[G.R. No. 133250.

July 9, 2002]

DECISION

On January 19, 1988, then President Corazon C. Aquino issued Special Patent No. 3517, granting and transferring to
PEA the parcels of land so reclaimed under the Manila-Cavite Coastal Road and Reclamation Project (MCCRRP) containing a
total area of one million nine hundred fifteen thousand eight hundred ninety four (1,915,894) square meters. Subsequently, on
April 9, 1988, the Register of Deeds of the Municipality of Paraaque issued Transfer Certificates of Title Nos. 7309, 7311, and
7312, in the name of PEA, covering the three reclaimed islands known as the Freedom Islands located at the southern portion
of the Manila-Cavite Coastal Road, Paraaque City. The Freedom Islands have a total land area of One Million Five Hundred
Seventy Eight Thousand Four Hundred and Forty One (1,578,441) square meters or 157.841 hectares.

This is an original Petition for Mandamus with prayer for a writ of preliminary injunction and a temporary restraining
order. The petition seeks to compel the Public Estates Authority (PEA for brevity) to disclose all facts on PEAs then on-going
renegotiations with Amari Coastal Bay and Development Corporation (AMARI for brevity) to reclaim portions of Manila
Bay. The petition further seeks to enjoin PEA from signing a new agreement with AMARI involving such reclamation.

On April 25, 1995, PEA entered into a Joint Venture Agreement (JVA for brevity) with AMARI, a private corporation, to
develop the Freedom Islands. The JVA also required the reclamation of an additional 250 hectares of submerged areas
surrounding these islands to complete the configuration in the Master Development Plan of the Southern Reclamation ProjectMCCRRP. PEA and AMARI entered into the JVA through negotiation without public bidding.[4] On April 28, 1995, the Board of
Directors of PEA, in its Resolution No. 1245, confirmed the JVA. [5] On June 8, 1995, then President Fidel V. Ramos, through
then Executive Secretary Ruben Torres, approved the JVA.[6]

FRANCISCO I. CHAVEZ, petitioner, vs. PUBLIC ESTATES AUTHORITY and AMARI COASTAL BAY DEVELOPMENT
CORPORATION, respondents.

CARPIO, J.:

The Facts
On November 20, 1973, the government, through the Commissioner of Public Highways, signed a contract with the
Construction and Development Corporation of the Philippines (CDCP for brevity) to reclaim certain foreshore and offshore
areas of Manila Bay. The contract also included the construction of Phases I and II of the Manila-Cavite Coastal Road. CDCP
obligated itself to carry out all the works in consideration of fifty percent of the total reclaimed land.
On February 4, 1977, then President Ferdinand E. Marcos issued Presidential Decree No. 1084 creating PEA. PD No.
1084 tasked PEA to reclaim land, including foreshore and submerged areas, and to develop, improve, acquire, x xx lease and
sell any and all kinds of lands.[1] On the same date, then President Marcos issued Presidential Decree No. 1085 transferring to
PEA the lands reclaimed in the foreshore and offshore of the Manila Bay [2] under the Manila-Cavite Coastal Road and
Reclamation Project (MCCRRP).
On December 29, 1981, then President Marcos issued a memorandum directing PEA to amend its contract with CDCP,
so that [A]ll future works in MCCRRP x xx shall be funded and owned by PEA. Accordingly, PEA and CDCP executed a
Memorandum of Agreement dated December 29, 1981, which stated:
(i) CDCP shall undertake all reclamation, construction, and such other works in the MCCRRP as may be agreed upon by the
parties, to be paid according to progress of works on a unit price/lump sum basis for items of work to be agreed upon, subject
to price escalation, retention and other terms and conditions provided for in Presidential Decree No. 1594. All the financing
required for such works shall be provided by PEA.
x xx
(iii) x xx CDCP shall give up all its development rights and hereby agrees to cede and transfer in favor of PEA, all of the rights,
title, interest and participation of CDCP in and to all the areas of land reclaimed by CDCP in the MCCRRP as of December 30,
1981 which have not yet been sold, transferred or otherwise disposed of by CDCP as of said date, which areas consist of
approximately Ninety-Nine Thousand Four Hundred Seventy Three (99,473) square meters in the Financial Center Area
covered by land pledge No. 5 and approximately Three Million Three Hundred Eighty Two Thousand Eight Hundred Eighty
Eight (3,382,888) square meters of reclaimed areas at varying elevations above Mean Low Water Level located outside the
Financial Center Area and the First Neighborhood Unit.[3]

On November 29, 1996, then Senate President Ernesto Maceda delivered a privilege speech in the Senate and
denounced the JVA as the grandmother of all scams. As a result, the Senate Committee on Government Corporations and
Public Enterprises, and the Committee on Accountability of Public Officers and Investigations, conducted a joint
investigation. The Senate Committees reported the results of their investigation in Senate Committee Report No. 560 dated
September 16, 1997.[7] Among the conclusions of their report are: (1) the reclaimed lands PEA seeks to transfer to AMARI
under the JVA are lands of the public domain which the government has not classified as alienable lands and therefore PEA
cannot alienate these lands; (2) the certificates of title covering the Freedom Islands are thus void, and (3) the JVA itself is
illegal.
On December 5, 1997, then President Fidel V. Ramos issued Presidential Administrative Order No. 365 creating a Legal
Task Force to conduct a study on the legality of the JVA in view of Senate Committee Report No. 560. The members of the
Legal Task Force were the Secretary of Justice, [8] the Chief Presidential Legal Counsel,[9] and the Government Corporate
Counsel.[10] The Legal Task Force upheld the legality of the JVA, contrary to the conclusions reached by the Senate
Committees.[11]
On April 4 and 5, 1998, the Philippine Daily Inquirer and Today published reports that there were on-going
renegotiations between PEA and AMARI under an order issued by then President Fidel V. Ramos. According to these reports,
PEA Director Nestor Kalaw, PEA Chairman Arsenio Yulo and retired Navy Officer Sergio Cruz composed the negotiating panel
of PEA.
On April 13, 1998, Antonio M. Zulueta filed before the Court a Petition for Prohibition with Application for the Issuance of
a Temporary Restraining Order and Preliminary Injunctiondocketed as G.R. No. 132994 seeking to nullify the JVA. The Court
dismissed the petition for unwarranted disregard of judicial hierarchy, without prejudice to the refiling of the case before the
proper court.[12]
On April 27, 1998, petitioner Frank I. Chavez (Petitioner for brevity) as a taxpayer, filed the instant Petition for
Mandamus with Prayer for the Issuance of a Writ of Preliminary Injunction and Temporary Restraining Order. Petitioner
contends the government stands to lose billions of pesos in the sale by PEA of the reclaimed lands to AMARI. Petitioner prays
that PEA publicly disclose the terms of any renegotiation of the JVA, invoking Section 28, Article II, and Section 7, Article III, of
the 1987 Constitution on the right of the people to information on matters of public concern. Petitioner assails the sale to
AMARI of lands of the public domain as a blatant violation of Section 3, Article XII of the 1987 Constitution prohibiting the sale
of alienable lands of the public domain to private corporations. Finally, petitioner asserts that he seeks to enjoin the loss of
billions of pesos in properties of the State that are of public dominion.
After several motions for extension of time,[13] PEA and AMARI filed their Comments on October 19, 1998 and June 25,
1998, respectively. Meanwhile, on December 28, 1998, petitioner filed an Omnibus Motion: (a) to require PEA to submit the
terms of the renegotiated PEA-AMARI contract; (b) for issuance of a temporary restraining order; and (c) to set the case for

hearing on oral argument. Petitioner filed a Reiterative Motion for Issuance of a TRO dated May 26, 1999, which the Court
denied in a Resolution dated June 22, 1999.
In a Resolution dated March 23, 1999, the Court gave due course to the petition and required the parties to file their
respective memoranda.

PEA and AMARI claim the petition is now moot and academic because AMARI furnished petitioner on June 21, 1999 a
copy of the signed Amended JVA containing the terms and conditions agreed upon in the renegotiations. Thus, PEA has
satisfied petitioners prayer for a public disclosure of the renegotiations. Likewise, petitioners prayer to enjoin the signing of the
Amended JVA is now moot because PEA and AMARI have already signed the Amended JVA on March 30, 1999. Moreover,
the Office of the President has approved the Amended JVA on May 28, 1999.

On March 30, 1999, PEA and AMARI signed the Amended Joint Venture Agreement (Amended JVA, for brevity). On
May 28, 1999, the Office of the President under the administration of then President Joseph E. Estrada approved the
Amended JVA.

Petitioner counters that PEA and AMARI cannot avoid the constitutional issue by simply fast-tracking the signing and
approval of the Amended JVA before the Court could act on the issue. Presidential approval does not resolve the constitutional
issue or remove it from the ambit of judicial review.

Due to the approval of the Amended JVA by the Office of the President, petitioner now prays that on constitutional and
statutory grounds the renegotiated contract be declared null and void.[14]

We rule that the signing of the Amended JVA by PEA and AMARI and its approval by the President cannot operate to
moot the petition and divest the Court of its jurisdiction. PEA and AMARI have still to implement the Amended JVA. The prayer
to enjoin the signing of the Amended JVA on constitutional grounds necessarily includes preventing its implementation if in the
meantime PEA and AMARI have signed one in violation of the Constitution. Petitioners principal basis in assailing the
renegotiation of the JVA is its violation of Section 3, Article XII of the Constitution, which prohibits the government from
alienating lands of the public domain to private corporations. If the Amended JVA indeed violates the Constitution, it is the duty
of the Court to enjoin its implementation, and if already implemented, to annul the effects of such unconstitutional contract.

The Issues
The issues raised by petitioner, PEA[15] and AMARI[16] are as follows:
I. WHETHER THE PRINCIPAL RELIEFS PRAYED FOR IN THE PETITION ARE MOOT AND ACADEMIC
BECAUSE OF SUBSEQUENT EVENTS;
II. WHETHER THE PETITION MERITS DISMISSAL FOR FAILING TO OBSERVE THE PRINCIPLE
GOVERNING THE HIERARCHY OF COURTS;
III. WHETHER THE PETITION MERITS DISMISSAL FOR NON-EXHAUSTION OF ADMINISTRATIVE
REMEDIES;
IV. WHETHER PETITIONER HAS LOCUS STANDI TO BRING THIS SUIT;
V. WHETHER THE CONSTITUTIONAL RIGHT TO INFORMATION INCLUDES OFFICIAL INFORMATION ON
ON-GOING NEGOTIATIONS BEFORE A FINAL AGREEMENT;
VI. WHETHER THE STIPULATIONS IN THE AMENDED JOINT VENTURE AGREEMENT FOR THE TRANSFER
TO AMARI OF CERTAIN LANDS, RECLAIMED AND STILL TO BE RECLAIMED, VIOLATE THE 1987
CONSTITUTION; AND
VII. WHETHER THE COURT IS THE PROPER FORUM FOR RAISING THE ISSUE OF WHETHER THE
AMENDED JOINT VENTURE AGREEMENT IS GROSSLY DISADVANTAGEOUS TO THE GOVERNMENT.

The Courts Ruling

The Amended JVA is not an ordinary commercial contract but one which seeks to transfer title and ownership to
367.5 hectares of reclaimed lands and submerged areas of Manila Bay to a single private corporation. It now becomes
more compelling for the Court to resolve the issue to insure the government itself does not violate a provision of the
Constitution intended to safeguard the national patrimony. Supervening events, whether intended or accidental, cannot prevent
the Court from rendering a decision if there is a grave violation of the Constitution. In the instant case, if the Amended JVA runs
counter to the Constitution, the Court can still prevent the transfer of title and ownership of alienable lands of the public domain
in the name of AMARI. Even in cases where supervening events had made the cases moot, the Court did not hesitate to
resolve the legal or constitutional issues raised to formulate controlling principles to guide the bench, bar, and the public. [17]
Also, the instant petition is a case of first impression. All previous decisions of the Court involving Section 3, Article XII of
the 1987 Constitution, or its counterpart provision in the 1973 Constitution, [18] covered agricultural lands sold to private
corporations which acquired the lands from private parties. The transferors of the private corporations claimed or could claim
the right to judicial confirmation of their imperfect titles [19] under Title II of Commonwealth Act. 141 (CA No. 141 for
brevity). In the instant case, AMARI seeks to acquire from PEA, a public corporation, reclaimed lands and submerged areas
for non-agricultural purposes by purchase under PD No. 1084 (charter of PEA) and Title III of CA No. 141. Certain
undertakings by AMARI under the Amended JVA constitute the consideration for the purchase. Neither AMARI nor PEA can
claim judicial confirmation of their titles because the lands covered by the Amended JVA are newly reclaimed or still to be
reclaimed. Judicial confirmation of imperfect title requires open, continuous, exclusive and notorious occupation of agricultural
lands of the public domain for at least thirty years since June 12, 1945 or earlier. Besides, the deadline for filing applications for
judicial confirmation of imperfect title expired on December 31, 1987.[20]
Lastly, there is a need to resolve immediately the constitutional issue raised in this petition because of the possible
transfer at any time by PEA to AMARI of title and ownership to portions of the reclaimed lands. Under the Amended JVA, PEA
is obligated to transfer to AMARI the latters seventy percent proportionate share in the reclaimed areas as the reclamation
progresses. The Amended JVA even allows AMARI to mortgage at any time the entire reclaimed area to raise financing for the
reclamation project.[21]

First issue: whether the principal reliefs prayed for in the petition are moot and academic because of subsequent
events.
The petition prays that PEA publicly disclose the terms and conditions of the on-going negotiations for a new
agreement. The petition also prays that the Court enjoin PEA from privately entering into, perfecting and/or executing any new
agreement with AMARI.

Second issue: whether the petition merits dismissal for failing to observe the principle governing the hierarchy of
courts.
PEA and AMARI claim petitioner ignored the judicial hierarchy by seeking relief directly from the Court. The principle of
hierarchy of courts applies generally to cases involving factual questions. As it is not a trier of facts, the Court cannot entertain

cases involving factual issues. The instant case, however, raises constitutional issues of transcendental importance to the
public.[22] The Court can resolve this case without determining any factual issue related to the case. Also, the instant case is a
petition for mandamus which falls under the originaljurisdiction of the Court under Section 5, Article VIII of the
Constitution. We resolve to exercise primary jurisdiction over the instant case.

