and justify his insistence
on taking the property subject of the warrant without waiting for instructions from his judge. A sheriff's
prerogative does not give him the liberty to determine who among the parties is entitled to the possession
of the attached property,[11] much less does he have any discretion to decide which agency has primary
jurisdiction and authority over the matter at hand.
When a writ is placed in the hands of a sheriff, it is his duty, in the absence of any instructions to the
contrary, to proceed with reasonable celerity and promptness to execute it according to its mandate.[12]
However, the prompt implementation of a warrant of seizure is called for only in instances where there is
no question regarding the right of the plaintiff to the property. Where the plaintiff has shown by his own
affidavit that he is entitled to the possession of the property; that the property is wrongfully detained by
the defendant; that the same has not been taken for tax assessment or seized under execution or
attachment, or if so seized, that it is exempt from such seizure,[13] then the executing officer has no other
recourse but to execute the warrant or writ expeditiously.
In the instant case, Deputy Sheriff Magumun has been informed that the property had been impounded
due to violation of forestry laws and an order for its forfeiture had already been issued by the DENR.
Moreover, he was advised that the proper remedy for SMC, owner of the vehicle, was to appeal the order
of forfeiture to the Secretary of the DENR.[14] The prudent recourse then for respondent was to desist from
executing the warrant and convey the information to his judge and to the plaintiff. Instead, Deputy Sheriff
Magumun carried out the implementation of the warrant of seizure with undue haste as evidenced by the
mere 6-day lapse from the time he first served the warrant of seizure on the DENR officials to the time of
his precipitate seizure of the van. A warrant could be returned within a period of not less than ten (10)
days nor more than sixty (60) days after its receipt by the executing officer.[15] Within this time frame,
Deputy Sheriff Magumun should have conferred with his judge and thereafter execute the warrant
judiciously and with more certainty.
True, sheriffs must comply with their mandated ministerial duty to implement writs promptly and
expeditiously, but equally true is the principle that sheriffs by the nature of their functions must at all

112

times conduct themselves with propriety and decorum and act above suspicion.[16] There must be no
room for anyone to conjecture that sheriffs and deputy sheriffs as officers of the court have conspired with
any of the parties to a case to obtain a favorable judgment or immediate execution. The sheriff is the front
line representative of the judiciary and by his act he may build or destroy the institution.
As observed by the OCA, the writ of replevin has been repeatedly used by unscrupulous plaintiffs to
retrieve their chattel earlier taken for violation of the Tariff and Customs Code,[17] tax assessment,
attachment or execution. Officers of the court, from the presiding judge to the sheriff, are implored to be
vigilant in their execution of the law otherwise, as in this case, valid seizure and forfeiture proceedings
could easily be undermined by the simple devise of a writ of replevin. Hence, sheriffs and deputy sheriffs,
as agents of the law, are called upon to discharge their duties with due care and utmost diligence because
in serving the court's writs and processes and implementing the orders of the court, they cannot afford to
err without affecting the integrity of their office and the efficient administration of justice.[18]
WHEREFORE, respondent Deputy Sheriff Manuel M. Magumun is found guilty of grave misconduct and, as
recommended, is fined P5,000.00 for arbitrarily implementing the warrant of seizure of personal property
and for ignorance of the proper procedure in serving writs of replevin in cases where the personal property
to be recovered has already been seized and forfeited in favor of the government for violation of forestry
laws. Respondent is warned that a repetition of the same or similar act will merit a more severe sanction.
SO ORDERED.

113

HON. HEHERSON ALVAREZ substituted by HON. ELISEA G. GOZUN, in her capacity as Secretary of the
Department of Environment and Natural Resources, Petitioner
vs.
PICOP RESOURCES, INC., Respondent
G.R. No. 162243 | 2009-12-03
A discussion citing this case is available.
Entries in official records
RESOLUTION

CHICO-NAZARIO, J.:

The cause of action of PICOP Resources, Inc. (PICOP) in its Petition for Mandamus with the trial court is
clear: the government is bound by contract, a 1969 Document signed by then President Ferdinand Marcos,
to enter into an Integrated Forest Management Agreement (IFMA) with PICOP. Since the remedy of
mandamus lies only to compel an officer to perform a ministerial duty, and since the 1969 Document itself
has a proviso requiring compliance with the laws and the Constitution, the issues in this Motion for
Reconsideration are the following: (1) firstly, is the 1969 Document a contract enforceable under the NonImpairment Clause of the Constitution, so as to make the signing of the IFMA a ministerial duty? (2)
secondly, did PICOP comply with all the legal and constitutional requirements for the issuance of an IFMA?

To recall, PICOP filed with the Department of Environment and Natural Resources (DENR) an application to
have its Timber License Agreement (TLA) No. 43 converted into an IFMA. In the middle of the processing of

114

PICOP's application, however, PICOP refused to attend further meetings with the DENR. Instead, on 2
September 2002, PICOP filed before the Regional Trial Court (RTC) of Quezon City a Petition for
Mandamus[1] against then DENR Secretary Heherson T. Alvarez. PICOP seeks the issuance of a privileged
writ of mandamus to compel the DENR Secretary to sign, execute and deliver an IFMA to PICOP, as well as
to -

[I]ssue the corresponding IFMA assignment number on the area covered by the IFMA, formerly TLA No. 43,
as amended; b) to issue the necessary permit allowing petitioner to act and harvest timber from the said
area of TLA No. 43, sufficient to meet the raw material requirements of petitioner's pulp and paper mills in
accordance with the warranty and agreement of July 29, 1969 between the government and PICOP's
predecessor-in-interest; and c) to honor and respect the Government Warranties and contractual
obligations to PICOP strictly in accordance with the warranty and agreement dated July 29, [1969] between
the government and PICOP's predecessor-in-interest. x x x.[2]

On 11 October 2002, the RTC rendered a Decision granting PICOP's Petition for Mandamus, thus:

WHEREFORE,

premises

considered,

the

Petition

for

Mandamus

is

hereby

GRANTED.

The Respondent DENR Secretary Hon. Heherson Alvarez is hereby ordered:

1.

to sign, execute and deliver the IFMA contract and/or documents to PICOP and issue the
corresponding IFMA assignment number on the area covered by the IFMA, formerly TLA No. 43, as
amended;

2.

to issue the necessary permit allowing petitioner to act and harvest timber from the said area of
TLA No. 43, sufficient to meet the raw material requirements of petitioner's pulp and paper mills in
accordance with the warranty and agreement of July 29, 1969 between the government and PICOP's
predecessor-in-interest; and

3.

to honor and respect the Government Warranties and contractual obligations to PICOP strictly in
accordance with the warranty and agreement dated July 29, 1999 (sic) between the government and
PICOP's predecessor-in-interest (Exhibits "H", "H-1" to "H-5", particularly the following:
a) the area coverage of TLA No. 43, which forms part and parcel of the government warranties;
b) PICOP tenure over the said area of TLA No. 43 and exclusive right to cut, collect and remove

115

sawtimber and pulpwood for the period ending on April 26, 1977; and said period to be renewable for
[an]other 25 years subject to compliance with constitutional and statutory requirements as well as with
existing
policy
on
timber
concessions;
and
c) The peaceful and adequate enjoyment by PICOP of the area as described and specified in the
aforesaid amended Timber License Agreement No. 43.

The Respondent Secretary Alvarez is likewise ordered to pay petitioner the sum of P10 million a month
beginning May 2002 until the conversion of TLA No. 43, as amended, to IFMA is formally effected and the
harvesting

from

the

said

area

granted. [3]

is

On 25 October 2002, the DENR Secretary filed a Motion for Reconsideration. [4] In a 10 February 2003 Order,
the RTC denied the DENR Secretary's Motion for Reconsideration and granted PICOP's Motion for the
Issuance of Writ of Mandamus and/or Writ of Mandatory Injunction. [5] The fallo of the 11 October 2002
Decision was practically copied in the 10 February 2003 Order, although there was no mention of the
damages imposed against then DENR Secretary Alvarez. [6] The DENR Secretary filed a Notice of
Appeal[7] from

the

11

October

2002

Decision

and

the

10

February

2003

Order.

On 19 February 2004, the Seventh Division of the Court of Appeals affirmed [8] the Decision of the RTC, to
wit:

WHEREFORE, the appealed Decision is hereby AFFIRMED with modification that the order directing then
DENR Secretary Alvarez "to pay petitioner-appellee the sum of P10 million a month beginning May, 2002
until the conversion to IFMA of TLA No. 43, as amended, is formally effected and the harvesting from the
said area is granted" is hereby deleted.

Challenging

the

deletion

of

the

[9]

damages

awarded

to

it,

PICOP

filed

Motion

for

Partial

Reconsideration[10] of this Decision, which was denied by the Court of Appeals in a 20 July 2004 Resolution.
[11]

The DENR Secretary and PICOP filed with this Court separate Petitions for Review of the 19 February 2004
Court of Appeals Decision. These Petitions were docketed as G.R. No. 162243 and No. 164516, respectively.
These cases were consolidated with G.R. No. 171875, which relates to the lifting of a Writ of Preliminary

116

Injunction

enjoining

the

execution

pending

appeal

of

the

foregoing

Decision.

On 29 November 2006, this Court rendered the assailed Decision on the Consolidated Petitions:

WHEREFORE, the Petition in G.R. No. 162243 is GRANTED. The Decision of the Court of Appeals insofar
as it affirmed the RTC Decision granting the Petition for Mandamus filed by Paper Industries Corp. of the
Philippines (PICOP) is hereby REVERSED and SET ASIDE. The Petition in G.R. No. 164516 seeking the
reversal of the same Decision insofar as it nullified the award of damages in favor of PICOP is DENIED for
lack of merit. The Petition in G.R. No. 171875, assailing the lifting of the Preliminary Mandatory Injunction
in favor of the Secretary of Environment and Natural Resources is DISMISSED on the ground of mootness.
[12]

On 18 January 2006, PICOP filed the instant Motion for Reconsideration, based on the following grounds:

I.

THE HONORABLE COURT ERRED IN HOLDING THAT THE CONTRACT WITH PRESIDENTIAL WARRANTY
SIGNED BY THE PRESIDENT OF THE REPUBLIC ON 29 JUNE 1969 ISSUED TO PICOP IS A MERE PERMIT OR
LICENSE AND IS NOT A CONTRACT, PROPERTY OR PROPERTY RIGHT PROTECTED BY THE DUE PROCESS
CLAUSE OF THE CONSTITUTION

II.

THE EVALUATION OF PICOP'S MANAGEMENT OF THE TLA 43 NATURAL FOREST CLEARLY SHOWED
SATISFACTORY PERFORMANCE FOR KEEPING THE NATURAL FOREST GENERALLY INTACT AFTER 50 YEARS OF
FOREST OPERATIONS. THIS COMPLETES THE REQUIREMENT FOR AUTOMATIC CONVERSION UNDER
SECTION 9 OF DAO 99-53.

117

III.

WITH DUE RESPECT, THE HONORABLE COURT, IN REVERSING THE FINDINGS OF FACTS OF THE TRIAL
COURT AND THE COURT OF APPEALS, MISAPPRECIATED THE EVIDENCE, TESTIMONIAL AND DOCUMENTARY,
WHEN IT RULED THAT:

i.

PICOP FAILED TO SUBMIT A FIVE-YEAR FOREST PROTECTION PLAN AND A SEVEN-YEAR REFORESTATION
PLAN FOR THE YEARS UNDER REVIEW.

ii.

PICOP FAILED TO COMPLY WITH THE PAYMENT OF FOREST CHARGES.

iii.

PICOP DID NOT COMPLY WITH THE REQUIREMENT FOR A CERTIFICATION FROM THE NCIP THAT THE AREA
OF TLA 43 DOES NOT OVERLAP WITH ANY ANCESTRAL DOMAIN.

iv.

PICOP FAILED TO HAVE PRIOR CONSULTATION WITH AND APPROVAL FROM THE SANGUNIAN CONCERNED,
AS REQUIRED BY SECTION 27 OF THE REPUBLIC ACT NO. 7160, OTHERWISE KNOWN AS THE LOCAL
GOVERNMENT CODE OF 1991.

v.

118

PCIOP FAILED TO SECURE SOCIAL ACCEPTABILITY UNDER PRESIDENTIAL DECREE NO. 1586.

IV

THE MOTIVATION OF ALVAREZ IN RECALLING THE CLEARANCE FOR AUTOMATIC CONVERSION HE ISSUED
ON 25 OCTOBER 2001 WAS NOT DUE TO ANY SHORTCOMING FROM PICOP BUT DUE TO HIS
DETERMINATION TO EXCLUDE 28,125 HECTARES FROM THE CONVERSION AND OTHER THINGS.

On 15 December 2008, on Motion by PICOP, the Third Division of this Court resolved to refer the
consolidated cases at bar to the Court en banc. On 16 December 2008, this Court sitting en banc resolved
to accept the said cases and set them for oral arguments. Oral arguments were conducted on 10 February
2009.

PICOP's Cause of Action: Matters PICOP Should Have Proven to Be Entitled to a Writ of
Mandamus

In seeking a writ of mandamus to compel the issuance of an IFMA in its favor, PICOP relied on a 29 July
1969 Document, the so-called Presidential Warranty approved by then President Ferdinand E. Marcos in
favor of PICOP's predecessor-in-interest, Bislig Bay Lumber Company, Inc. (BBLCI). PICOP's cause of action
is summarized in paragraphs 1.6 and 4.19 of its Petition for Mandamus:

1.6 Respondent Secretary impaired the obligation of contract under the said Warranty and Agreement of
29 July 1969 by refusing to respect the tenure; and its renewal for another twenty five (25) years, of PICOP
over the area covered by the said Agreement which consists of permanent forest lands with an aggregate
area of 121,587 hectares and alienable and disposable lands with an aggregate area of approximately
21,580 hectares, and petitioner's exclusive right to cut, collect and remove sawtimber and pulpwood
therein and the peaceful and adequate enjoyment of the said area as described and specified in
petitioner's Timber License Agreement (TLA) No. 43 guaranteed by the Government, under the Warranty
and

119

Agreement

of

29

July

1969.[13]

4.19 Respondent is in violation of the Constitution and has impaired the obligation of contract by his
refusal to respect: a) the tenurial rights of PICOP over the forest area covered by TLA No. 43, as amended
and its renewal for another twenty five (25) years; b) the exclusive right of PICOP to cut, collect and
remove sawtimber and pulpwood therein; and c) PICOP's peaceful and adequate enjoyment of the said
area which the government guaranteed under the Warranty and Agreement of 29 July 1969. [14]

The grounds submitted by PICOP in its Petition for Mandamus are as follows:

Respondent secretary has unlawfully refused and/or neglected to sign and execute the IFMA contract of
PICOP even as the latter has complied with all the legal requirements for the automatic conversion of TLA
No. 43, as amended, into an IFMA.

II

Respondent Secretary acted with grave abuse of discretion and/or in excess of jurisdiction in refusing to
sign and execute PICOP's IFMA contract, notwithstanding that PICOP had complied with all the
requirements for Automatic Conversion under DAO 99-53, as in fact Automatic Conversion was already
cleared in October, 2001, and was a completed process.

III

Respondent Secretary has impaired the obligation of contract under a valid and binding warranty and
agreement of 29 July 1969 between the government and PICOP's predecessor-in-interest, by refusing to
respect: a) the tenure of PICOP, and its renewal for another twenty five (25) years, over the TLA No.43 area
covered by said agreement; b) the exclusive right to cut, collect and remove sawtimber and pulpwood
timber; and c) the peaceful and adequate enjoyment of the said area.

120

IV

As a result of respondent Secretary's unlawful refusal and/or neglect to sign and deliver the IFMA contract,
and violation of the constitutional rights of PICOP against non-impairment of the obligation of contract
(Sec.

10,

Art.

III,

1997

[sic] Constitution),

PICOP suffered

grave

and

irreparable

damages. [15]

Petitions for Mandamus are governed by Rule 65 of the Rules of Court, Section 3 of which provides:

SEC. 3. Petition for mandamus.--When any tribunal, corporation, board, officer or person unlawfully
neglects the performance of an act which the law specifically enjoins as a duty resulting from an
office, trust, or station, or unlawfully excludes another from the use and enjoyment of a right or office to
which such other is entitled, and there is no other plain, speedy and adequate remedy in the ordinary
course of law, the person aggrieved thereby may file a verified petition in the proper court, alleging the
facts with certainty and praying that judgment be rendered commanding the respondent, immediately or
at some other time to be specified by the court, to do the act required to be done to protect the rights of
the petitioner, and to pay the damages sustained by the petitioner by reason of the wrongful acts of the
respondent. (Emphasis supplied.)

PICOP is thus asking this Court to conclude that the DENR Secretary is specifically enjoined by law to issue
an IFMA in its favor. An IFMA, as defined by DENR Administrative Order (DAO) No. 99-53, [16] is -

[A] production-sharing contract entered into by and between the DENR and a qualified applicant wherein
the DENR grants to the latter the exclusive right to develop, manage, protect and utilize a specified area of
forestland and forest resource therein for a period of 25 years and may be renewed for another 25-year
period, consistent with the principle of sustainable development and in accordance with an approved
CDMP, and under which both parties share in its produce.[17]

PICOP stresses the word "automatic" in Section 9 of this DAO No. 99-53:

121

Sec.

9. Qualifications

(a)

of

Applicants.

Filipino

The

citizen

applicants

of

for

IFMA

legal

age;

shall

be:

or,

(b) Partnership, cooperative or corporation whether public or private, duly registered under Philippine laws.

However, in the case of application for conversion of TLA into IFMA, an automatic conversion after proper
evaluation shall be allowed, provided the TLA holder shall have signified such intention prior to the expiry
of the TLA, PROVIDED further, that the TLA holder has showed satisfactory performance and have
complied in the terms of condition of the TLA and pertinent rules and regulations. (Emphasis supplied.) [18]

This administrative regulation provision allowing automatic conversion after proper evaluation can hardly
qualify as a law, much less a law specifically enjoining the execution of a contract. To enjoin is "to order or
direct with urgency; to instruct with authority; to command." [19] "`Enjoin' is a mandatory word, in legal
parlance, always; in common parlance, usually." [20] The word "allow," on the other hand, is not equivalent
to

the

word

"must,"

and

is

in

no

sense

command. [21]

As an extraordinary writ, the remedy of mandamus lies only to compel an officer to perform
a ministerial duty, not a discretionary one; mandamus will not issue to control the exercise of discretion of
a public officer where the law imposes upon him the duty to exercise his judgment in reference to any
manner in which he is required to act, because it is his judgment that is to be exercised and not that of the
court.[22]

The execution of agreements, in itself, involves the exercise of discretion. Agreements are products of
negotiations and mutual concessions, necessitating evaluation of their provisions on the part of both
parties. In the case of the IFMA, the evaluation on the part of the government is specifically mandated in
the afore-quoted Section 3 of DAO No. 99-53. This evaluation necessarily involves the exercise of discretion
and judgment on the part of the DENR Secretary, who is tasked not only to negotiate the sharing of the
profit arising from the IFMA, but also to evaluate the compliance with the requirements on the part of the
applicant.

Furthermore, as shall be discussed later, the period of an IFMA that was merely automatically converted

122

from a TLA in accordance with Section 9, paragraph 2 of DAO No. 99-53 would only be for the remaining
period of the TLA. Since the TLA of PICOP expired on 26 April 2002, the IFMA that could have been granted
to PICOP via the automatic conversion provision in DAO No. 99-53 would have expired on the same date,
26

April

2002,

and

the

PICOP's

Petition

for

Mandamus

would

have

become

moot.

This is where the 1969 Document, the purported Presidential Warranty, comes into play. When PICOP's
application was brought to a standstill upon the evaluation that PICOP had yet to comply with the
requirements for such conversion, PICOP refused to attend further meetings with the DENR and instead
filed a Petition for Mandamus, insisting that the DENR Secretary had impaired the obligation of contract by
his refusal to respect: a) the tenurial rights of PICOP over the forest area covered by TLA No. 43, as
amended, and its renewal for another twenty-five (25) years; b) the exclusive right of PICOP to cut, collect
and remove sawtimber and pulpwood therein; and c) PICOP's peaceful and adequate enjoyment of the said
area which the government guaranteed under the Warranty and Agreement of 29 July 1969.

[23]

PICOP is, thus, insisting that the government is obligated by contract to issue an IFMA in its favor because
of

the

1969

Document.

A contract, being the law between the parties, can indeed, with respect to the State when it is a party to
such contract, qualify as a law specifically enjoining the performance of an act. Hence, it is possible that a
writ of mandamus may be issued to PICOP, but only if it proves both of the following:

1) That the 1969 Document is a contract recognized under the non-impairment clause; and

2) That the 1969 Document specifically enjoins the government to issue the IFMA.

If PICOP fails to prove any of these two matters, the grant of a privileged writ of mandamus is not
warranted. This was why we pronounced in the assailed Decision that the overriding controversy involved
in the Petition was one of law. [24] If PICOP fails to prove any of these two matters, more significantly its
assertion that the 1969 Document is a contract, PICOP fails to prove its cause of action. [25] Not even the
satisfactory compliance with all legal and administrative requirements for an IFMA would save PICOP's
Petition

123

for

Mandamus.

The reverse, however, is not true. The 1969 Document expressly states that the warranty as to the tenure
of PICOP is "subject to compliance with constitutional and statutory requirements as well as with existing
policy on timber concessions." Thus, if PICOP proves the two above-mentioned matters, it still has
to prove compliance with statutory and administrative requirements for the conversion of its
TLA

into

an

IFMA.

Exhaustion of Administrative Remedies

PICOP uses the same argument -- that the government is bound by contract to issue the IFMA -- in its
refusal to exhaust all administrative remedies by not appealing the alleged illegal non-issuance of the IFMA
to the Office of the President. PICOP claimed in its Petition for Mandamus with the trial court that:

1.10 This petition falls as an exception to the exhaustion of administrative remedies. The acts of
respondent DENR Secretary complained of in this petition are patently illegal; in derogation of the
constitutional rights of petitioner against non-impairment of the obligation of contracts;
without jurisdiction, or in excess of jurisdiction or so capriciously as to constitute an abuse of discretion
amounting to excess or lack of jurisdiction; and moreover, the failure or refusal of a high government
official such as a Department head from whom relief is brought to act on the matter was considered
equivalent to exhaustion of administrative remedies (Sanoy v. Tantuico, 50 SCRA 455 [1973]), and there
are compelling and urgent reasons for judicial intervention (Bagatsing v. Ramirez, 74 SCRA 306 [1976]).

Thus, if there has been no impairment of the obligation of contracts in the DENR Secretary's non-issuance
of the IFMA, the proper remedy of PICOP in claiming that it has complied with all statutory and
administrative requirements for the issuance of the IFMA should have been with the Office of the President.
This makes the issue of the enforceability of the 1969 Document as a contract even more significant.

The Nature and Effects of the Purported 29 July 1969 Presidential Warranty

124

Base Metals Case

PICOP challenges our ruling that the 1969 Document is not a contract. Before we review this finding,
however, it must be pointed out that one week after the assailed Decision, another division of this Court
promulgated a Decision concerning the very same 1969 Document. Thus, in PICOP Resources, Inc. v. Base
Metals Mineral Resources Corporation,[26] five other Justices who were still unaware of this Division's
Decision,[27] came up with the same conclusion as regards the same issue of whether former President
Marcos's

Presidential

Warranty

is

contract:

Finally, we do not subscribe to PICOP's argument that the Presidential Warranty dated September 25, 1968
is

contract

protected

by

the

non-impairment

clause

of

the

1987

Constitution.

An examination of the Presidential Warranty at once reveals that it simply reassures PICOP of the
government's commitment to uphold the terms and conditions of its timber license and
guarantees PICOP's peaceful and adequate possession and enjoyment of the areas which are
the basic sources of raw materials for its wood processing complex. The warranty covers only the
right to cut, collect, and remove timber in its concession area, and does not extend to the utilization of
other

resources,

such

as

mineral

resources,

occurring

within

the

concession.

The Presidential Warranty cannot be considered a contract distinct from PTLA No. 47 and FMA
No. 35. We agree with the OSG's position that it is merely a collateral undertaking which
cannot amplify PICOP's rights under its timber license. Our definitive ruling in Oposa v.
Factoran that a timber license is not a contract within the purview of the non-impairment
clause is

edifying.

We

declared:

Needless to say, all licenses may thus be revoked or rescinded by executive action. It is not a contract,
property or a property right protected by the due process clause of the Constitution. In Tan vs. Director of
Forestry, this Court held:

"x x x A timber license is an instrument by which the State regulates the utilization and disposition of
forest resources to the end that public welfare is promoted. A timber license is not a contract within the
purview of the due process clause; it is only a license or a privilege, which can be validly withdrawn
whenever

125

dictated

by

public

interest

or

public

welfare

as

in

this

case.

`A license is merely a permit or privilege to do what otherwise would be unlawful, and is not a contract
between the authority, federal, state, or municipal, granting it and the person to whom it is granted;
neither is it a property or a property right, nor does it create a vested right; nor is it taxation' (C.J. 168).
Thus, this Court held that the granting of license does not create irrevocable rights, neither is it property or
property rights (People vs. Ong Tin, 54 O.G. 7576). x x x"

We reiterated this pronouncement in Felipe Ysmael, Jr. & Co., Inc. vs. Deputy Executive Secretary:

"x x x Timber licenses, permits and license agreements are the principal instruments by which the State
regulates the utilization and disposition of forest resources to the end that public welfare is promoted. And
it can hardly be gainsaid that they merely evidence a privilege granted by the State to qualified entities,
and do not vest in the latter a permanent or irrevocable right to the particular concession area and the
forest products therein. They may be validly amended, modified, replaced or rescinded by the Chief
Executive when national interests so require. Thus, they are not deemed contracts within the purview of
the due process of law clause [See Sections 3(ee) and 20 of Pres. Decree No. 705, as amended. Also, Tan v.
Director of Forestry, G.R. No. L-24548, October 27, 1983, 125 SCRA 302]."

Since

"SEC.

timber

10.

licenses

No

law

are

not

impairing

contracts,

the

the

obligation

non-impairment

of

contracts

clause,

shall

which

be

reads:

passed."

cannot be invoked.

The Presidential Warranty cannot, in any manner, be construed as a contractual undertaking

assuring PICOP of exclusive possession and enjoyment of its concession areas. Such an
interpretation would result in the complete abdication by the State in favor of PICOP of the sovereign
power to control and supervise the exploration, development and utilization of the natural resources in the
area.[28]

The Motion for Reconsideration was denied with finality on 14 February 2007. A Second Motion for

126

Reconsideration

filed

by

PICOP

was

denied

on

23

May

2007.

PICOP insists that the pronouncement in Base Metals is a mere obiter dictum, which would not bind this
Court in resolving this Motion for Reconsideration. In the oral arguments, however, upon questioning from
the ponente himself of Base Metals, it was agreed that the issue of whether the 1969 Document is a
contract was necessary in the resolution of Base Metals:

JUSTICE

TINGA:

And do you confirm that one of the very issues raised by PICOP in that case [ PICOP Resources Inc. v. Base
Metal Mineral Resources Corporation] revolves around its claim that a Presidential Warranty is protected by
the

non-impairment

c[l]ause

of

the

Constitution.