Third issue: whether the petition merits dismissal for non-exhaustion of administrative remedies.
PEA faults petitioner for seeking judicial intervention in compelling PEA to disclose publicly certain information without
first asking PEA the needed information. PEA claims petitioners direct resort to the Court violates the principle of exhaustion of
administrative remedies. It also violates the rule that mandamus may issue only if there is no other plain, speedy and adequate
remedy in the ordinary course of law.
PEA distinguishes the instant case from Taada v. Tuvera[23] where the Court granted the petition for mandamus even if
the petitioners there did not initially demand from the Office of the President the publication of the presidential decrees. PEA
points out that in Taada, the Executive Department had an affirmative statutory duty under Article 2 of the Civil Code[24] and
Section 1 of Commonwealth Act No. 638[25] to publish the presidential decrees. There was, therefore, no need for the
petitioners in Taada to make an initial demand from the Office of the President. In the instant case, PEA claims it has no
affirmative statutory duty to disclose publicly information about its renegotiation of the JVA. Thus, PEA asserts that the Court
must apply the principle of exhaustion of administrative remedies to the instant case in view of the failure of petitioner here to
demand initially from PEA the needed information.
The original JVA sought to dispose to AMARI public lands held by PEA, a government corporation. Under Section 79 of
the Government Auditing Code,[26]2 the disposition of government lands to private parties requires public bidding. PEA was
under a positive legal duty to disclose to the public the terms and conditions for the sale of its lands. The law obligated
PEA to make this public disclosure even without demand from petitioner or from anyone. PEA failed to make this public
disclosure because the original JVA, like the Amended JVA, was the result of a negotiated contract, not of a public
bidding. Considering that PEA had an affirmative statutory duty to make the public disclosure, and was even in breach of this
legal duty, petitioner had the right to seek direct judicial intervention.
Moreover, and this alone is determinative of this issue, the principle of exhaustion of administrative remedies does not
apply when the issue involved is a purely legal or constitutional question.[27] The principal issue in the instant case is the
capacity of AMARI to acquire lands held by PEA in view of the constitutional ban prohibiting the alienation of lands of the public
domain to private corporations. We rule that the principle of exhaustion of administrative remedies does not apply in the instant
case.

Fourth issue: whether petitioner has locus standi to bring this suit
PEA argues that petitioner has no standing to institute mandamus proceedings to enforce his constitutional right to
information without a showing that PEA refused to perform an affirmative duty imposed on PEA by the Constitution. PEA also
claims that petitioner has not shown that he will suffer any concrete injury because of the signing or implementation of the
Amended JVA. Thus, there is no actual controversy requiring the exercise of the power of judicial review.
The petitioner has standing to bring this taxpayers suit because the petition seeks to compel PEA to comply with its
constitutional duties. There are two constitutional issues involved here. First is the right of citizens to information on matters of
public concern. Second is the application of a constitutional provision intended to insure the equitable distribution of alienable
lands of the public domain among Filipino citizens. The thrust of the first issue is to compel PEA to disclose publicly information
on the sale of government lands worth billions of pesos, information which the Constitution and statutory law mandate PEA to

disclose. The thrust of the second issue is to prevent PEA from alienating hundreds of hectares of alienable lands of the public
domain in violation of the Constitution, compelling PEA to comply with a constitutional duty to the nation.
Moreover, the petition raises matters of transcendental importance to the public. In Chavez v. PCGG,[28] the Court
upheld the right of a citizen to bring a taxpayers suit on matters of transcendental importance to the public, thus Besides, petitioner emphasizes, the matter of recovering the ill-gotten wealth of the Marcoses is an issue of transcendental
importance to the public. He asserts that ordinary taxpayers have a right to initiate and prosecute actions questioning the
validity of acts or orders of government agencies or instrumentalities, if the issues raised are of paramount public interest, and
if they immediately affect the social, economic and moral well being of the people.
Moreover, the mere fact that he is a citizen satisfies the requirement of personal interest, when the proceeding involves the
assertion of a public right, such as in this case. He invokes several decisions of this Court which have set aside the procedural
matter of locus standi, when the subject of the case involved public interest.
x xx
In Taada v. Tuvera, the Court asserted that when the issue concerns a public right and the object of mandamus is to obtain the
enforcement of a public duty, the people are regarded as the real parties in interest; and because it is sufficient that petitioner
is a citizen and as such is interested in the execution of the laws, he need not show that he has any legal or special interest in
the result of the action. In the aforesaid case, the petitioners sought to enforce their right to be informed on matters of public
concern, a right then recognized in Section 6, Article IV of the 1973 Constitution, in connection with the rule that laws in order
to be valid and enforceable must be published in the Official Gazette or otherwise effectively promulgated. In ruling for the
petitioners' legal standing, the Court declared that the right they sought to be enforced is a public right recognized by no less
than the fundamental law of the land.
Legaspi v. Civil Service Commission, while reiterating Taada, further declared that when a mandamus proceeding involves the
assertion of a public right, the requirement of personal interest is satisfied by the mere fact that petitioner is a citizen and,
therefore, part of the general 'public' which possesses the right.
Further, in Albano v. Reyes, we said that while expenditure of public funds may not have been involved under the questioned
contract for the development, management and operation of the Manila International Container Terminal, public interest [was]
definitely involved considering the important role [of the subject contract] . . . in the economic development of the country and
the magnitude of the financial consideration involved. We concluded that, as a consequence, the disclosure provision in the
Constitution would constitute sufficient authority for upholding the petitioner's standing.
Similarly, the instant petition is anchored on the right of the people to information and access to official records, documents and
papers a right guaranteed under Section 7, Article III of the 1987 Constitution. Petitioner, a former solicitor general, is a Filipino
citizen. Because of the satisfaction of the two basic requisites laid down by decisional law to sustain petitioner's legal standing,
i.e. (1) the enforcement of a public right (2) espoused by a Filipino citizen, we rule that the petition at bar should be allowed.
We rule that since the instant petition, brought by a citizen, involves the enforcement of constitutional rights - to
information and to the equitable diffusion of natural resources - matters of transcendental public importance, the petitioner has
the requisite locus standi.

Fifth issue: whether the constitutional right to information includes official information on on-going negotiations
before a final agreement.

Section 7, Article III of the Constitution explains the peoples right to information on matters of public concern in this
manner:
Sec. 7. The right of the people to information on matters of public concern shall be recognized. Access to official records,
and to documents, and papers pertaining to official acts, transactions, or decisions, as well as to government research
data used as basis for policy development, shall be afforded the citizen, subject to such limitations as may be provided by
law. (Emphasis supplied)
The State policy of full transparency in all transactions involving public interest reinforces the peoples right to information on
matters of public concern. This State policy is expressed in Section 28, Article II of the Constitution, thus:
Sec. 28. Subject to reasonable conditions prescribed by law, the State adopts and implements a policy of full public
disclosure of all its transactions involving public interest. (Emphasis supplied)
These twin provisions of the Constitution seek to promote transparency in policy-making and in the operations of the
government, as well as provide the people sufficient information to exercise effectively other constitutional rights. These twin
provisions are essential to the exercise of freedom of expression. If the government does not disclose its official acts,
transactions and decisions to citizens, whatever citizens say, even if expressed without any restraint, will be speculative and
amount to nothing. These twin provisions are also essential to hold public officials at all times x xx accountable to the people,
[29]
for unless citizens have the proper information, they cannot hold public officials accountable for anything. Armed with the
right information, citizens can participate in public discussions leading to the formulation of government policies and their
effective implementation. An informed citizenry is essential to the existence and proper functioning of any democracy. As
explained by the Court in Valmonte v. Belmonte, Jr.[30]
An essential element of these freedoms is to keep open a continuing dialogue or process of communication between the
government and the people. It is in the interest of the State that the channels for free political discussion be maintained to the
end that the government may perceive and be responsive to the peoples will. Yet, this open dialogue can be effective only to
the extent that the citizenry is informed and thus able to formulate its will intelligently. Only when the participants in the
discussion are aware of the issues and have access to information relating thereto can such bear fruit.
PEA asserts, citing Chavez v. PCGG,[31] that in cases of on-going negotiations the right to information is limited to
definite propositions of the government. PEA maintains the right does not include access to intra-agency or inter-agency
recommendations or communications during the stage when common assertions are still in the process of being formulated or
are in the exploratory stage.
Also, AMARI contends that petitioner cannot invoke the right at the pre-decisional stage or before the closing of the
transaction. To support its contention, AMARI cites the following discussion in the 1986 Constitutional Commission:
Mr. Suarez. And when we say transactions which should be distinguished from contracts, agreements, or treaties or whatever,
does the Gentleman refer to the steps leading to the consummation of the contract, or does he refer to the contract itself?
Mr. Ople: The transactions used here, I suppose is generic and therefore, it can cover both steps leading to a contract
and already a consummated contract, Mr. Presiding Officer.
Mr. Suarez: This contemplates inclusion of negotiations leading to the consummation of the transaction.
Mr. Ople: Yes, subject only to reasonable safeguards on the national interest.

Mr. Suarez: Thank you.[32] (Emphasis supplied)

AMARI argues there must first be a consummated contract before petitioner can invoke the right. Requiring government
officials to reveal their deliberations at the pre-decisional stage will degrade the quality of decision-making in government
agencies. Government officials will hesitate to express their real sentiments during deliberations if there is immediate public
dissemination of their discussions, putting them under all kinds of pressure before they decide.
We must first distinguish between information the law on public bidding requires PEA to disclose publicly, and
information the constitutional right to information requires PEA to release to the public. Before the consummation of the
contract, PEA must, on its own and without demand from anyone, disclose to the public matters relating to the disposition of its
property.These include the size, location, technical description and nature of the property being disposed of, the terms and
conditions of the disposition, the parties qualified to bid, the minimum price and similar information. PEA must prepare all these
data and disclose them to the public at the start of the disposition process, long before the consummation of the contract,
because the Government Auditing Code requires public bidding. If PEA fails to make this disclosure, any citizen can demand
from PEA this information at any time during the bidding process.
Information, however, on on-going evaluation or review of bids or proposals being undertaken by the bidding or
review committee is not immediately accessible under the right to information. While the evaluation or review is still on-going,
there are no official acts, transactions, or decisions on the bids or proposals. However, once the committee makes its official
recommendation, there arises a definite proposition on the part of the government. From this moment, the publics right to
information attaches, and any citizen can access all the non-proprietary information leading to such definite
proposition. In Chavez v. PCGG,[33] the Court ruled as follows:
Considering the intent of the framers of the Constitution, we believe that it is incumbent upon the PCGG and its officers, as
well as other government representatives, to disclose sufficient public information on any proposed settlement they have
decided to take up with the ostensible owners and holders of ill-gotten wealth. Such information, though, must pertain
to definite propositions of the government, not necessarily to intra-agency or inter-agency recommendations or
communications during the stage when common assertions are still in the process of being formulated or are in the exploratory
stage. There is need, of course, to observe the same restrictions on disclosure of information in general, as discussed earlier
such as on matters involving national security, diplomatic or foreign relations, intelligence and other classified
information. (Emphasis supplied)
Contrary to AMARIs contention, the commissioners of the 1986 Constitutional Commission understood that the right to
information contemplates inclusion of negotiations leading to the consummation of the transaction. Certainly, a
consummated contract is not a requirement for the exercise of the right to information. Otherwise, the people can never
exercise the right if no contract is consummated, and if one is consummated, it may be too late for the public to expose its
defects.
Requiring a consummated contract will keep the public in the dark until the contract, which may be grossly
disadvantageous to the government or even illegal, becomes a fait accompli.This negates the State policy of full transparency
on matters of public concern, a situation which the framers of the Constitution could not have intended. Such a requirement will
prevent the citizenry from participating in the public discussion of any proposed contract, effectively truncating a basic right
enshrined in the Bill of Rights. We can allow neither an emasculation of a constitutional right, nor a retreat by the State of its
avowed policy of full disclosure of all its transactions involving public interest.
The right covers three categories of information which are matters of public concern, namely: (1) official records; (2)
documents and papers pertaining to official acts, transactions and decisions; and (3) government research data used in
formulating policies. The first category refers to any document that is part of the public records in the custody of government
agencies or officials. The second category refers to documents and papers recording, evidencing, establishing, confirming,
supporting, justifying or explaining official acts, transactions or decisions of government agencies or officials. The third
category refers to research data, whether raw, collated or processed, owned by the government and used in formulating
government policies.

The information that petitioner may access on the renegotiation of the JVA includes evaluation reports,
recommendations, legal and expert opinions, minutes of meetings, terms of reference and other documents attached to such
reports or minutes, all relating to the JVA. However, the right to information does not compel PEA to prepare lists, abstracts,
summaries and the like relating to the renegotiation of the JVA. [34] The right only affords access to records, documents and
papers, which means the opportunity to inspect and copy them. One who exercises the right must copy the records,
documents and papers at his expense. The exercise of the right is also subject to reasonable regulations to protect the
integrity of the public records and to minimize disruption to government operations, like rules specifying when and how to
conduct the inspection and copying.[35]
The right to information, however, does not extend to matters recognized as privileged information under the separation
of powers.[36] The right does not also apply to information on military and diplomatic secrets, information affecting national
security, and information on investigations of crimes by law enforcement agencies before the prosecution of the accused,
which courts have long recognized as confidential.[37] The right may also be subject to other limitations that Congress may
impose by law.
There is no claim by PEA that the information demanded by petitioner is privileged information rooted in the separation
of powers. The information does not cover Presidential conversations, correspondences, or discussions during closed-door
Cabinet meetings which, like internal deliberations of the Supreme Court and other collegiate courts, or executive sessions of
either house of Congress,[38] are recognized as confidential. This kind of information cannot be pried open by a co-equal
branch of government. A frank exchange of exploratory ideas and assessments, free from the glare of publicity and pressure
by interested parties, is essential to protect the independence of decision-making of those tasked to exercise Presidential,
Legislative and Judicial power.[39] This is not the situation in the instant case.
We rule, therefore, that the constitutional right to information includes official information on on-going
negotiations before a final contract. The information, however, must constitute definite propositions by the government and
should not cover recognized exceptions like privileged information, military and diplomatic secrets and similar matters affecting
national security and public order.[40] Congress has also prescribed other limitations on the right to information in several
legislations.[41]

Sixth issue: whether stipulations in the Amended JVA for the transfer to AMARI of lands, reclaimed or to be
reclaimed, violate the Constitution.

Philippine Legislature approved Act No. 2874, the Public Land Act, which authorized the lease, but not the sale, of
reclaimed lands of the government to corporations and individuals. On November 7, 1936, the National Assembly passed
Commonwealth Act No. 141, also known as the Public Land Act, which authorized the lease, but not the sale, of reclaimed
lands of the government to corporations and individuals. CA No. 141 continues to this day as the general law governing
the classification and disposition of lands of the public domain.
The Spanish Law of Waters of 1866 and the Civil Code of 1889
Under the Spanish Law of Waters of 1866, the shores, bays, coves, inlets and all waters within the maritime zone of the
Spanish territory belonged to the public domain for public use. [44] The Spanish Law of Waters of 1866 allowed the reclamation
of the sea under Article 5, which provided as follows:
Article 5. Lands reclaimed from the sea in consequence of works constructed by the State, or by the provinces, pueblos or
private persons, with proper permission, shall become the property of the party constructing such works, unless otherwise
provided by the terms of the grant of authority.
Under the Spanish Law of Waters, land reclaimed from the sea belonged to the party undertaking the reclamation, provided
the government issued the necessary permit and did not reserve ownership of the reclaimed land to the State.
Article 339 of the Civil Code of 1889 defined property of public dominion as follows:
Art. 339. Property of public dominion is
1. That devoted to public use, such as roads, canals, rivers, torrents, ports and bridges constructed by the State,
riverbanks, shores, roadsteads, and that of a similar character;
2. That belonging exclusively to the State which, without being of general public use, is employed in some public
service, or in the development of the national wealth, such as walls, fortresses, and other works for the
defense of the territory, and mines, until granted to private individuals.
Property devoted to public use referred to property open for use by the public. In contrast, property devoted to public service
referred to property used for some specific public service and open only to those authorized to use the property.

The Regalian Doctrine

Property of public dominion referred not only to property devoted to public use, but also to property not so used but
employed to develop the national wealth. This class of property constituted property of public dominion although employed
for some economic or commercial activity to increase the national wealth.

The ownership of lands reclaimed from foreshore and submerged areas is rooted in the Regalian doctrine which holds
that the State owns all lands and waters of the public domain.Upon the Spanish conquest of the Philippines, ownership of all
lands, territories and possessions in the Philippines passed to the Spanish Crown. [42] The King, as the sovereign ruler and
representative of the people, acquired and owned all lands and territories in the Philippines except those he disposed of by
grant or sale to private individuals.

wit:

The 1935, 1973 and 1987 Constitutions adopted the Regalian doctrine substituting, however, the State, in lieu of the
King, as the owner of all lands and waters of the public domain.TheRegalian doctrine is the foundation of the time-honored
principle of land ownership that all lands that were not acquired from the Government, either by purchase or by grant, belong
to the public domain.[43] Article 339 of the Civil Code of 1889, which is now Article 420 of the Civil Code of 1950, incorporated
the Regalian doctrine.

Article 341 of the Civil Code of 1889 governed the re-classification of property of public dominion into private property, to

Art. 341. Property of public dominion, when no longer devoted to public use or to the defense of the territory, shall become a
part of the private property of the State.
This provision, however, was not self-executing. The legislature, or the executive department pursuant to law, must declare the
property no longer needed for public use or territorial defense before the government could lease or alienate the property to
private parties.[45]

Ownership and Disposition of Reclaimed Lands

Act No. 1654 of the Philippine Commission

The Spanish Law of Waters of 1866 was the first statutory law governing the ownership and disposition of reclaimed
lands in the Philippines. On May 18, 1907, the Philippine Commission enacted Act No. 1654 which provided for the lease, but
not the sale, of reclaimed lands of the government to corporations and individuals. Later, on November 29, 1919, the

On May 8, 1907, the Philippine Commission enacted Act No. 1654 which regulated the lease of reclaimed and foreshore
lands. The salient provisions of this law were as follows:

Section 1. The control and disposition of the foreshore as defined in existing law, and the title to all Government or
public lands made or reclaimed by the Government by dredging or filling or otherwise throughout the Philippine
Islands, shall be retained by the Government without prejudice to vested rights and without prejudice to rights conceded to
the City of Manila in the Luneta Extension.
Section 2. (a) The Secretary of the Interior shall cause all Government or public lands made or reclaimed by the Government
by dredging or filling or otherwise to be divided into lots or blocks, with the necessary streets and alleyways located thereon,
and shall cause plats and plans of such surveys to be prepared and filed with the Bureau of Lands.
(b) Upon completion of such plats and plans the Governor-General shall give notice to the public that such parts of the
lands so made or reclaimed as are not needed for public purposes will be leased for commercial and business
purposes, x xx.
x xx
(e) The leases above provided for shall be disposed of to the highest and best bidder therefore, subject to such
regulations and safeguards as the Governor-General may by executive order prescribe. (Emphasis supplied)
Act No. 1654 mandated that the government should retain title to all lands reclaimed by the government. The Act
also vested in the government control and disposition of foreshore lands. Private parties could lease lands reclaimed by the
government only if these lands were no longer needed for public purpose. Act No. 1654 mandated public bidding in the lease
of government reclaimed lands. Act No. 1654 made government reclaimed lands sui generis in that unlike other public lands
which the government could sell to private parties, these reclaimed lands were available only for lease to private parties.
Act No. 1654, however, did not repeal Section 5 of the Spanish Law of Waters of 1866. Act No. 1654 did not prohibit
private parties from reclaiming parts of the sea under Section 5 of the Spanish Law of Waters. Lands reclaimed from the sea
by private parties with government permission remained private lands.
Act No. 2874 of the Philippine Legislature
On November 29, 1919, the Philippine Legislature enacted Act No. 2874, the Public Land Act.[46] The salient provisions
of Act No. 2874, on reclaimed lands, were as follows:
Sec. 6. The Governor-General, upon the recommendation of the Secretary of Agriculture and Natural Resources, shall
from time to time classify the lands of the public domain into
(a) Alienable or disposable,
(b) Timber, and
(c) Mineral lands, x xx.
Sec. 7. For the purposes of the government and disposition of alienable or disposable public lands, the GovernorGeneral, upon recommendation by the Secretary of Agriculture and Natural Resources, shall from time to time
declare what lands are open to disposition or concession under this Act.
Sec. 8. Only those lands shall be declared open to disposition or concession which have been officially delimited or
classified x xx.
x xx

Sec. 55. Any tract of land of the public domain which, being neither timber nor mineral land, shall be classified as suitable for
residential purposes or for commercial, industrial, or other productive purposes other than agricultural purposes, and
shall be open to disposition or concession, shall be disposed of under the provisions of this chapter, and not otherwise.
Sec. 56. The lands disposable under this title shall be classified as follows:
(a) Lands reclaimed by the Government by dredging, filling, or other means;
(b) Foreshore;
(c) Marshy lands or lands covered with water bordering upon the shores or banks of navigable lakes or rivers;
(d) Lands not included in any of the foregoing classes.
x xx.
Sec. 58. The lands comprised in classes (a), (b), and (c) of section fifty-six shall be disposed of to private parties by
lease only and not otherwise, as soon as the Governor-General, upon recommendation by the Secretary of Agriculture
and Natural Resources, shall declare that the same are not necessary for the public service and are open to
disposition under this chapter. The lands included in class (d) may be disposed of by sale or lease under the
provisions of this Act. (Emphasis supplied)
Section 6 of Act No. 2874 authorized the Governor-General to classify lands of the public domain into x xx alienable or
disposable[47] lands. Section 7 of the Act empowered the Governor-General to declare what lands are open to disposition or
concession. Section 8 of the Act limited alienable or disposable lands only to those lands which have been officially delimited
and classified.
Section 56 of Act No. 2874 stated that lands disposable under this title [48] shall be classified as government reclaimed,
foreshore and marshy lands, as well as other lands. All these lands, however, must be suitable for residential, commercial,
industrial or other productive non-agricultural purposes. These provisions vested upon the Governor-General the power to
classify inalienable lands of the public domain into disposable lands of the public domain. These provisions also empowered
the Governor-General to classify further such disposable lands of the public domain into government reclaimed, foreshore or
marshy lands of the public domain, as well as other non-agricultural lands.
Section 58 of Act No. 2874 categorically mandated that disposable lands of the public domain classified as government
reclaimed, foreshore and marshy lands shall be disposed of to private parties by lease only and not otherwise. The
Governor-General, before allowing the lease of these lands to private parties, must formally declare that the lands were not
necessary for the public service. Act No. 2874 reiterated the State policy to lease and not to sell government reclaimed,
foreshore and marshy lands of the public domain, a policy first enunciated in 1907 in Act No. 1654. Government reclaimed,
foreshore and marshy lands remained sui generis, as the only alienable or disposable lands of the public domain that the
government could not sell to private parties.
The rationale behind this State policy is obvious. Government reclaimed, foreshore and marshy public lands for nonagricultural purposes retain their inherent potential as areas for public service. This is the reason the government prohibited
the sale, and only allowed the lease, of these lands to private parties. The State always reserved these lands for some future
public service.
Act No. 2874 did not authorize the reclassification of government reclaimed, foreshore and marshy lands into other nonagricultural lands under Section 56 (d). Lands falling under Section 56 (d) were the only lands for non-agricultural purposes the
government could sell to private parties. Thus, under Act No. 2874, the government could not sell government reclaimed,
foreshore and marshy lands to private parties, unless the legislature passed a law allowing their sale.[49]
Act No. 2874 did not prohibit private parties from reclaiming parts of the sea pursuant to Section 5 of the Spanish Law of
Waters of 1866. Lands reclaimed from the sea by private parties with government permission remained private lands.
Dispositions under the 1935 Constitution

On May 14, 1935, the 1935 Constitution took effect upon its ratification by the Filipino people. The 1935 Constitution, in
adopting the Regalian doctrine, declared in Section 1, Article XIII, that
Section 1. All agricultural, timber, and mineral lands of the public domain, waters, minerals, coal, petroleum, and other mineral
oils, all forces of potential energy and other natural resources of the Philippines belong to the State, and their disposition,
exploitation, development, or utilization shall be limited to citizens of the Philippines or to corporations or associations at least
sixty per centum of the capital of which is owned by such citizens, subject to any existing right, grant, lease, or concession at
the time of the inauguration of the Government established under this Constitution. Natural resources, with the exception of
public agricultural land, shall not be alienated, and no license, concession, or lease for the exploitation, development, or
utilization of any of the natural resources shall be granted for a period exceeding twenty-five years, renewable for another
twenty-five years, except as to water rights for irrigation, water supply, fisheries, or industrial uses other than the development
of water power, in which cases beneficial use may be the measure and limit of the grant. (Emphasis supplied)
The 1935 Constitution barred the alienation of all natural resources except public agricultural lands, which were the only
natural resources the State could alienate. Thus, foreshore lands, considered part of the States natural resources, became
inalienable by constitutional fiat, available only for lease for 25 years, renewable for another 25 years. The government could
alienate foreshore lands only after these lands were reclaimed and classified as alienable agricultural lands of the public
domain. Government reclaimed and marshy lands of the public domain, being neither timber nor mineral lands, fell under the
classification of public agricultural lands.[50] However, government reclaimed and marshy lands, although subject to
classification as disposable public agricultural lands, could only be leased and not sold to private parties because of Act No.
2874.
The prohibition on private parties from acquiring ownership of government reclaimed and marshy lands of the public
domain was only a statutory prohibition and the legislature could therefore remove such prohibition. The 1935 Constitution did
not prohibit individuals and corporations from acquiring government reclaimed and marshy lands of the public domain that
were classified as agricultural lands under existing public land laws. Section 2, Article XIII of the 1935 Constitution provided as
follows:
Section 2. No private corporation or association may acquire, lease, or hold public agricultural lands in excess of one
thousand and twenty four hectares, nor may any individual acquire such lands by purchase in excess of one hundred
and forty hectares, or by lease in excess of one thousand and twenty-four hectares, or by homestead in excess of twentyfour hectares. Lands adapted to grazing, not exceeding two thousand hectares, may be leased to an individual, private
corporation, or association. (Emphasis supplied)
Still, after the effectivity of the 1935 Constitution, the legislature did not repeal Section 58 of Act No. 2874 to open for sale to
private parties government reclaimed and marshy lands of the public domain. On the contrary, the legislature continued the
long established State policy of retaining for the government title and ownership of government reclaimed and marshy lands of
the public domain.
Commonwealth Act No. 141 of the Philippine National Assembly
On November 7, 1936, the National Assembly approved Commonwealth Act No. 141, also known as the Public Land
Act, which compiled the then existing laws on lands of the public domain. CA No. 141, as amended, remains to this day
the existing general law governing the classification and disposition of lands of the public domain other than timber and
mineral lands.[51]
Section 6 of CA No. 141 empowers the President to classify lands of the public domain into alienable or
disposable[52] lands of the public domain, which prior to such classification are inalienable and outside the commerce of
man. Section 7 of CA No. 141 authorizes the President to declare what lands are open to disposition or concession. Section 8
of CA No. 141 states that the government can declare open for disposition or concession only lands that are officially delimited
and classified. Sections 6, 7 and 8 of CA No. 141 read as follows:

Sec. 6. The President, upon the recommendation of the Secretary of Agriculture and Commerce, shall from time to
time classify the lands of the public domain into
(a) Alienable or disposable,
(b) Timber, and
(c) Mineral lands,
and may at any time and in like manner transfer such lands from one class to another,[53] for the purpose of their administration
and disposition.
Sec. 7. For the purposes of the administration and disposition of alienable or disposable public lands, the President, upon
recommendation by the Secretary of Agriculture and Commerce, shall from time to time declare what lands are open
to disposition or concession under this Act.
Sec. 8. Only those lands shall be declared open to disposition or concession which have been officially delimited and
classified and, when practicable, surveyed, and which have not been reserved for public or quasi-public uses, nor
appropriated by the Government, nor in any manner become private property, nor those on which a private right authorized
and recognized by this Act or any other valid law may be claimed, or which, having been reserved or appropriated, have
ceased to be so. x xx.
Thus, before the government could alienate or dispose of lands of the public domain, the President must first officially classify
these lands as alienable or disposable, and then declare them open to disposition or concession. There must be no law
reserving these lands for public or quasi-public uses.
The salient provisions of CA No. 141, on government reclaimed, foreshore and marshy lands of the public domain, are
as follows:
Sec. 58. Any tract of land of the public domain which, being neither timber nor mineral land, is intended to be used for
residential purposes or for commercial, industrial, or other productive purposes other than agricultural, and is open
to disposition or concession, shall be disposed of under the provisions of this chapter and not otherwise.
Sec. 59. The lands disposable under this title shall be classified as follows:
(a) Lands reclaimed by the Government by dredging, filling, or other means;
(b) Foreshore;
(c) Marshy lands or lands covered with water bordering upon the shores or banks of navigable lakes or rivers;
(d) Lands not included in any of the foregoing classes.
Sec. 60. Any tract of land comprised under this title may be leased or sold, as the case may be, to any person, corporation, or
association authorized to purchase or lease public lands for agricultural purposes. x xx.
Sec. 61. The lands comprised in classes (a), (b), and (c) of section fifty-nine shall be disposed of to private parties by
lease only and not otherwise, as soon as the President, upon recommendation by the Secretary of Agriculture, shall
declare that the same are not necessary for the public service and are open to disposition under this chapter. The lands
included in class (d) may be disposed of by sale or lease under the provisions of this Act. (Emphasis supplied)

Section 61 of CA No. 141 readopted, after the effectivity of the 1935 Constitution, Section 58 of Act No. 2874 prohibiting
the sale of government reclaimed, foreshore and marshy disposable lands of the public domain. All these lands are intended
for residential, commercial, industrial or other non-agricultural purposes. As before, Section 61 allowed only the lease of such
lands to private parties. The government could sell to private parties only lands falling under Section 59 (d) of CA No. 141, or
those lands for non-agricultural purposes not classified as government reclaimed, foreshore and marshy disposable lands of
the public domain. Foreshore lands, however, became inalienable under the 1935 Constitution which only allowed the lease of
these lands to qualified private parties.

to a province, municipality or branch or subdivision of the Government for the purposes deemed by said entities conducive to
the public interest; but the land so granted, donated, or transferred to a province, municipality or branch or subdivision
of the Government shall not be alienated, encumbered, or otherwise disposed of in a manner affecting its title, except
when authorized by Congress: x xx. (Emphasis supplied)

Section 58 of CA No. 141 expressly states that disposable lands of the public domain intended for residential,
commercial, industrial or other productive purposes other than agriculturalshall be disposed of under the provisions of this
chapter and not otherwise. Under Section 10 of CA No. 141, the term disposition includes lease of the land. Any disposition
of government reclaimed, foreshore and marshy disposable lands for non-agricultural purposes must comply with Chapter IX,
Title III of CA No. 141,[54] unless a subsequent law amended or repealed these provisions.