ATTY.

Yes,

AGABIN:

believe

that

statement

was

made

by

the

Court,

your

JUSTICE

Honor.

TINGA:

Yes. And that claim on the part of PICOP necessarily implies that the Presidential Warranty according to
PICOP

is

contract

protected

ATTY.

Yes,

by

the

non-impairment

clause.

AGABIN:

Your

JUSTICE

Honor.

TINGA:

Essentially, the PICOP raised the issue of whether the Presidential Warranty is a contract or not.

ATTY.

Yes,

127

AGABIN:

Your

Honor.

JUSTICE

TINGA:

And therefore any ruling on the part of the Court on that issue could not be an obiter dictum.

ATTY.

AGABIN:

Your Honor, actually we believe that the basic issue in that case was whether or not Base Metals could
conduct mining activities underneath the forest reserve allotted to PICOP and the Honorable Court ruled
that the Mining Act of 1995 as well as the Department Order of DENR does not disallow mining activity
under

forest

reserve.

JUSTICE

TINGA:

But it was PICOP itself which raised the claim that a Presidential Warranty is a contract. And therefore be,
should

be

protected

on

the

under

the

non-impairment

clause

ATTY.

Yes,

JUSTICE

of

the

Constitution.

AGABIN:

Your

Honor.

Except

that...

TINGA:

So, how can you say now that the Court merely uttered, declared, laid down an obiter dictum in saying that
the Presidential Warranty is not a contract, and it is not being a contract, it is not prohibited by the nonimpairment

ATTY.

clause.

AGABIN:

This Honorable Court could have just ruled, held that the mining law allows mining activities under a forest
reserve without deciding on that issue that was raised by PICOP, your Honor, and therefore we believe....

JUSTICE

128

TINGA:

It could have been better if PICOP has not raised that issue and had not claimed that the Presidential
Warranty

is

not

contract.

ATTY.

AGABIN:

Well, that is correct, your Honor except that the Court could have just avoided that question. Because...

JUSTICE

TINGA:

Why[?]

ATTY.

It

AGABIN:

already

settled

the

issue,

the

basic

JUSTICE

issue.

TINGA:

Yes, because the Court in saying that merely reiterated a number of rulings to the effect that the
Presidential Warranty, a Timber License for that matter is not a contract protected by the non-impairment
laws.

ATTY.

AGABIN:

Well, it is our submission, your Honor, that it is obiter because, that issue even a phrase by PICOP was not
really fully argued by the parties for the Honorable Court and it seems from my reading at least it was just
an aside given by the Honorable Court to decide on that issue raised by PICOP but it was not necessary to
the

decision

of

the

JUSTICE

It

ATTY.

129

court.

TINGA:

was

not

necessary[?]

AGABIN:

To

the

decision

of

the

Court.

JUSTICE

TINGA:

It

was.

ATTY.

AGABIN:

It

was

not

necessary.

JUSTICE

TINGA:

It

was.

ATTY.

AGABIN:

Yes.

JUSTICE

TINGA:

And PICOP devoted quite a number of pages in [its] memorandum to that issue and so did the Court [in its
Decision].

ATTY.

AGABIN:

Anyway,

your

Honor,

we

beg

the

Court

to

revisit,

not

to... [29]

Interpretation of the 1969 Document That Would Be in Harmony with the Constitution

To remove any doubts as to the contents of the 1969 Document, the purported Presidential Warranty,
below is a complete text thereof:

130

Republic of the Philippines

Department of Agriculture and Natural Resources
OFFICE OF THE SECRETARY
Diliman, Quezon City

D-53,

Licenses

(T.L.A.

No.

43)

Bislig

Bay

Lumber

Co.,

Inc.

Bay

Lumber

Co.,

Inc.

(Bislig, Surigao)
July 29, 1969

Bislig
[unreadable

word]

Bldg.

Makati,

Rizal

s:

This has reference to the request of the Board of Investments through its Chairman in a letter dated July
16, 1969 for a warranty on the boundaries of your concession area under Timber License Agreement No.
43,

as

amended.

We are made to understand that your company is committed to support the first large scale integrated
wood processing complex hereinafter called: "The Project") and that such support will be provided not only
in the form of the supply of pulpwood and other wood materials from your concession but also by making
available funds generated out of your own operations, to supplement PICOP's operational sources of funds
and other financial arrangements made by him. In order that your company may provide such support
effectively, it is understood that you will call upon your stockholders to take such steps as may be
necessary to effect a unification of managerial, technical, economic and manpower resources between
your

company

and

PICOP.

It is in the public interest to promote industries that will enhance the proper conservation of our forest
resources as well as insure the maximum utilization thereof to the benefit of the national economy. The

131

administration feels that the PICOP project is one such industry which should enjoy priority over the usual
logging operations hitherto practiced by ordinary timber licensees: For this reason, we are pleased to
consider

favorably

the

request.

We confirm that your Timber License Agreement No. 43, as amended (copy of which is attached as Annex
"A" hereof which shall form part and parcel of this warranty) definitely establishes the boundary lines of
your concession area which consists of permanent forest lands with an aggregate area of 121,587 hectares
and alienable or disposable lands with an aggregate area of approximately 21,580 hectares.

We further confirm that your tenure over the area and exclusive right to cut, collect and remove sawtimber
and pulpwood shall be for the period ending on April 26, 1977; said period to be renewable for other 25
years subject to compliance with constitutional and statutory requirements as well as with existing policy
on

timber

concessions.

The peaceful and adequate enjoyment by you of your area as described and specified in your aforesaid
amended Timber License Agreement No. 43 is hereby warranted provided that pertinent laws, regulations
and the terms and conditions of your license agreement are observed.

Very

(Sgd.)
Secretary

truly

FERNANDO
of

yours,

LOPEZ
Agriculture

and Natural Resources

Encl.:

RECOMMENDED BY:
(Sgd.)
Acting Director of Forestry

APPROVED:

132

JOSE

VIADO

(Sgd.)

FERDINAND

E.

MARCOS

President of the Philippines

ACCEPTED:

BISLIG

BAY

LBR.

CO.,

INC.

By:
(Sgd.)

JOSE

E.

SORIANO

President

PICOP interprets this document in the following manner:

6.1 It is clear that the thrust of the government warranty is to establish a particular area defined by
boundary lines of TLA No. 43 for the PICOP Project. In consideration for PICOP's commitment to pursue and
establish the project requiring huge investment/funding from stockholders and lending institutions, the
government provided a warranty that ensures the continued and exclusive right of PICOP to source its raw
materials

needs

from

the

forest

and

renewable

trees

within

the

areas

established.

6.2 As a long-term support, the warranty covers the initial twenty five (25) year period and is renewable
for periods of twenty five (25) years provided the project continues to exist and operate. Very
notably, the wording of the Presidential Warranty connotes that for as long as the holder complies with all
the legal requirements, the term of the warranty is not limited to fifty (50) years but other
twenty

five

(25)

years.

6.3 Note must be made that the government warranted that PICOP's tenure over the area and exclusive
right to cut, collect and remove saw timber and pulpwood shall be for the period ending on 26 April 1977
and said period to be renewable for other 25 years subject to "compliance with constitutional and statutory
requirements as well as existing policy on timber requirements". It is clear that the renewal for other 25
years, not necessarily for another 25 years is guaranteed. This explains why on 07 October 1977, TLA No.
43, as amended, was automatically renewed for another period of twenty five (25) years to expire on 26
April 2002.[30]

133

PICOP's interpretation of the 1969 Document cannot be sustained. PICOP's claim that the term of the
warranty is not limited to fifty years, but that it extends to other fifty years, perpetually, violates Section 2,
Article XII of the Constitution which provides:

Section 2. All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all
forces of potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural
resources are owned by the State. With the exception of agricultural lands, all other natural
resources shall not be alienated. The exploration, development, and utilization of natural
resources shall be under the full control and supervision of the State. The State may directly
undertake such activities, or it may enter into co-production, joint venture, or productionsharing agreements with Filipino citizens, or corporations or associations at least sixty per
centum of whose capital is owned by such citizens. Such agreements may be for a period not
exceeding twenty-five years, renewable for not more than twenty-five years, and under such
terms and conditions as may be provided by law. In cases of water rights for irrigation, water supply
fisheries, or industrial uses other than the development of water power, beneficial use may be the
measure and limit of the grant.

Mr. Justice Dante O. Tinga's interpretation of the 1969 Document is much more in accord with the laws and
the Constitution. What one cannot do directly, he cannot do indirectly. Forest lands cannot be alienated in
favor of private entities. Granting to private entities, via a contract, a permanent, irrevocable, and
exclusive possession of and right over forest lands is tantamount to granting ownership thereof. PICOP, it
should be noted, claims nothing less than having exclusive, continuous and uninterrupted possession of its
concession areas,[31] where all other entrants are illegal, [32] and where so-called "illegal settlers and
squatters"

apprehended.[33]

are

IFMAs are production-sharing agreements concerning the development and utilization of natural resources.
As such, these agreements "may be for a period not exceeding twenty-five years, renewable for not more
than twenty-five years, and under such terms and conditions as may be provided by law." Any superior
"contract" requiring the State to issue TLAs and IFMAs whenever they expire clearly circumvents Section 2,
Article XII of the Constitution, which provides for the only permissible schemes wherein the full control and
supervision of the State are not derogated: co-production, joint venture, or production-sharing agreements
within

134

the

time

limit

of

twenty-five

years,

renewable

for

another

twenty-five

years.

On its face, the 1969 Document was meant to expire on 26 April 2002, upon the expiration of the expected
extension of the original TLA period ending on 26 April 1977:

We further confirm that your tenure over the area and exclusive right to cut, collect and remove sawtimber
and pulpwood shall be for the period ending on April 26, 1977; said period to be renewable for other 25
years subject to compliance with constitutional and statutory requirements as well as with existing policy
on timber concessions.

Any interpretation extending the application of the 1969 Document beyond 26 April 2002 and any
concession that may be granted to PICOP beyond the said date would violate the Constitution, and no
amount of legal hermeneutics can change that. Attempts of PICOP to explain its way out of this
Constitutional provision only led to absurdities, as exemplified in the following excerpt from the oral
arguments:

JUSTICE

CARPIO:

The maximum trend of agreement to develop and utilize natural resources like forest products is 25 years
plus

another

25

years

or

total

of

50

years

ATTY.

AGABIN

Yes,

Your

Honor.

JUSTICE

That

CARPIO:

is

true

for

the

1987,

ATTY.

Yes,

135

correct?

1973,

1935

Constitution,

correct?

AGABIN:

Your

Honor.

JUSTICE

The

CARPIO:

TLA

here,

TLA

43,

expired,

the

first

25

years

expired

in

1977,

ATTY.

AGABIN:

Yes,

Your

Honor.

JUSTICE

And

correct?

CARPIO:

it

was

renewed

for

another

25

years

until

2002,

the

ATTY.

50 th year?

AGABIN:

Yes,

Your

Honor.

JUSTICE

CARPIO:

Now, could PICOP before the end of the 50 th year let's say in 2001, one year before the expiration, could it
have

asked

for

an

extension

of

another

25

years

of

ATTY.

JUSTICE

its

TLA

agreement[?]

AGABIN:

believe

so,

Your

Honor.

CARPIO:

But the Constitution says, maximum of fifty years. How could you ask for another 25 years of its TLA.

ATTY.

AGABIN:

Well, your Honor, we believe on a question like this, this Honorable Court should balance the interest.

JUSTICE

136

CARPIO:

The Constitution is very clear, you have only a maximum of 50 years, 25 plus another 25. PICOP could
never have applied for an extension, for a third 25-year term whether under the 1935 Constitution, the
1973

Constitution

and

the

1987

Constitution,

correct?

ATTY.

Your

AGABIN:

Honor,

except

that

we

are

invoking

the

warranty,

the

terms

of

the

warranty....

JUSTICE

CARPIO:

Can

the

warranty

prevail

over

the

Constitution?

ATTY.

AGABIN:

Well,

it

is

vested

right,

your

Honor.

JUSTICE

Yes,

CARPIO:

but

whatever

it

is,

can

it

prevail

over

the

Constitution?

ATTY.

The

AGABIN:

Constitution

itself

provides

that

vested

rights

should

be

JUSTICE

....

CARPIO:

If it is not in violation of specific provision of the Constitution. The Constitution says, 25 years plus another
25 years, that's the end of it. You mean to say that a President of the Philippines can give somebody 1,000
years

license?

ATTY.

AGABIN:

Well,

137

that

is

not

our

position,

Your

Honor.

Because

our

position

is

that

....

JUSTICE

CARPIO:

My question is, what is the maximum term, you said 50 years. So, my next question is, can PICOP apply for
an

extension

of

another

25

years

after

2002,

50 th year?

the

ATTY.

Yes,

AGABIN:

based

on

the

contract

of

warranty,

Your

Honor,

because

the

contract

of

JUSTICE

warranty....

CARPIO:

But in the PICOP license it is very clear, it says here, provision 28, it says the license agreement is for a
total of 50 years. I mean it is very simple, the President or even Congress cannot pass a law extending the
license, whatever kind of license to utilize natural resources for more than fifty year[s]. I mean even the
law

cannot

do

that.

It

cannot

prevail

over

the

Constitution.

Is

that

correct,

ATTY.

Counsel?

AGABIN:

It is correct, Your Honor, except that in this case, what is actually our application is that the law provides
for

the

conversion

of

existing

TLA

into

JUSTICE

So,

they

CARPIO:

file

the

petition

for

conversion

before

ATTY.

Yes,

JUSTICE

IFMA.

the

end

of

the

50 th year

for

IFMA.

AGABIN:

Your

Honor.

CARPIO:

But IFMA is the same, it is based on Section 2, Article 12 of the Constitution, develop and utilize natural
resources because as you said when the new constitution took effect we did away with the old licensing

138

regime, we have now co-production, a production sharing, joint venture, direct undertaking but still the
same developing and utilizing the natural resources, still comes from section 2, Art. 12 of the Constitution.
It

is

still

license

but

different

format

ATTY.

now.

AGABIN:

It is correct, Your Honor, except that the regimes of joint venture, co-production and production sharing are
what

is

referred

to

in

the

constitution,

Your

Honor,

JUSTICE

and

still

covered...

CARPIO:

Yes, but it is covered by same 25 year[s], you mean to say people now can circumvent the 50 year
maximum term by calling their TLA as IFMA and after fifty years calling it ISMA, after another 50 years call
it

MAMA.

ATTY.

AGABIN:

Yes,

Your

Honor.

Because...

JUSTICE

CARPIO:

It

can

be

ATTY.

done.

AGABIN:

That is provided for by the department itself.[34]

PICOP is, in effect, arguing that the DENR issued DAO No. 99-53 in order to provide a way to circumvent
the provisions of the Constitution limiting agreements for the utilization of natural resources to a maximum
period of fifty years. Official duties are, however, disputably considered to be regularly performed, [35] and
good

faith

is

always

presumed.

DAO No. 99-53 was issued to change the means by which the government enters into an agreement with
private entities for the utilization of forest products. DAO No. 99-53 is a late response to the change in the

139

constitutional provisions on natural resources from the 1973 Constitution, which allowed the granting of
licenses to private entities,[36] to the present Constitution, which provides for co-production, joint venture,
or production-sharing agreements as the permissible schemes wherein private entities may participate in
the utilization of forest products. Since the granting of timber licenses ceased to be a permissible scheme
for the participation of private entities under the present Constitution, their operations should have ceased
upon the issuance of DAO No. 99-53, the rule regulating the schemes under the present Constitution. This
would be iniquitous to those with existing TLAs that would not have expired yet as of the issuance of DAO
No. 99-53, especially those with new TLAs that were originally set to expire after 10 or even 20 or more
years. The DENR thus inserted a provision in DAO No. 99-53 allowing these TLA holders to finish the period
of their TLAs, but this time as IFMAs, without the rigors of going through a new application, which they
have

probably

just

gone

through

few

years

ago.

Such an interpretation would not only make DAO No. 99-53 consistent with the provisions of the
Constitution, but would also prevent possible discrimination against new IFMA applicants:
ASSOCIATE

JUSTICE

DE

CASTRO:

I ask this question because of your interpretation that the period of the IFMA, if your TLA is converted into
IFMA, would cover a new a fresh period of twenty-five years renewable by another period of twenty-five
years.

DEAN

AGABIN:

Yes,

Your

ASSOCIATE

Honor.

JUSTICE

DE

CASTRO:

Don't you think that will, in effect, be invidious discrimination with respect to other applicants if you are
granted

DEAN

fresh

period

of

twenty-five

years

extendible

to

another

twenty-five

years?

AGABIN:

I don't think it would be, Your Honor, considering that the IFMA is different regime from the TLA. And not
only that, there are considerations of public health and ecology which should come into play in this case,
and which we had explained in our opening statement and, therefore the provision of the Constitution on

140

the twenty-five limits for renewal of co-production, joint venture and production sharing agreements,
should be balanced with other values stated in the Constitution, like the value of balanced ecology, which
should be in harmony with the rhythm of nature, or the policy of forest preservation in Article XII, Section
14 of the Constitution. These are all important policy considerations which should be balanced against the
term

limits

in

ASSOCIATE

Article

II

of

JUSTICE

the

Constitution.

DE

CASTRO:

The provision of this Administrative Order regarding automatic conversion may be reasonable, if, I want to
know if you agree with me, if we limit this automatic conversion to the remaining period of the TLA,
because in that case there will be a valid ground to make a distinction between those with existing TLA
and

those

who

are

applying

for

the

first

DEAN

time

for

IFMA?

AGABIN:

Well, Your Honor, we beg to disagree, because as I said TLA's are completely different from IFMA. The TLA
has no production sharing or co-production agreement or condition. All that the licensee has to do is, to
pay forest charges, taxes and other impositions from the local and national government. On the other
hand, the IFMAs contained terms and conditions which are completely different, and that they either
impose co-production, production sharing or joint venture terms. So it's a completely different regime, Your
Honor.

ASSOCIATE

JUSTICE

DE

CASTRO:

Precisely, that is the reason why there should be an evaluation of what you mentioned earlier of the
development

plan.

DEAN

AGABIN:

Yes,

ASSOCIATE

Your

JUSTICE

Honor.

DE

CASTRO:

So it will be reasonable to convert a TLA into an IFMA without considering the development plan submitted

141

by other applicants or the development plan itself of one seeking conversion into IFMA if it will only be
limited to the period, the original period of the TLA. But once you go beyond the period of the TLA, then
you will be, the DENR is I think should evaluate the different proposals of the applicants if we are thinking
of a fresh period of twenty-five years, and which is renewable under the Constitution by another twentyfive years. So the development plan will be important in this case, the submission of the development plan
of the different applicants must be considered. So I don't understand why you mentioned earlier that the
development plan will later on be a subject matter of negotiation between the IFMA grantee and the
government. So it seems that it will be too late in the day to discuss that if you have already converted the
TLA into IFMA or if the government has already granted the IFMA, and then it will later on study the
development plan, whether it is viable or not, or it is sustainable or not, and whether the development plan
of the different applicants are, are, which of the development plan of the different applicants is better or
more advantageous to the government.[37]

PICOP insists that the alleged Presidential Warranty, having been signed on 29 July 1969, could not have
possibly considered the limitations yet to be imposed by future issuances, such as the 1987 Constitution.
However, Section 3, Article XVIII of said Constitution, provides:

Section 3. All existing laws, decrees, executive orders, proclamations, letters of instructions, and other
executive issuances not inconsistent with this Constitution shall remain operative until amended, repealed,
or revoked.

In the recent case Sabio v. Gordon,[38] we ruled that "(t)he clear import of this provision is that all existing
laws, executive orders, proclamations, letters of instructions and other executive issuances inconsistent or
repugnant

to

the

Constitution

are

repealed."

When a provision is susceptible of two interpretations, "the one that will render them operative and
effective and harmonious with other provisions of law" [39] should be adopted. As the interpretations in the
assailed Decision and in Mr. Justice Tinga's ponencia are the ones that would not make the subject
Presidential Warranty unconstitutional, these are what we shall adopt.

142

Purpose of the 1969 Document: Assurance That the Boundaries of Its Concession Area Would
Not Be Altered Despite the Provision in the TLA that the DENR Secretary Can Amend Said
Boundaries

In the assailed Decision, we ruled that the 1969 Document cannot be considered a contract that would
bind the government regardless of changes in policy and the demands of public interest and social welfare.
PICOP claims this conclusion "did not take into consideration that PICOP already had a valid and current
TLA before the contract with warranty was signed in 1969." [40] PICOP goes on: "The TLA is a license that
equips any TLA holder in the country for harvesting of timber. A TLA is signed by the Secretary of the DANR
now DENR. The Court ignored the significance of the need for another contract with the Secretary of the
DANR but this time with the approval of the President of the Republic." [41] PICOP then asks us: "If
PICOP/BBLCI was only an ordinary TLA holder, why will it go through the extra step of securing another
contract just to harvest timber when the same can be served by the TLA signed only by the Secretary and
not

requiring

the

approval

of

the

President

of

the

Republic(?)" [42]

The answer to this query is found in TLA No. 43 itself wherein, immediately after the boundary lines of TLA
No. 43 were established, the following conditions were given:

This license is granted to the said party of the second part upon the following express conditions:

I. That authority is granted hereunder to the party of the second part[43] to cut, collect or remove firewood
or other minor forest products from the area embraced in this license agreement except as hereinafter
provided.

II. That the party of the first part[44] may amend or alter the description of the boundaries of the
area covered by this license agreement to conform with official surveys and that the decision of
the party of the first part as to the exact location of the said boundaries shall be final.

III. That if the party of the first part deems it necessary to establish on the ground the boundary lines of the
area granted under this license agreement, the party of the second part shall furnish to the party of the
first part or its representatives as many laborers as it needs and all the expenses to be incurred on the
work including the wages of such laborers shall be paid by the party of the second part. [45]

143

Thus, BBLCI needed an assurance that the boundaries of its concession area, as established in
TLA No. 43, as amended, would not be altered despite this provision. Hence, BBLCI endeavored to
obtain the 1969 Document, which provides:

We confirm that your Timber License Agreement No. 43, as amended (copy of which is attached as Annex
"A" hereof which shall form part and parcel of this warranty) definitely establishes the boundary lines
of your concession area which consists of permanent forest lands with an aggregate area of 121,587
hectares and alienable or disposable lands with an aggregate area of approximately 21,580 hectares.

We further confirm that your tenure over the area and exclusive right to cut, collect and remove
sawtimber and pulpwood shall be for the period ending on April 26, 1977; said period to be renewable
for other 25 years subject to compliance with constitutional and statutory requirements as well as with
existing

policy

on

timber

concessions.

The peaceful and adequate enjoyment by you of your area as described and specified in your
aforesaid amended Timber License Agreement No. 43 is hereby warranted provided that
pertinent laws, regulations and the terms and conditions of your license agreement are observed. [46]

In Koa v. Court of Appeals,[47] we ruled that a warranty is a collateral undertaking and is merely part of a
contract. As a collateral undertaking, it follows the principal wherever it goes. When this was pointed out
by the Solicitor General, PICOP changed its designation of the 1969 Document from "Presidential Warranty"
or "government warranty" in all its pleadings prior to our Decision, to "contract with warranty" in its Motion
for Reconsideration. This, however, is belied by the statements in the 29 July 1969 Document, which refers
to

itself

as

"this

warranty."

Re: Allegation That There Were Mutual Contract Considerations

Had the 29 July 1969 Document been intended as a contract, it could have easily said so. More
importantly, it could have clearly defined the mutual considerations of the parties thereto. It could have

144

also easily provided for the sanctions for the breach of the mutual considerations specified therein. PICOP
had vigorously argued that the 1969 Document was a contract because of these mutual considerations,
apparently referring to the following paragraph of the 1969 Document:

We are made to understand that your company is committed to support the first large scale integrated
wood processing complex hereinafter called: "The Project") and that such support will be provided not only
in the form of the supply of pulpwood and other wood materials from your concession but also by making
available funds generated out of your own operations, to supplement PICOP's operational surces (sic) of
funds and other financial arrangements made by him. In order that your company may provide such
support effectively, it is understood that you will call upon your stockholders to take such steps as may be
necessary to effect a unification of managerial, technical, economic and manpower resources between
your company and PICOP.

This provision hardly evinces a contract consideration (which, in PICOP's interpretation, is in exchange for
theexclusive and perpetual tenure over 121,587 hectares of forest land and 21,580 hectares of alienable
and disposable lands). As elucidated by PICOP itself in bringing up the Investment Incentives Act which we
shall discuss later, and as shown by the tenor of the 1969 Document, the latter document was more of a
conferment of an incentive for BBLCI's investment rather than a contract creating mutual obligations on
the part of the government, on one hand, and BBLCI, on the other. There was no stipulation providing for
sanctions for breach if BBLCI's being "committed to support the first large scale integrated wood
processing complex" remains a commitment. Neither did the 1969 Document give BBLCI a period within
which

to

pursue

this

commitment.

According to Article 1350 of the Civil Code, "(i)n onerous contracts the cause is understood to be, for each
contracting party, the prestation or promise of a thing or service by the other." [48] Private investments for
one's businesses, while indeed eventually beneficial to the country and deserving to be given incentives,
are still principally and predominantly for the benefit of the investors. Thus, the "mutual" contract
considerations by both parties to this alleged contract would be both for the benefit of one of the parties
thereto, BBLCI, which is not obligated by the 1969 Document to surrender a share in its proceeds any more
than

it

is

already

required

by

its

TLA

and

by

the

tax

laws.

PICOP's argument that its investments can be considered as contract consideration derogates the rule that
"a license or a permit is not a contract between the sovereignty and the licensee or permittee, and is not a

145

property in the constitutional sense, as to which the constitutional proscription against the impairment of
contracts may extend." All licensees obviously put up investments, whether they are as small as a tricycle
unit or as big as those put up by multi-billion-peso corporations. To construe these investments as contract
considerations would be to abandon the foregoing rule, which would mean that the State would be bound
to all licensees, and lose its power to revoke or amend these licenses when public interest so dictates.

The power to issue licenses springs from the State's police power, known as "the most essential, insistent
and least limitable of powers, extending as it does to all the great public needs." [49] Businesses affecting
the public interest, such as the operation of public utilities and those involving the exploitation of natural
resources, are mandated by law to acquire licenses. This is so in order that the State can regulate their
operations and thereby protect the public interest. Thus, while these licenses come in the form of
"agreements," e.g., "Timber License Agreements," they cannot be considered contracts under the nonclause.[50]

impairment

PICOP found this argument "lame," arguing, thus:

43. It is respectfully submitted that the aforesaid pronouncement in the Decision is an egregious and
monumental

error.

44. The Decision could not dismiss as "preposterous" the mutual covenants in the Presidential Warranty
which calls for a huge investment of Php500 million at that time in 1969 out of which Php268,440,000
raised from domestic foreign lending institution to establish the first large scale integrated wood
processing

complex

in

the

Philippines.