One reason for the congressional authority is that Section 60 of CA No. 141 exempted government units and entities
from the maximum area of public lands that could be acquired from the State. These government units and entities should not
just turn around and sell these lands to private parties in violation of constitutional or statutory limitations. Otherwise, the
transfer of lands for non-agricultural purposes to government units and entities could be used to circumvent constitutional
limitations on ownership of alienable or disposable lands of the public domain. In the same manner, such transfers could also
be used to evade the statutory prohibition in CA No. 141 on the sale of government reclaimed and marshy lands of the public
domain to private parties. Section 60 of CA No. 141 constitutes by operation of law a lien on these lands.[57]

In his concurring opinion in the landmark case of Republic Real Estate Corporation v. Court of Appeals,[55] Justice
Reynato S. Puno summarized succinctly the law on this matter, as follows:
Foreshore lands are lands of public dominion intended for public use. So too are lands reclaimed by the government by
dredging, filling, or other means. Act 1654 mandated that the control and disposition of the foreshore and lands under water
remained in the national government. Said law allowed only the leasing of reclaimed land. The Public Land Acts of 1919 and
1936 also declared that the foreshore and lands reclaimed by the government were to be disposed of to private parties by
lease only and not otherwise. Before leasing, however, the Governor-General, upon recommendation of the Secretary of
Agriculture and Natural Resources, had first to determine that the land reclaimed was not necessary for the public
service. This requisite must have been met before the land could be disposed of. But even then, the foreshore and lands
under water were not to be alienated and sold to private parties. The disposition of the reclaimed land was only by
lease. The land remained property of the State. (Emphasis supplied)
As observed by Justice Puno in his concurring opinion, Commonwealth Act No. 141 has remained in effect at present.
The State policy prohibiting the sale to private parties of government reclaimed, foreshore and marshy alienable lands
of the public domain, first implemented in 1907 was thus reaffirmed in CA No. 141 after the 1935 Constitution took effect. The
prohibition on the sale of foreshore lands, however, became a constitutional edict under the 1935 Constitution. Foreshore
lands became inalienable as natural resources of the State, unless reclaimed by the government and classified as agricultural
lands of the public domain, in which case they would fall under the classification of government reclaimed lands.
After the effectivity of the 1935 Constitution, government reclaimed and marshy disposable lands of the public domain
continued to be only leased and not sold to private parties. [56]These lands remained sui generis, as the only alienable or
disposable lands of the public domain the government could not sell to private parties.
Since then and until now, the only way the government can sell to private parties government reclaimed and marshy
disposable lands of the public domain is for the legislature to pass a law authorizing such sale. CA No. 141 does not authorize
the President to reclassify government reclaimed and marshy lands into other non-agricultural lands under Section 59 (d).
Lands classified under Section 59 (d) are the only alienable or disposable lands for non-agricultural purposes that the
government could sell to private parties.

The congressional authority required in Section 60 of CA No. 141 mirrors the legislative authority required in Section 56 of Act
No. 2874.

In case of sale or lease of disposable lands of the public domain falling under Section 59 of CA No. 141, Sections 63
and 67 require a public bidding. Sections 63 and 67 of CA No. 141 provide as follows:
Sec. 63. Whenever it is decided that lands covered by this chapter are not needed for public purposes, the Director of Lands
shall ask the Secretary of Agriculture and Commerce (now the Secretary of Natural Resources) for authority to dispose of the
same. Upon receipt of such authority, the Director of Lands shall give notice by public advertisement in the same manner as in
the case of leases or sales of agricultural public land, x xx.
Sec. 67. The lease or sale shall be made by oral bidding; and adjudication shall be made to the highest bidder. x
xx. (Emphasis supplied)
Thus, CA No. 141 mandates the Government to put to public auction all leases or sales of alienable or disposable lands of the
public domain.[58]
Like Act No. 1654 and Act No. 2874 before it, CA No. 141 did not repeal Section 5 of the Spanish Law of Waters of
1866. Private parties could still reclaim portions of the sea with government permission. However, the reclaimed land could
become private land only if classified as alienable agricultural land of the public domain open to disposition under CA
No. 141. The 1935 Constitution prohibited the alienation of all natural resources except public agricultural lands.
The Civil Code of 1950
The Civil Code of 1950 readopted substantially the definition of property of public dominion found in the Civil Code of
1889. Articles 420 and 422 of the Civil Code of 1950 state that
Art. 420. The following things are property of public dominion:
(1) Those intended for public use, such as roads, canals, rivers, torrents, ports and bridges constructed by the
State, banks, shores, roadsteads, and others of similar character;

Moreover, Section 60 of CA No. 141 expressly requires congressional authority before lands under Section 59 that the
government previously transferred to government units or entities could be sold to private parties. Section 60 of CA No. 141
declares that
Sec. 60. x xx The area so leased or sold shall be such as shall, in the judgment of the Secretary of Agriculture and Natural
Resources, be reasonably necessary for the purposes for which such sale or lease is requested, and shall not exceed one
hundred and forty-four hectares: Provided, however, That this limitation shall not apply to grants, donations, or transfers made

(2) Those which belong to the State, without being for public use, and are intended for some public service or for
the development of the national wealth.
x xx.
Art. 422. Property of public dominion, when no longer intended for public use or for public service, shall form part of the
patrimonial property of the State.

Again, the government must formally declare that the property of public dominion is no longer needed for public use or
public service, before the same could be classified as patrimonial property of the State. [59] In the case of government reclaimed
and marshy lands of the public domain, the declaration of their being disposable, as well as the manner of their disposition, is
governed by the applicable provisions of CA No. 141.

alienable lands of the public domain, while the statutory ban under CA No. 141 applied only to government reclaimed,
foreshore and marshy alienable lands of the public domain.

Like the Civil Code of 1889, the Civil Code of 1950 included as property of public dominion those properties of the State
which, without being for public use, are intended for public service or the development of the national wealth. Thus,
government reclaimed and marshy lands of the State, even if not employed for public use or public service, if developed to
enhance the national wealth, are classified as property of public dominion.

PD No. 1084 Creating the Public Estates Authority

Dispositions under the 1973 Constitution

The 1973 Constitution, which took effect on January 17, 1973, likewise adopted the Regalian doctrine. Section 8, Article
XIV of the 1973 Constitution stated that
Sec. 8. All lands of the public domain, waters, minerals, coal, petroleum and other mineral oils, all forces of potential energy,
fisheries, wildlife, and other natural resources of the Philippines belong to the State. With the exception of agricultural,
industrial or commercial, residential, and resettlement lands of the public domain, natural resources shall not be
alienated, and no license, concession, or lease for the exploration, development, exploitation, or utilization of any of the
natural resources shall be granted for a period exceeding twenty-five years, renewable for not more than twenty-five years,
except as to water rights for irrigation, water supply, fisheries, or industrial uses other than the development of water power, in
which cases, beneficial use may be the measure and the limit of the grant. (Emphasis supplied)
The 1973 Constitution prohibited the alienation of all natural resources with the exception of agricultural, industrial or
commercial, residential, and resettlement lands of the public domain. In contrast, the 1935 Constitution barred the alienation of
all natural resources except public agricultural lands. However, the term public agricultural lands in the 1935 Constitution
encompassed industrial, commercial, residential and resettlement lands of the public domain. [60] If the land of public domain
were neither timber nor mineral land, it would fall under the classification of agricultural land of the public domain. Both the
1935 and 1973 Constitutions, therefore, prohibited the alienation of all natural resources except agricultural lands of
the public domain.
The 1973 Constitution, however, limited the alienation of lands of the public domain to individuals who were citizens of
the Philippines. Private corporations, even if wholly owned by Philippine citizens, were no longer allowed to acquire alienable
lands of the public domain unlike in the 1935 Constitution. Section 11, Article XIV of the 1973 Constitution declared that

On February 4, 1977, then President Ferdinand Marcos issued Presidential Decree No. 1084 creating PEA, a wholly
government owned and controlled corporation with a special charter. Sections 4 and 8 of PD No. 1084, vests PEA with the
following purposes and powers:
Sec. 4. Purpose. The Authority is hereby created for the following purposes:
(a) To reclaim land, including foreshore and submerged areas, by dredging, filling or other means, or to
acquire reclaimed land;
(b) To develop, improve, acquire, administer, deal in, subdivide, dispose, lease and sell any and all kinds of
lands, buildings, estates and other forms of real property, owned, managed, controlled and/or operated by the
government;
(c) To provide for, operate or administer such service as may be necessary for the efficient, economical and beneficial
utilization of the above properties.
Sec. 5. Powers and functions of the Authority. The Authority shall, in carrying out the purposes for which it is created, have the
following powers and functions:
(a)To prescribe its by-laws.
x xx
(i) To hold lands of the public domain in excess of the area permitted to private corporations by statute.
(j) To reclaim lands and to construct work across, or otherwise, any stream, watercourse, canal, ditch, flume x
xx.
x xx
(o) To perform such acts and exercise such functions as may be necessary for the attainment of the purposes and objectives
herein specified. (Emphasis supplied)
PD No. 1084 authorizes PEA to reclaim both foreshore and submerged areas of the public domain. Foreshore areas are
those covered and uncovered by the ebb and flow of the tide. [61] Submerged areas are those permanently under water
regardless of the ebb and flow of the tide.[62] Foreshore and submerged areas indisputably belong to the public domain[63] and
are inalienable unless reclaimed, classified as alienable lands open to disposition, and further declared no longer needed for
public service.

Sec. 11. The BatasangPambansa, taking into account conservation, ecological, and development requirements of the natural
resources, shall determine by law the size of land of the public domain which may be developed, held or acquired by, or leased
to, any qualified individual, corporation, or association, and the conditions therefor. No private corporation or association
may hold alienable lands of the public domain except by lease not to exceed one thousand hectares in area nor may any
citizen hold such lands by lease in excess of five hundred hectares or acquire by purchase, homestead or grant, in excess of
twenty-four hectares. No private corporation or association may hold by lease, concession, license or permit, timber or forest
lands and other timber or forest resources in excess of one hundred thousand hectares. However, such area may be
increased by the BatasangPambansa upon recommendation of the National Economic and Development Authority. (Emphasis
supplied)

The ban in the 1973 Constitution on private corporations from acquiring alienable lands of the public domain did not
apply to PEA since it was then, and until today, a fully owned government corporation. The constitutional ban applied then, as
it still applies now, only to private corporations and associations. PD No. 1084 expressly empowers PEA to hold lands of the
public domain even in excess of the area permitted to private corporations by statute. Thus, PEA can hold title to private
lands, as well as title to lands of the public domain.

Thus, under the 1973 Constitution, private corporations could hold alienable lands of the public domain only through
lease. Only individuals could now acquire alienable lands of the public domain, and private corporations became absolutely
barred from acquiring any kind of alienable land of the public domain. The constitutional ban extended to all kinds of

Sec. 60. x xx; but the land so granted, donated or transferred to a province, municipality, or branch or subdivision of the
Government shall not be alienated, encumbered or otherwise disposed of in a manner affecting its title, except when
authorized by Congress; x xx. (Emphasis supplied)

In order for PEA to sell its reclaimed foreshore and submerged alienable lands of the public domain, there must be
legislative authority empowering PEA to sell these lands. This legislative authority is necessary in view of Section 60 of CA
No.141, which states

Without such legislative authority, PEA could not sell but only lease its reclaimed foreshore and submerged alienable lands of
the public domain. Nevertheless, any legislative authority granted to PEA to sell its reclaimed alienable lands of the public
domain would be subject to the constitutional ban on private corporations from acquiring alienable lands of the public domain.
Hence, such legislative authority could only benefit private individuals.

If we recall, this provision did not exist under the 1935 Constitution, but this was introduced in the 1973 Constitution. In effect,
it prohibits private corporations from acquiring alienable public lands. But it has not been very clear in jurisprudence what
the reason for this is. In some of the cases decided in 1982 and 1983, it was indicated that the purpose of this is to
prevent large landholdings. Is that the intent of this provision?
MR. VILLEGAS: I think that is the spirit of the provision.