45. The Decision puts up a lame explanation that "all licensees put up investments in pursuing their
business"

46. Now there are about a hundred timber licenses issued by the Government thru the DENR, but these are
ordinary timber licenses which involve the mere cutting of timber in the concession area, and nothing else.
Records in the DENR shows that no timber licensee has put up an integrated large wood processing
complex in the Philippines except PICOP.[51]

PICOP thus argues on the basis of quantity, and wants us to distinguish between the investment of the

146

tricycle driver and that of the multi-billion corporation. However, not even billions of pesos in investment
can change the fact that natural resources and, therefore, public interest are involved in PICOP's venture,
consequently necessitating the full control and supervision by the State as mandated by the Constitution.
Not even billions of pesos in investment can buy forest lands, which is practically what PICOP is asking for
by interpreting the 1969 Document as a contract giving it perpetual and exclusive possession over such
lands. Among all TLA holders in the Philippines, PICOP has, by far, the largest concession area at 143,167
hectares, a land area more than the size of two Metro Manilas. [52] How can it not expect to also have the
largest investment?

Investment Incentives Act

PICOP then claims that the contractual nature of the 1969 Document was brought about by its issuance in
accordance with and pursuant to the Investment Incentives Act. According to PICOP:

The conclusion in the Decision that to construe PICOP's investments as a consideration in a contract would
be to stealthily render ineffective the principle that a license is not a contract between the sovereignty and
the licensee is so flawed since the contract with the warranty dated 29 July 1969 was issued by the
Government in accordance with and pursuant to Republic Act No. 5186, otherwise known as "The
Investment Incentives Act."[53]

PICOP then proceeds to cite Sections 2 and 4(d) and (e) of said act:

Section 2. Declaration of Policy - To accelerate the sound development of the national economy in
consonance with the principles and objectives of economic nationalism, and in pursuance of a planned,
economically feasible and practicable dispersal of industries, under conditions which will encourage
competition and discharge monopolies, it is hereby declared to be the policy of the state to encourage
Filipino and foreign investments, as hereinafter set out, in projects to develop agricultural, mining and
manufacturing industries which increase national income most at the least cost, increase exports, bring
about greater economic stability, provide more opportunities for employment, raise the standards of living

147

of the people, and provide for an equitable distribution of wealth. It is further declared to be the policy of
the state to welcome and encourage foreign capital to establish pioneer enterprises that are capital
intensive and would utilize a substantial amount of domestic raw materials, in joint venture with
substantial

Filipino

capital,

whenever

available.

Section 4. Basic Rights and Guarantees. - All investors and enterprises are entitled to the basic rights and
guarantees provided in the constitution. Among other rights recognized by the Government of the
Philippines

are

the

following:

d) Freedom from Expropriation. - There shall be no expropriation by the government of the property
represented by investments or of the property of enterprises except for public use or in the interest of
national

welfare

and

defense

and

upon

payment

of

just

compensation.

x.

e) Requisition of Investment. - There shall be no requisition of the property represented by the investment
or of the property of enterprises, except in the event of war or national emergency and only for the
duration thereof. Just compensation shall be determined and paid either at the time of requisition or
immediately after cessation of the state of war or national emergency. Payments received as compensation
for the requisitioned property may be remitted in the currency in which the investment was originally
made and at the exchange rate prevailing at the time of remittance, subject to the provisions of Section
seventy-four of republic Act Numbered Two hundred sixty-five.

Section 2 speaks of the policy of the State to encourage Filipino and foreign investments. It does not speak
of how this policy can be implemented. Implementation of this policy is tackled in Sections 5 to 12 of the
same law,[54] which PICOP failed to mention, and for a good reason. None of the 24 incentives enumerated
therein relates to, or even remotely suggests that, PICOP's proposition that the 1969 Document is a
contract.

PICOP could indeed argue that the enumeration is not exclusive. Certainly, granting incentives to investors,
whether included in the enumeration or not, would be an implementation of this policy. However, it is
presumed that whatever incentives may be given to investors should be within the bounds of the laws and
the Constitution. The declaration of policy in Section 2 cannot, by any stretch of the imagination, be read
to provide an exception to either the laws or, heaven forbid, the Constitution. Exceptions are never

148

presumed and should be convincingly proven. Section 2 of the Investment Incentives Act cannot be read
as exempting investors from the Constitutional provisions (1) prohibiting private ownership of forest lands;
(2) providing for the complete control and supervision by the State of exploitation activities; or (3) limiting
exploitation

agreements

to

twenty-five

years,

renewable

for

another

twenty-five

years.

Section 4(d) and (e), on the other hand, is a recognition of rights already guaranteed under the
Constitution. Freedom from expropriation is granted under Section 9 of Article III [55] of the Constitution,
while

the

provision

on

requisition

is

negative

restatement

of

Section

6,

Article

XII. [56]

Refusal to grant perpetual and exclusive possession to PICOP of its concession area would not result in the
expropriation or requisition of PICOP's property, as these forest lands belong to the State, and not to PICOP.
This is not changed by PICOP's allegation that:

Since it takes 35 years before the company can go back and harvest their residuals in a logged-over area,
it must be assured of tenure in order to provide an inducement for the company to manage and preserve
the residuals during their growth period. This is a commitment of resources over a span of 35 years for
each plot for each cycle. No company will undertake the responsibility and cost involved
in policing, preserving and managing residual forest areas until it were sure that it had firm
title to the timber.[57]

The requirement for logging companies to preserve and maintain forest areas, including the reforestation
thereof, is one of the prices a logging company must pay for the exploitation thereof. Forest lands are
meant to be enjoyed by countless future generations of Filipinos, and not just by one logging company. The
requirements of reforestation and preservation of the concession areas are meant to protect them, the
future generations, and not PICOP.Reforestation and preservation of the concession areas are not
required of logging companies so that they would have something to cut again, but so that the
forest would remain intact after their operations.That PICOP would not accept the responsibility to
preserve its concession area if it is not assured of tenure thereto does not speak well of its corporate
policies.

149

Conclusion

In sum, PICOP was not able to prove either of the two things it needed to prove to be entitled to a Writ of
Mandamus against the DENR Secretary. The 1969 Document is not a contract recognized under the nonimpairment clause and, even if we assume for the sake of argument that it is, it did not enjoin the
government to issue an IFMA in 2002 either. These are the essential elements in PICOP's cause of action,
and the failure to prove the same warrants a dismissal of PICOP's Petition for Mandamus, as not even
PICOP's compliance with all the administrative and statutory requirements can save its Petition now.

Whether PICOP Has Complied with the Statutory and Administrative Requirements for the
Conversion of the TLA to an IFMA

In the assailed Decision, our ruling was based on two distinct grounds, each one being sufficient in itself for
us to rule that PICOP was not entitled to a Writ of Mandamus: (1) the 1969 Document, on which PICOP
hinges its right to compel the issuance of an IFMA, is not a contract; and (2) PICOP has not complied with
all

administrative

and

statutory

requirements

for

the

issuance

of

an

IFMA.

When a court bases its decision on two or more grounds, each is as authoritative as the other and neither
is obiter dictum.[58] Thus, both grounds on which we based our ruling in the assailed Decision would
become judicial dictum, and would affect the rights and interests of the parties to this case unless
corrected in this Resolution on PICOP's Motion for Reconsideration. Therefore, although PICOP would not be
entitled to a Writ of Mandamus even if the second issue is resolved in its favor, we should nonetheless
resolve the same and determine whether PICOP has indeed complied with all administrative and statutory
requirements

for

the

issuance

of

an

IFMA.

While the first issue (on the nature of the 1969 Document) is entirely legal, this second issue (on PICOP's
compliance with administrative and statutory requirements for the issuance of an IFMA) has both legal and
factual sub-issues. Legal sub-issues include whether PICOP is legally required to (1) consult with and
acquire an approval from the Sanggunian concerned under Sections 26 and 27 of the Local Government
Code; and (2) acquire a Certification from the National Commission on Indigenous Peoples (NCIP) that the
concession area does not overlap with any ancestral domain. Factual sub-issues include whether, at the
time it filed its Petition for Mandamus, PICOP had submitted the required Five-Year Forest Protection Plan

150

and

Seven-Year

Reforestation

Plan

and

whether

PICOP

had

paid

all

forest

charges.

For the factual sub-issues, PICOP invokes the doctrine that factual findings of the trial court, especially
when upheld by the Court of Appeals, deserve great weight. However, deserving of even greater weight
are the factual findings of administrative agencies that have the expertise in the area of concern. The
contentious facts in this case relate to the licensing, regulation and management of forest resources, the
determination of which belongs exclusively to the DENR:

SECTION 4. Mandate. - The Department shall be the primary government agency responsible for the
conservation, management, development and proper use of the country's environment and
natural resources, specifically forest and grazing lands, mineral resources, including those in
reservation and watershed areas, and lands of the public domain, as well as the licensing and
regulation of all natural resources as may be provided for by law in order to ensure equitable
sharing of the benefits derived therefrom for the welfare of the present and future generations of Filipinos.
[59]

When parties file a Petition for Certiorari against judgments of administrative agencies tasked with
overseeing the implementation of laws, the findings of such administrative agencies are entitled to great
weight. In the case at bar, PICOP could not have filed a Petition for Certiorari, as the DENR Secretary had
not yet even determined whether PICOP should be issued an IFMA. As previously mentioned, when PICOP's
application was brought to a standstill upon the evaluation that PICOP had yet to comply with the
requirements for the issuance of an IFMA, PICOP refused to attend further meetings with the DENR and
instead filed a Petition for Mandamus against the latter. By jumping the gun, PICOP did not diminish the
weight of the DENR Secretary's initial determination.

Forest Protection and Reforestation Plans

The Performance Evaluation Team tasked to appraise PICOP's performance on its TLA No. 43 found that
PICOP had not submitted its Five-Year Forest Protection Plan and its Seven-Year Reforestation Plan. [60]

151

In its Motion for Reconsideration, PICOP asserts that, in its Letter of Intent dated 28 August 2000 and
marked as Exhibit L in the trial court, there was a reference to a Ten-Year Sustainable Forest Management
Plan (SFMP), in which a Five-Year Forest Protection Plan and a Seven-Year Reforestation Plan were allegedly
incorporated. PICOP submitted a machine copy of a certified photocopy of pages 50-67 and 104-110 of this
SFMP in its Motion for Reconsideration. PICOP claims that the existence of this SFMP was repeatedly
asserted

during

the

IFMA

process. [61]

application

Upon examination of the portions of the SFMP submitted to us, we cannot help but notice that PICOP's
concept of forest protection is the security of the area against "illegal" entrants and settlers. There is no
mention of the protection of the wildlife therein, as the focus of the discussion of the silvicultural
treatments and the SFMP itself is on the protection and generation of future timber harvests. We are
particularly disturbed by the portions stating that trees of undesirable quality shall be removed.

However, when we required the DENR Secretary to comment on PICOP's Motion for Reconsideration, the
DENR Secretary did not dispute the existence of this SFMP, or question PICOP's assertion that a Ten-Year
Forest Protection Plan and a Ten-Year Reforestation Plan are already incorporated therein. Hence, since the
agency tasked to determine compliance with IFMA administrative requirements chose to remain silent in
the face of allegations of compliance, we are constrained to withdraw our pronouncement in the assailed
Decision that PICOP had not submitted a Five-Year Forest Protection Plan and a Seven-Year Reforestation
Plan for its TLA No. 43. As previously mentioned, the licensing, regulation and management of forest
resources

are

the

primary

responsibilities

of

the

DENR. [62]

The compliance discussed above is, of course, only for the purpose of determining PICOP's satisfactory
performance as a TLA holder, and covers a period within the subsistence of PICOP's TLA No. 43. This
determination, therefore, cannot prohibit the DENR from requiring PICOP, in the future, to submit proper
forest protection and reforestation plans covering the period of the proposed IFMA.

Forest Charges

In determining that PICOP did not have unpaid forest charges, the Court of Appeals relied on the
assumption that if it were true that PICOP had unpaid forest charges, it should not have been issued an

152

approved Integrated Annual Operation Plan (IAOP) for the year 2001-2002 by Secretary Alvarez himself. [63]

In the assailed Decision, we held that the Court of Appeals had been selective in its evaluation of the IAOP,
as it disregarded the part thereof that shows that the IAOP was approved subject to several conditions, not
the least of which was the submission of proof of the updated payment of forest charges from April 2001 to
June 2001.[64] We also held that even if we considered for the sake of argument that the IAOP should not
have been issued if PICOP had existing forestry accounts, the issuance of the IAOP could not be considered
proof that PICOP had paid the same. Firstly, the best evidence of payment is the receipt thereof. PICOP has
not presented any evidence that such receipts were lost or destroyed or could not be produced in court.
[65]

Secondly, the government cannot be estopped by the acts of its officers. If PICOP has been issued an

IAOP in violation of the law, allegedly because it may not be issued if PICOP had existing forestry accounts,
the government cannot be estopped from collecting such amounts and providing the necessary sanctions
therefor,

including

the

withholding

of

the

IFMA

until

such

amounts

are

paid.

We therefore found that, as opposed to the Court of Appeals' findings, which were based merely on
estoppel of government officers, the positive and categorical evidence presented by the DENR Secretary
was more convincing with respect to the issue of payment of forestry charges:

1.

Forest Management Bureau (FMB) Senior Forest Management Specialist (SFMS) Ignacio M.
Evangelista testified that PICOP had failed to pay its regular forest charges covering the period from 22
September 2001 to 26 April 2002 in the total amount of P15,056,054.05 [66] PICOP also allegedly paid
late most of its forest charges from 1996 onwards, by reason of which, PICOP is liable for a surcharge of
25% per annum on the tax due and interest of 20% per annum which now amounts to
P150,169,485.02.[67] Likewise, PICOP allegedly had overdue and unpaid silvicultural fees in the amount
of P2,366,901.00 as of 30 August 2002. [68] Summing up the testimony, therefore, it was alleged that
PICOP had unpaid and overdue forest charges in the sum of P167,592,440.90 as of 10 August 2002. [69]

2.

Collection letters were sent to PICOP, but no official receipts are extant in the DENR record in Bislig
City evidencing payment of the overdue amount stated in the said collection letters. [70] There were no
official receipts for the period covering 22 September 2001 to 26 April 2002.

We also considered these pieces of evidence more convincing than the other ones presented by PICOP:

1.

PICOP presented the certification of Community Environment and Natural Resources Office (CENRO)
Officer Philip A. Calunsag, which refers only to PICOP's alleged payment of regular forest charges

153

covering the period from 14 September 2001 to 15 May 2002. [71] We noted that it does not mention
similar payment of the penalties, surcharges and interests that PICOP incurred in paying late several
forest charges, which fact was not rebutted by PICOP.
2.

The 27 May 2002 Certification by CENRO Calunsag specified only the period covering 14 September
2001 to 15 May 2002 and the amount of P53,603,719.85 paid by PICOP without indicating the
corresponding volume and date of production of the logs. This is in contrast to the findings of SFMS
Evangelista, which cover the period from CY 1996 to 30 August 2002 and includes penalties, interests,
and surcharges for late payment pursuant to DAO 80, series of 1987.

3.

The 21 August 2002 PICOP-requested certification issued by Bill Collector Amelia D. Arayan, and
attested to by CENRO Calunsag himself, shows that PICOP paid only regular forest charges for its log
production covering 1 July 2001 to 21 September 2001. However, there were log productions after 21
September 2001, the regular forest charges for which have not been paid, amounting to
P15,056,054.05.[72] The same certification shows delayed payment of forest charges, thereby
corroborating the testimony of SFMS Evangelista and substantiating the imposition of penalties and
surcharges.

In its Motion for Reconsideration, PICOP claims that SFMS Evangelista is assigned to an office that has
nothing to do with the collection of forest charges, and that he based his testimony on the Memoranda of
Forest Management Specialist II (FMS II) Teofila Orlanes and DENR, Bislig City Bill Collector Amelia D.
Arayan, neither of whom was presented to testify on his or her Memorandum. PICOP also submitted an
Addendum to Motion for Reconsideration, wherein it appended certified true copies of CENRO Summaries
with attached Official Receipts tending to show that PICOP had paid a total of P81,184,747.70 in forest
charges for 10 January 2001 to 20 December 2002, including the period during which SFMS Evangelista
claims

PICOP

did

not

pay

forest

charges

(22

September

2001

to

26

April

2002).

Before proceeding any further, it is necessary for us to point out that, as with our ruling on the forest
protection and reforestation plans, this determination of compliance with the payment of forest charges is
exclusively for the purpose of determining PICOP's satisfactory performance on its TLA No. 43. This cannot
bind

either

party

in

possible

collection

case

that

may

ensue.

An evaluation of the DENR Secretary's position on this matter shows a heavy reliance on the testimony of
SFMS Evangelista, making it imperative for us to strictly scrutinize the same with respect to its contents
and

admissibility.

PICOP claims that SFMS Evangelista's office has nothing to do with the collection of forest charges.

154

According to PICOP, the entity having administrative jurisdiction over it is CENRO, Bislig City by virtue of
DENR Administrative Order No. 96-36, dated 20 November 1996, which states:

1. In order for the DENR to be able to exercise closer and more effective supervision, management and
control over the forest resources within the areas covered by TLA No. 43, PTLA No. 47 and IFMA No. 35 of
the PICOP Resources, Inc., (PRI) and, at the same time, provide greater facility in the delivery of DENR
services to various publics, the aforesaid forest holdings of PRI are hereby placed under the exclusive
jurisdiction of DENR Region No. XIII with the CENR Office at Bislig, Surigao del Sur, as directly responsible
thereto. x x x.

We disagree. Evangelista is an SFMS assigned at the Natural Forest Management Division of the FMB,
DENR. In Evangelista's aforementioned affidavit submitted as part of his direct examination, Evangelista
enumerated his duties and functions as SFMS:

1.

As

SFMS,

have

the

following

duties

and

functions:

a) To evaluate and act on cases pertaining to forest management referred to in the Natural forest
Management

Division;

b) To monitor, verify and validate forest management and related activities by timber licences as to their
compliance

to

approved

plans

and

programs;

c) To conduct investigation and verification of compliance by timber licenses/permittees to existing DENR

rules

and

regulations;

d) To gather field data and information to be used in the formulation of forest policies and regulations; and
e) To perform other duties and responsibilities as may be directed by superiors. [73]

PICOP also alleges that the testimony of SFMS Evangelista was based on the aforementioned Memoranda
of Orlanes and Arayan and that, since neither Orlanes nor Arayan was presented as a witness, SFMS
Evangelista's testimony should be deemed hearsay. SFMS Evangelista's 1 October 2002 Affidavit, [74] which
was offered as part of his testimony, provides:

155

2. Sometime in September, 2001 the DENR Secretary was furnished a copy of forest Management
Specialist II (FMS II) Teofila L. Orlanes' Memorandum dated September 24, 2001 concerning unopaid forest
charges of PICOP. Attached to the said Memorandum was a Memorandum dated September 19, 2001 of
Amelia D. Arayan, Bill collector of the DENR R13-14, Bislig City. Copies of the said Memoranda are attached
as

Annexes

3.

The

said

Memoranda

were

referred

and

to

the

2,

FMB

Director

respectively.

for

appropriate

action.

4. Thus, on August 5, 2002, I was directed by the FMB Director to proceed to Region 13 to gather forestryrelated data and validate the report contained in the Memoranda of Ms. Orlanes and Arayan.

5. On August 6, 2002, I proceeded to DENR Region 13 in Bislig City. A copy of my Travel Order is attached
as

Annex

3.

6. Upon my arrival at CENRO, Bislig, surigao del Sur, I coordinated with CENRO Officer Philip A. Calunsag
and requested him to make available to me the records regarding the forest products assessments of
PICOP.

7.

After

was

provided

with

the

requested

records,

evaluated

and

collected

the

data.

8. After the evaluation, I found that the unpaid forest charges adverted to in the Memoranda of Mr. Orlanes
and Arayan covering the period from May 8, 2001 to July 7, 2001 had already been paid but late. I further
found out that PICOP had not paid its forest charges covering the period from September 22, 2001 to April
26,

2002

in

the

total

amount

of

P15,056,054.05.

9. I also discovered that from 1996 up to august 30, 2002, PICOP paid late some of its forest charges in
1996 and consistently failed to pay late its forest charges from 1997 up to the present time.

10. Under Section 7.4 of DAO No. 80 Series of 19787 and Paragraph (4a), Section 10 of BIR revenue
Regulations No. 2-81 dated November 18, 1980, PICOP is mandated to pay a surcharge of 25% per annum
of

the

tax

due

and

interest

of

20%

per

annum

for

late

payment

of

forest

charges.

11. The overdue unpaid forest charges of PICOP as shown in the attached tabulation marked as Annex 4
hereof is P150,169,485.02. Likewise, PICOP has overdue and unpaid silvicultural fees in the amount of

156

P2,366,901.00

from

1996

to

the

present.

12. In all, PICOP has an outstanding and overdue total obligation of P167,592,440.90 as of August 30, 2002
based on the attached tabulation which is marked as Annex 5 hereof. [75]

Clearly, SFMS Evangelista had not relied on the Memoranda of Orlanes and Arayan. On the contrary, he
traveled to Surigao del Sur in order to verify the contents of these Memoranda. SFMS Evangelista, in fact,
revised the findings therein, as he discovered that certain forest charges adverted to as unpaid had
already

been

paid.

This does not mean, however, that SFMS Evangelista's testimony was not hearsay. A witness may testify
only on facts of which he has personal knowledge; that is, those derived from his perception, except in
certain circumstances allowed by the Rules. [76] Otherwise, such testimony is considered hearsay and,
hence,

inadmissible

evidence.[77]

in

SFMS Evangelista, while not relying on the Memoranda of Orlanes and Arayan, nevertheless relied on
records, the preparation of which he did not participate in. [78] These records and the persons who prepared
them were not presented in court, either. As such, SFMS Evangelista's testimony, insofar as he relied on
these records, was on matters not derived from his own perception, and was, therefore, hearsay.

Section 44, Rule 130 of the Rules of Court, which speaks of entries in official records as an exception to the
hearsay rule, cannot excuse the testimony of SFMS Evangelista. Section 44 provides:

SEC. 44. Entries in official records. - Entries in official records made in the performance of his duty by a
public officer of the Philippines, or by a person in the performance of a duty specially enjoined by law,
are prima facie evidence of the facts therein stated.

In Africa v. Caltex,[79] we enumerated the following requisites for the admission of entries in official records
as an exception to the hearsay rule: (1) the entries were made by a public officer or a private person in the
performance of a duty; (2) the performance of the duty is especially enjoined by law; (3) the public officer
or the private person had sufficient knowledge of the facts stated by him, which must have been acquired
by

157

him

personally

or

through

official

information.

The presentation of the records themselves would, therefore, have been admissible as an exception to the
hearsay rule even if the public officer/s who prepared them was/were not presented in court, provided the
above requisites could be adequately proven. In the case at bar, however, neither the records nor the
persons who prepared them were presented in court. Thus, the above requisites cannot be sufficiently
proven. Also, since SFMS Evangelista merely testified based on what those records contained, his
testimony was hearsay evidence twice removed, which was one step too many to be covered by the
official-records

exception

to

the

hearsay

rule.

SFMS Evangelista's testimony of nonpayment of forest charges was, furthermore, based on his failure to
find official receipts corresponding to billings sent to PICOP. As stated above, PICOP attached official
receipts in its Addendum to Motion for Reconsideration to this Court. While this course of action is normally
irregular in judicial proceedings, we merely stated in the assailed Decision that "the DENR Secretary has
adequately proven that PICOP has, at this time, failed to comply with administrative and statutory
requirements for the conversion of TLA No. 43 into an IFMA," [80] and that "this disposition confers another
chance

to

comply

with

the

foregoing

requirements."[81]

In view of the foregoing, we withdraw our pronouncement that PICOP has unpaid forestry charges, at least
for the purpose of determining compliance with the IFMA requirements.

NCIP Certification

The Court of Appeals held that PICOP need not comply with Section 59 of Republic Act No. 8371, which
requires prior certification from the NCIP that the areas affected do not overlap with any ancestral domain
before any IFMA can be entered into by the government. According to the Court of Appeals, Section 59
should be interpreted to refer to ancestral domains that have been duly established as such by the
continuous possession and occupation of the area concerned by indigenous peoples since time
immemorial up to the present. The Court of Appeals held that PICOP had acquired property rights over TLA
No. 43 areas, being in exclusive, continuous and uninterrupted possession and occupation of these areas
since

158

1952

up

to

the

present.

In the assailed Decision, we reversed the findings of the Court of Appeals. Firstly, the Court of Appeals
ruling defies the settled jurisprudence we have mentioned earlier, that a TLA is neither a property nor a
property

right,

and

that

it

does

not

create

vested

right. [82]

Secondly, the Court of Appeals' resort to statutory construction is misplaced, as Section 59 of Republic Act
No. 8379 is clear and unambiguous:

SEC. 59. Certification Precondition. - All departments and other governmental agencies shall
henceforth be strictly enjoined from issuing, renewing or granting any concession, license or
lease, or entering into any production-sharing agreement, without prior certification from the
NCIP that the area affected does not overlap with any ancestral domain. Such certification shall
only be issued after a field-based investigation is conducted by the Ancestral Domains Office of the area
concerned: Provided, That no certification shall be issued by the NCIP without the free and prior informed
and written consent of the ICCs/IPs concerned: Provided, further, That no department, government agency
or government-owned or controlled corporation may issue new concession, license, lease, or production
sharing agreement while there is a pending application for a CADT: Provided, finally, That the ICCs/IPs shall
have the right to stop or suspend, in accordance with this Act, any project that has not satisfied the
requirement of this consultation process.

PICOP had tried to put a cloud of ambiguity over Section 59 of Republic Act No. 8371 by invoking the
definition of Ancestral Domains in Section 3(a) thereof, wherein the possesssion by Indigenous Cultural
Communities/Indigenous Peoples (ICCs/IPs) must have been continuous to the present. However, we noted
the exception found in the very same sentence invoked by PICOP:

a) Ancestral domains - Subject to Section 56 hereof, refers to all areas generally belonging to ICCs/IPs
comprising lands, inland waters, coastal areas, and natural resources therein, held under a claim of
ownership, occupied or possessed by ICCs/IPs, by themselves or through their ancestors,
communally or individually since time immemorial, continuously to the present except when
interrupted by war, force majeure or displacement by force, deceit, stealth or as a consequence of
government projects or any other voluntary dealings entered into by government and private
individuals/corporations, and which are necessary to ensure their economic, social and cultural welfare.
It shall include ancestral lands, forests, pasture, residential, agricultural, and other lands individually

159

owned whether alienable and disposable or otherwise, hunting grounds, burial grounds, worship areas,
bodies of water, mineral and other natural resources, and lands which may no longer be exclusively
occupied by ICCs/IPs but from which they traditionally had access to for their subsistence and traditional
activities, particularly the home ranges of ICCs/IPs who are still nomadic and/or shifting cultivators;

Ancestral domains, therefore, remain as such even when possession or occupation of these areas has been
interrupted by causes provided under the law, such as voluntary dealings entered into by the government
and private individuals/corporations. Consequently, the issuance of TLA No. 43 in 1952 did not cause the
ICCs/IPs

to

lose

their

possession

or

occupation

over

the

area

covered

by

TLA

No.

43.

Thirdly, we held that it was manifestly absurd to claim that the subject lands must first be proven to be
part of ancestral domains before a certification that the lands are not part of ancestral domains can be
required, and invoked the separate opinion of now Chief Justice Reynato Puno in Cruz v. Secretary of
DENR[83]:

As its subtitle suggests, [Section 59 of R.A. No. 8371] requires as a precondition for the issuance of any
concession, license or agreement over natural resources, that a certification be issued by the NCIP that the
area subject of the agreement does not lie within any ancestral domain. The provision does not vest the
NCIP with power over the other agencies of the State as to determine whether to grant or deny any
concession or license or agreement. It merely gives the NCIP the authority to ensure that the ICCs/IPs have
been informed of the agreement and that their consent thereto has been obtained. Note that the
certification applies to agreements over natural resources that do not necessarily lie within
the ancestral domains. For those that are found within the said domains, Sections 7(b) and 57
of the IPRA apply.

PICOP rejects the entire disposition of this Court on the matter, relying on the following theory:

84. It is quite clear that Section 59 of R.A. 8371 does not apply to the automatic conversion of TLA 43 to
IFMA.

First, the automatic conversion of TLA 43 to an IFMA is not a new project. It is a mere continuation of the

160

harvesting process in an area that PICOP had been managing, conserving and reforesting for the last 50
years since 1952. Hence any pending application for a CADT within the area, cannot affect much less hold
back the automatic conversion. That the government now wishes to change the tenurial system to an IFMA
could not change the PICOP project, in existence and operating for the last 30 (sic) years, into a new one.
[84]

PICOP's position is anything but clear. What is clearly provided for in Section 59 is that it covers
"issuing, renewing or granting (of) any concession, license or lease, or entering into any production sharing
agreement." PICOP is implying that, when the government changed the tenurial system to an IFMA,
PICOP's existing TLA would just be upgraded or modified, but would be the very same agreement, hence,
dodging the inclusion in the word "renewing." However, PICOP is conveniently leaving out the fact that its
TLA expired in 2002. If PICOP really intends to pursue the argument that the conversion of the TLA into an
IFMA would not create a new agreement, but would only be a modification of the old one, then it should be
willing to concede that the IFMA expired as well in 2002. An automatic modification would not alter the
terms and conditions of the TLA except when they are inconsistent with the terms and conditions of an
IFMA. Consequently, PICOP's concession period under the renewed TLA No. 43, which is from the year 1977
to

2002,

would

remain

the

same.

PICOP cannot rely on a theory of the case whenever such theory is beneficial to it, but refute the same
whenever the theory is damaging to it. In the same way, PICOP cannot claim that the alleged Presidential
Warranty is "renewable for other 25 years" and later on claim that what it is asking for is not a renewal.
Extensions of agreements must necessarily be included in the term renewal. Otherwise, the inclusion of
"renewing"

in

Section

59

would

be

rendered

inoperative.

PICOP further claims:

85. Verily, in interpreting the term "held under claim of ownership," the Supreme Court could not have
meant to include claims that had just been filed and not yet recognized under the provisions of DENR
Administrative Order No. 2 Series of 1993, nor to any other community / ancestral domain program prior to
R.A.

161

8371.

87. One can not imagine the terrible damage and chaos to the country, its economy, its people and its
future if a mere claim filed for the issuance of a CADC or CADT will already provide those who filed the
application, the authority or right to stop the renewal or issuance of any concession, license or lease or any
production-sharing agreement. The same interpretation will give such applicants through a mere
application the right to stop or suspend any project that they can cite for not satisfying the requirements of
the consultation process of R.A. 8371. If such interpretation gets enshrined in the statures of the land, the
unscrupulous and the extortionists can put any ongoing or future project or activity to a stop in any part of
the country citing their right from having filed an application for issuance of a CADC or CADT claim and the
legal doctrine established by the Supreme Court in this PICOP case. [85]

We are not sure whether PICOP's counsels are deliberately trying to mislead us, or are just plainly ignorant
of basic precepts of law. The term "claim" in the phrase "claim of ownership" is not a document of any sort.
It is an attitude towards something. The phrase "claim of ownership" means "the possession of a piece of
property with the intention of claiming it in hostility to the true owner." [86] It is also defined as "a party's
manifest intention to take over land, regardless of title or right." [87] Other than in Republic Act No. 8371, the
phrase "claim of ownership" is thoroughly discussed in issues relating to acquisitive prescription in Civil
Law.

Before PICOP's counsels could attribute to us an assertion that a mere attitude or intention would stop the
renewal or issuance of any concession, license or lease or any production-sharing agreement, we should
stress beforehand that this attitude or intention must be clearly shown by overt acts and, as required by
Section 3(a), should have been in existence "since time immemorial, continuously to the present except
when interrupted by war, force majeure or displacement by force, deceit, stealth or as a consequence of
government projects or any other voluntary dealings entered into by government and private
individuals/corporations."

Another argument of PICOP involves the claim itself that there was no overlapping:

Second, there could be no overlapping with any Ancestral Domain as proven by the evidence presented
and

162

testimonies

rendered

during

the

hearings

in

the

Regional

Trial

Court.

x.

x.

88. The DENR issued a total of 73 CADCs as of December 11, 1996. The DENR Undersecretary for Field
Operations had recommended another 11 applications for issuance of CADCs. None of the CADCs overlap
the

TLA

43

area.

89. However former DENR Secretary Alvarez, in a memorandum dated 13 September, 2002 addressed to
PGMA, insisted that PICOP had to comply with the requirement to secure a Free and Prior Informed Concent
because

CADC

095

was

issued

covering

17,112

hectares

of

TLA

43.

90. This CADC 095 is a fake CADC and was not validly released by the DENR. While the Legal Department
of the DENR was still in the process of receiving the filings for applicants and the oppositors to the CADC
application, PICOP came across filed copies of a CADC 095 with the PENRO of Davao Oriental as part of
their application for a Community Based Forest Management Agreement (CBFMA). Further research came
across the same group filing copies of the alleged CADC 095 with the Mines and Geosciences Bureau in
Davao City for a mining agreement application. The two applications had two different versions of the
CADCs second page. One had Mr. Romeo T. Acosta signing as the Social reform Agenda Technical Action
Officer, while the other had him signing as the Head, Community-Based Forest Management Office. One
had the word "Eight" crossed out and "Seven" written to make it appear that the CADC was issued on
September 25, 1997, the other made it appear that there were no alterations and the date was supposed
to be originally 25 September 1997.

What is required in Section 59 of Republic Act No. 8379 is a Certification from the NCIP that there was no
overlapping with any Ancestral Domain. PICOP cannot claim that the DENR gravely abused its discretion
for requiring this Certification, on the ground that there was no overlapping. We reiterate that it is
manifestly absurd to claim that the subject lands must first be proven to be part of ancestral
domains before a certification that they are not can be required. As discussed in the assailed
Decision, PICOP did not even seek any certification from the NCIP that the area covered by TLA No. 43,
subject of its IFMA conversion, did not overlap with any ancestral domain. [88]

Sanggunian Consultation and Approval

163

While PICOP did not seek any certification from the NCIP that the former's concession area did not overlap
with any ancestral domain, PICOP initially sought to comply with the requirement under Sections 26 and 27
of the Local Government Code to procure prior approval of the Sanggunians concerned. However, only one
of the many provinces affected approved the issuance of an IFMA to PICOP. Undaunted, PICOP nevertheless
submitted to the DENR the purported resolution[89] of the Province of Surigao del Sur indorsing the approval
of PICOP's application for IFMA conversion, apparently hoping either that the disapproval of the other
provinces would go unnoticed, or that the Surigao del Sur approval would be treated as sufficient
compliance.

Surprisingly, the disapproval by the other provinces did go unnoticed before the RTC and the Court of
Appeals, despite the repeated assertions thereof by the Solicitor General. When we pointed out in the
assailed Decision that the approval must be by all the Sanggunians concerned and not by only one of
them, PICOP changed its theory of the case in its Motion for Reconsideration, this time claiming that they
are

not

required at

all to

procure

Sanggunian

approval.

Sections 2(c), 26 and 27 of the Local Government Code provide:

SEC.

2.

x.

(c) It is likewise the policy of the State to require all national agencies and offices to conduct periodic
consultations with appropriate local government units, nongovernmental and people's organizations, and
other concerned sectors of the community before any project or program is implemented in their
respective

jurisdictions.

SEC. 26. Duty of National Government Agencies in the Maintenance of Ecological Balance. - It shall be the
duty of every national agency or government-owned or controlled corporation authorizing or
involved in the planning and implementation of any project or program that may cause
pollution, climatic change, depletion of non-renewable resources, loss of crop land, rangeland,
or forest cover, and extinction of animal or plant species, to consult with the local government
units, nongovernmental organizations, and other sectors concerned and explain the goals and objectives of
the project or program, its impact upon the people and the community in terms of environmental or

164

ecological balance, and the measures that will be undertaken to prevent or minimize the adverse effects
thereof.

SEC. 27. Prior Consultations Required. - No project or program shall be implemented by government
authorities unless the consultations mentioned in Sections 2(c) and 26 hereof are complied with, and
prior approval of the sanggunian concerned is obtained: Provided, That occupants in areas where
such projects are to be implemented shall not be evicted unless appropriate relocation sites have been
provided, in accordance with the provisions of the Constitution.

As stated in the assailed Decision, the common evidence of the DENR Secretary and PICOP, namely, the 31
July 2001 Memorandum of Regional Executive Director (RED) Elias D. Seraspi, Jr., enumerated the local
government units and other groups which had expressed their opposition to PICOP's application for IFMA
conversion:

7. During the conduct of the performance evaluation of TLA No. 43 issues complaints against PRI were
submitted thru Resolutions and letters. It is important that these are included in this report for assessment
of

what

are

their

worth,

viz:

xxxx

7.2 Joint Resolution (unnumbered), dated March 19, 2001 of the Barangay Council and Barangay Tribal
Council of Simulao, Boston, Davao Oriental (ANNEX F) opposing the conversion of TLA No. 43 into IFMA
over

the

17,112

hectares

allegedly

covered

with

CADC

No.

095.

7.3 Resolution Nos. 10, s-2001 and 05, s-2001 (ANNEXES G & H) of the Bunawan Tribal Council of Elders
(BBMTCE) strongly demanding none renewal of PICOP TLA. They claim to be the rightful owner of the area
it

being

their

alleged

ancestral

land.

7.4 Resolution No. 4, S-2001 of Sitio Linao, San Jose, Bislig City (ANNEX I) requesting not to renew TLA 43
over

the

900

hectares

occupied

by

them.

7.5 Resolution No. 22, S-2001 (ANNEX J) of the Sanguniang Bayan, Lingig, Surigao del Sur not to grant the
conversion of TLA 43 citing the plight of former employees of PRI who were forced to enter and farm

165

portion

of

TLA

No.

43,

after

they

were

laid

off.

7.6 SP Resolution No. 2001-113 and CDC Resolution Nos. 09-2001 of the Sanguniang Panglungsod of Bislig
City (ANNEXES K & L) requesting to exclude the area of TLA No. 43 for watershed purposes.

7.7 Resolution No. 2001-164, dated June 01, 2001 (ANNEX M) Sanguniang Panglungsod of Bislig City
opposing the conversion of TLA 43 to IFMA for the reason that IFMA do not give revenue benefits to the
City.[90]

PICOP had claimed that it complied with the Local Government Code requirement of obtaining prior
approval of the Sanggunian concerned by submitting a purported resolution [91] of the Province of Surigao
del Sur indorsing the approval of PICOP's application for IFMA conversion. We ruled that this cannot be
deemed sufficient compliance with the foregoing provision. Surigao del Sur is not the only province
affected by the area covered by the proposed IFMA. As even the Court of Appeals found, PICOP's TLA No.
43 traverses the length and breadth not only of Surigao del Sur but also of Agusan del Sur, Compostela
Valley

and

Oriental.[92]

Davao

On Motion for Reconsideration, PICOP now argues that the requirement under Sections 26 and 27 does not
apply

to

it:

97. PICOP is not a national agency. Neither is PICOP government owned or controlled. Thus Section 26 does
not

apply

to

PICOP.

98. It is very clear that Section 27 refers to projects or programs to be implemented by government
authorities or government-owned and controlled corporations. PICOP's project or the automatic conversion
is a purely private endevour. First the PICOP project has been implemented since 1969. Second, the project
was

being

implemented

by

private

investors

and

financial

institutions.

99. The primary government participation is to warrant and ensure that the PICOP project shall have
peaceful tenure in the permanent forest allocated to provide raw materials for the project. To rule now that
a project whose foundations were commenced as early as 1969 shall now be subjected to a 1991 law is to
apply the law retrospectively in violation of Article 4 of the Civil Code that laws shall not be applied
retroactively.

166

100. In addition, under DAO 30, Series of 1992, TLA and IFMA operations were not among those devolved
function from the National Government / DENR to the local government unit. Under its Section 03, the
devolved function cover only:

a) Community Based forestry projects.

b) Communal forests of less than 5000 hectares

c) Small watershed areas which are sources of local water supply. [93]

We have to remind PICOP again of the contents of Section 2, Article XII of the Constitution:

Section 2. All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all
forces of potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources
are owned by the State. With the exception of agricultural lands, all other natural resources shall not be
alienated. The exploration, development, and utilization of natural resources shall be under the
full control and supervision of the State. The State may directly undertake such activities, or it
may enter into co-production, joint venture, or production-sharing agreements with Filipino
citizens, or corporations or associations at least sixty per centum of whose capital is owned by
such citizens. Such agreements may be for a period not exceeding twenty-five years, renewable for not
more than twenty-five years, and under such terms and conditions as may be provided by law. In cases of
water rights for irrigation, water supply, fisheries, or industrial uses other than the development of water
power, beneficial use may be the measure and limit of the grant.

All projects relating to the exploration, development and utilization of natural resources are projects of the
State. While the State may enter into co-production, joint venture, or production-sharing agreements with
Filipino citizens, or corporations or associations at least sixty per centum of whose capital is owned by
these citizens, such as PICOP, the projects nevertheless remain as State projects and can never be
purely

167

private

endeavors.

Also, despite entering into co-production, joint venture, or production-sharing agreements, the State
remains in full control and supervision over such projects. PICOP, thus, cannot limit government
participation in the project to being merely its bouncer, whose primary participation is only to "warrant and
ensure that the PICOP project shall have peaceful tenure in the permanent forest allocated to provide raw
materials

for

the

project."

PICOP is indeed neither a national agency nor a government-owned or controlled corporation. The DENR,
however, is a national agency and is the national agency prohibited by Section 27 from issuing an IFMA
without the prior approval of the Sanggunian concerned. As previously discussed, PICOP's Petition for
Mandamus can only be granted if the DENR Secretary is required by law to issue an IFMA. We, however,
see here the exact opposite: the DENR Secretary was actually prohibited by law from issuing an IFMA, as
there

had

been

no

prior

approval

by

all

the

other

Sanggunians

concerned.

As regards PICOP's assertion that the application to them of a 1991 law is in violation of the prohibition
against the non-retroactivity provision in Article 4 of the Civil Code, we have to remind PICOP that it is
applying for an IFMA with a term of 2002 to 2027. Section 2, Article XII of the Constitution allows
exploitation agreements to last only "for a period not exceeding twenty-five years, renewable for not more
than twenty-five years." PICOP, thus, cannot legally claim that the project's term started in 1952 and
extends

all

the

way

to

the

present.

Finally, the devolution of the project to local government units is not required before Sections 26 and 27
would be applicable. Neither Section 26 nor 27 mentions such a requirement. Moreover, it is not only the
letter, but more importantly the spirit of Sections 26 and 27, that shows that the devolution of the project
is not required. The approval of the Sanggunian concerned is required by law, not because the local
government has control over such project, but because the local government has the duty to protect its
constituents and their stake in the implementation of the project. Again, Section 26 states that it applies to
projects that "may cause pollution, climatic change, depletion of non-renewable resources, loss of crop
land, rangeland, or forest cover, and extinction of animal or plant species." The local government should
thus represent the communities in such area, the very people who will be affected by flooding, landslides
or even climatic change if the project is not properly regulated, and who likewise have a stake in the
resources in the area, and deserve to be adequately compensated when these resources are exploited.

Indeed, it would be absurd to claim that the project must first be devolved to the local government before

168

the requirement of the national government seeking approval from the local government can be applied. If
a project has been devolved to the local government, the local government itself would be implementing
the project. That the local government would need its own approval before implementing its own project is
patently silly.

EPILOGUE AND DISPOSITION

PICOP'c cause of action consists in the allegation that the DENR Secretary, in not issuing an IFMA, violated
its constitutional right against non-impairment of contracts. We have ruled, however, that the 1969
Document is not a contract recognized under the non-impairment clause, much less a contract specifically
enjoining the DENR Secretary to issue the IFMA. The conclusion that the 1969 Document is not a contract
recognized under the non-impairment clause has even been disposed of in another case decided by
another division of this Court, PICOP Resources, Inc. v. Base Metals Mineral Resources Corporation,[94] the
Decision in which case has become final and executory. PICOP's Petition for Mandamus should, therefore,
fail.

Furthermore, even if we assume for the sake of argument that the 1969 Document is a contract recognized
under the non-impairment clause, and even if we assume for the sake of argument that the same is a
contract specifically enjoining the DENR Secretary to issue an IFMA, PICOP's Petition for Mandamus must
still fail. The 1969 Document expressly states that the warranty as to the tenure of PICOP is "subject to
compliance with constitutional and statutory requirements as well as with existing policy on timber
concessions." Thus, if PICOP proves the two above-mentioned matters, it still has to prove compliance with
statutory

and

administrative

requirements

for

the

conversion

of

its

TLA

into

an

IFMA.

While we have withdrawn our pronouncements in the assailed Decision that (1) PICOP had not submitted
the required forest protection and reforestation plans, and that (2) PICOP had unpaid forestry charges, thus
effectively ruling in favor of PICOP on all factual issues in this case, PICOP still insists that the requirements
of an NCIP certification and Sanggunian consultation and approval do not apply to it. To affirm PICOP's
position on these matters would entail nothing less than rewriting the Indigenous Peoples' Rights Act and
the

169

Local

Government

Code,

an

act

simply

beyond

our

jurisdiction.

WHEREFORE, the

Motion

for

Reconsideration

of

PICOP

Resources,

Inc.

is DENIED.

SO ORDERED

HON. HEHERSON ALVAREZ substituted by HON. ELISEA G. GOZUN, in her capacity as Secretary of the
Department of Environment and Natural Resources, Petitioner, versus PICOP RESOURCES, INC.,
Respondent.
G.R. No. 162243 | 2006-11-29
A discussion citing this case is available.
Entries in official records
DECISION

CHICO-NAZARIO, J.:

On the line are three consolidated Petitions, all arising from the 11 October 2002 Quezon City Regional Trial
Court (RTC) Decision[1] granting the Petition for Mandamus filed by Paper Industries Corporation of the

170

Philippines (PICOP). The Court of Appeals affirmed the 11 October 2002 RTC Decision, with modification, in
a

19

February

Decision.[2]

2004

In G.R. No. 162243, then Department of Environment and Natural Resources (DENR) Secretary Heherson T.
Alvarez, who was later successively substituted by subsequent DENR Secretaries Elisea G. Gozun and
Angelo T. Reyes, assails the 19 February 2004 Decision insofar as it granted the Petition for Mandamus. In
G.R. No. 164516, PICOP assails the same Decision insofar as it deleted the imposition of damages against
then Secretary Alvarez. Secretary Reyes filed a third Petition docketed as G.R. No. 171875, assailing the 16
December 2004 Amended Decision[3] of the Court of Appeals lifting the Writ of Preliminary Injunction that
enjoined the enforcement of the 11 October 2002 Decision and 10 February 2003 Orders of the RTC.

FACTS

The

facts,

culled

from

the

records

of

the

three

consolidated

petitions,

are

as

follows:

On 24 May 1952, PICOP's predecessor, Bislig Bay Lumber Co., Inc. (BBLCI) was granted Timber License
Agreement (TLA) No. 43.[4] The TLA was amended on 26 April 1953 and 4 March 1959. As amended, TLA
No. 43 covers an area of 75,545 hectares in Surigao del Sur, Agusan del Sur, Compostela Valley, and
Davao

Oriental.

Allegedly sometime in 1969, the late President Ferdinand E. Marcos issued a presidential warranty to
BBLCI, confirming that TLA No. 43 "definitely establishes the boundary lines of [BBLCI's] concession
area."[5]

TLA No. 43, as amended, expired on 26 April 1977. It was renewed on 7 October 1977 for another 25 years
to

"terminate

on

April

25,

2002."[6]

On 23 December 1999, then DENR Secretary Antonio H. Cerilles promulgated DENR Administrative Order
(DAO) No. 99-53 which had for its subject, the "Regulations Governing the Integrated Forest Management
Program

171

(IFMP)."[7]

In a 28 August 2000 letter to the Community Environment and Natural Resources Office (CENRO), DENRRegion XIII-D4, Bislig, Surigao del Sur, PICOP signified its intention to convert its TLA No. 43 into an
Integrated Forest Management Agreement (IFMA) invoking the provisions of Section 9, Chapter III of DAO
99-53.[8]

No.

Acting on the said letter, Forester III Trifino M. Peregrino, In-Charge, Office of the CENRO, wrote a letter
dated 1 September 2000 to PICOP's resident manager in Tabon, Bislig, Surigao del Sur, informing PICOP
"that we will consider said letter as an advance notice considering that it is yet premature to act on your
request

since

we

are

yet

in

2000." [9]

CY

In a 24 January 2001 letter, Neolito Frondozo, Group Manager, Forest Operations Manager of PICOP,
requested for a favorable indorsement of their letter of intent from the CENRO of the DENR, Region XIII-D4
in Bislig City. This was followed up by another letter dated 25 January 2001 of Wilfredo D. Fuentes, Vice
President and Resident Manager of PICOP, to the Regional Executive Director (RED), DENR, Caraga Region
XIII in Ambago, Butuan City, likewise, requesting for a favorable indorsement of their letter of intent to the
Secretary.[10]

DENR

The Officer-In-Charge (OIC), Regional Executive Director Constantino A. Paye, Jr., in a 6 March 2001
Memorandum, forwarded PICOP's letter of intent dated 28 August 2000 to the DENR Secretary informing
the latter that the DENR Caraga Region XIII in Ambago, Butuan City, had created a team tasked to conduct
a

performance

evaluation

on

PICOP

on

the

said

TLA

pursuant

to

DAO

No.

99-53. [11]

Subsequently, Elias R. Seraspi, Jr., RED, DENR, Caraga Region XIII in Ambago, Butuan City, submitted a 31
July 2001 Memorandum to the DENR Secretary on the performance evaluation of PICOP on its TLA No. 43.
Paragraph 11 of the same Memorandum reads:

Hence, it is imperative to chart a good forest policy direction for the management, development and
protection of TLA No. 43 after it expires on April 26, 2002 for the purpose of sustainable forest
management of the area in support of national development. With this vision, the proper evaluation to
consider the request for automatic conversion of TLA No. 43 to IFMA pursuant to Section 9, DENR A.O. No.
99-53, upon its expiration on April 26, 2002 is hereby recommended. [12]

172

Attached to said Memorandum, inter alia, were the 11 July 2001 Report and 27 July 2001 Supplemental
Report of the Performance Evaluation Team created to conduct such performance evaluation indicating
violations by PICOP of existing DENR Rules and Regulations governing TLA No. 43, such as the nonsubmission of its five-year forest protection plan and seven-year reforestation plan as required by the
DENR rules and regulations. The said 31 July 2001 Memorandum was forwarded to the Forest Management
Bureau

(FMB)

for

appropriate

action

recommendation.[13]

and

Sometime in September 2001, the DENR Secretary was furnished a copy of Forest Management Specialist
II (FMS II) Teofila L. Orlanes' 24 September 2001 Memorandum concerning alleged unpaid and overdue
forest charges of respondent on TLA No. 43. Attached thereto was a 19 September 2001 Memorandum of
Amelia D. Arayan, Bill Collector of the DENR R13-14, Bislig City, likewise indicating purported unpaid and
overdue

forest

charges

by

PICOP

on

its

TLA

No.

43. [14]

Said Memorandum was referred to FMB Director Romeo T. Acosta, who directed FMB Senior Forest
Management Specialist (SFMS) Ignacio Evangelista to proceed to Region 13 to gather forestry-related data
and validate the report contained in the respective Memoranda of Orlanes and Arayan. [15] SFMS Evangelista
found that the 8 May 2001 to 7 July 2001 forest charges adverted to in the Orlanes and Arayan Memoranda
was belatedly filed. He also found that PICOP had not paid its regular forest charges covering the period of
22 September 2001 to 26 April 2002 in the total amount of P15,056,054.05. [16] Moreso, he discovered that
from 1996 to 30 August 2002, PICOP was late in paying some of its forest charges in 1996, and was
consistently

late

in

paying

all

its

forestry

charges

from

1997

onwards. [17]

The overdue and unpaid forest charges (including penalties, interests and surcharges) of PICOP total
P150,169,485.02. Its silvicultural fees amount to P2,366,901.00 from 1996 up to 30 August 2002. In all,
PICOP has an outstanding and overdue total obligation on its forest charges in the amount of
P167,592,440.90

as

of

30

August

2002. [18]

Thus, FMB Director Acosta submitted a 5 October 2001 Memorandum to the DENR Secretary concerning
PICOP's application for conversion of its TLA No. 43 into an IFMA, viz:

RECOMMENDATION

173

The conversion of the TLA into IFMA is primarily aimed at sustaining the raw materials for the continuous
operation of the integrated wood processing plant of the company. However, the very complex issues
presented cannot just be ignored and have to be fully addressed to before further appropriate action is
taken on the application for conversion. In the absence of categorical comments and recommendation of
the regional office to resolve the issue, it is recommended that a transition team composed of the following
be created: x x x.[19]

In lieu of a transition team, the DENR Secretary constituted a negotiating team by virtue of Special Order
No. 2001-698 dated 23 October 2001 composed of Undersecretary Ramon J.P. Paje as chairman, with the
following as members: Undersecretary Gregorio V. Cabantac and FMB Assistant Director Neria A. Andin.
The team was authorized to negotiate for such terms and conditions as are advantageous to the
Government.[20]

The DENR Secretary sent a 25 October 2001 letter to PICOP, through its president, requesting him to
designate its representative/s to discuss with the DENR negotiating team "the conditions and details of the
said IFMA including the production sharing arrangement between PICOP and the government." [21]

Since PICOP failed to send a representative, and considering that TLA No. 43 was about to expire, DENR
Undersecretary Paje called for a meeting on 21 March 2002. It was only then, or almost five months from
the receipt of the 25 October 2001 letter from the DENR Secretary, that PICOP sent its representatives to
the

DENR.[22]

On 9 April 2002, the DENR Negotiating Team issued Resolution No. 1, series of 2002, creating a Technical
Working Committee (TWC) to provide technical assistance to the negotiating team composed of
representatives from both DENR and PICOP. [23] On 10 April 2002, the members of the TWC met and
discussed the findings of the Performance Evaluation Team that PICOP has neither submitted its Five-Year
Forest Protection Plan nor presented its Seven-Year Reforestation Plan, both being required by DENR rules
and regulations. In the same meeting, PICOP agreed to secure and submit a clearance from the National
Commission on Indigenous Peoples (NCIP) as required by Section 59 of the Indigenous Peoples' Rights Act
(IPRA).[24]

On 15 April 2002, another TWC meeting was conducted, wherein the proposed validation of PICOP's overall
performance "as part of the evaluation process for the conversion of the TLA into an IFMA" was discussed

174

with PICOP representatives being given copies of the performance evaluation of PICOP on its TLA No. 43.
[25]

PICOP's representatives were subsequently requested to prepare a map showing by categories the area

planted

with

trees

in

compliance

with

PICOP's

reforestation

requirements. [26]

In the next TWC meeting on 19 April 2002, PICOP's representatives were asked of their compliance with
their agreement during the 10 April 2002 meeting that they should have submitted a list of stockholders
on 15 April 2002. The PICOP representatives did not submit such list and instead inquired on the TWC's
interpretation of the 25 October 2001 letter of the DENR Secretary to PICOP, which provides in full, thus:

25 October 2001

MR.