Dispositions under the 1987 Constitution

The 1987 Constitution, like the 1935 and 1973 Constitutions before it, has adopted the Regalian doctrine. The 1987
Constitution declares that all natural resources are owned by the State, and except for alienable agricultural lands of the
public domain, natural resources cannot be alienated. Sections 2 and 3, Article XII of the 1987 Constitution state that
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. x xx.
Section 3. Lands of the public domain are classified into agricultural, forest or timber, mineral lands, and national
parks. Agricultural lands of the public domain may be further classified by law according to the uses which they may be
devoted. Alienable lands of the public domain shall be limited to agricultural lands. Private corporations or
associations may not hold such alienable lands of the public domain except by lease, for a period not exceeding
twenty-five years, renewable for not more than twenty-five years, and not to exceed one thousand hectares in area.
Citizens of the Philippines may lease not more than five hundred hectares, or acquire not more than twelve hectares thereof by
purchase, homestead, or grant.
Taking into account the requirements of conservation, ecology, and development, and subject to the requirements of agrarian
reform, the Congress shall determine, by law, the size of lands of the public domain which may be acquired, developed, held,
or leased and the conditions therefor. (Emphasis supplied)
The 1987 Constitution continues the State policy in the 1973 Constitution banning private corporations from
acquiring any kind of alienable land of the public domain. Like the 1973 Constitution, the 1987 Constitution allows private
corporations to hold alienable lands of the public domain only through lease. As in the 1935 and 1973 Constitutions, the
general law governing the lease to private corporations of reclaimed, foreshore and marshy alienable lands of the public
domain is still CA No. 141.

The Rationale behind the Constitutional Ban

The rationale behind the constitutional ban on corporations from acquiring, except through lease, alienable lands of the
public domain is not well understood. During the deliberations of the 1986 Constitutional Commission, the commissioners
probed the rationale behind this ban, thus:
FR. BERNAS: Mr. Vice-President, my questions have reference to page 3, line 5 which says:
`No private corporation or association may hold alienable lands of the public domain except by lease, not to
exceed one thousand hectares in area.

FR. BERNAS: In existing decisions involving the Iglesiani Cristo, there were instances where the Iglesiani Cristo was not
allowed to acquire a mere 313-square meter land where a chapel stood because the Supreme Court said it would be in
violation of this. (Emphasis supplied)
In Ayog v. Cusi,[64] the Court explained the rationale behind this constitutional ban in this way:
Indeed, one purpose of the constitutional prohibition against purchases of public agricultural lands by private corporations is to
equitably diffuse land ownership or to encourage owner-cultivatorship and the economic family-size farm and to prevent a
recurrence of cases like the instant case. Huge landholdings by corporations or private persons had spawned social unrest.
However, if the constitutional intent is to prevent huge landholdings, the Constitution could have simply limited the size of
alienable lands of the public domain that corporations could acquire. The Constitution could have followed the limitations on
individuals, who could acquire not more than 24 hectares of alienable lands of the public domain under the 1973 Constitution,
and not more than 12 hectares under the 1987 Constitution.
If the constitutional intent is to encourage economic family-size farms, placing the land in the name of a corporation
would be more effective in preventing the break-up of farmlands. If the farmland is registered in the name of a corporation,
upon the death of the owner, his heirs would inherit shares in the corporation instead of subdivided parcels of the
farmland. This would prevent the continuing break-up of farmlands into smaller and smaller plots from one generation to the
next.
In actual practice, the constitutional ban strengthens the constitutional limitation on individuals from acquiring more than
the allowed area of alienable lands of the public domain.Without the constitutional ban, individuals who already acquired the
maximum area of alienable lands of the public domain could easily set up corporations to acquire more alienable public
lands. An individual could own as many corporations as his means would allow him. An individual could even hide his
ownership of a corporation by putting his nominees as stockholders of the corporation. The corporation is a convenient vehicle
to circumvent the constitutional limitation on acquisition by individuals of alienable lands of the public domain.
The constitutional intent, under the 1973 and 1987 Constitutions, is to transfer ownership of only a limited area of
alienable land of the public domain to a qualified individual. This constitutional intent is safeguarded by the provision
prohibiting corporations from acquiring alienable lands of the public domain, since the vehicle to circumvent the constitutional
intent is removed. The available alienable public lands are gradually decreasing in the face of an ever-growing population. The
most effective way to insure faithful adherence to this constitutional intent is to grant or sell alienable lands of the public
domain only to individuals. This, it would seem, is the practical benefit arising from the constitutional ban.

The Amended Joint Venture Agreement

The subject matter of the Amended JVA, as stated in its second Whereas clause, consists of three properties, namely:
1. [T]hree partially reclaimed and substantially eroded islands along Emilio Aguinaldo Boulevard in Paranaque
and Las Pinas, Metro Manila, with a combined titled area of 1,578,441 square meters;

2. [A]nother area of 2,421,559 square meters contiguous to the three islands; and
3. [A]t AMARIs option as approved by PEA, an additional 350 hectares more or less to regularize the
configuration of the reclaimed area.[65]
PEA confirms that the Amended JVA involves the development of the Freedom Islands and further reclamation of about 250
hectares x xx, plus an option granted to AMARI to subsequently reclaim another 350 hectares x x x. [66]
In short, the Amended JVA covers a reclamation area of 750 hectares. Only 157.84 hectares of the 750-hectare
reclamation project have been reclaimed, and the rest of the 592.15 hectares are still submerged areas forming part
of Manila Bay.
Under the Amended JVA, AMARI will reimburse PEA the sum of P1,894,129,200.00 for PEAs actual cost in partially
reclaiming the Freedom Islands. AMARI will also complete, at its own expense, the reclamation of the Freedom
Islands. AMARI will further shoulder all the reclamation costs of all the other areas, totaling 592.15 hectares, still to be
reclaimed. AMARI and PEA will share, in the proportion of 70 percent and 30 percent, respectively, the total net usable area
which is defined in the Amended JVA as the total reclaimed area less 30 percent earmarked for common areas. Title to
AMARIs share in the net usable area, totaling 367.5 hectares, will be issued in the name of AMARI. Section 5.2 (c) of the
Amended JVA provides that
x xx, PEA shall have the duty to execute without delay the necessary deed of transfer or conveyance of the title pertaining to
AMARIs Land share based on the Land Allocation Plan. PEA, when requested in writing by AMARI, shall then cause the
issuance and delivery of the proper certificates of title covering AMARIs Land Share in the name of AMARI, x xx;
provided, that if more than seventy percent (70%) of the titled area at any given time pertains to AMARI, PEA shall deliver to
AMARI only seventy percent (70%) of the titles pertaining to AMARI, until such time when a corresponding proportionate area
of additional land pertaining to PEA has been titled. (Emphasis supplied)

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. x xx.
x xx
Section 3. x xx Alienable lands of the public domain shall be limited to agricultural lands. Private corporations or
associations may not hold such alienable lands of the public domain except by lease, x x x.(Emphasis supplied)

Classification of Reclaimed Foreshore and Submerged Areas

PEA readily concedes that lands reclaimed from foreshore or submerged areas of Manila Bay are alienable or
disposable lands of the public domain. In its Memorandum,[67] PEA admits that
Under the Public Land Act (CA 141, as amended), reclaimed lands are classified as alienable and disposable lands of
the public domain:
Sec. 59. The lands disposable under this title shall be classified as follows:
(a) Lands reclaimed by the government by dredging, filling, or other means;
x xx. (Emphasis supplied)

Indisputably, under the Amended JVA AMARI will acquire and own a maximum of 367.5 hectares of reclaimed land
which will be titled in its name.

Likewise, the Legal Task Force [68] constituted under Presidential Administrative Order No. 365 admitted in its Report and
Recommendation to then President Fidel V. Ramos,[R]eclaimed lands are classified as alienable and disposable lands of
the public domain.[69] The Legal Task Force concluded that

To implement the Amended JVA, PEA delegated to the unincorporated PEA-AMARI joint venture PEAs statutory
authority, rights and privileges to reclaim foreshore and submerged areas in Manila Bay. Section 3.2.a of the Amended JVA
states that

D. Conclusion

PEA hereby contributes to the joint venture its rights and privileges to perform Rawland Reclamation and Horizontal
Development as well as own the Reclamation Area, thereby granting the Joint Venture the full and exclusive right, authority
and privilege to undertake the Project in accordance with the Master Development Plan.
The Amended JVA is the product of a renegotiation of the original JVA dated April 25, 1995 and its supplemental agreement
dated August 9, 1995.

The Threshold Issue

The threshold issue is whether AMARI, a private corporation, can acquire and own under the Amended JVA 367.5
hectares of reclaimed foreshore and submerged areas in Manila Bay in view of Sections 2 and 3, Article XII of the 1987
Constitution which state that:

Reclaimed lands are lands of the public domain. However, by statutory authority, the rights of ownership and disposition over
reclaimed lands have been transferred to PEA, by virtue of which PEA, as owner, may validly convey the same to any qualified
person without violating the Constitution or any statute.
The constitutional provision prohibiting private corporations from holding public land, except by lease (Sec. 3, Art. XVII, [70] 1987
Constitution), does not apply to reclaimed lands whose ownership has passed on to PEA by statutory grant.
Under Section 2, Article XII of the 1987 Constitution, the foreshore and submerged areas of Manila Bay are part of the
lands of the public domain, waters x xx and other natural resources and consequently owned by the State. As such, foreshore
and submerged areas shall not be alienated, unless they are classified as agricultural lands of the public domain. The mere
reclamation of these areas by PEA does not convert these inalienable natural resources of the State into alienable or
disposable lands of the public domain. There must be a law or presidential proclamation officially classifying these reclaimed
lands as alienable or disposable and open to disposition or concession. Moreover, these reclaimed lands cannot be classified
as alienable or disposable if the law has reserved them for some public or quasi-public use.[71]
Section 8 of CA No. 141 provides that only those lands shall be declared open to disposition or concession which have
been officially delimited and classified.[72] The President has the authority to classify inalienable lands of the public domain
into alienable or disposable lands of the public domain, pursuant to Section 6 of CA No. 141. In Laurel vs. Garcia,[73] the
Executive Department attempted to sell the Roppongi property in Tokyo, Japan, which was acquired by the Philippine
Government for use as the Chancery of the Philippine Embassy.Although the Chancery had transferred to another location

thirteen years earlier, the Court still ruled that, under Article 422 [74] of the Civil Code, a property of public dominion retains such
character until formally declared otherwise. The Court ruled that
The fact that the Roppongi site has not been used for a long time for actual Embassy service does not automatically convert it
to patrimonial property. Any such conversion happens only if the property is withdrawn from public use (Cebu Oxygen and
Acetylene Co. v. Bercilles, 66 SCRA 481 [1975]. A property continues to be part of the public domain, not available for
private appropriation or ownership until there is a formal declaration on the part of the government to withdraw it
from being such (Ignacio v. Director of Lands, 108 Phil. 335 [1960]. (Emphasis supplied)

Article 5 of the Spanish Law of Waters must be read together with laws subsequently enacted on the disposition of
public lands. In particular, CA No. 141 requires that lands of the public domain must first be classified as alienable or
disposable before the government can alienate them. These lands must not be reserved for public or quasi-public purposes.
[78]
Moreover, the contract between CDCP and the government was executed after the effectivity of the 1973 Constitution which
barred private corporations from acquiring any kind of alienable land of the public domain. This contract could not have
converted the Freedom Islands into private lands of a private corporation.
Presidential Decree No. 3-A, issued on January 11, 1973, revoked all laws authorizing the reclamation of areas under
water and revested solely in the National Government the power to reclaim lands. Section 1 of PD No. 3-A declared that

PD No. 1085, issued on February 4, 1977, authorized the issuance of special land patents for lands reclaimed by PEA
from the foreshore or submerged areas of Manila Bay. On January 19, 1988 then President Corazon C. Aquino issued Special
Patent No. 3517 in the name of PEA for the 157.84 hectares comprising the partially reclaimed Freedom Islands.Subsequently,
on April 9, 1999 the Register of Deeds of the Municipality of Paranaque issued TCT Nos. 7309, 7311 and 7312 in the name of
PEA pursuant to Section 103 of PD No. 1529 authorizing the issuance of certificates of title corresponding to land patents. To
this day, these certificates of title are still in the name of PEA.

The provisions of any law to the contrary notwithstanding, the reclamation of areas under water, whether foreshore or
inland, shall be limited to the National Government or any person authorized by it under a proper contract. (Emphasis
supplied)

PD No. 1085, coupled with President Aquinos actual issuance of a special patent covering the Freedom Islands, is
equivalent to an official proclamation classifying the Freedom Islands as alienable or disposable lands of the public
domain. PD No. 1085 and President Aquinos issuance of a land patent also constitute a declaration that the Freedom Islands
are no longer needed for public service. The Freedom Islands are thus alienable or disposable lands of the public
domain, open to disposition or concession to qualified parties.

PD No. 3-A repealed Section 5 of the Spanish Law of Waters of 1866 because reclamation of areas under water could now be
undertaken only by the National Government or by a person contracted by the National Government. Private parties may
reclaim from the sea only under a contract with the National Government, and no longer by grant or permission as provided in
Section 5 of the Spanish Law of Waters of 1866.

At the time then President Aquino issued Special Patent No. 3517, PEA had already reclaimed the Freedom Islands
although subsequently there were partial erosions on some areas. The government had also completed the necessary surveys
on these islands. Thus, the Freedom Islands were no longer part of Manila Bay but part of the land mass. Section 3, Article XII
of the 1987 Constitution classifies lands of the public domain into agricultural, forest or timber, mineral lands, and national
parks. Being neither timber, mineral, nor national park lands, the reclaimed Freedom Islands necessarily fall under the
classification of agricultural lands of the public domain. Under the 1987 Constitution, agricultural lands of the public domain are
the only natural resources that the State may alienate to qualified private parties. All other natural resources, such as the seas
or bays, are waters x xx owned by the State forming part of the public domain, and are inalienable pursuant to Section 2,
Article XII of the 1987 Constitution.
AMARI claims that the Freedom Islands are private lands because CDCP, then a private corporation, reclaimed the
islands under a contract dated November 20, 1973 with the Commissioner of Public Highways. AMARI, citing Article 5 of the
Spanish Law of Waters of 1866, argues that if the ownership of reclaimed lands may be given to the party constructing the
works, then it cannot be said that reclaimed lands are lands of the public domain which the State may not alienate. [75] Article 5
of the Spanish Law of Waters reads as follows:
Article 5. Lands reclaimed from the sea in consequence of works constructed by the State, or by the provinces, pueblos or
private persons, with proper permission, shall become the property of the party constructing such works, unless otherwise
provided by the terms of the grant of authority. (Emphasis supplied)
Under Article 5 of the Spanish Law of Waters of 1866, private parties could reclaim from the sea only with proper
permission from the State. Private parties could own the reclaimed land only if not otherwise provided by the terms of the grant
of authority. This clearly meant that no one could reclaim from the sea without permission from the State because the sea is
property of public dominion. It also meant that the State could grant or withhold ownership of the reclaimed land because any
reclaimed land, like the sea from which it emerged, belonged to the State. Thus, a private person reclaiming from the sea
without permission from the State could not acquire ownership of the reclaimed land which would remain property of public
dominion like the sea it replaced.[76] Article 5 of the Spanish Law of Waters of 1866 adopted the time-honored principle of land
ownership that all lands that were not acquired from the government, either by purchase or by grant, belong to the public
domain.[77]

x xx.