TEODORO

G.

BERNARDINO

President

PICOP

Resources

2nd Flr,

Incorporated

Moredel

2280

Pasong

Building
Tamo

Extension

Makati

City

Dear

Mr.

Bernardino:

Consistent with our attached Memorandum to Her Excellency, the President, dated 17 October 2001 and in
response to your Letter of Intent dated 25 February 2001, we wish to inform you that, pursuant to DENR
Administrative Order No. 99-53, we have cleared the conversion of PICOP's Timber License Agreement
(TLA) No. 43 to Integrated Forest Management Agreement (IFMA) effective from the expiration of said TLA
on

April

26,

2002.

In this regard, you are hereby requested to designate PICOP's representative(s) to discuss with the DENR
Team, created under Special Order No. 2001-638, the conditions and details of the said IFMA, including the
production

For

175

sharing

your

agreement

between

information

PICOP

and

and

the

government.

guidance.

Very

truly

yours,

T.

ALVAREZ

(sgd)

HEHERSON
Secretary[27]

It was the position of the DENR members of the TWC that PICOP's application for the IFMA conversion
should undergo the process as provided in DAO No. 99-53. PICOP representative Atty. Caingat, however,
claimed that "the TLA has been converted" and suggested the suspension of the meeting as they would
submit

written

position

on

the

matter

the

following

day. [28]

On 22 April 2002, the TWC members of the DENR received a letter from PICOP dated 18 April 2002
insisting that "the conversion of TLA No. 43 into IFMA has already been completed" and indicated that they
had "no choice except to decline participation in the ongoing meeting and bring our issues to the proper
public

and

forum."[29]

legal

On 24 April 2002, the TWC submitted a Memorandum dated 22 April 2002 to the Undersecretary for
Operations and Undersecretary for Legal, Lands and International Affairs of the DENR, enumerating the
salient points taken up during the TWC meetings. This includes the performance evaluation report of the
DENR Regional Office covering the period from 24 June 1999 to 23 June 2000. The report states that PICOP
has not submitted its 5-Year Forest Protection Plan and 7-Year Reforestation Plan; that it has unpaid and
overdue forest charges; and its failure to secure a clearance from the Regional Office of the NCIP
considering the presence of Indigenous Peoples (IPs) in the area and Certificate of Ancestral Domain
Claims

issued

within

the

area.

The DENR Secretary instructed the RED, Caraga Region, to coordinate with PICOP and reiterate the
requirements

for

conversion

of

TLA

No.

43

into

IFMA.

Thereafter, the FMB Director received a letter dated 6 August 2002 from NCIP Chairperson Atty. Evelyn S.
Dunuan informing him that, based on their records, no certification has been issued to PICOP concerning
its application for conversion of its TLA No. 43 into IFMA, "as there has never been an application or

176

endorsement

of

such

application

to

office."[30]

our

On 12 August 2002, a meeting was held at the Office of the President of the Philippines presided by
Undersecretary Jose Tale and Undersecretary Jake Lagonera of the Office of the Executive Secretary.
PICOP's representatives committed to submit the following, to wit:

1.

Certificate of Filing of Amended Articles of Incorporation issued on 12 August 2002 that extended
PICOP's corporate term for another fifty (50) years;

2.

Proof of Payment of forest charges;

3.

Proof of Payment of Reforestation Deposit;

4.

Response to social issues, particularly clearance from the NCIP; and

5.

Map showing reforestation activities on an annual basis.[31]

PICOP submitted its purported compliance with aforesaid undertaking through a letter dated 21 August
2002 to the DENR Secretary. Upon evaluation of the documents submitted by PICOP, the TWC noted that:

a)

PICOP

did

not

submit

the

required

NCIP

clearance;

b) The proof of payments for forest charges covers only the production period from 1 July 2001 to 21
September

2001;

c) The proof of payment of reforestation deposits covers only the period from the first quarter of CY 1999
to

the

second

quarter

of

CY

2001;

d) The map of the areas planted through supplemental planting and social forestry is not sufficient
compliance per Performance Evaluation Team's 11 July 2001 report on PICOP's performance on its TLA No.
43,

pursuant

to

Section

6.6

of

e) PICOP failed to respond completely to all the social issues raised. [32]

177

DAO

79-87;

and

Accordingly, the Secretary of DENR claims that further processing of PICOP's application for the conversion
of

TLA

No.

43

cannot

proceed

until

PICOP

complies

with

the

requirements.

Insisting that the conversion of its TLA No. 43 had been completed, PICOP filed a Petition for Mandamus
against then DENR Secretary Heherson T. Alvarez before the RTC of Quezon City, which was raffled to
Branch 220, presided by Hon. Jose G. Paneda. The petition was docketed as Civil Case No. Q-02-47764
(hereinafter

referred

to

as

the

MANDAMUS

CASE).

On 11 October 2002, the RTC rendered a Decision granting PICOP's Petition for Mandamus, thus:

WHEREFORE,

premises

considered,

the

Petition

for

Mandamus

is

hereby

GRANTED.

The Respondent DENR Secretary Hon. Heherson Alvarez is hereby ordered:

1.

to sign, execute and deliver the IFMA contract and/or documents to PICOP and issue the
corresponding IFMA assignment number on the area covered by the IFMA, formerly TLA No. 43, as
amended;

2.

to issue the necessary permit allowing petitioner to act and harvest timber from the said area of
TLA No. 43, sufficient to meet the raw material requirements of petitioner's pulp and paper mills in
accordance with the warranty and agreement of July 29, 1969 between the government and PICOP's
predecessor-in-interest; and

3.

to honor and respect the Government Warranties and contractual obligations to PICOP strictly in
accordance with the warranty and agreement dated July 29, 1999 (sic) between the government and
PICOP's predecessor-in-interest (Exhibits "H", "H-1" to "H-5", particularly the following:

a) the area coverage of TLA No. 43, which forms part and parcel of the government warranties;

b) PICOP tenure over the said area of TLA No. 43 and exclusive right to cut, collect and remove sawtimber
and pulpwood for the period ending on April 26, 1977; and said period to be renewable for [an]other 25
years subject to compliance with constitutional and statutory requirements as well as with existing policy
on

timber

concessions;

and

c) The peaceful and adequate enjoyment by PICOP of the area as described and specified in the aforesaid
amended Timber License Agreement No. 43.

178

The Respondent Secretary Alvarez is likewise ordered to pay petitioner the sum of P10 million a month
beginning May 2002 until the conversion of TLA No. 43, as amended, to IFMA is formally effected and the
harvesting from the said area is granted.[33]

On

25

October

2002,

the

DENR

Secretary

filed

Motion

for

Reconsideration. [34]

PICOP filed an Urgent Motion for Issuance of Writ of Mandamus and/or Writ of Mandatory Injunction. [35]

On 12 November 2002, then DENR Secretary Alvarez filed a Motion to Inhibit Hon. Jose G. Paneda from
further trying the case, attaching to said motion an administrative complaint against the latter which was
filed by the former before the Office of the Court Administrator. [36] The Motion was denied in an Order dated
10

December

2002.

On 19 December 2002, PICOP filed a Manifestation and Motion to Implead Hon. Elisea Gozun as
respondent,[37]which was granted. Elisea Gozun was, thus, substituted as respondent in her official capacity
as

the

new

Secretary. [38]

DENR

On 6 November 2002, then NCIP Chairperson Atty. Evelyn S. Dunuan sent a letter to the DENR (1)
informing the DENR Secretary that after validation by the NCIP, it was found out that the area of 47,420
hectares covered by PICOP's TLA No. 43 conflicts with the ancestral domains of the Manobos; and (2)
reiterating the information that no NCIP certification was sought by PICOP to certify that the area covered
by TLA No. 43, subject of its IFMA conversion, does not overlap with any ancestral domain. Accordingly,
she "strongly urge[d] the revocation of the one-year permit granted to PICOP until the full provisions of
[the] IPRA are followed and the rights of our Indigenous Peoples over their ancestral land claims are
respected."[39]

On 25 November 2002, President Gloria Macapagal-Arroyo issued Proclamation No. 297, "EXCLUDING A
CERTAIN AREA FROM THE OPERATION OF PROCLAMATION NO. 369 DATED FEBRUARY 27, 1931, AND
DECLARING THE SAME AS MINERAL RESERVATION AND AS ENVIRONMENTALLY CRITICAL AREA." The
excluded area consists of 8,100 hectares, more or less, which formed part of PICOP's expired TLA No. 43,
subject

of

its

application

for

IFMA

conversion. [40]

On 21 January 2003, PICOP filed a Petition for the Declaration of Nullity of the aforesaid presidential

179

proclamation as well as its implementing DENR Administrative Order No. 2002-35 (DAO No. 2002-35) which
was raffled to Branch 78 of the RTC in Quezon City. The Petition was docketed as Special Civil Action No. Q03-48648

(hereinafter

referred

to

as

the

NULLITY

CASE).

In said NULLITY CASE, the RTC issued a Temporary Restraining Order (TRO) enjoining respondents
therein[41]from implementing the questioned issuances. The DENR Secretary and her co-respondents in said
case filed on 6 February 2003 an Omnibus Motion (1) To Dissolve the Temporary Restraining Order dated 3
February 2003; and (2) To Dismiss (With Opposition to the Issuance of a Writ of Preliminary Injunction). [42]

The trial court issued a Resolution dated 19 February 2003 granting the Motion to Dismiss on the ground
that the Petition does not state a cause of action. [43] PICOP filed a Motion for Reconsideration as well as a
Motion to Inhibit. On 24 March 2003, the presiding judge of Branch 78 inhibited himself from hearing the
case.[44] Accordingly, the NULLITY CASE was re-raffled to Branch 221 of the RTC of Quezon City, which
granted PICOP's Motion for Reconsideration by setting for hearing PICOP's application for preliminary
injunction.

Meanwhile, in the MANDAMUS CASE, the RTC denied the DENR Secretary's Motion for Reconsideration and
granted the Motion for the Issuance of Writ of Mandamus and/or Writ of Mandatory Injunction via a 10
February 2003 Order.[45] The fallo of the 11 October 2002 Decision was practically copied in the 10
February 2003 Order, although there was no mention of the damages imposed against then Secretary
Alvarez.[46] The DENR Secretary filed a Notice of Appeal [47] from the 11 October 2002 Decision and the 10
February

2003

Order.

On 28 February 2003, the DENR Secretary filed before the Court of Appeals, a Petition for Certiorari With a
Most Urgent Prayer for the Issuance of a Temporary Restraining Order and/or Writ of Preliminary Injunction
insofar as the trial court ordered the execution of its 11 October 2002 Decision pending appeal. The
petition (hereinafter referred to as the INJUNCTION CASE) was docketed as CA-G.R. SP No. 75698, which
was

assigned

to

the

Special

13 Division

thereof.

On 11 March 2003, the Court of Appeals issued a 60-day TRO [48] enjoining the enforcement of the 11
October 2002 Decision and the 10 February 2003 Order of the RTC. On 30 April 2003, the Court of Appeals
issued

Writ

of

Preliminary

Injunction. [49]

On 30 October 2003, the Court of Appeals rendered its Decision [50] in the INJUNCTION CASE granting the

180

Petition and annulling the Writ of Mandamus and/or Writ of Mandatory Injunction issued by the trial court.
PICOP

filed

Motion

Reconsideration. [51]

for

On 19 February 2004, the Seventh Division of the Court of Appeals rendered a Decision [52] on the
MANDAMUS CASE, affirming the Decision of the RTC, to wit:

WHEREFORE, the appealed Decision is AFFIRMED with modification that the order directing then DENR
Secretary Alvarez "to pay petitioner-appellee the sum of P10 million a month beginning May, 2002 until the
conversion to IFMA of TLA No. 43, as amended, is formally effected and the harvesting from the said area
is granted" is hereby deleted.[53]

PICOP filed a Motion for Partial Reconsideration [54] of this Decision, which was denied by the Court of
Appeals

in

20

July

2004

Resolution. [55]

Meanwhile, in a 22 March 2004 Resolution, [56] the Special Thirteenth Division of the Court of Appeals held in
abeyance the ruling on the Motion for Reconsideration of the INJUNCTION CASE pending the Seventh
Division's resolution of the Motion for Reconsideration of the 19 February 2004 Decision in the MANDAMUS
CASE.

The DENR Secretary and PICOP filed with this Court separate Petitions for Review on the 19 February 2004
Court of Appeals Decision in the MANDAMUS CASE. These Petitions were docketed as G.R. No. 162243 and
164516,

respectively.

On 16 December 2004, the Special Thirteenth Division of the Court of Appeals rendered an Amended
Decision[57] on the INJUNCTION CASE lifting the Writ of Preliminary Injunction it had previously issued, to
wit:

WHEREFORE, the Resolution dated March 22, 2004 holding in abeyance the resolution of the motion for
reconsideration of Our October 30, 2003 decision is set aside and the Decision dated October 30, 2003
reconsidered.

181

The Writ of Preliminary Injunction dated 30 April 2003 is hereby lifted and dissolved and the Order dated
10 February 2003 allowing execution pending appeal and authorizing the issuance of the writ of
mandamus and/or writ of mandatory injunction is hereby affirmed. The Petition dated February 27, 2003 is
herewith dismissed.[58]

Upon denial of its Motion for Reconsideration in a 9 March 2006 Resolution, [59] the DENR Secretary filed
with this Court, a Petition for Review [60] of the INJUNCTION CASE. The Petition was docketed as G.R. No.
171875.

On 5 July 2006, this Court resolved[61] to consolidate G.R. No. 162243, 164516, and 171875.

ISSUES

In G.R. No. 162243, the DENR Secretary brought forth the following issues for our consideration:

WHETHER THE PRESIDENTIAL WARRANTY IS A CONTRACT WHICH CONSTITUTES A LEGAL BAR TO THE
EXERCISE BY THE STATE OF ITS FULL CONTROL AND SUPERVISION REGARDING THE EXPLORATION
DEVELOPMENT AND UTILIZATION OF ITS NATURAL RESOURCES.

II

WHETHER [PICOP] HAD ACQUIRED A VESTED RIGHT OVER ITS FOREST CONCESSION AREA BY VIRTUE OF
THE AFORESAID PRESIDENTIAL WARRANTY.

182

III

WHETHER THE TRIAL COURT HAD JURISDICTION TO TAKE COGNIZANCE OF THIS CASE BECAUSE THE
SUBJECT MATTER THEREOF PERTAINS TO THE EXCLUSIVE ADMINISTRATIVE DOMAIN OF [THE DENR
SECRETARY].

IV

WHETHER [PICOP'S] PETITION FOR MANDAMUS SHOULD HAVE BEEN DISMISSED (1) FOR LACK OF CAUSE
OF ACTION; AND (2) BECAUSE THE SUBJECT MATTER THEREOF IS NOT CONTROLLABLE BY CERTIORARI.

WHETHER [PICOP] HAS FAITHFULLY COMPLIED WITH ALL THE ADMINISTRATIVE AND OTHER STATUTORY
REQUIREMENTS ENTITLING IT TO AN IFMA CONVERSION.

VI

WHETHER [PRESIDENTIAL DECREE NO. 605][62] HAS BEEN PARTLY REPEALED BY [REPUBLIC ACT NO. 8975].
[63]

In

G.R.

No.

164516,

PICOP

submits

the

sole

issue:

WHETHER THE COURT OF APPEALS PROPERLY DELETED THE AWARD OF DAMAGES TO PETITIONER BY THE
TRIAL

183

COURT.[64]

Finally, in G.R. No. 171875, the DENR Secretary submits the following arguments:

1.

[PICOP] DID NOT ACTUALLY FILE A MOTION FOR EXECUTION PENDING APPEAL.

2.

THERE ARE NO GOOD REASONS FOR THE GRANT OF EXECUTION PENDING APPEAL. [65]

THIS COURT'S RULING

Whether or not outright dismissal

was proper

Since the third, fourth and sixth issues raised by the DENR Secretary, if determined in favor of the DENR
Secretary, would have warranted an outright dismissal of the MANDAMUS CASE as early as the trial court
level,

it

is

proper

to

resolve

these

issues

first.

The DENR Secretary alleges that the jurisdiction over the subject matter of the MANDAMUS CASE pertains
to the exclusive administrative domain of the DENR, and therefore, the RTC had been in error in taking
cognizance thereof. The DENR Secretary adds that, assuming arguendo that the RTC properly took
cognizance of the MANDAMUS CASE, it committed a reversible error in not dismissing the same (1) for lack
of cause of action; and (2) because the subject matter thereof is not controllable by mandamus.

The Petition filed before the trial court was one for mandamus with prayer for the issuance of a writ of
preliminary prohibitory and mandatory injunction with damages. Specifically, it sought to compel the DENR
Secretary to: (1) sign, execute and deliver the IFMA documents to PICOP; (2) issue the corresponding IFMA
number assignment; and (3) approve the harvesting of timber by PICOP from the area of TLA No. 43. The
DENR Secretary contends that these acts relate to the licensing regulation and management of forest
resources, which task belongs exclusively to the DENR[66] as conveyed in its mandate:

SECTION 4. Mandate. The Department shall be the primary government agency responsible for the
conservation, management, development and proper use of the country's environment and natural

184

resources, specifically forest and grazing lands, mineral resources, including those in reservation and
watershed areas, and lands of the public domain, as well as the licensing and regulation of all natural
resources as may be provided for by law in order to ensure equitable sharing of the benefits derived
therefrom for the welfare of the present and future generations of Filipinos. [67]

The Court of Appeals ruled:

The contention does not hold water. In its petition for mandamus, [PICOP] asserted that "DENR Secretary
Alvarez acted with grave abuse of discretion or in excess of his jurisdiction in refusing to perform his
ministerial duty to sign, execute and deliver the IFMA contract and to issue the corresponding IFMA
number to it." The cited jurisdiction of the DENR on licencing regulation and management of our
environment and natural resources is not disputed. In fact, the petition seeks to compel it to properly
perform its said functions in relation to [PICOP]. What is at stake is not the scope of the DENR jurisdiction
but

the

manner

by

which

it

exercises

or

refuses

to

exercise

that

jurisdiction.

The courts have the duty and power to strike down any official act or omission tainted with grave abuse of
discretion. The 1987 Constitution is explicit in providing that judicial power includes not only the duty of
the courts of justice to settle actual controversies involving rights which are legally demandable and
enforceable, but also to determine whether or not there has been grave abuse of discretion amounting to
lack or in excess of jurisdiction on the part of any branch or instrumentality of the government. [68]

The Court of Appeals is correct. Since PICOP alleges grave abuse of discretion on the part of the DENR
Secretary, it behooves the court to determine the same. An outright dismissal of the case would have
prevented

such

determination.

For the same reason, the MANDAMUS CASE could not have been dismissed outright for lack of cause of
action. A motion to dismiss based on lack of cause of action hypothetically admits the truth of the
allegations in the complaint.[69]In ruling upon the DENR Secretary's Motion to Dismiss, PICOP's allegation
that it has a contract with the government should, thus, be hypothetically admitted. Necessarily, the DENR
Secretary's argument that there was no such contract should be considered in the trial of the case and
should

185

be

disregarded

at

this

stage

of

the

proceedings.

The DENR Secretary, however, counters that he/she has not yet exercised his/her exclusive jurisdiction
over the subject matter of the case, i.e., either to approve or disapprove PICOP's application for IFMA
conversion. Hence, it is argued that PICOP's immediate resort to the trial court was precipitate based on
the

doctrine

of

exhaustion

of

remedies. [70]

administrative

The Court of Appeals ruled that the doctrine of exhaustion of administrative remedies is disregarded when
there are circumstances indicating the urgency of judicial intervention, [71] which are averred to be extant in
this case, citing PICOP's employment of a sizable number of workers and its payment of millions in taxes to
the government.[72] The Court of Appeals appends:

Moreover, contrary to [the DENR Secretary's] claim, the approval of an application for IFMA conversion is
not purely discretionary on the part of the DENR Secretary since the approval of an IFMA conversion
depends

upon

compliance

with

the

requirements

provided

under

DAO

No.

99-53.

Of course, as earlier intimated, even assuming, arguendo, that the approval of an IFMA conversion involves
the exercise of discretion by the DENR Secretary, the writ of mandamus may be issued to compel the
proper exercise of that discretion where it is shown that there was grave abuse of discretion, manifest
injustice, or palpable excess of authority.[73]

While the Court of Appeals is correct in making such rulings, such accuracy applies only insofar as the
RTC assessment that the MANDAMUS CASE should not have been subjected to outright
dismissal. The issue of whether there was indeed an urgency of judicial intervention (as to warrant the
issuance of a writ of mandamus despite the exclusive jurisdiction of the DENR) is ultimately connected to
the truth of PICOP's assertions, which were hypothetically admitted in the motion to dismiss stage. In other
words, it all boils down to whether the DENR Secretary committed grave abuse of discretion in not
executing the IFMA documents and in not approving PICOP's harvesting of timber from the area of TLA No.
43.

The sixth issue raised by the DENR Secretary concerns Section 1 of Presidential Decree No. 605 which,
according to the Court of Appeals had been partly repealed by Republic Act No. 8975. Section 1 of
Presidential Decree No. 605 provides:

186

SECTION 1. No court of the Philippines shall have jurisdiction to issue any restraining order, preliminary
injunction or preliminary mandatory injunction in any case involving or growing out of the issuance,
approval or disapproval, revocation or suspension of, or any action whatsoever by the proper
administrative official or body on concessions, licenses, permits, patents, or public grants of any kind in
connection with the disposition, exploitation, utilization, exploration and/or development of the natural
resources of the Philippines.

According to the Court of Appeals,

Section 1 of PD 605 has been partly repealed by RA No. 8975, enacted on November 7, 2002. Section 3 of
the said law limits the prohibition on the issuance of restraining orders and injunctions to the following:

"(a) Acquisition, clearance and development of the right-of-way and/or site of location of any national
government

project;

"(b) Bidding or awarding of contract/project of the national government as defined under Section 2 hereof;

"(c) Commencement, prosecution, execution, implementation, operation of any such contract or project;

"(d)

Termination

or

rescission

of

any

such

contract/project;

and

"(e) The undertaking or authorization of any other lawful activity necessary for such contract/project."

Noticeably, the subject coverage on concessions, licenses and the like contemplated in Section 1 of PD 605
is not reproduced in the foregoing enumeration under Section 3 of R.A. 8975. The effect of the nonreenactment is a partial repeal of Section 1 of PD 605. It is a rule of legal hermenuetics (sic) that an act
which purports to set out in full all that it intends to contain operates as a repeal of anything omitted which
was contained in the old act and not included in the act as revised. As the repealing clause of R.A. 8975
states:

187

"Sec. 9. Repealing Clause All laws, decrees including Presidential Decree Nos. 605, 1818 and Republic
Act No. 7160, as amended, orders, rules and regulations or parts thereof inconsistent with this act are
hereby repealed or amended accordingly."[74]

The DENR Secretary claims that since Republic Act No. 8975 simply declares that Presidential Decree No.
605 or parts thereof "inconsistent with this Act are hereby repealed or amended accordingly," then, there
should be an inconsistency between Presidential Decree No. 605 and Republic Act No. 8975 before there
can

be

partial

repeal

of

Presidential

Decree

No.

605.

We agree with the DENR Secretary. Republic Act No. 8975 was not intended to set out in full all laws
concerning the prohibition against temporary restraining orders, preliminary injunctions and preliminary
mandatory injunctions. Republic Act No. 8975 prohibits lower courts from issuing such orders in connection
with the implementation of government infrastructure projects, while Presidential Decree No. 605 prohibits
the issuance of the same, in any case involving licenses, concessions and the like, in connection with the
natural resources of the Philippines. This can be further seen from the respective titles of these two laws,
which, of course, should express the subjects thereof:[75]

REPUBLIC ACT NO. 8975

AN ACT TO ENSURE THE EXPEDITIOUS IMPLEMENTATION AND COMPLETION OF GOVERNMENT

INFRASTRUCTURE PROJECTS BY PROHIBITING LOWER COURTS FROM ISSUING TEMPORARY RESTRAINING
ORDERS, PRELIMINARY INJUNCTIONS OR PRELIMINARY MANDATORY INJUNCTIONS, PROVIDING PENALTIES
FOR VIOLATIONS THEREOF, AND FOR OTHER PURPOSES.

PRESIDENTIAL DECREE NO. 605

BANNING THE ISSUANCE BY COURTS OF PRELIMINARY INJUNCTIONS IN CASES INVOLVING CONCESSIONS,

LICENSES, AND OTHER PERMITS ISSUED BY PUBLIC ADMINISTRATIVE OFFICIALS OR BODIES FOR THE
EXPLOITATION OF NATURAL RESOURCES.

188

However, when the licenses, concessions and the like also entail government infrastructure projects, the
provisions of Republic Act No. 8975 should be deemed to apply, [76] and, thus, Presidential Decree No. 605
had

been

modified

in

this

sense.

Nevertheless, despite the fact that Presidential Decree No. 605 subsists, the DENR Secretary must have
missed our ruling in Datiles and Co. v. Sucaldito,[77] wherein we held that the prohibition in Presidential
Decree

No.

605

"pertains

to

the

issuance

of

injunctions

or

restraining

orders

by

courts

against administrative acts in controversies involving facts or the exercise of discretion in technical
cases, because to allow courts to judge these matters could disturb the smooth functioning of the
administrative machinery. But on issues definitely outside of this dimension and involving
questions of law, courts are not prevented by Presidential Decree No. 605 from exercising their power to
restrain

or

prohibit

administrative

acts."