Executive Order No. 525, issued on February 14, 1979, designated PEA as the National Governments implementing
arm to undertake all reclamation projects of the government, whichshall be undertaken by the PEA or through a proper
contract executed by it with any person or entity. Under such contract, a private party receives compensation for
reclamation services rendered to PEA. Payment to the contractor may be in cash, or in kind consisting of portions of the
reclaimed land, subject to the constitutional ban on private corporations from acquiring alienable lands of the public
domain. The reclaimed land can be used as payment in kind only if the reclaimed land is first classified as alienable or
disposable land open to disposition, and then declared no longer needed for public service.
The Amended JVA covers not only the Freedom Islands, but also an additional 592.15 hectares which are still
submerged and forming part of Manila Bay. There is no legislative or Presidential act classifying these submerged areas
as alienable or disposable lands of the public domain open to disposition. These submerged areas are not covered by
any patent or certificate of title. There can be no dispute that these submerged areas form part of the public domain, and in
their present state are inalienable and outside the commerce of man. Until reclaimed from the sea, these submerged areas
are, under the Constitution, waters x xx owned by the State, forming part of the public domain and consequently
inalienable.Only when actually reclaimed from the sea can these submerged areas be classified as public agricultural lands,
which under the Constitution are the only natural resources that the State may alienate. Once reclaimed and transformed into
public agricultural lands, the government may then officially classify these lands as alienable or disposable lands open to
disposition.Thereafter, the government may declare these lands no longer needed for public service. Only then can these
reclaimed lands be considered alienable or disposable lands of the public domain and within the commerce of man.
The classification of PEAs reclaimed foreshore and submerged lands into alienable or disposable lands open to
disposition is necessary because PEA is tasked under its charter to undertake public services that require the use of lands of
the public domain. Under Section 5 of PD No. 1084, the functions of PEA include the following: [T]o own or operate railroads,
tramways and other kinds of land transportation, x xx; [T]o construct, maintain and operate such systems of sanitary sewers as
may be necessary; [T]o construct, maintain and operate such storm drains as may be necessary. PEA is empowered to issue
rules and regulations as may be necessary for the proper use by private parties of any or all of the highways, roads,
utilities, buildings and/or any of its properties and to impose or collect fees or tolls for their use. Thus, part of the reclaimed
foreshore and submerged lands held by the PEA would actually be needed for public use or service since many of the
functions imposed on PEA by its charter constitute essential public services.

Moreover, Section 1 of Executive Order No. 525 provides that PEA shall be primarily responsible for integrating,
directing, and coordinating all reclamation projects for and on behalf of the National Government. The same section also states
that [A]ll reclamation projects shall be approved by the President upon recommendation of the PEA, and shall be undertaken
by the PEA or through a proper contract executed by it with any person or entity; x xx. Thus, under EO No. 525, in relation to
PD No. 3-A and PD No.1084, PEA became the primary implementing agency of the National Government to reclaim foreshore
and submerged lands of the public domain. EO No. 525 recognized PEA as the government entity to undertake the
reclamation of lands and ensure their maximum utilization in promoting public welfare and interests.[79] Since large portions
of these reclaimed lands would obviously be needed for public service, there must be a formal declaration segregating
reclaimed lands no longer needed for public service from those still needed for public service.

In short, DENR is vested with the power to authorize the reclamation of areas under water, while PEA is vested with the
power to undertake the physical reclamation of areas under water, whether directly or through private contractors. DENR is
also empowered to classify lands of the public domain into alienable or disposable lands subject to the approval of the
President. On the other hand, PEA is tasked to develop, sell or lease the reclaimed alienable lands of the public domain.

Section 3 of EO No. 525, by declaring that all lands reclaimed by PEA shall belong to or be owned by the PEA, could
not automatically operate to classify inalienable lands into alienable or disposable lands of the public domain. Otherwise,
reclaimed foreshore and submerged lands of the public domain would automatically become alienable once reclaimed by PEA,
whether or not classified as alienable or disposable.

Absent two official acts a classification that these lands are alienable or disposable and open to disposition and a
declaration that these lands are not needed for public service, lands reclaimed by PEA remain inalienable lands of the public
domain. Only such an official classification and formal declaration can convert reclaimed lands into alienable or disposable
lands of the public domain, open to disposition under the Constitution, Title I and Title III [83] of CA No. 141 and other applicable
laws.[84]

Clearly, the mere physical act of reclamation by PEA of foreshore or submerged areas does not make the reclaimed
lands alienable or disposable lands of the public domain, much less patrimonial lands of PEA. Likewise, the mere transfer by
the National Government of lands of the public domain to PEA does not make the lands alienable or disposable lands of the
public domain, much less patrimonial lands of PEA.

The Revised Administrative Code of 1987, a later law than either PD No. 1084 or EO No. 525, vests in the Department
of Environment and Natural Resources (DENR for brevity) the following powers and functions:
Sec. 4. Powers and Functions. The Department shall:
(1) xxx
x xx
(4) Exercise supervision and control over forest lands, alienable and disposable public lands, mineral resources and, in
the process of exercising such control, impose appropriate taxes, fees, charges, rentals and any such form of levy and collect
such revenues for the exploration, development, utilization or gathering of such resources;
x xx
(14) Promulgate rules, regulations and guidelines on the issuance of licenses, permits, concessions, lease
agreements and such other privileges concerning the development, exploration and utilization of the countrys
marine, freshwater, and brackish water and over all aquatic resources of the country and shall continue to oversee,
supervise and police our natural resources; cancel or cause to cancel such privileges upon failure, non-compliance or
violations of any regulation, order, and for all other causes which are in furtherance of the conservation of natural resources
and supportive of the national interest;
(15) Exercise exclusive jurisdiction on the management and disposition of all lands of the public domain and serve
as the sole agency responsible for classification, sub-classification, surveying and titling of lands in consultation with
appropriate agencies.[80] (Emphasis supplied)
As manager, conservator and overseer of the natural resources of the State, DENR exercises supervision and control
over alienable and disposable public lands. DENR also exercises exclusive jurisdiction on the management and disposition of
all lands of the public domain. Thus, DENR decides whether areas under water, like foreshore or submerged areas of Manila
Bay, should be reclaimed or not. This means that PEA needs authorization from DENR before PEA can undertake reclamation
projects in Manila Bay, or in any part of the country.
DENR also exercises exclusive jurisdiction over the disposition of all lands of the public domain. Hence, DENR decides
whether reclaimed lands of PEA should be classified as alienable under Sections 6 [81] and 7[82] of CA No. 141. Once DENR
decides that the reclaimed lands should be so classified, it then recommends to the President the issuance of a proclamation
classifying the lands as alienable or disposable lands of the public domain open to disposition. We note that then DENR
Secretary Fulgencio S. Factoran, Jr. countersigned Special Patent No. 3517 in compliance with the Revised Administrative
Code and Sections 6 and 7 of CA No. 141.

PEAs Authority to Sell Reclaimed Lands

PEA, like the Legal Task Force, argues that as alienable or disposable lands of the public domain, the reclaimed lands
shall be disposed of in accordance with CA No. 141, the Public Land Act. PEA, citing Section 60 of CA No. 141, admits that
reclaimed lands transferred to a branch or subdivision of the government shall not be alienated, encumbered, or otherwise
disposed of in a manner affecting its title, except when authorized by Congress: x x x.[85] (Emphasis by PEA)
In Laurel vs. Garcia,[86] the Court cited Section 48 of the Revised Administrative Code of 1987, which states that
Sec. 48. Official Authorized to Convey Real Property. Whenever real property of the Government is authorized by law to be
conveyed, the deed of conveyance shall be executed in behalf of the government by the following: x xx.
Thus, the Court concluded that a law is needed to convey any real property belonging to the Government. The Court declared
that It is not for the President to convey real property of the government on his or her own sole will. Any such conveyance must
be authorized and approved by a law enacted by the Congress. It requires executive and legislative
concurrence. (Emphasis supplied)
PEA contends that PD No. 1085 and EO No. 525 constitute the legislative authority allowing PEA to sell its reclaimed
lands. PD No. 1085, issued on February 4, 1977, provides that
The land reclaimed in the foreshore and offshore area of Manila Bay pursuant to the contract for the reclamation and
construction of the Manila-Cavite Coastal Road Project between the Republic of the Philippines and the Construction and
Development Corporation of the Philippines dated November 20, 1973 and/or any other contract or reclamation covering the
same area is hereby transferred, conveyed and assigned to the ownership and administration of the Public Estates
Authority established pursuant to PD No. 1084; Provided, however, That the rights and interests of the Construction and
Development Corporation of the Philippines pursuant to the aforesaid contract shall be recognized and respected.
Henceforth, the Public Estates Authority shall exercise the rights and assume the obligations of the Republic of the Philippines
(Department of Public Highways) arising from, or incident to, the aforesaid contract between the Republic of the Philippines
and the Construction and Development Corporation of the Philippines.

In consideration of the foregoing transfer and assignment, the Public Estates Authority shall issue in favor of the Republic of
the Philippines the corresponding shares of stock in said entity with an issued value of said shares of stock (which) shall be
deemed fully paid and non-assessable.
The Secretary of Public Highways and the General Manager of the Public Estates Authority shall execute such contracts or
agreements, including appropriate agreements with the Construction and Development Corporation of the Philippines, as may
be necessary to implement the above.
Special land patent/patents shall be issued by the Secretary of Natural Resources in favor of the Public Estates
Authority without prejudice to the subsequent transfer to the contractor or his assignees of such portion or portions
of the land reclaimed or to be reclaimed as provided for in the above-mentioned contract. On the basis of such
patents, the Land Registration Commission shall issue the corresponding certificate of title. (Emphasis supplied)
On the other hand, Section 3 of EO No. 525, issued on February 14, 1979, provides that Sec. 3. All lands reclaimed by PEA shall belong to or be owned by the PEA which shall be responsible for its
administration, development, utilization or disposition in accordance with the provisions of Presidential Decree No. 1084. Any
and all income that the PEA may derive from the sale, lease or use of reclaimed lands shall be used in accordance with the
provisions of Presidential Decree No. 1084.
There is no express authority under either PD No. 1085 or EO No. 525 for PEA to sell its reclaimed lands. PD No. 1085
merely transferred ownership and administration of lands reclaimed from Manila Bay to PEA, while EO No. 525 declared that
lands reclaimed by PEA shall belong to or be owned by PEA. EO No. 525 expressly states that PEA should dispose of its
reclaimed lands in accordance with the provisions of Presidential Decree No. 1084, the charter of PEA.
PEAs charter, however, expressly tasks PEA to develop, improve, acquire, administer, deal in, subdivide, dispose, lease
and sell any and all kinds of lands x xx owned, managed, controlled and/or operated by the government. [87] (Emphasis
supplied) There is, therefore, legislative authority granted to PEA to sell its lands, whether patrimonial or alienable
lands of the public domain. PEA may sell to private parties its patrimonial properties in accordance with the PEA charter
free from constitutional limitations. The constitutional ban on private corporations from acquiring alienable lands of the public
domain does not apply to the sale of PEAs patrimonial lands.
PEA may also sell its alienable or disposable lands of the public domain to private individuals since, with the
legislative authority, there is no longer any statutory prohibition against such sales and the constitutional ban does not apply to
individuals. PEA, however, cannot sell any of its alienable or disposable lands of the public domain to private corporations
since Section 3, Article XII of the 1987 Constitution expressly prohibits such sales. The legislative authority benefits only
individuals. Private corporations remain barred from acquiring any kind of alienable land of the public domain, including
government reclaimed lands.

exempting PEA from holding a public auction. [88] Special Patent No. 3517 expressly states that the patent is issued by authority
of the Constitution and PD No. 1084, supplemented by Commonwealth Act No. 141, as amended. This is an acknowledgment
that the provisions of CA No. 141 apply to the disposition of reclaimed alienable lands of the public domain unless otherwise
provided by law. Executive Order No. 654,[89] which authorizes PEA to determine the kind and manner of payment for the
transfer of its assets and properties, does not exempt PEA from the requirement of public auction. EO No. 654 merely
authorizes PEA to decide the mode of payment, whether in kind and in installment, but does not authorize PEA to dispense
with public auction.
Moreover, under Section 79 of PD No. 1445, otherwise known as the Government Auditing Code, the government is
required to sell valuable government property through public bidding. Section 79 of PD No. 1445 mandates that
Section 79. When government property has become unserviceable for any cause, or is no longer needed, it shall, upon
application of the officer accountable therefor, be inspected by the head of the agency or his duly authorized representative in
the presence of the auditor concerned and, if found to be valueless or unsaleable, it may be destroyed in their presence. If
found to be valuable, it may be sold at public auction to the highest bidder under the supervision of the proper committee
on award or similar body in the presence of the auditor concerned or other authorized representative of the Commission, after
advertising by printed notice in the Official Gazette, or for not less than three consecutive days in any newspaper of
general circulation, or where the value of the property does not warrant the expense of publication, by notices posted for a
like period in at least three public places in the locality where the property is to be sold. In the event that the public auction
fails, the property may be sold at a private sale at such price as may be fixed by the same committee or body
concerned and approved by the Commission.
It is only when the public auction fails that a negotiated sale is allowed, in which case the Commission on Audit must approve
the selling price.[90] The Commission on Audit implements Section 79 of the Government Auditing Code through Circular No.
89-296[91] dated January 27, 1989. This circular emphasizes that government assets must be disposed of only through public
auction, and a negotiated sale can be resorted to only in case of failure of public auction.
At the public auction sale, only Philippine citizens are qualified to bid for PEAs reclaimed foreshore and submerged
alienable lands of the public domain. Private corporations are barred from bidding at the auction sale of any kind of alienable
land of the public domain.
PEA originally scheduled a public bidding for the Freedom Islands on December 10, 1991. PEA imposed a condition
that the winning bidder should reclaim another 250 hectares of submerged areas to regularize the shape of the Freedom
Islands, under a 60-40 sharing of the additional reclaimed areas in favor of the winning bidder. [92] No one, however, submitted a
bid. On December 23, 1994, the Government Corporate Counsel advised PEA it could sell the Freedom Islands through
negotiation, without need of another public bidding, because of the failure of the public bidding on December 10, 1991.[93]

The provision in PD No. 1085 stating that portions of the reclaimed lands could be transferred by PEA to the contractor
or his assignees (Emphasis supplied) would not apply to private corporations but only to individuals because of the
constitutional ban. Otherwise, the provisions of PD No. 1085 would violate both the 1973 and 1987 Constitutions.