While there are indeed questions of facts in the present Petitions, the overriding controversy involved
herein is one of law: whether the Presidential Warranty issued by former President Marcos are contracts
within the purview of the Constitution's Non-Impairment Clause. Accordingly, the prohibition in Presidential
Decree No. 605 against the issuance of preliminary injunction in cases involving permits for the
exploitation

of

natural

resources

does

not

apply

in

this

case.

Moreover, as we held in Republic v. Nolasco,[78] statutes such as Presidential Decree No. 605, Presidential
Decree No. 1818 and Republic Act No. 8975 merely proscribe the issuance of temporary restraining orders
and writs of preliminary injunction and preliminary mandatory injunction. They cannot, under pain of
violating the Constitution, deprive the courts of authority to take cognizance of the issues raised in the
principal action, as long as such action and the relief sought are within their jurisdiction. We further held
in Nolasco:

However, it must be clarified that Republic Act No. 8975 does not ordinarily warrant the outright dismissal
of any complaint or petition before the lower courts seeking permanent injunctive relief from the
implementation of national government infrastructure projects. What is expressly prohibited by the statute
is the issuance of the provisional reliefs of temporary restraining orders, preliminary injunctions, and
preliminary mandatory injunctions. It does not preclude the lower courts from assuming jurisdiction over
complaints or petitions that seek as ultimate relief the nullification or implementation of a national

189

government infrastructure project. A statute such as Republic Act No. 8975 cannot diminish the
constitutionally mandated judicial power to determine whether or not there has been a grave
abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or
instrumentality of government. x x x.[79]

As the disposition of these consolidated Petitions will be dispositions of the principal actions, any
applicability

of

the

prohibitions

in

Presidential

Decree

No.

605

will

be

mooted.

Whether or not the presidential

warranty was a contract

PICOP's ground for the issuance of a writ of mandamus is the supposed contract entered into by the
government in the form of a Presidential Warranty, dated 29 July 1969 issued by then President Ferdinand
E. Marcos to PICOP. The DENR Secretary refutes this claim, and alleges that the RTC and the Court of
Appeals erred in declaring the Presidential Warranty a valid and subsisting contract under the
Constitution's

Non-Impairment

Clause.

The Court of Appeals has this brief statement concerning the main issue of the MANDAMUS CASE:

The questioned warranty is a valid contract. It was freely entered into by the government and [PICOP].
Mutual considerations were taken into account in the execution of that contract. [PICOP] invested billions
of pesos in its concession areas. In return, the government assured [PICOP] of its tenurial rights over TLA
No. 43, as amended, as well as its exclusive right to cut, collect and saw timber and pulpwood therein. The
DENR must perforce honor and respect the warranty by maintaining the area alloted (sic) to [PICOP] under
TLA No. 43, as amended.[80]

We are constrained to disagree. In unequivocal terms, we have consistently held that such licenses
concerning the harvesting of timber in the country's forests cannot be considered contracts that would

190

bind the Government regardless of changes in policy and the demands of public interest and welfare.
[81]

Such unswerving verdict is synthesized in Oposa v. Factoran, Jr.,[82] where we held:

In the first place, the respondent Secretary did not, for obvious reasons, even invoke in his motion to
dismiss the non-impairment clause. If he had done so, he would have acted with utmost infidelity to the
Government by providing undue and unwarranted benefits and advantages to the timber license holders
because he would have forever bound the Government to strictly respect the said licenses according to
their terms and conditions regardless of changes in policy and the demands of public interest and welfare.
He was aware that as correctly pointed out by petitioners, into every timber license must be read Section
20 of the Forestry Reform Code (P.D. No. 705) which provides:

"x x x Provided, that when the national interest so requires, the President may amend, modify, replace or
rescind any contract, concession, permit, licenses or any other form of privilege granted herein x x x."

Needless to say, all licenses may thus be revoked or rescinded by executive action. It is not a contract,
property or a property right protected by the due process clause of the constitution. In Tan vs. Director of
Forestry, [125 SCRA 302, 325 (1983)] this Court held:

"x x x A timber license is an instrument by which the State regulates the utilization and disposition of
forest resources to the end that public welfare is promoted. A timber license is not a contract within the
purview of the due process clause; it is only a license or privilege, which can be validly withdrawn
whenever

dictated

by

public

interest

or

public

welfare

as

in

this

case.

"A license is merely a permit or privilege to do what otherwise would be unlawful, and is not a contract
between the authority, federal, state, or municipal, granting it and the person to whom it is granted;
neither is it property or a property right, nor does it create a vested right; nor is it taxation (37 C.J. 168).
Thus, this Court held that the granting of license does not create irrevocable rights, neither is it property or
property rights. (People vs. Ong Tin, 54 O.G. 7576). x x x"

191

We reiterated this pronouncement in Felipe Ysmael, Jr. & Co., Inc. vs. Deputy Executive Secretary [190
SCRA 673, 684 (1990)]:

"x x x Timber licenses, permits and license agreements are the principal instruments by which the State
regulates the utilization and disposition of forest resources to the end that public welfare is promoted. And
it can hardly be gainsaid that they merely evidence a privilege granted by the State to qualified entities,
and do not vest in the latter a permanent or irrevocable right to the particular concession area and the
forest products therein. They may be validly amended, modified, replaced or rescinded by the Chief
Executive when national interests so require. Thus, they are not deemed contracts within the purview of
the due process of law clause [See Sections 3(ee) and 20 of Pres. Decree No. 705, as amended. Also, Tan v.
Director of Forestry, G.R. No. L-24548, October 27, 1983, 125 SCRA 302]."

Since timber licenses are not contracts, the non-impairment clause, which reads:

"SEC. 10. No law impairing, the obligation of contracts shall be passed."

cannot be invoked.

PICOP, however, argues that these rulings laid down in Tan v. Director of Forestry, [83] Felipe Ysmael, Jr. &
Co., Inc. v. Deputy Executive Secretary [84] and Oposa do not find application in the present case allegedly
because the issue here is the unlawful refusal of then DENR Secretary Alvarez to issue an IFMA to PICOP
and

not

the

matter

of

timber

license

being

merely

license

or

privilege. [85]

We are not persuaded. PICOP filed the MANDAMUS CASE against then DENR Secretary Alvarez on the
ground that Secretary Alvarez's refusal to issue an IFMA in its favor allegedly violated its vested right over
the area covered by its TLA No. 43 and presidential warranty, and impaired the obligation of contract under
said

agreement

and

warranty.[86]

The argument that the Presidential Warranty is a contract on the ground that there were mutual
considerations taken into account consisting in investments on PICOP's part is preposterous. All licensees

192

put up investments in pursuing their businesses. To construe these investments as consideration in a

contract would be to stealthily render ineffective the settled jurisprudence that "a license or a permit is not
a contract between the sovereignty and the licensee or permittee, and is not a property in the
constitutional sense, as to which the constitutional proscription against the impairment of contracts may
extend."[87] Neither shall we allow a circumvention of such doctrine by terming such permit as a "warranty."

Whether or not there was

compliance with the requirements
for the conversion of TLA No. 43
as amended into an IFMA

DAO No. 99-53 enumerates the requirements for the grant of the IFMA conversion:

Sec. 9. Qualifications of Applicants. The applicants for IFMA shall be:

(a)

Filipino

citizen

of

legal

age;

or

(b) Partnership, cooperative or corporation whether public or private, duly registered under Philippine laws.

However, in the case of application for conversion of TLA into IFMA, an automatic conversion after proper
evaluation shall be allowed, provided the TLA holder shall have signified such intention prior to the expiry
of the TLA, PROVIDED further, the TLA holder has shown satisfactory performance and have
complied with the terms and conditions of the TLA and pertinent rules and regulations.

Therefore, the following are the requisites for the automatic conversion of the TLA into an IFMA, to wit:

1.

The TLA holder had signified its intent to convert its TLA into an IFMA prior to the expiration of its
TLA;

193

2.
3.

Proper evaluation was conducted on the application; and

The TLA holder has satisfactorily performed and complied with the terms and conditions of the TLA
and the pertinent rules and regulations.

The Court of Appeals held:

From the foregoing provision, it can be gleaned that as long as an applicant-corporation has signified its
intention to convert its TLA into an IFMA prior to the expiration of its TLA, has shown satisfactory
performance as a TLA holder and has complied with the terms and conditions of the TLA and pertinent
rules

and

regulations,

conversion

follows

as

matter

of

course.

It

becomes

automatic.

[PICOP] has complied with the administrative requirements. In its letter dated August 28, 2000 to the
Community Environment and Natural Resources Office (CENRO) for DENR-RXIII-D4, Bislig, Surigao del Sur,
it signified its intention to convert its TLA into an IFMA. It has also shown satisfactory performance as a TLA
holder as evidenced by the July 31, 2001 Report of Director Elias Seraspi, Jr. The said report states that
[PICOP]

was

able

to

hold

on

its

management

and

protection

of

its

concession

areas.

Apparently, [the DENR Secretary] refuses to sign the documents on the grounds that [PICOP] has not
secured and submitted a clearance from the National Commission on Indigenous Peoples (NCIP) showing
that its TLA areas do not overlap with existing ancestral domains: and that [PICOP] has outstanding and
overdue

obligation

in

forest

charges.

The two reasons last cited by the Secretary for refusing to sign and deliver the IFMA documents are not
real

nor

valid.

Section 59 of RA 8371, which requires prior certification from the NCIP that the areas affected do not
overlap with any ancestral domain before any IFMA can be entered into by the government, should be read
in

conjunction

with

Sections

(a)

and

56

of

the

same

law.

Section 3 (a) of RA 8371 describes ancestral domains as "areas generally belonging to ICCs/IPs comprising
lands, inland waters, coastal areas, and natural resources therein, held under a claim of ownership,

194

occupied or possessed by ICCs/IPs, by themselves or through their ancestors, communally or individually

since time immemorial, continuously to the present xxx." On the other hand, Section 56 of the same law
provides:

"Sec. 56. Existing Property Rights Regimes. Property rights within the ancestral domains already existing
and/or vested upon effectivity of this Act, shall be recognized and respected."

It can thus be deduced that Section 59 can only be interpreted to refer to ancestral domains which have
been duly established as such (i.e., the concerned indigenous people must have been in continuous
possession or occupation of the area concerned since time immemorial up to the present). Too, existing
property rights over the areas sought to be declared as part of an ancestral domain must be recognized
and

respected.

[PICOP] has already acquired property rights over its concession areas. It has been in exclusive, continuous
and uninterrupted possession and occupation of TLA No. 43 areas since 1952 to present. From the time it
managed and operated TLA No. 43, it has made huge investments on its concession areas. These include
the planting of millions of trees and the scientific silvicultural treatment of the forest to make it more
productive. Having acquired property rights over TLA No. 43 areas, [PICOP] need not be required to secure
clearance

from

the

NCIP

pursuant

to

Section

59

of

RA

8371.

[The DENR Secretary's] claim that [PICOP] failed to settle its outstanding obligations to the government in
the form of unpaid forest charges do not inspire belief. Under Sec. 3 (3.5) of DENR Memorandum Circular
No. 96-04 dated March 14, before an Integrated Annual Operations Plan (IAOP) can be issued, it is a
condition precedent that the licensee has no pending forestry accounts. If it were true that [PICOP] had
unpaid forest charges, why was it issued IAOP for calendar year 2001-2002 by Secretary Alvarez himself?
[88]

Upon close scrutiny of the records, this Court observes that these findings of compliance by PICOP are
negated

by

the

very

evidence

on

which

they

are

supposedly

moored.

As clearly shown by the 31 July 2001 Memorandum of Regional Executive Director Elias D. Seraspi, Jr.,
DENR Caraga Region, RED Seraspi neither made a categorical finding of PICOP's satisfactory performance

195

on its TLA No. 43 nor favorably recommended approval of PICOP's application for IFMA conversion. Rather,
RED Seraspi recommended the proper evaluation of PICOP's request for the automatic conversion of TLA
No. 43 into an IFMA:

Hence, it is imperative to chart a good forest policy direction for the management, development and
protection of TLA No. 43 after it expires on April 26, 2002 for the purpose of sustainable forest
management of the area in support of national development. With this vision, the proper evaluation to
consider the request for automatic conversion of TLA No. 43 to IFMA pursuant to Section 9, DENR A.O. No.
99-53, upon its expiration on April 26, 2002 is hereby recommended. [89]

Administrative

Requirements

There was actually no way by which RED Seraspi could have come up with a satisfactory performance
finding since the very Performance Evaluation Team tasked to make the evaluation found PICOP to have
violated existing DENR rules and regulations. According to the 11 July 2002 Memorandum Report of the
Performance Evaluation Team, PICOP has not submitted its Five-Year Forest Protection Plan and its SevenYear

Plan.[90]

Reforestation

Forest charges are, on the other hand, due and payable within 30 days from removal of the forest products
from the cutting area when timber and other forest products are removed for domestic sales pursuant to
Sections 6 and 6.2 of DAO No. 80, series of 1987. Thus:

Section 6. Payment of Forest Charges. x x x In such a case, the forest charges shall be due and payable
as

6.1

follows:

When

timber

and

other

forest

products

are

intended

for

export.

6.2 When timber and other forest products are to be removed for domestic sales. The forest charges
shall be due and payable within thirty (30) days from removal thereof at the cutting area, or where the

196

forest products are gathered; Provided, that such date of removal shall in no case be beyond thirty (30)
days when the products are cut, gathered and removed.

As testified to by FMB SFMS Ignacio M. Evangelista, PICOP failed to pay its regular forest charges covering
the period from 22 September 2001 to 26 April 2002 in the total amount of P15,056,054.05. [91] PICOP was
also late in paying most of its forest charges from 1996 onwards for which it is liable for a surcharge of
25% per annum on the tax due and interest of 20% per annum which now amounts to P150,169,485.02.
[92]

Likewise, it has overdue and unpaid silvicultural fees in the amount of P2,366,901.00 as of 30 August

2002.[93] In all, PICOP has unpaid and overdue forest charges in the sum of P167,592,440.90 as of 10
2002.[94]

August

PICOP's failure to pay its regular forest charges, interests, penalties and surcharges and silvicultural fees
amounting to P167,592,440.90 as of 30 August 2002 is further evidenced by the collection letters sent to
PICOP and the absence of official receipts in the DENR records in Bislig City evidencing payment of the
overdue amounts stated in the said collection letters. [95] As can be gleaned from SFMS Evangelista's
tabulation, all the official receipts evidencing payments of PICOP with their corresponding periods are
indicated. However, there are no similar official receipts for the period covering 22 September 2001 to 26
April

2002,

which

indicate

that

no

payment

has

been

made

for

the

same

period.

With the DENR Secretary's presentation of its positive and categorical evidence showing PICOP's failure to
pay its forest charges amounting to P167,592,440.90 as of 10 August 2002, the burden of evidence has
been shifted to PICOP to prove otherwise. PICOP should have, thus, presented official receipts as proof of
their

payment

of

such

forest

charges,

but

failed

to

do

so.

Despite the foregoing evidence, the Court of Appeals declared that if it were true that PICOP has unpaid
forest charges, it should not have been issued an IAOP for the year 2001-2002 by Secretary Alvarez
himself.[96] In doing so, the Court of Appeals disregarded the part of the very evidence presented by PICOP
itself, which shows that the IAOP was approved subject to several conditions, not the least of which was
the submission of proof of updated payment of forest charges from April 2001 to June 2001. [97]

Neither was this the only evidence presented by PICOP which showed that it has unpaid forest charges.
PICOP presented the certification of CENRO Calunsag which refers only to its alleged payment of regular
forest charges covering the period from 14 September 2001 to 15 May 2002. [98] The certification does not

197

mention similar payment of the penalties, surcharges and interests which it incurred in paying late several
forest

charges,

which

fact

it

did

not

rebut.

The 27 May 2002 Certification by CENRO Calunsag, on the other hand, specified only the period covering
14 September 2001 to 15 May 2002 and the amount of P53,603,719.85 paid by PICOP without indicating
the corresponding volume and date of production of the logs. This is in contrast to the findings of SFMS
Evangelista which cover the period from CY 1996 to 30 August 2002 which includes penalties, interests,
and

surcharges

for

late

payment

pursuant

to

DAO

80,

series

of

1987.

Per request of PICOP, a certification dated 21 August 2002 was issued by Bill Collector Amelia D. Arayan,
and attested to by CENRO Calunsag, showing that PICOP paid only regular forest charges of its log
production covering 1 July 2001 to 21 September 2001. However, there being log productions after 21
September 2001, PICOP failed to pay the corresponding regular forest charges amounting to
P15,056,054.05.[99] The same certification also shows delayed payment of forest charges, thereby
corroborating the testimony of SFMS Evangelista and substantiating the imposition of penalties and
surcharges.

Finally, even if we consider for the sake of argument that the IAOP should not have been issued if PICOP
had existing forestry accounts, the issuance of the IAOP cannot be considered proof that PICOP has paid
the same. Firstly, the best evidence of payment is the receipt thereof. PICOP has not presented any
evidence that such receipts had been lost or destroyed or cannot be produced in court. [100] Secondly, it is a
well known and settled rule in our jurisdiction that the Republic, or its government, is usually not estopped
by mistake or error on the part of its officials or agents. [101] If PICOP had been issued an IAOP in violation of
the law allegedly because it may not be issued if PICOP had existing forestry accounts, the government
cannot be estopped from collecting such amounts and providing the necessary sanctions therefor,
including

Statutory

the

withholding

of

the

IFMA

until

such

amounts

are

paid.

Requirements

To recap, the Court of Appeals had relied on RED Seraspi's certification in concluding that there was
satisfactory performance on the part of PICOP as a TLA holder, despite said certification showing noncompliance with the required Five-Year Forest Protection Plan and Seven-Year Reforestation Plan. The Court
of Appeals also declared that PICOP has paid its outstanding obligations based on an inference that the

198

IAOP would not have been issued if PICOP had unpaid forest charges, contrary to the conditions laid down
in the IAOP itself, and in violation of the Best Evidence Rule and the doctrine disallowing the estoppel of
the

government

from

the

acts

of

its

officers.

On the statutory requirement of procuring a clearance from the NCIP, the Court of Appeals held that PICOP
need not comply with the same at all. As quoted above, the Court of Appeals held that Section 59 of
Republic Act No. 8371, which requires prior certification from the NCIP that the areas affected do not
overlap with any ancestral domain before any IFMA can be entered into by government, should be
interpreted to refer to ancestral domains which have been duly established as such by the continuous
possession and occupation of the area concerned by indigenous peoples since time immemorial up to the
present. According to the Court of Appeals, PICOP has acquired property rights over the TLA No. 43 areas,
being in exclusive, continuous and uninterrupted possession and occupation of TLA No. 43 areas since
1952

up

to

the

present.

This ruling defies the settled jurisprudence we have mentioned earlier, including that of Oposa and Tan
which held that "[a] license is merely a permit or privilege to do what otherwise would be unlawful, and is
not a contract between the authority, federal, state or municipal, granting it and the person to whom it is
granted; neither is it property or a property right, nor does it create a vested right; x x x."[102]

The Court of Appeals' resort to statutory construction is, in itself, misplaced. Section 59 of Republic Act No.
8371 is clear and unambiguous:

SEC. 59. Certification Precondition. All departments and other governmental agencies shall henceforth
be strictly enjoined from issuing, renewing or granting any concession, license or lease, or entering into
any production-sharing agreement, without prior certification from the NCIP that the area affected does not
overlap with any ancestral domain. Such certification shall only be issued after a field-based investigation
is conducted by the Ancestral Domains Office of the area concerned: Provided, That no certification shall
be issued by the NCIP without the free and prior informed and written consent of the ICCs/IPs concerned:
Provided, further, That no department, government agency or government-owned or controlled corporation
may issue new concession, license, lease, or production sharing agreement while there is a pending
application for a CADT: Provided, finally, That the ICCs/IPs shall have the right to stop or suspend, in
accordance with this Act, any project that has not satisfied the requirement of this consultation process.

199

The court may not construe a statute that is clear and free from doubt. Time and again, it has been
repeatedly declared by this Court that where the law speaks in clear and categorical language, there is no
room for interpretation. There is only room for application. [103] PICOP's intent to put a cloud of ambiguity in
Section 59 of Republic Act No. 8371 by invoking Section 3(a) thereof fails miserably. Section 3(a) of
Republic Act No. 8371 defines ancestral domain as follows:

a) Ancestral domains Subject to Section 56 hereof, refers to all areas generally belonging to ICCs/IPs
comprising lands, inland waters, coastal areas, and natural resources therein, held under a claim of
ownership, occupied or possessed by ICCs/IPs, by themselves or through their ancestors, communally or
individually since time immemorial, continuously to the present except when interrupted by war, force
majeure or displacement by force, deceit, stealth or as a consequence of government projects or any other
voluntary dealings entered into by government and private individuals/corporations, and which are
necessary to ensure their economic, social and cultural welfare. It shall include ancestral lands, forests,
pasture, residential, agricultural, and other lands individually owned whether alienable and disposable or
otherwise, hunting grounds, burial grounds, worship areas, bodies of water, mineral and other natural
resources, and lands which may no longer be exclusively occupied by ICCs/IPs but from which they
traditionally had access to for their subsistence and traditional activities, particularly the home ranges of
ICCs/IPs who are still nomadic and/or shifting cultivators;

Ancestral domains remain as such even when possession or occupation of the area has been interrupted
by causes provided under the law such as voluntary dealings entered into by the government and private
individuals/corporation. Therefore, the issuance of TLA No. 43 in 1952 did not cause the Indigenous
Cultural Communities or Indigenous Peoples to lose their possession or occupation over the area covered
by

TLA

No.

43.

The issuance of a Certificate of Ancestral Domain Title is merely a formal recognition of the ICCs/IPs' rights
of possession and ownership over their ancestral domain identified and delineated in accordance with the
Indigenous Peoples Rights Act, [104] and therefore, cannot be considered a condition precedent for the need
for an NCIP certification. In the first place, it is manifestly absurd to claim that the subject lands must first
be proven to be part of ancestral domains before a certification that they are not part of ancestral domains
can be required. In Cruz v. Secretary of DENR,[105] where no single member of the Court penned a majority
opinion (since the petition to declare Republic Act No. 8371 unconstitutional was dismissed for the reason

200

that the votes were equally divided), Mr. Justice Reynato Puno, who voted to dismiss the petition, wrote in
his separate opinion:

As its subtitle suggests, [Section 59 of R.A. No. 8371] requires as a precondition for the issuance of any
concession, license or agreement over natural resources, that a certification be issued by the NCIP that the
area subject of the agreement does not lie with any ancestral domain. The provision does not vest the
NCIP with power over the other agencies of the State as to determine whether to grant or deny any
concession or license or agreement. It merely gives the NCIP the authority to ensure that the ICCs/IPs have
been informed of the agreement and that their consent thereto has been obtained. Note that the
certification applies to agreements over natural resources that do not necessarily lie within the ancestral
domains. For those that are found within the said domains, Sections 7(b) and 57 of the IPRA apply.

Another

requirement

determined

by

the

Court

of

Appeals

to

have

been

complied

with

by

PICOP, albeit impliedly this time by not mentioning it at all, is the requirement posed by Sections 26 and
27 of the Local Government Code:

SEC. 26. Duty of National Government Agencies in the Maintenance of Ecological Balance. It shall be the
duty of every national agency or government-owned or controlled corporation authorizing or involved in
the planning and implementation of any project or program that may cause pollution, climatic change,
depletion of non-renewable resources, loss of crop land, rangeland, or forest cover, and extinction of
animal or plant species, to consult with the local government units, nongovernmental organizations, and
other sectors concerned and explain the goals and objectives of the project or program, its impact upon
the people and the community in terms of environmental or ecological balance, and the measures that will
be

undertaken

to

prevent

or

minimize

the

adverse

effects

thereof.

SEC. 27. Prior Consultation Required. No project or program shall be implemented by government
authorities unless the consultations mentioned in Sections 2 (c) and 26 hereof are complied with, and prior
approval of the sanggunian concerned is obtained: Provided, That occupants in areas where such projects
are to be implemented shall not be evicted unless appropriate relocation sites have been provided, in
accordance with the provisions of the Constitution.

201

These provisions are clear: the prior approval of local government units affected by the proposed
conversion of a TLA into an IFMA is necessary before any project or program can be implemented by the
government authorities that may cause "depletion of non-renewable resources, loss of crop land,
rangeland

or

forest

cover,

and

extinction

of

animal

or

plant

species."

The common evidence of the DENR Secretary and PICOP, namely the 31 July 2001 Memorandum of RED
Seraspi, enumerates the local government units and other groups which had expressed their opposition to
PICOP's application for IFMA conversion:

7. During the conduct of the performance evaluation of TLA No. 43 issues/complaints against PRI were
submitted thru Resolutions and letters. It is important that these are included in this report for assessment
of

what

are

their

worth,

viz:

xxxx

7.2 Joint Resolution (unnumbered), dated March 19, 2001 of the Barangay Council and Barangay Tribal
Council of Simulao, Boston, Davao Oriental (ANNEX F) opposing the conversion of TLA No. 43 into IFMA
over

the

17,112

hectares

allegedly

covered

with

CADC

No.

095.

7.3 Resolution Nos. 10, s-2001 and 05, s-2001 (ANNEXES G & H) of the Bunawan Tribal Council of Elders
(BBMTCE) strongly demanding none renewal of PICOP TLA. They claim to be the rightful owner of the area
it

being

their

alleged

ancestral

land.

7.4 Resolution No. 4, S-2001 of Sitio Linao, San Jose, Bislig City (ANNEX I) requesting not to renew TLA 43
over

the

900

hectares

occupied

by

them.

7.5 Resolution No. 22, S-2001 (ANNEX J) of the Sanguniang Bayan, Lingig, Surigao del Sur not to grant the
conversion of TLA 43 citing the plight of former employees of PRI who were forced to enter and farm
portion

of

TLA

No.

43,

after

they

were

laid

off.

7.6 SP Resolution No. 2001-113 and CDC Resolution Nos. 09-2001 of the Sanguniang Panglungsod of Bislig
City (ANNEXES K & L) requesting to exclude the area of TLA No. 43 for watershed purposes.

202

7.7 Resolution No. 2001-164, dated June 01, 2001 (ANNEX M) Sanguniang Panglungsod of Bislig City
opposing the conversion of TLA 43 to IFMA for the reason that IFMA do not give revenue benefits to the
City.[106]

As stated in RED Seraspi's 31 July 2001 Memorandum, [107] several indigenous groups and some affected
local government units have expressly opposed PICOP's application for IFMA conversion of its TLA No. 43.

PICOP merely submitted a purported resolution [108] of the Province of Surigao del Sur indorsing the approval
of PICOP's application for IFMA conversion. But Surigao del Sur is not the only province affected by the area
covered by the proposed IFMA. As even the Court of Appeals found, PICOP's TLA No. 43 traverses the
length and breadth not only of Surigao del Sur but also Agusan del Sur, Compostela Valley and Davao
Oriental.[109] How then can PICOP claim that it complied with the Local Government Code requirement of
obtaining prior approval of the Sangunian concerned when only one out of the four affected local
government units has purportedly signified its concurrence to the proposed IFMA conversion?