However, the original JVA dated April 25, 1995 covered not only the Freedom Islands and the additional 250 hectares
still to be reclaimed, it also granted an option to AMARI to reclaim another 350 hectares. The original JVA, a negotiated
contract, enlarged the reclamation area to 750 hectares.[94] The failure of public bidding on December 10, 1991, involving only
407.84 hectares,[95] is not a valid justification for a negotiated sale of 750 hectares, almost double the area publicly
auctioned. Besides, the failure of public bidding happened on December 10, 1991, more than three years before the signing of
the original JVA on April 25, 1995. The economic situation in the country had greatly improved during the intervening period.

The requirement of public auction in the sale of reclaimed lands

Reclamation under the BOT Law and the Local Government Code

Assuming the reclaimed lands of PEA are classified as alienable or disposable lands open to disposition, and further
declared no longer needed for public service, PEA would have to conduct a public bidding in selling or leasing these
lands. PEA must observe the provisions of Sections 63 and 67 of CA No. 141 requiring public auction, in the absence of a law

The constitutional prohibition in Section 3, Article XII of the 1987 Constitution is absolute and clear: Private corporations
or associations may not hold such alienable lands of the public domain except by lease, x xx. Even Republic Act No. 6957

(BOT Law, for brevity), cited by PEA and AMARI as legislative authority to sell reclaimed lands to private parties, recognizes
the constitutional ban. Section 6 of RA No. 6957 states

After the registration and issuance of the certificate and duplicate certificate of title based on a public land
patent, the land covered thereby automatically comes under the operation of Republic Act 496 subject to all
the safeguards provided therein.

Sec. 6. Repayment Scheme. - For the financing, construction, operation and maintenance of any infrastructure projects
undertaken through the build-operate-and-transfer arrangement or any of its variations pursuant to the provisions of this Act,
the project proponent x xx may likewise be repaid in the form of a share in the revenue of the project or other non-monetary
payments, such as, but not limited to, the grant of a portion or percentage of the reclaimed land, subject to the constitutional
requirements with respect to the ownership of the land: x xx. (Emphasis supplied)

3. Heirs of Gregorio Tengco v. Heirs of Jose Aliwalas,[99] where the Court ruled -

A private corporation, even one that undertakes the physical reclamation of a government BOT project, cannot acquire
reclaimed alienable lands of the public domain in view of the constitutional ban.

4. Manalo v. Intermediate Appellate Court,[100] where the Court held

Section 302 of the Local Government Code, also mentioned by PEA and AMARI, authorizes local governments in land
reclamation projects to pay the contractor or developer in kind consisting of a percentage of the reclaimed land, to wit:
Section 302. Financing, Construction, Maintenance, Operation, and Management of Infrastructure Projects by the Private
Sector. x xx
x xx
In case of land reclamation or construction of industrial estates, the repayment plan may consist of the grant of a portion or
percentage of the reclaimed land or the industrial estate constructed.
Although Section 302 of the Local Government Code does not contain a proviso similar to that of the BOT Law, the
constitutional restrictions on land ownership automatically apply even though not expressly mentioned in the Local
Government Code.
Thus, under either the BOT Law or the Local Government Code, the contractor or developer, if a corporate entity, can
only be paid with leaseholds on portions of the reclaimed land. If the contractor or developer is an individual, portions of the
reclaimed land, not exceeding 12 hectares[96] of non-agricultural lands, may be conveyed to him in ownership in view of the
legislative authority allowing such conveyance. This is the only way these provisions of the BOT Law and the Local
Government Code can avoid a direct collision with Section 3, Article XII of the 1987 Constitution.

Registration of lands of the public domain

Finally, PEA theorizes that the act of conveying the ownership of the reclaimed lands to public respondent PEA
transformed such lands of the public domain to private lands. This theory is echoed by AMARI which maintains that the
issuance of the special patent leading to the eventual issuance of title takes the subject land away from the land of public
domain and converts the property into patrimonial or private property. In short, PEA and AMARI contend that with the issuance
of Special Patent No. 3517 and the corresponding certificates of titles, the 157.84 hectares comprising the Freedom Islands
have become private lands of PEA. In support of their theory, PEA and AMARI cite the following rulings of the Court:
1. Sumail v. Judge of CFI of Cotabato,[97] where the Court held
Once the patent was granted and the corresponding certificate of title was issued, the land ceased to be part
of the public domain and became private property over which the Director of Lands has neither control nor
jurisdiction.
2. Lee Hong Hok v. David,[98] where the Court declared -

While the Director of Lands has the power to review homestead patents, he may do so only so long as the
land remains part of the public domain and continues to be under his exclusive control; but once the patent is
registered and a certificate of title is issued, the land ceases to be part of the public domain and becomes
private property over which the Director of Lands has neither control nor jurisdiction.

When the lots in dispute were certified as disposable on May 19, 1971, and free patents were issued
covering the same in favor of the private respondents, the said lots ceased to be part of the public domain
and, therefore, the Director of Lands lost jurisdiction over the same.
5.Republic v. Court of Appeals,[101] where the Court stated
Proclamation No. 350, dated October 9, 1956, of President Magsaysay legally effected a land grant to the
Mindanao Medical Center, Bureau of Medical Services, Department of Health, of the whole lot, validly
sufficient for initial registration under the Land Registration Act. Such land grant is constitutive of a fee simple
title or absolute title in favor of petitioner Mindanao Medical Center. Thus, Section 122 of the Act, which
governs the registration of grants or patents involving public lands, provides that Whenever public lands in
the Philippine Islands belonging to the Government of the United States or to the Government of the
Philippines are alienated, granted or conveyed to persons or to public or private corporations, the same shall
be brought forthwith under the operation of this Act (Land Registration Act, Act 496) and shall become
registered lands.
The first four cases cited involve petitions to cancel the land patents and the corresponding certificates of titles issued
to private parties. These four cases uniformly hold that the Director of Lands has no jurisdiction over private lands or that
upon issuance of the certificate of title the land automatically comes under the Torrens System. The fifth case cited involves
the registration under the Torrens System of a 12.8-hectare public land granted by the National Government to Mindanao
Medical Center, a government unit under the Department of Health. The National Government transferred the 12.8-hectare
public land to serve as the site for the hospital buildings and other facilities of Mindanao Medical Center, which performed a
public service. The Court affirmed the registration of the 12.8-hectare public land in the name of Mindanao Medical Center
under Section 122 of Act No. 496. This fifth case is an example of a public land being registered under Act No. 496 without the
land losing its character as a property of public dominion.
In the instant case, the only patent and certificates of title issued are those in the name of PEA, a wholly government
owned corporation performing public as well as proprietary functions. No patent or certificate of title has been issued to any
private party. No one is asking the Director of Lands to cancel PEAs patent or certificates of title. In fact, the thrust of the
instant petition is that PEAs certificates of title should remain with PEA, and the land covered by these certificates, being
alienable lands of the public domain, should not be sold to a private corporation.
Registration of land under Act No. 496 or PD No. 1529 does not vest in the registrant private or public ownership of the
land. Registration is not a mode of acquiring ownership but is merely evidence of ownership previously conferred by any of the
recognized modes of acquiring ownership. Registration does not give the registrant a better right than what the registrant had
prior to the registration.[102] The registration of lands of the public domain under the Torrens system, by itself, cannot convert
public lands into private lands.[103]
Jurisprudence holding that upon the grant of the patent or issuance of the certificate of title the alienable land of the
public domain automatically becomes private land cannot apply to government units and entities like PEA. The transfer of the
Freedom Islands to PEA was made subject to the provisions of CA No. 141 as expressly stated in Special Patent No. 3517
issued by then President Aquino, to wit:

NOW, THEREFORE, KNOW YE, that by authority of the Constitution of the Philippines and in conformity with the provisions of
Presidential Decree No. 1084, supplemented by Commonwealth Act No. 141, as amended, there are hereby granted and
conveyed unto the Public Estates Authority the aforesaid tracts of land containing a total area of one million nine hundred
fifteen thousand eight hundred ninety four (1,915,894) square meters; the technical description of which are hereto attached
and made an integral part hereof. (Emphasis supplied)
Thus, the provisions of CA No. 141 apply to the Freedom Islands on matters not covered by PD No. 1084. Section 60 of
CA No. 141 prohibits, except when authorized by Congress, the sale of alienable lands of the public domain that are
transferred to government units or entities. Section 60 of CA No. 141 constitutes, under Section 44 of PD No. 1529, a statutory
lien affecting title of the registered land even if not annotated on the certificate of title. [104] Alienable lands of the public domain
held by government entities under Section 60 of CA No. 141 remain public lands because they cannot be alienated or
encumbered unless Congress passes a law authorizing their disposition. Congress, however, cannot authorize the sale to
private corporations of reclaimed alienable lands of the public domain because of the constitutional ban. Only individuals can
benefit from such law.
The grant of legislative authority to sell public lands in accordance with Section 60 of CA No. 141 does not automatically
convert alienable lands of the public domain into private or patrimonial lands. The alienable lands of the public domain must be
transferred to qualified private parties, or to government entities not tasked to dispose of public lands, before these lands can
become private or patrimonial lands. Otherwise, the constitutional ban will become illusory if Congress can declare lands of the
public domain as private or patrimonial lands in the hands of a government agency tasked to dispose of public lands. This will
allow private corporations to acquire directly from government agencies limitless areas of lands which, prior to such law, are
concededly public lands.
Under EO No. 525, PEA became the central implementing agency of the National Government to reclaim foreshore
and submerged areas of the public domain. Thus, EO No. 525 declares that
EXECUTIVE ORDER NO. 525
Designating the Public Estates Authority as the Agency Primarily Responsible for all Reclamation Projects
Whereas, there are several reclamation projects which are ongoing or being proposed to be undertaken in various parts of the
country which need to be evaluated for consistency with national programs;
Whereas, there is a need to give further institutional support to the Governments declared policy to provide for a coordinated,
economical and efficient reclamation of lands;
Whereas, Presidential Decree No. 3-A requires that all reclamation of areas shall be limited to the National Government or any
person authorized by it under proper contract;
Whereas, a central authority is needed to act on behalf of the National Government which shall ensure a coordinated
and integrated approach in the reclamation of lands;
Whereas, Presidential Decree No. 1084 creates the Public Estates Authority as a government corporation to
undertake reclamation of lands and ensure their maximum utilization in promoting public welfare and interests; and
Whereas, Presidential Decree No. 1416 provides the President with continuing authority to reorganize the national
government including the transfer, abolition, or merger of functions and offices.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the
Constitution and pursuant to Presidential Decree No. 1416, do hereby order and direct the following:
Section 1. The Public Estates Authority (PEA) shall be primarily responsible for integrating, directing, and
coordinating all reclamation projects for and on behalf of the National Government. All reclamation projects shall be
approved by the President upon recommendation of the PEA, and shall be undertaken by the PEA or through a proper
contract executed by it with any person or entity; Provided, that, reclamation projects of any national government agency or
entity authorized under its charter shall be undertaken in consultation with the PEA upon approval of the President.
x xx .
As the central implementing agency tasked to undertake reclamation projects nationwide, with authority to sell
reclaimed lands, PEA took the place of DENR as the government agency charged with leasing or selling reclaimed lands of the
public domain. The reclaimed lands being leased or sold by PEA are not private lands, in the same manner that DENR, when it
disposes of other alienable lands, does not dispose of private lands but alienable lands of the public domain. Only when
qualified private parties acquire these lands will the lands become private lands. In the hands of the government agency
tasked and authorized to dispose of alienable of disposable lands of the public domain, these lands are still public,
not private lands.
Furthermore, PEAs charter expressly states that PEA shall hold lands of the public domain as well as any and all
kinds of lands. PEA can hold both lands of the public domain and private lands. Thus, the mere fact that alienable lands of the
public domain like the Freedom Islands are transferred to PEA and issued land patents or certificates of title in PEAs name
does not automatically make such lands private.
To allow vast areas of reclaimed lands of the public domain to be transferred to PEA as private lands will sanction a
gross violation of the constitutional ban on private corporations from acquiring any kind of alienable land of the public
domain. PEA will simply turn around, as PEA has now done under the Amended JVA, and transfer several hundreds of
hectares of these reclaimed and still to be reclaimed lands to a single private corporation in only one transaction. This scheme
will effectively nullify the constitutional ban in Section 3, Article XII of the 1987 Constitution which was intended to diffuse
equitably the ownership of alienable lands of the public domain among Filipinos, now numbering over 80 million strong.
This scheme, if allowed, can even be applied to alienable agricultural lands of the public domain since PEA can acquire
x xx any and all kinds of lands. This will open the floodgates to corporations and even individuals acquiring hundreds of
hectares of alienable lands of the public domain under the guise that in the hands of PEA these lands are private lands. This
will result in corporations amassing huge landholdings never before seen in this country - creating the very evil that the
constitutional ban was designed to prevent. This will completely reverse the clear direction of constitutional development in this
country. The 1935 Constitution allowed private corporations to acquire not more than 1,024 hectares of public lands. [105] The
1973 Constitution prohibited private corporations from acquiring any kind of public land, and the 1987 Constitution has
unequivocally reiterated this prohibition.
The contention of PEA and AMARI that public lands, once registered under Act No. 496 or PD No. 1529, automatically
become private lands is contrary to existing laws. Several laws authorize lands of the public domain to be registered under the
Torrens System or Act No. 496, now PD No. 1529, without losing their character as public lands. Section 122 of Act No. 496,
and Section 103 of PD No. 1529, respectively, provide as follows:
Act No. 496
Sec. 122. Whenever public lands in the Philippine Islands belonging to the x xx Government of the Philippine Islands are
alienated, granted, or conveyed to persons or the public or private corporations, the same shall be brought forthwith under
the operation of this Act and shall become registered lands.