Finally, the DENR, by withholding the conversion of PICOP's TLA No. 43 into an IFMA, has made a factual
finding that PICOP has not yet complied with the requirements for such a conversion. Findings of facts of
administrative agencies are generally accorded great respect, if not finality, by the courts because of the
special knowledge and expertise over matters falling under their jurisdiction. [110] Such finality of the DENR's
factual finding, supported as it is by substantial evidence, can only be overcome by grave abuse of
discretion amounting to lack or excess in jurisdiction, which is even more pronounced in a Petition for
Mandamus.

Whether or not there has already

been a conversion of TLA No. 43
into an IFMA

The Court of Appeals declared that there exists no legal impediment to the conversion of respondent's TLA
No. 43 into an IFMA as evidenced by petitioner's letters dated 26 October 2002 and 26 April 2002:

203

Moreover, [the DENR Secretary's] own letters to [PICOP] confirm that it has established a clear right to the
automatic conversion of TLA No. 43 to IFMA. Thus, on October 26, 2002, [the DENR Secretary] stated in his
letter to [PICOP] "that pursuant to DAO-99-53, we have cleared the conversion on PICOP's TLA No. 43 to
IFMA effective from the expiration of said TLA on April 26, 2002." Too, in its April 24, 2002 letter to [PICOP],
[the DENR Secretary] granted PICOP's TDMP "[p]ending the formal approval of [its] IFMA xxx." It could thus
be deduced that there exists no legal impediment to the conversion of PICOP's TLA 43 to IFMA. Its approval
remains a formality.

We disagree. Then DENR Secretary Alvarez's 25 October 2001 letter is reproduced herein for reference:

Dear

Mr.

Bernardino:

Consistent with your attached Memorandum to her Excellency, the President, dated 17 October 2001 and
in response to your Letter of Intent dated 25 January 2001, we wish to inform you that, pursuant to DENR
Administrative Order No. 99-53, we have cleared the conversion of PICOP's Timber License
Agreement (TLA) No. 43 to Integrated Forest Management Agreement (IFMA) effective from the
expiration

of

said

TLA

on

April

26,

2002.

In this regard, you are hereby requested to designate PICOP's representative(s) to discuss with the DENR
Team, created under Special Order No. 2001-638, the conditions and details of the said IFMA, including the
production sharing arrangement between PICOP and the government. [111]

By giving this clearance for the conversion of PICOP's TLA into an IFMA, the DENR Secretary cannot, by any
stretch of imagination, be claimed to have granted the conversion itself. The letter is clear that the
"conversion" could not be final since its conditions and details still have to be discussed as stated in the
second paragraph of said letter; hence, the same letter could not have reduced to a mere formality the
approval

of

the

conversion

of

PICOP's

TLA

No.

43

into

an

IFMA.

Likewise, then DENR Secretary Alvarez's 26 April 2002 letter approving PICOP's Transition Development
and Management Plan (TDMP) cannot be considered as an approval of PICOP's application for IFMA
conversion. Again, the aforesaid letter is quoted in full:

204

April 24, 2002

MR.

WILFREDO

Vice

President

PICOP

D.

FUENTES
Resident

Manager

Resources,

2nd

Floor,

2280

Incorporated
Moredel

Pasong

Building

Tamo

Extension

Makati

City

Dear

Mr.

Fuentes:

This refers to your request for approval of the submitted Two-year Transition Development and
Management Plan of PICOP Resources, Inc. (PRI) for the areas under TLA No. 43 which expires on April 26,
2002.

Pending the formal approval of your IFMA and consistent with our letter to the PRI President dated 25
October 2002, we hereby grant your Transition Development and Management Plan (TDMP) for a period of
one

(1)

year,

effective

26

April

2002.

Within such period we expect PRI to submit/comply with all the necessary requisites for the
final conversion of TLA 43 into IFMA, as provided for under DENR Administrative Order No. 99-53,
including the settlement of certain obligations such as taxes, if any, and submission of plans and programs
for evaluation and approval of item number 1 of your proposal contained in your letter dated February 4,
2002.

All other proposed activities in your TDMP, particularly items 2 7 of your letter dated February 4, 2002,
are

For

Very

(sgd)

205

hereby

your

information

truly

approved.

and

guidance.

yours,

HEHERSON

T.

ALVAREZ

Secretary

Cc:

Mr.

Teodoro

G.

Bernardino

President

The Director, FMB

The aforesaid letter speaks for itself. PICOP's application for IFMA conversion is still pending
approval. Indeed, there could have been no approval of PICOP's application for IFMA conversion because
DAO No. 99-53 (which governs application for IFMA conversion) requires full and complete compliance with
the requirements for conversion before it may be approved. As stated in the letter itself of then DENR
Secretary Alvarez, PICOP has yet to"submit/comply with all the necessary requisites for final
conversion

of

TLA

No.

43

into

IFMA."

Even assuming, however, that the IFMA has already been converted, this is all purely academic because of
the above-discussed settled jurisprudence that logging permits are not contracts within the NonImpairment Clause and thus, can be amended, modified, replaced or rescinded when the national interest
so requires. If the DENR Secretary, therefore, finds that the IFMA would be in violation of statutes, rules
and regulations, particularly those protecting the rights of the local governments and the indigenous
peoples within the IFMA area, then it behooves the DENR Secretary to revoke such IFMA. These same
statutes, rules and regulations are the very same requirements mentioned above for the conversion of the
TLA

No.

43

into

an

IFMA.

Whether or not it is proper to

determine the constitutionality of
Proclamation No. 297 in these
consolidated petitions

Another reason why the DENR Secretary wishes to further withhold the conversion of PICOP's TLA No. 43
into an IFMA is the 25 November 2002 Proclamation No. 297 excluding an area of 8,100 hectares, more or

206

less, from the coverage of TLA No. 43, as amended, and which declared the same as a mineral reservation
and as an environmentally critical area. The DENR Secretary claims that said Presidential Proclamation is
rendered nugatory by the Court of Appeals' disposition that the DENR should honor and respect the area
allotted

to

PICOP

under

TLA

43.[112]

No.

PICOP claims that Proclamation No. 297 is a new matter which the DENR Secretary cannot raise before this
Court

without

offending

the

basic

rules

of

fair

play,

justice

and

due

process. [113]

The DENR Secretary counters that it did not take up the issue of Proclamation No. 297 before the trial court
precisely because said proclamation was issued more than one month after the trial court rendered its 11
October 2002 Decision. The DENR Secretary claims that PICOP cannot claim a violation of its right to due
process

because

it

raised

the

issue

before

the

Court

of

Appeals

in

its

Memorandum.

While not giving in to the DENR Secretary's argument, PICOP claims that Proclamation No. 297 is violative
of

the

Constitution

and

an

encroachment

on

the

legislative

powers

of

Congress. [114]

We agree with PICOP that this constitutional issue cannot be decided upon in this case. This Court will not
touch the issue of unconstitutionality unless it is the very lis mota. It is a well-established rule that a court
should not pass upon a constitutional question and decide a law to be unconstitutional or invalid, unless
such question is raised by the parties and that when it is raised, if the record also presents some other
ground upon which the court may raise its judgment, that course will be adopted and the constitutional
question

will

be

left

for

consideration

until

such

question

will

be

unavoidable. [115]

The constitutional question presented by PICOP is not the very lis mota in these consolidated cases, as the
preceding discussions very well give us adequate grounds to grant the Petition in G.R. No. 162243, deny
the Petition in G.R. No. 164516, and dismiss the Petition in G.R. No. 171875. Moreover, PICOP has filed a
separate petition for the declaration of nullity of Proclamation No. 297, wherein the issue of the
constitutionality

of

Proclamation

No.

297

is

properly

ventilated.

Consequently, all actions and reliefs sought by either PICOP or the DENR Secretary which has Proclamation
No. 297 as its ground or subject should be ventilated either in the pending petition for the declaration of its
nullity, or in another proper suit instituted for that matter.

207

EPILOGUE AND DISPOSITION

In sum, the DENR Secretary has adequately proven that PICOP has, at this time, failed to comply with the
administrative and statutory requirements for the conversion of TLA No. 43 into an IFMA. The Petition in
G.R.

No.

162243

should

therefore

be

granted.

On the other hand, as PICOP is not yet entitled to such conversion, then Secretary Alvarez had been
correct in withholding the same and thus cannot be held liable for damages therefor. Thus, the Petition in
G.R.

No.

164516

should

be

dismissed.

Finally, the DENR Secretary's Petition in G.R. No. 171875, assailing the lifting by the Court of Appeals of the
Preliminary

Injunction

in

its

favor,

is

now

mooted.

PICOP's noncompliance with the requirements for the conversion of their TLA is so glaring, that we almost
see a reluctance to uphold the law in light of PICOP's sizeable investments in its business, a fact repeatedly
stressed by PICOP in its pleadings. In applying the judicial policy of nurturing prosperity, consideration
should also be given to the long-term effects of the judicial evaluations involved, particularly to our
nation's

greatest

wealth,

our

vast

natural

resources.

Our country has been blessed with rich, lush and verdant rain forests in which varied, rare and unique
species of flora and fauna may be found. [116] The legislative policy has been to preserve and nourish these
natural resources as they are not only for our benefit but more so for the countless future generations to
which we are likewise responsible. It has also been legislative policy to let the citizens of this country reap
their benefits, foremost the citizens in close proximity to such resources, through the local governments
and

the

NCIP.

In working for the legislative policy of environmental preservation, the requirements of a five-year forest protection
plan and seven-year reforestation plan had been laid down, together with the levy of forest charges for the regulation
of forestry activities. In pursuing, on the other hand, the benefit distribution policy, the Local Government Code
requires prior Sanggunian approval to ensure that local communities partake in the fruits of their own backyard, while
R.A. No. 8371 provides for the rights of the indigenous peoples, who have been living in, managing, and nourishing
these

208

forests

since

time

immemorial.

PICOP has been fortunate to have been awarded an enormous concession area and thus, a huge chunk of the benefits
of this country's natural resources. Attached to this fortune is the responsibility to comply with the laws and
regulations implementing the stated legislative policies of environmental preservation and benefit distribution. These
laws and regulations should not be ignored, and the courts should not condone such blatant disregard by those who
believe they are above the law because of their sizable investments and significant number of workers employed.
PICOP has only itself to blame for the withholding of the conversion of its TLA. But while this disposition confers
another chance to comply with the foregoing requirements, the DENR Secretary can rightfully grow weary if the
persistence on noncompliance will continue. The judicial policy of nurturing prosperity would be better served by
granting

such

concessions

to

someone

who

will

abide

by

the

law.

WHEREFORE, the Petition in G.R. No. 162243 is GRANTED. The Decision of the Court of Appeals insofar as it affirmed
the RTC Decision granting the Petition for Mandamus filed by Paper Industries Corporation of the Philippines (PICOP) is
hereby REVERSED and SET ASIDE. The Petition in G.R. No. 164516 seeking the reversal of the same Decision insofar
as it nullified the award of damages in favor of PICOP is DENIED for lack of merit. The Petition in G.R. No. 171875,
assailing the lifting of the Preliminary Injunction in favor of the Secretary of Environment and Natural Resources
is DISMISSED on the ground Of mootness.SO ORDERED.

MATUGUINA

INTEGRATED

WOOD

PRODUCTS,

INC.,

petitioner,

vs.
The HON. COURT OF APPEALS, DAVAO ENTERPRISES CORPORATION, The HON. MINISTER, (NOW
SECRETARY) of NATURAL RESOURCES AND PHILLIP CO, respondents.
G.R. No. 98310 | 1996-10-24
Tagged under keywords

TORRES, JR., J.:

Matuguina Integrated Wood Products Inc. (MIWPI, for brevity) filed this action for Prohibition, Damages and
Injunction, in order to prevent the respondent Minister (now Secretary) of Natural Resources from enforcing
its Order of Execution against it, for liability arising from an alleged encroachment of the petitioner over
the timber concession of respondent DAVENCOR located in Mati, Davao Oriental.
The Regional Trial Court, Branch 17, Davao City, ruled in favor of the petitioner, but on appeal, was
reversed by the respondent Court of Appeals in its decision dated February 25, 1991, which found MIWPI,
as an alter ego of Milagros Matuguina and/or Matuguina Logging Enterprises (MLE), to be liable to
DAVENCOR for the illegal encroachment.

209

The following are the antecedent facts:

On June 28, 1973, the Acting Director of the Bureau of Forest Development issued Provisional Timber
License (PTL) No. 30, covering an area of 5,400 hectares to Ms. Milagros Matuguina who was then doing
business under the name of MLE, a sole proprietorship venture. A portion, covering 1,900 hectares, of the
said area was located within the territorial boundary of Gov. Generoso in Mati, Davao Oriental, and
adjoined the timber concession of Davao Enterprises Corporation (DAVENCOR), the private respondent in
this case.
On July 10, 1974, petitioner Matuguina Integrated Wood Products, Inc. (MIWPI), was incorporated, having
an authorized capital stock of Ten Million Pesos (P10,000,000.00). 1 The incorporators/stockholders of
MIWPI, and their stock subscriptions were as follows:
Name No. Of Shares Amount of Capital Subscribed Stock Subscribed
1. Henry Wee 1,160,000 1,160,000.00
2. Ma. Milagros Matuguina 400,000 400,000.00
3. Alejandro Chua Chun 200,000 200,000.00
4. Bernadita Chua 120,000 120,000.00
5. Domingo Herrera 40,000 40,000.00
6. Manuel Hernaez 40,000 40,000.00
7. Luis Valderama 40,000 40,000.00
2,000,000 2,000,000.00
======== =========
Milagros Matuguina became the majority stockholder of MIWPI on September 24, 1974, when the latter's
Board of Directors approved by Resolution the transfer of 1,000,000 shares from Henry Wee to Milagros
Matuguina, thus giving her seventy percent (70%) stock ownership of MIWPI.
In an undated letter 2 to the Director of Forest Development (BFD) on November 26, 1974, Milagros
Matuguina requested the Director for a change of name and transfer of management of PTL No. 30 from a
single proprietorship under her name, to that of MIWPI.
This request was favorably endorsed on December 2, 1974 3 by the BFD's Acting Director, Jose Viado to
respondent Secretary of Natural Resources, who approved the same on September 5, 1975. 4
On July 17, 1975, Milagros Matuguina and petitioner MIWPI executed a Deed of Transfer 5 transferring all of
the former's rights, interests, ownership and participation in Provincial Timber License No. 30 to the latter
for and in consideration of 148,000 shares of stocks in MIWPI.
A copy of said deed was submitted to the Director of Forest Development and petitioner MIWPI had since
been acting as holder and licensee of PTL No. 30
On July 28, 1975, pending approval of the request to transfer the PTL to MIWPI, DAVENCOR, through its
Assistant General Manager, complained to the District Forester at Mati, Davao Oriental that Milagros

210

Matuguina/MLE had encroached into and was conducting logging operations in DAVENCOR's timber
concession.
After investigation of DAVENCOR's complaint, the Investigating Committee which looked into DAVENCOR's
complaint submitted its report to the Director, finding that MLE had encroached on the concession area of
DAVENCOR. In line with this, the Director of Forest Development issued an Order 6 on July 15, 1981, finding
and declaring MLE to have encroached upon, and conducted illegal logging operations within the licensed
or concession area of DAVENCOR.
MLE appealed the Order to the Ministry of Natural Resources, which appeal was docketed as MNR CASE No.
6540. During the pendency of the appealed case with the Minister of Natural Resources, Ma. Milagros
Matuguina disposed of her shares in petitioner MIWPI, thereby ceasing to be a stockholder of the petitioner
as of March 16, 1986. 7
On October 1, 1986, The Minister of Natural Resources, Hon. Ernesto M. Maceda rendered his Decision, 8
affirming the aforesaid order of the Director of Foreign Development, stating thus:
DECISION
For our Resolution is the appeal by MATUGUINA LOGGING ENTERPRISES (MLR, for short) of the Order dated
15 July 1991 of the Director of Forest Development finding and declaring MLE to have encroached upon,
and conducted illegal logging operations within the license or concession area of DAVAO ENTERPRISES
CORPORATION. The aforesaid Order dispositively states:
Wherefore, there being a clear and convincing proof that Matuguina Conducted illegal operation within the
license area of DAVENCOR, above named respondent is hereby ordered to pay to the complainant the
equivalent value in pesos of 2,352.04 cubic meters of timber based on the market price obtaining, at the
logpond of the respondent at the time of cutting, minus the cost of production, or to restitute to the
complainant equal volume of 2,352.04 cubic meters of logs owned by respondent to be taken at
respondent's logpond. The respondent is hereby directed to comply with this Order within a period of
ninety (90) days from receipt of this Order and after the lapse of the said period, no compliance has been
made by the respondent, its logging operations shall ipso facto become automatically suspended until
respondent shall have complied as directed.
The Regional Director of Region II, Davao City is hereby instructed to implement this Order and to submit
his compliance report within ten (10) days after the lapse of the ninety (90) days period within which the
respondent is directed to comply with this Order.
And that the dispositive portion of the said decision states:
WHEREFORE, the Order dated 15 July 1981 of the Director of Forest Development is hereby AFFIRMED.
When the Decision of the Minister of Natural Resources became final and executory, Philip Co and
DAVENCOR requested the respondent Minister on October 30, 1986 to issue immediately a writ of
execution against MLE and/or MIWPI. 9 The Order of Execution 10 was issued on January 6, 1987 by the
Minister through the latter's Assistant on Legal Affairs. The said Order directed the issuance of a writ of

211

execution, not only against MLE, but likewise against MIWPI. The dispositive portion of the order provides:
WHEREFORE, let a Writ of Execution be issued against Matuguina Logging Enterprises and/or Matuguina
Integrated Wood Products, Inc. For the satisfaction of the Decision of the Bureau of Forest Development
dated 15 July 1981, and the Order of this office dated 1 October 1986.
SO ORDERED.
Subsequently, a writ of execution 11 dated January 8, 1987 was issued in favor of the respondent
DAVENCOR, which states:
The City/Provincial SheriffDavao City
GREETINGS:
You are hereby directed to enforce, implement and execute the Order of Execution dated 06 June 1987 of
this Office in the above-entitled case against Matuguina Logging Enterprises and/or Matuguina Integrated
Wood Products, Inc. Its officers or any person or corporation in its behalf and conformably with the Order
dated 15 July 1981 of the Director of Forest Development, stating dispositively.
Xxx xxx xxx
You are hereby requested to submit your return to this Office within the period of sixty (60) days from your
receipt hereof as to action taken hereon.
SO ORDERED.
On February 11, 1987, MIWPI filed the instant complaint 12 for prohibition, damages and injunction, with
prayer for restraining order, which case was docketed as Civil Case No. 18,457-87 in the Regional Trial
Court Davao City, Branch 17. MIWPI stated its primary cause of action, the relevant portion of which reads,
viz.:
5. That plaintiff which has a distinct and separate personality of its own under the law, and was never a
party to the case between DAVENCOR and MLE, suddenly became a party to the case after the decision
became final and executory with the issuance of Annex "B" hereof for reasons known to the defendants
alone:
6. That the issuance of Annex "B" hereof (the order of execution) by the defendant Minister has been made
not only without or in excess of his authority but that the same was issued patently without any factual or
legal basis, hence, a gross violation of plaintiff's constitutional rights under the due process clause;
7. That plaintiff, in the face of the order (Annex "B") complained of, there being no appeal or any plain,
speedy, and adequate remedy in the ordinary course of law, does not have any alternative but to ventilate
the present recourse;
8. That defendant Minister is doing, threatens or is about to do, or is procuring or suffering to be done,

212

some act which definitely is in violation of the plaintiff's rights respecting the subject matter of the action,
and unless said act or acts are restrained or prohibited at least during the pendency of this case, said act
or acts would probably work not only injustice to plaintiff but would tend to render the judgment of this
Honorable Court ineffectual;
9. That the commission or continuance of the acts complained of during the present litigation would not
only cause great and irreparable injury, but will also work injustice to the plaintiff, and would complicate,
aggravate and multiply the issues in this case;
10. That the plaintiff is entitled to the relief demanded, and the whole or part of such relief consists in
restraining the commission or continuance of the acts complained of, or in the performance of acts, either
for a limited period or perpetually;
11. That great and irreparable injury would inevitably result to the plaintiff before the matter can be heard
on notice, hence, immediate issuance of a restraining order is necessary and proper;
12. That the plaintiff is willing and able to file the necessary bond executed to the defendants, in an
amount to be fixed by the court, to the effect that the plaintiff will pay to the defendants all damages
which they may sustain by reason of the injunction if the court should finally decide that the plaintiff was
not entitled thereto.
MIWPI, likewise, alleges that in wantonly and imprudently procuring the Writ of Execution against it, which
DAVENCOR and Philip Co seek to enforce a 2.5 Million Peso liability of plaintiff, the latter has been
constrained to bring the present action, thereby incurring damages in the sum of P500,000.00 in concept
of actual and compensatory damages, and P250,000.00 in attorney's fees, which amount petitioner now
seeks to recover.
The trial court issued a temporary restraining order the next day, February 12, 1987, restraining and/or
enjoining the private respondents and the Hon. Secretary of Natural Resources from enforcing,
implementing and/or carrying into effect, the decision of the respondent Secretary dated October 1, 1986,
as well as the order of execution dated January 6, 1987.
On February 17, 1987, private respondents filed a Motion to Dismiss 13 alleging that the trial court had no
jurisdiction over the case under Presidential Decree No. 705, to which Motion to Dismiss, petitioner filed an
Opposition 14 dated February 1987. On March 9, 1987, the trial court issued an order 15 denying private
respondent's Motion to Dismiss. Hence, private respondents filed their Answer 16 dated March 13, 1987
and an Amended Answer 17 dated July 16, 1987.
In the latter pleading, private respondents raised the following special and affirmative defenses:
7. That neither Milagros Matuguina nor Matuguina Integrated Wood Products, Inc. advised defendant
Davencor of the change of name, and transfer of management of PTL No. 30 from Milagros Matuguina to
Matuguina Integrated Wood Products, Inc., during the pendency of MNR Case No. 6540 before the Bureau
of Forest Development and the Ministry of Natural Resources, notwithstanding that the lawyer of
Matuguina Integrated Wood Products, Inc., who was also a stockholder thereof, had appeared for Milagros
Matuguina in said administrative case.

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8. That plaintiff has acted in bad faith and is now in estoppel from questioning the Writ of Execution issued
against Milagros Matuguina (now Matuguina Integrated Wood Products, Inc.) to satisfy the judgment in
MNR Case No. 6540.
9. This Honorable Court has no jurisdiction over the nature and subject matter of this action, especially
because:
(a) The plaintiff has not exhausted administrative remedies available to it before initiating this action;
(b) In the guise of entertaining an action for damages, this Court is being misled by the plaintiff into
deciding questions properly for the Department of Natural Resources to decide exclusively in the lawful
exercise of its regulatory jurisdiction;
(c) The plaintiff is now precluded and estopped from filing this action.
10. The plaintiff has no cause of action against the defendants and has not stated any in its complaint,
especially because:
(a) Having failed to exhaust administrative remedies, plaintiff is without a ripe cause of action that can be
pleaded before this Honorable Court;
(b) In substance, there is no justiciable question raised under the facts and circumstances of this case.
Meanwhile, on June 2, 1987, the trial court issued on order 18 granting the petitioner's prayer for the
issuance of a writ of preliminary injunction against the private respondents and the Secretary of Natural
Resources, ordering them to desist, refrain and prevent from enforcing respondent Secretary's Decision
dated October 1, 1986 as well as the writ of execution dated January 8, 1987.
On May 10, 1989, the trial court rendered its Decision 19 in favor of the petitioner, disposing of the action
as follows:
WHEREFORE, in view of the foregoing, finding the evidence of plaintiff, Matuguina Integrated Wood
Products, Inc. sufficient to sustain a preponderance of evidence, showing that the order of execution dated
January 6, 1987, issued by the Minister of Natural Resources, through Alexander C. Castro, Assistant
Minister for Legal Affairs, included therein, plaintiff Matuguina Integrated Wood Products, Inc., despite noninclusion of plaintiff in the decision of the then Minister of Natural Resources, dated October 1, 1986,
already final and executory before the issuance of the order and execution, said order or execution is
hereby declared null and void and without any legal effect.
As a consequence thereof, the writ of preliminary injunction issued by this court, dated June 2, 1987 is
hereby made permanent.
Moreover, as a result of the filing of this case, defendant Philip Co and Davencor Corporation, are ordered
to jointly and severally pay the amount of P100,000.00 as actual and compensatory damages, along with
another amount of P20,000.00 as attorney's fees and costs of this action, in favor of plaintiff Matuguina

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Integrated Wood Products, Inc.

SO ORDERED.
Private respondents appealed the trial court's decision on May 19, 1989. Their notice of appeal was
approved by the trial court. The appealed case was docketed with respondent Honorable Court of Appeals
as CA-G.R. SP No. 19887.
On February 25, 1991, the respondent Court rendered its Decision, 20 reversing the lower court's
pronouncement. The dispositive portion of the Decision reads:
WHEREFORE, premises considered, the decision appealed from is reversed and set aside and the Order of
Execution issued by the Minister of Natural Resources dated January 6, 1987 is affirmed. Without
pronouncement as to costs.
SO ORDERED.
In due time, petitioner filed a motion for reconsideration. 21 Private respondents filed their opposition 22
to the same on April 2, 1991. In a Resolution 23 dated April 12, 1991, the motion was denied by the
respondent Court.
Not content with the court's pronouncement, petitioner is now before us on a Petition for Review on
Certiorari, 24 alleging that the respondent court acted with grave abuse of discretion in rendering the
questioned decision and its companion resolution, denying the motion for reconsideration.
The reasons relied upon by the Petitioner in filing its petition are hereby restated:
I
PETITIONER WAS DENIED DUE PROCESS OF LAW WHEN IT WAS MADE LIABLE BY RESPONDENT SECRETARY
OF NATURAL RESOURCES IN HIS ORDER OF EXECUTION DATED 06 JANUARY 1987 (EXHIBIT "B" OF
ATTACHMENT "O") ISSUED IN MNR CASE NO. 6540 DESPITE THE FACT THAT PETITIONER WAS NEVER A
PARTY NOR A PARTICIPANT IN THE SAID CASE: IN FACT, PETITIONER NEVER HAD NOTICE OF THE
PROCEEDINGS IN MNR CASE NO. 6540.
II
THE FAILURE TO AFFORD PETITIONER THE OPPORTUNITY TO BE HEARD IN THE ADMINISTRATIVE LEVEL
(MNR CASE NO. 6540) COULD NOT HAVE BEEN CURED BY THE INSTITUTION OF THE ACTION FOR
PROHIBITION IN THE TRIAL COURT BECAUSE SAID COURT HAD NO JURISDICTION TO DETERMINE WHETHER
PETITIONER WAS GUILTY OF ENCROACHMENT ON PRIVATE RESPONDENT DAVENCOR'S TIMBER
CONCESSION; FURTHERMORE, THE QUESTION ON WHETHER PETITIONER WAS GUILTY OF ENCROACHMENT
WAS NEVER PUT IN ISSUE IN THE CASE BEFORE THE TRIAL COURT.
III
THE LIABILITY OF MILAGROS/MLE AS FOUND BY RESPONDENT SECRETARY IN ITS DECISION DATED 01

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OCTOBER 1986 (EXHIBIT "A" OF THE ATTACHMENT "0") CANNOT BE IMPUTED AGAINST PETITIONER SINCE
THE LATTER IS A CORPORATION HAVING A PERSONALITY SEPARATE AND DISTINCT FROM MILAGROS/MLE.
IV
PETITIONER CANNOT BE MADE LIABLE TO PRIVATE RESPONDENTS UNDER THE DEED OF TRANSFER DATED
18 JULY 1975 (EXHIBIT "3" OF ATTACHMENT "P") AND SECTION 61 OF THE REVISED FORESTRY CODE OF
THE PHILIPPINES (P.D. 705, AS AMENDED):
A. THE ALLEGED TRANSFER OF PTL NO. 30 FROM MILAGROS/MLE TO PETITIONER NEVER BECAME BINDING
AND EFFECTIVE SINCE PTL NO. 30 REMAINED IN THE NAME OF MILAGROS/MLE UNTIL ITS EXPIRATION ON
30 JUNE 1977: THIS IS DUE TO THE FACT THAT SAID TRANSFER WAS NEVER APPROVED BY THE SECRETARY
OF NATURAL RESOURCES.
B. GRANTING ARGUENDO THAT THERE WAS AN EFFECTIVE TRANSFER OF PTL NO. 30 FROM MILAGROS/MLE
TO PETITIONER, THE TRANSFER COULD NOT MAKE PETITIONER LIABLE FOR THE ALLEGED ENCROACHMENT
OF PRIVATE RESPONDENT DAVENCOR'S TIMBER CONCESSION, SINCE:
1. SAID TRANSFER WAS EXECUTED PRIOR TO THE COMMISSION OF THE ALLEGED ENCROACHMENT AND
THE FILING THE ADMINISTRATIVE COMPLAINT FOR ENCROACHMENT DATED 28 JULY 1975; THUS,
PETITIONER CANNOT BE MADE LIABLE FOR OBLIGATIONS OF MILAGROS/MLE WHICH WERE INCURRED
AFTER THE DATE OF THE SAID TRANSFER.
2. SAID TRANSFER COVERED ONLY FORESTRY CHARGES AND OTHER GOVERNMENT FEES, AND DID NOT
INCLUDE THE PERSONAL LIABILITY OF MILAGROS/MLE THAT AROSE FROM THE ENCROACHMENT OF THE
TIMBER CONCESSION OF RESPONDENT DAVENCOR. 25
Private Respondents DAVENCOR and the public respondent Hon. Minister (now Secretary) of Natural
Resources filed separate Comments 26 on September 5, 1991 and June 8, 1992 respectively.
The essential issues of the present controversy boil down to the following:
Was the Petitioner denied due process when it was adjudged liable with MLE for encroaching upon the
timber concession of DAVENCOR in the respondent Minister's Order of Execution?
Is the petitioner a transferee of MLE's interest, as to make it liable for the latter's illegal logging operations
in DAVENCOR's timber concession, or more specially, is it possible to pierce the veil of MIWPI's corporate
existence, making it a mere conduit or successor of MLE?
Generally accepted is the principle that no man shall be affected by any proceeding to which he is a
stranger, and strangers to a case not bound by judgment rendered by the court. In the same manner an
execution can be issued only against a party and not against one who did not have his day in court. In
Lorenzo vs. Cayetano, 78 SCRA 485 [1987], this Court held that only real parties in interest in an action are
bound by judgment therein and by writs of execution and demolition issued pursuant thereto. 27
Indeed a judgment cannot bind persons who are not parties to theaction. 28 It is elementary that strangers

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to a case are not bound by the judgment rendered by the court and such judgment is not available as an
adjudication either against or in favor of such other person. A decision of a court will not operate to divest
the rights of a person who has not and has never been a party to a litigation, either as plaintiff or as
defendant. Execution of a judgment can only be issued against one who is a party to the action, and not
against one who, not being a party in the action has not yet had his day in court. 29
The writ of execution must conform to the judgment which is to be executed, as it may not vary the terms
of the judgment it seeks to enforce. 30 Nor may it go beyond the terms of the judgment sought to be
executed. Where the execution is not in harmony with the judgment which gives it life and exceeds it, it
has pro tanto no validity. To maintain otherwise would be to ignore the constitutional provision against
depriving a person of his property without due process of law. 31
The writ of execution issued by the Secretary of Natural Resources on January 8, 1987 clearly varies the
term of his Decision of October 1, 1986, inasmuch as the Writ includes the MIWPI as party liable whereas
the Decision only mentions Milagros Matuguina/MLE.
There is no basis for the issuance of the Order of Execution against the petitioner. The same was issued
without giving the petitioner an opportunity to defend itself and oppose the request of DAVENCOR for the
issuance of a writ of execution against it. In fact, it does not appear that petitioner was at all furnished with
a copy of DAVENCOR's letter requesting for the Execution of the Honorable Secretary's decision against it.
Petitioner was suddenly made liable upon the order of execution by the respondent Secretary's expedient
conclusions that MLE and MIWPI are one and the same, apparently on the basis merely of DAVENCOR's
letter requesting for the Order, and without hearing or impleading MIWPI. Until the issuance of the Order of
execution, petitioner was not included or mentioned in the proceedings as having any participation in the
encroachment in DAVENCOR's timber concession. This action of the respondent Secretary disregards the
most basis tenets of due process and elementary fairness.
The liberal atmosphere which pervades the procedure in administrative proceedings does not empower the
presiding officer to make conclusions of fact before hearing all the parties concerned. 32 In Police
Commission vs. Hon. Judge Lood, 33 we held that the formalities usually attendant in court hearings need
not be present in an administrative investigation, provided that the parties are heard given the opportunity
to adduce their evidence. The right to notice and hearing is essential to due process and its nonobservance will, as a rule, invalidate the administrative proceedings.
As observed by the appellate court, to writ:
the appellant should have filed a Motion with the Minister with Notice to the appellee to include the latter
as party liable for the judgment in order to afford the appellee an opportunity to be heard on its liability for
the judgment rendered against Ma. Milagros Matuguina doing business under the name Matuguina Logging
Enterprises. 34
Continuing, the said court stated further that:
Nevertheless, the failure to comply with the procedure in order to satisfy the requirements of due process
was cured by the present action for prohibition where the liability of appellee has been ventilated.

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We do not agree. Essential, Prohibition is a remedy to prevent inferior courts, corporations, boards or
persons from usurping or exercising a jurisdiction or power with which they have not been vested by law
35 As we have held in Mafinco Trading Corporation vs. Ople, et al, 36 in a certiorari or prohibition case,
only issues affecting the jurisdiction of the tribunal, board and offices involved may be resolved on the
basis of undisputed facts.
The issue of whether or not petitioner is an alter ego of Milagros Matuguina/MLE, is one of fact, and which
should have been threshed out in the administrative proceedings, and not in the prohibition proceedings in
the trial court, where it is precisely the failure of the respondent Minister of Natural Resources to proceed
as mandated by law in the execution of its order which is under scrutiny.
Assuming, arguendo, that prohibition is the proper remedy for determining the propriety of piercing the
separate personality of petitioner with its stockholders, the evidence presented at said trial does not
warrant such action.
It is settled that a corporation is clothed with personality separate and distinct from that of the persons
composing it. It may not generally be held liable for that of the persons composing it. It may not be held
liable for the personal indebtedness of its stockholders or those of the entities connected with it.
Conversely, a stockholder cannot be made to answer for any of its financial obligations even if he should
be its president. 37 But when the juridical personality of the corporation is used to defeat public
convenience, justify wrong, protect fraud or defend crime, the corporation shall be considered as a mere
association of persons (Koppel, Inc. vs. Yatco, 77 Phil 496, Palay, Inc. vs. Clave, G.R. No. 56076, September
21, 1983, 124 SCRA 638), and its responsible officers and/or stockholders shall be individually liable
(Namarco vs. Associated Finance Co., Inc., G.R. No. L-20886, April 27, 1967, 19 SCRA 962). For the same
reasons, a corporation shall be liable for the obligations of a stockholder (Palacio vs. Fely Transportation
Co., G.R No. L-15121, August 31, 1963, 5 SCRA 1011), or a corporation and its successor-in-interest shall
be considered as one and the liability of the former shall attach to the latter. 38
But for the separate juridical personality of a corporation to be disregarded, the wrongdoing must be
clearly and convincingly established. It cannot be presumed. 39
In the case at bar, there is, insufficient basis for the appellate court's ruling that MIWPI is the same as
Matuguina. The trial court's observation is enlightening.
Despite apparently opposing evidence of both parties, the Court gathered and finds, that defendant's
attempt to pierce the veil of corporate personality of plaintiff corporation, as to consider plaintiff
corporations merely an adjunct or alter ego of Maria Milagros Matuguina Logging Enterprises, to justify
defendant's claim against plaintiff corporation, suffers heavily from insufficiency of evidence.
It is the vehement contention of defendants, to bolster its claim, that plaintiff corporation is the alter ego
of Maria Milagros Matuguina Logging Enterprises, because when Milagros Matuguina became the Chairman
of the Board of Directors of plaintiff corporation, she requested for the change of name and transfer of
management of PTL No. 30, from her single proprietorship, to plaintiff corporation.
Secondly, when Milagros Matuguina executed the deed of transfer, transferring her forest concession
under PTL No. 30, together with all the structures and improvements therein, to plaintiff corporation, for a

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consideration of P14,800.00 representing 148,000 shares of stocks of plaintiff corporation actually all
existing shares of stocks of Milagros Matuguina, in plaintiff corporation represents 77.4% therein; suffice to
say that plaintiff corporation practically became an alter ego of Milagros Matuguina.
Defendant's arguments on this peripheral aspect of corporate existence, do not at all indicate that such a
legal fiction, was granted.
In the first place, the alleged control of plaintiff corporation was not evident in any particular corporate
acts of plaintiff corporation, wherein Maria Milagros Matuguina Logging Enterprises using plaintiff
corporation, executed acts or powers directly involving plaintiff corporation.
Neither was there any evidence of defendants, that Maria Milagros Matuguina Logging Enterprises, using
the facilities and resources of plaintiff corporation, involved itself in transaction using both single
proprietorship and plaintiff corporation in such particular line of business undertakings.
As stated by this court in resolving plaintiff's prayer for issuance of a writ or preliminary injunction, said:
There is actually, no evidence presented by defendant, showing that sometime on March 15, 1986, to
January 1987, during which period, the subject decision of Hon. Secretary of Natural Resources and
corresponding writ of execution, Maria Milagros Matuguina was a stockholder of plaintiff corporation in
such amount or was she an officer of plaintiff corporation in whatever capacity.
The above circumstances is relevant and significant to assume any such justification of including plaintiff
corporation in the subject writ of execution, otherwise, as maintained by defendants, what matters most
was the control of Milagros Matuguina Logging Enterprises of plaintiff corporation in 1974 and 1975, when
the administrative case was pending, this circumstance alone without formally including plaintiff
corporation in said case, will not create any valid and sufficient justification for plaintiff corporation, to
have been supposedly included in the suit against defendants and Maria Milagros Matuguina Logging
Enterprises, in the administrative case.
Yet, granting as claimed by defendants, that in 1974 or in 1975, Maria Milagros Matuguina became the
controlling stockholder of plaintiff corporation, on account of the change of name and transfer of
management of PTL No. 30, this circumstance, we repeat, does not of itself prove that plaintiff corporation
was the alter ego of Maria Milagros Matuguina Logging Enterprises, as enunciated in various decisions of
this Court, to writ:
It is important to bear in mind that mere ownership by a single stockholder or by another corporation of all
or nearly all of the capital stocks of the corporation, is not itself a sufficient warrant for disregarding the
fiction of separate personality (Liddel and Co. vs. Collector of Internal Revenue, G.R. No. 9687, June 30,
1961).
It is recognized as lawful to obtain a corporation charter, even with a single substantial stockholder, to
engage in specific activity and such activity may co-exist with other private activities of the stockholder.
If the corporation is substantial one, conducted lawfully; without fraud on another, its separate identity is
to be respected. 40

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In this jurisdiction, it is a settled rule that conclusions and findings of fact by the trial court are entitled to
great weight on appeal and should not be disturbed unless for strong and cogent reasons because the trial
court is in a better position to examine real evidence, as well as to observe the demeanor of the witnesses
while testifying in the case. 41
It is likewise improper to state that the MIWPI is the privy or the successor-in-interest of MLE, as the liability
for the encroachment over DAVENCOR's timber concession is concerned, by reason of the transfer of
interest in PTL No. 30 from MLE to MIWPI.
First of all, it does not appear indubitable that the said transfer ever became effective, since PTL No. 30
remained in the name of Milagros Matuguina/MLE until it expired on June 30, 1977. 42
More importantly, even if it is deemed that there was a valid change of name and transfer of interest in the
PTL No. 30, this only signifies a transfer of authority, from MLE to MIWPI, to conduct logging operations in
the area covered by PTL No. 30. It does not show indubitable proof that MIWPI was a mere conduit or
successor of Milagros Matuguina/MLE, as far the latter's liability for the encroachment upon DAVENCOR's
concession is concerned. This is the only conclusion which we can discern from the language of Section 61
of P.D. 750, 43 and the letters of the Acting Minister of Natural Resources to Milagros Matuguina/MLE and
to MIWPI, on September 16, 1975. 44 In Soriano vs. Court of Appeals, this Court stated in clear language,
that
It is the general rule that the protective mantle of a corporation's separate and distinct personality could
only be pierced and liability attached directly to its officers and/or members stockholders, when the same
is used for fraudulent, unfair, or illegal purpose. In the case at bar, there is no showing that the Association
entered into the transaction with the private respondent for the purpose of defrauding the latter of his
goods or the payment thereof. . . . Therefore, the general rule on corporate liability, not the exception,
should be applied in resolving this case. (G.R. No. 49834, June 22, 1989)
The respondents cite Section 61 of P.D. 705 to establish MIWPI's succession to the liability of Milagros
Matuguina/MLE:
Sec. 61. Transfers. Unless authorized by the Department Head, no licensee, lessee, or permittee may
transfer, exchange, sell, or convey his license agreement, license, lease or permit, or any of his rights or
interests therein, or any of his assets used in connection therewith.
The licensee, lessee, or permittee shall be allowed to transfer or convey his license agreement, license,
lease, or permit only if he has not violated any forestry law, rule or regulation; has been faithfully
complying with the terms and conditions of the license agreement, license, lease or permit; the transferee
has all the qualifications and none of the disqualifications to hold a license agreement, license, lease or
permit; there is no evidence that such transfer or conveyance is being made for purposes of speculation;
and the transferee shall assume all the obligations of the transferor.
The transferor shall forever be barred from acquiring another license agreement, license, lease or permit.
Even if it is mandated in the abovestated provision that "the transferee shall assume all the obligations of

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the transferor" this does not mean that all obligations are assumed, indiscriminately.
Invariably, it is not the letter, but the spirit of the law and intent of the legislature that is important. When
the interpretation of a statute according to the exact and literal import of its words would lead to absurdity,
it should be construed according to the spirit and reason, disregarding if necessary the letter of the law.
45
In construing statutes, the terms used therein are generally to be given their ordinary meaning, that is,
such meaning which is ascribed to them when they are commonly used, to the end that absurdity in the
law must be avoided. 46 The term "obligations" as used in the final clause of the second paragraph of
Section 61 of P.D. 705 is construed to mean those obligations incurred by the transferor in the ordinary
course of business. It cannot be construed to mean those obligations or liabilities incurred by the transferor
as a result of transgressions of the law, as these are personal obligations of the transferor, and could not
have been included in the term "obligations" absent any modifying provision to that effect.
In the September 16, 1975 letters of Acting Director of the Bureau of Forest Development of Milagros
Matuguina and MIWPI informing them of the approval of Matuguina's request for the change of name and
transfer of management of PTL No. 30, the following statements were made by the Acting Director:
In view hereof, (Matuguina Integrated Wood Products, Inc.) shall assume the responsibility of paying
whatever pending liabilities and/or accounts remaining unsettled, if any, by the former licensee, Milagros
Matuguina, with the government. 47
Accordingly, the letter's language implies that the obligations which MIWPI are to assume as transferee of
Milagros Matuguina/MLE are those obligations in favor of the government only, and not to any other entity.
Thus this would include Forestry Charges, Taxes, Fees, and similar accountabilities.
In sum, the Court makes the following pronouncements:
(a) The respondent Honorable Minister of Natural Resources gravely abused its discretion when it issued its
Order of Execution on January 6, 1987, including therein as one of the parties liable the petitioner
Matuguina Integrated Wood Products, Inc., which was never a party to the assailed proceeding resulting in
the issuance of such Order and, without affording the same an opportunity to be heard before it was
adjudged liable.
(b) The petitioner is a corporate entity separate and distinct from Milagros Matuguina/Matuguina Logging
Enterprises, there being no clear basis for considering it as a mere conduit or alter ego of Matuguina/MLE,
and therefore, cannot be made liable for the obligations of the same for encroachment over the timber
concession of private respondent DAVENCOR.
IN VIEW OF THE FOREGOING, the Petition is hereby GRANTED, and the Decision dated February 25, 1991,
is SET ASIDE. The decision of the Regional Trial Court is hereby REINSTATED, and correspondingly, Order of
Execution of the respondent Secretary of Natural Resources is declared NULL and VOID and without effect.
No pronouncement as to costs.

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SO ORDERED.

SOLEDAD DY, doing business under the name and style RONWOOD LUMBER petitioner, vs.,
COURT OF APPEALS and ODEL BERNARDO LAUSA, respondent.
G.R. No. 121587 | 1999-03-09
Tagged under keywords

DECISION

MENDOZA, J.:
This is a petition for review of the decision1 [Per Associate Justice Buenaventura Guerrero, Chairman,
concurred in by Justices Cesar D. Francisco and Celia Lipana-Reyes, members.] of the Court of Appeals in
CA G.R. SP 33099 setting aside two orders of the Regional Trial Court of Butuan City (Branch 5) and the
appellate court's resolution denying petitioner's motion for reconsideration.
The facts are as follows.
On May 31, 1993, the Mayor of Butuan City issued Executive Order No. 93-01 creating Task Force Kalikasan
to combat "illegal logging, log smuggling or possession of and/or transport of illegally cut or produced logs,
lumber, flitches and other forest products" in that city.2 [CA Rollo, p. 52; Petition, Annex J, p. 2.] The team
was composed of personnel of the Philippine Army, Philippine National Police (PNP), the Department of
Natural Resources (DENR), and the Office of the City Mayor of Butuan. Respondent Odel Bernardo Lausa,
who was the acting chief of civilian security in the mayor's office, was a member of the team.
On July 1, 1993, the members of the task force received confidential information that two truckloads of
illegally cut lumber would be brought to Butuan City from the Ampayon-Taguibe-Tiniwisan area.
Accordingly, the team set up a check-point along kilometer 4 in Baan, Butuan City.3 [Id., p. 120; Private
Respondent's Reply to Petitioner's Comment, Annex E, p.1. ] What happened thereafter is summarized in
the following portion of the decision of the Court of Appeals:4 [Rollo, p. 28; Decision, p. 2.]
At around 10:00 p.m., two trucks with Plate Nos. KAK-542 and KBL-214 and loaded with lumber approached
the checkpoint. They were flagged down by the operatives but instead of stopping, they accelerated their
speed hence, the task force gave chase. They finally caught up with the two vehicles at the compound of
Young Metalcraft and Peterwood Agro-Forest Industries at Baan, Butuan City, about two kilometers from
the checkpoint. When requested by the operatives, Pulcita Lucero, caretaker/in charge of the compound
could not produce any document as proof of the legality of the origin/possession of the forest products.
Forester Resurreccion Maxilom of the DENR issued a temporary seizure order and a seizure receipt for the

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two vehicles and their cargo consisting of several pieces of lumber of different sizes and dimensions, but
Lucero, the caretaker of the compound where they were seized, refused to accept them. The seized lumber
and vehicles were then taken to the City motorpool and placed in the custody of respondent Lausa.
The next day, July 2, 1993, Maxilom submitted a memorandum-report to the Community Environment and
Natural Resources Officer (CENRO) of Butuan City on the seizure of the lumber and the two vehicles.5 [CA
Rollo,, pp. 61-62; Petition, Annex P.] On July 6, the CENRO issued a notice of confiscation which was duly
posted for three days.
For lack of claimants, DENR Regional Technical Director Raoul Geollegue recommended to the Secretary on
July 29, 1993 the forfeiture of the lumber and the two vehicles.6 [Id., p. 63; id., Annex Q.] Accordingly, on
July 30, 1993, DENR Regional Director De la Rosa ordered the CENRO of Butuan City to issue the requisite
forfeiture orders,7 [Id., p. 64; id., Annex R.] which CENRO Angelita Orcasitas issued on August 15, 1993.8
[Id., pp. 49-50; id., Annex I-I-1.]
On October 20, 1993, more than two months after the lumber had been forfeited, petitioner, claiming to be
the owner of the lumber, filed a suit for replevin in the Regional Trial Court of Butuan City (Branch 5) for its
recovery. The next day, October 21, 1993, the trial court issued a preliminary writ of replevin.
On October 29, 1993, respondent Lausa filed a motion for the approval of a counterbond. Before the court
could act on his motion, he moved to dismiss and/or quash the writ of replevin on the ground that the
lumber in question, having been seized and forfeited by the DENR pursuant to P.D. No. 705, as amended
(Revised Forestry Code), was under its custody and, therefore, resort should first be made to the DENR.
On November 29, 1993, the trial court denied respondent Lausa's application for the approval of the
counterbond as well as his motion to dismiss and/or quash the suit for replevin. For this reason, respondent
filed a petition for certiorari in the Court of Appeals in which he sought the approval of his counterbond and
the nullification of the two orders, dated October 21, 1993 and November 29, 1993, granting petitioner's
prayer for a preliminary writ of replevin and denying his Motion to Dismiss Case and/or Quash Writ of
Replevin.
On January 19, 1995, the Court of Appeals rendered a decision, the dispositive portion of which reads:
WHEREFORE, the petition is hereby GRANTED, and
a. The Orders dated 21 October 1993 and 29 November 1993 are SET ASIDE.
b. Respondent judge is directed to approve a duly qualified counterbond to be filed by petitioner, even with
a period of at least one year.
No pronouncements as to costs.

SO ORDERED.9 [Rollo, p. 32; Decision, p. 6.]

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Petitioner's subsequent motion for reconsideration was denied in a resolution, dated July 26, 1995. Hence,
this petition. Petitioner alleges that:

FIRST ERROR
WITH DUE RESPECT RESPONDENT COURT OF APPEALS ERRED IN RULING THAT THE VERIFICATION MADE BY
LORENCIO DY AND NOT BY PETITIONER SOLEDAD Y. DY WAS INSUFFICIENT TO JUSTIFY THE ISSUANCE OF
THE REPLEVIN WRIT.10 [Id., p. 19; Petition, p. 9.]

SECOND ERROR
THE RESPONDENT COURT OF APPEALS ERRED IN RULING THAT A COUNTERBOND IN REPLEVIN WHICH IS
EFFECTIVE FOR ONLY ONE YEAR IS VALID TO CAUSE THE RETURN OF THE PROPERTY TO DEFENDANT.11
[Id., p. 21; id., p. 11.]

THIRD ERROR
THE RESPONDENT COURT OF APPEALS ERRED IN GIVING DUE COURSE TO PRIVATE RESPONDENT'S
PETITION FOR CERTIORARI.12 [Id., p. 24; id., p. 14.]
The appeal is without merit. The threshold question is whether the Regional Trial Court could in fact take
cognizance of the replevin suit, considering that the object was the recovery of lumber seized and forfeited
by law enforcement agents of the DENR pursuant to P.D. No. 705 (Revised Forestry Code), as amended by
Executive Order No. 277.
The rule is that a party must exhaust all administrative remedies before he can resort to the courts. In a
long line of cases, we have consistently held that before a party may be allowed to seek the intervention of
the court, it is a pre-condition that he should have availed himself of all the means afforded by the
administrative processes. Hence, if a remedy within the administrative machinery can still be resorted to
by giving the administrative officer concerned every opportunity to decide on a matter that comes within
his jurisdiction then such remedy should be exhausted first before a court's judicial power can be sought.
The premature invocation of a court's intervention is fatal to one's cause of action. Accordingly, absent any
finding of waiver or estoppel, the case is susceptible of dismissal for lack of cause of action.13 [Paat v.
Court of Appeals, 266 SCRA 167, 175 (1997), citing cases.]
Section 8 of P.D. No. 705, as amended, provides:
SEC. 8. Review. All actions and decisions of the Director are subject to review, motu propio or upon appeal
of any person aggrieved thereby, by the Department Head whose decision shall be final and executory
after the lapse of thirty (30) days from receipt by the aggrieved party of said decision, unless appealed to
the President in accordance with Executive Order No. 19, series of 1966. The Decision of the Department
Head may not be reviewed by the courts except through a special civil action for certiorari or prohibition.

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In Paat v. Court of Appeals,14 [266 SCRA 167 (1997)] where, as in the case at bar, the trial court issued a
writ of replevin against the DENR, thus allowing the claimant to obtain possession of the conveyance used
in transporting undocumented forest products, this Court stated:
Dismissal of the replevin suit for lack of cause of action in view of the private respondents' failure to
exhaust administrative remedies should have been the proper cause of action by the lower court instead of
assuming jurisdiction over the case and consequently issuing the writ ordering the return of the truck.
Exhaustion of the remedies in the administrative forum, being a condition precedent prior to one's
recourse to the courts and more importantly, being an element of private respondents' right of action, is
too significant to be waylaid by the lower court.15 [Id., at 184.]
As petitioner clearly failed to exhaust available administrative remedies, the Court of Appeals correctly set
aside the assailed orders of the trial court granting petitioner's application for a replevin writ and denying
private respondent's motion to dismiss. Having been forfeited pursuant to P.D. No. 705, as amended, the
lumber properly came under the custody of the DENR and all actions seeking to recover possession thereof
should be directed to that agency.
The appellate court's directive to the trial court judge to allow the respondent agent of the DENR to file a
counterbond in order to recover custody of the lumber should be disregarded as being contrary to its order
to dismiss the replevin suit of petitioner. For, indeed, what it should have done was to dismiss the case
without prejudice to petitioner filing her claim before the Department of Natural Resources (DENR).
In view of the conclusion reached in this case, it is unnecessary to discuss the errors assigned by
petitioner. These pertain to the questions whether petitioner's complaint below was properly verified and
whether private respondent's counterbond should be approved. Both are based on the premise that the
trial court can take cognizance over the case. As shown above, however, such is not the case.
WHEREFORE, the decision of the Court of Appeals, dated January 19, 1995, and its Resolution, dated July
26, 1995, in CA-G.R. SP 33099 are AFFIRMED with the modification that the complaint for recovery of
personal property is DISMISSED.

SO ORDERED.

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