PD No. 1529
Sec. 103. Certificate of Title to Patents. Whenever public land is by the Government alienated, granted or conveyed to any
person, the same shall be brought forthwith under the operation of this Decree. (Emphasis supplied)
Based on its legislative history, the phrase conveyed to any person in Section 103 of PD No. 1529 includes conveyances of
public lands to public corporations.
Alienable lands of the public domain granted, donated, or transferred to a province, municipality, or branch or
subdivision of the Government, as provided in Section 60 of CA No. 141, may be registered under the Torrens System
pursuant to Section 103 of PD No. 1529. Such registration, however, is expressly subject to the condition in Section 60 of CA
No. 141 that the land shall not be alienated, encumbered or otherwise disposed of in a manner affecting its title, except
when authorized by Congress. This provision refers to government reclaimed, foreshore and marshy lands of the public
domain that have been titled but still cannot be alienated or encumbered unless expressly authorized by Congress. The need
for legislative authority prevents the registered land of the public domain from becoming private land that can be disposed of to
qualified private parties.
The Revised Administrative Code of 1987 also recognizes that lands of the public domain may be registered under the
Torrens System. Section 48, Chapter 12, Book I of the Code states
Sec. 48. Official Authorized to Convey Real Property. Whenever real property of the Government is authorized by law to be
conveyed, the deed of conveyance shall be executed in behalf of the government by the following:
(1) xxx
(2) For property belonging to the Republic of the Philippines, but titled in the name of any political subdivision or of
any corporate agency or instrumentality, by the executive head of the agency or instrumentality. (Emphasis supplied)
Thus, private property purchased by the National Government for expansion of a public wharf may be titled in the name of a
government corporation regulating port operations in the country. Private property purchased by the National Government for
expansion of an airport may also be titled in the name of the government agency tasked to administer the airport.Private
property donated to a municipality for use as a town plaza or public school site may likewise be titled in the name of the
municipality.[106] All these properties become properties of the public domain, and if already registered under Act No. 496 or PD
No. 1529, remain registered land. There is no requirement or provision in any existing law for the de-registration of land from
the Torrens System.
Private lands taken by the Government for public use under its power of eminent domain become unquestionably part of
the public domain. Nevertheless, Section 85 of PD No. 1529 authorizes the Register of Deeds to issue in the name of the
National Government new certificates of title covering such expropriated lands. Section 85 of PD No. 1529 states
Sec. 85. Land taken by eminent domain. Whenever any registered land, or interest therein, is expropriated or taken by eminent
domain, the National Government, province, city or municipality, or any other agency or instrumentality exercising such right
shall file for registration in the proper Registry a certified copy of the judgment which shall state definitely by an adequate
description, the particular property or interest expropriated, the number of the certificate of title, and the nature of the public
use. A memorandum of the right or interest taken shall be made on each certificate of title by the Register of Deeds, and where
the fee simple is taken, a new certificate shall be issued in favor of the National Government, province, city,
municipality, or any other agency or instrumentality exercising such right for the land so taken. The legal expenses incident to
the memorandum of registration or issuance of a new certificate of title shall be for the account of the authority taking the land
or interest therein. (Emphasis supplied)
Consequently, lands registered under Act No. 496 or PD No. 1529 are not exclusively private or patrimonial lands. Lands of the
public domain may also be registered pursuant to existing laws.

AMARI makes a parting shot that the Amended JVA is not a sale to AMARI of the Freedom Islands or of the lands to be
reclaimed from submerged areas of Manila Bay. In the words of AMARI, the Amended JVA is not a sale but a joint venture with
a stipulation for reimbursement of the original cost incurred by PEA for the earlier reclamation and construction works
performed by the CDCP under its 1973 contract with the Republic. Whether the Amended JVA is a sale or a joint venture, the
fact remains that the Amended JVA requires PEA to cause the issuance and delivery of the certificates of title conveying
AMARIs Land Share in the name of AMARI.[107]
This stipulation still contravenes Section 3, Article XII of the 1987 Constitution which provides that private corporations
shall not hold such alienable lands of the public domain except by lease. The transfer of title and ownership to AMARI clearly
means that AMARI will hold the reclaimed lands other than by lease. The transfer of title and ownership is a disposition of the
reclaimed lands, a transaction considered a sale or alienation under CA No. 141, [108] the Government Auditing Code,[109] and
Section 3, Article XII of the 1987 Constitution.
The Regalian doctrine is deeply implanted in our legal system. Foreshore and submerged areas form part of the public
domain and are inalienable. Lands reclaimed from foreshore and submerged areas also form part of the public domain and are
also inalienable, unless converted pursuant to law into alienable or disposable lands of the public domain. Historically, lands
reclaimed by the government are sui generis, not available for sale to private parties unlike other alienable public
lands. Reclaimed lands retain their inherent potential as areas for public use or public service. Alienable lands of the public
domain, increasingly becoming scarce natural resources, are to be distributed equitably among our ever-growing
population. To insure such equitable distribution, the 1973 and 1987 Constitutions have barred private corporations from
acquiring any kind of alienable land of the public domain. Those who attempt to dispose of inalienable natural resources of the
State, or seek to circumvent the constitutional ban on alienation of lands of the public domain to private corporations, do so at
their own risk.
We can now summarize our conclusions as follows:
1. The 157.84 hectares of reclaimed lands comprising the Freedom Islands, now covered by certificates of title in
the name of PEA, are alienable lands of the public domain. PEA may lease these lands to private
corporations but may not sell or transfer ownership of these lands to private corporations. PEA may only sell
these lands to Philippine citizens, subject to the ownership limitations in the 1987 Constitution and existing
laws.
2. The 592.15 hectares of submerged areas of Manila Bay remain inalienable natural resources of the public
domain until classified as alienable or disposable lands open to disposition and declared no longer needed
for public service. The government can make such classification and declaration only after PEA has
reclaimed these submerged areas. Only then can these lands qualify as agricultural lands of the public
domain, which are the only natural resources the government can alienate. In their present state, the 592.15
hectares of submerged areas are inalienable and outside the commerce of man.
3. Since the Amended JVA seeks to transfer to AMARI, a private corporation, ownership of 77.34 hectares [110] of
the Freedom Islands, such transfer is void for being contrary to Section 3, Article XII of the 1987 Constitution
which prohibits private corporations from acquiring any kind of alienable land of the public domain.
4. Since the Amended JVA also seeks to transfer to AMARI ownership of 290.156 hectares [111] of still submerged
areas of Manila Bay, such transfer is void for being contrary to Section 2, Article XII of the 1987 Constitution
which prohibits the alienation of natural resources other than agricultural lands of the public domain. PEA
may reclaim these submerged areas. Thereafter, the government can classify the reclaimed lands as
alienable or disposable, and further declare them no longer needed for public service. Still, the transfer of
such reclaimed alienable lands of the public domain to AMARI will be void in view of Section 3, Article XII of
the 1987 Constitution which prohibits private corporations from acquiring any kind of alienable land of the
public domain.
Clearly, the Amended JVA violates glaringly Sections 2 and 3, Article XII of the 1987 Constitution. Under Article 1409[112] of the
Civil Code, contracts whose object or purpose is contrary to law, or whose object is outside the commerce of men, are

inexistent and void from the beginning. The Court must perform its duty to defend and uphold the Constitution, and therefore
declares the Amended JVA null and void ab initio.

Seventh issue: whether the Court is the proper forum to raise the issue of whether the Amended JVA is grossly
disadvantageous to the government.
Considering that the Amended JVA is null and void ab initio, there is no necessity to rule on this last issue. Besides, the
Court is not a trier of facts, and this last issue involves a determination of factual matters.
WHEREFORE, the petition is GRANTED. The Public Estates Authority and Amari Coastal Bay Development
Corporation are PERMANENTLY ENJOINED from implementing the Amended Joint Venture Agreement which is hereby
declared NULL and VOID ab initio.
SO ORDERED.

On October 22, 1949, plaintiff filed his complaint7 for injunction and damages against the defendants City Engineer of Manila,
District Engineer of Rizal, the Director of Public Works, and Engr. Busuego, the Engineer-in-charge of the plant. It was prayed
that the latter be restrained from excavating, bulldozing and extracting gravel, sand and soil from his property and that they
solidarily pay to him P5,000.00 as damages. Defendants' answer alleged, in affirmative defense, that the extractions were
made from the riverbed while counterclaiming with a prayer for injunction against plaintiffwho, it was claimed, was preventing
them from their operations.

G.R. No. L-19570

April 27, 1967

JOSE V. HILARIO, JR., plaintiff-appellant,

vs.
THE CITY OF MANILA, defendant-appellee,
DIRECTOR OF PUBLIC WORKS, CITY ENGINEER OF MANILA, FERNANDO BUSUEGO and EUGENIO
SESE,defendants-appellants,
MAXIMO CALALANG, intervenor;
DIRECTOR OF MINES, intervenor.
Maximo Calalang for plaintiff and appellant.
Gregorio Ejercito and Leandro L. Arguelles for defendant-appellee City of Manila.
Office of the Solicitor General for other defendants and appellants.
BENGZON, J.P., J.:
Dr. Jose Hilario was the registered owner of a large tract of land around 49 hectares in area located at Barrio Guinayang,
in San Mateo, Rizal.1 Upon his death, this property was inherited by his son, herein plaintiff-appellant Jose Hilario, Jr., to whom
a new certificate of title2 was issued.
During the lifetime of plaintiff's father, the Hilario estate was bounded on the western side by the San Mateo River. 3 To prevent
its entry into the land, a bamboo and lumber post dike or ditch was constructed on the northwestern side. This was further
fortified by a stonewall built on the northern side. For years, these safeguards served their purpose. However, in 1937, a great
and extraordinary flood occurred which inundated the entire place including the neighboring barrios and municipalities. The
river destroyed the dike on the northwest, left its original bed and meandered into the Hilario estate, segregating from the rest
thereof a lenticular place of land. The disputed area is on the eastern side of this lenticular strip which now stands between the
old riverbed site and the new course.4
In 1945 the U.S. Army opened a sand and gravel plant within the premises5 and started scraping, excavating and extracting
soil, gravel and sand from the nearby areas the River. The operations eventually extended northward into this strip of land.
Consequently, a claim for damages was filed with the U.S. War Department by Luis Hilario, the then administrator of Dr.
Hilario's estate. The U.S. Army paid.6 In 1947, the plant was turned over to herein defendants-appellants and appellee who
took over its operations and continued the extractions and excavations of gravel and sand from the strip of land along an area
near the River.

Subsequently, the Bureau of Mines and Atty. Maximo Calalang were respectively allowed to join the litigation as intervenors.
The former complained that the disputed area was within the bed of the river so that plaintiff should not only be enjoined from
making extractions therefrom but should also be ordered to pay the fees and penalties for the materials taken by him. On the
other hand, the latter claimed that he was authorized by plaintiff to extract materials from the disputed area but this
notwithstanding, the Provincial Treasurer of Rizal collected from him a sand and gravel fee which would be an illegal exaction
if the disputed area turns out to be of private ownership. Answers to the two complaints in intervention were duly filed by the
affected parties.
On March 14, 1954, defendants filed a petition for injunction against plaintiff and intervenor Calalang in the same case,
alleging that the latter have fenced off the disputed area in contravention of an agreement8 had between the latter and the
Director of Public Works wherein he defendants were allowed to continue their operations but subject to the final outcome of
the pending suit. It was prayed that plaintiff and intervenor Calalang be ordered to remove the fence and allow defendants'
men to continue their operations unhampered. Opposition to this petition was filed by the other side, with a prayer for counter
injunction. On March 23, 1954, the lower court issued an order maintaining the status quo and allowing the defendants to
continue their extractions from the disputed area provided a receipt9 in plaintiff's favor be issued for all the materials taken.
On May 13, 1954, plaintiff amended his complaint. Impleaded as additional defendants were the City of Manila,10the Provincial
Treasurer of Rizal,11 and Engr. Eugenio Sese, the new Engineer-in-charge of the plant. Plaintiff also converted his claim to one
purely for damages directed against the City of Manila and the Director of Public Works, solidarily, in the amount of
P1,000,000.00, as the cost of materials taken since 1949, as well as those to be extracted therefrom until defendants stop their
operations.
Came the separate amended answers of the several defendants. Manila City denied ownership of the plant and claimed that
the City Engineer, acted merely as a deputy of the Public Works Director. The other defendants12 put up, as special defense,
the agreement between plaintiff and the Public Works Director, and asserted a P1.2 million counterclaim for damages against
plaintiff. The rest13 renewed the same defense; that the disputed area was part of the public domain, since it was situated on
the riverbanks.
On November 3, 1954, the defendant City Engineer of Manila filed a petition to delimit the area of excavation and asked the
lower court to authorize his men to extend their operations west of the camachile tree in the disputed area. This met vigorous
opposition from plaintiff and intervenor Calalang. On May 27, 1955, the petition was denied.
Finally, on December 21, 1956, the lower court rendered its decision on the merits. The dispositive portion provided:14
WHEREFORE, judgment is hereby rendered against the defendants City of Manila and the Director of Public
Works, to pay solidarily the herein plaintiff the sum of P376,989.60, as the cost of gravel and sand extracted from
plaintiff's land, plus costs. Judgment is likewise hereby rendered against the defendant Provincial Treasurer of
Rizal, ordering him to reimburse to intervenor Maximo Calalang the amount of P236.80 representing gravel fees

illegally collected. Finally, defendants herein are perpetually enjoined from extracting any sand or gravel from
plaintiff's property which is two-fifths northern portion of the disputed area.
It is so ordered.

Property of public ownership is

1. That devoted to public use, such as roads, canals, rivers, torrents, ports and bridges constructed by the State,
riverbanks, shores, roadsteads, and that of a similar character; (Emphasis supplied)

None of the parties litigants seemed satisfied with this decision and they all sought a reconsideration of the same. On August
30, 1957, the lower court resolved the motions to reconsider with an order, the dispositive portion of which provided: 15

Moreover, as correctly contended by defendants, the riverbank is part of the riverbed. Art. 73 of the Law of Waters which
defines the phrase "banks of a river" provides:

WHEREFORE, the court hereby denies the motion for reconsideration filed by plaintiff and intervenor Calalang;
dismisses the complaint with respect to defendant City of Manila; holds that the northern two-fifths portion of the
area in controversy belongs to the plaintiff with right to the immediate possession thereof and hereby enjoins the
defendants and intervenor Bureau of Mines to vacate the same and to stop from extracting gravel thereon. The
Court however hereby dismisses the case against the defendant Bureau of Public Works and its agents and
employees insofar as the claim for money is concerned without prejudice to plaintiffs taking such action as he may
deem proper to enforce said claim against the proper party in accordance with law.

By the phrase "banks of a river" is understood those lateral strips or zones of its bed which are washed by the
stream only during such high floods as do not cause inundations. ... (Emphasis supplied)

It is so ordered.
Still unsatisfied, plaintiff and intervenor Calalang filed a second motion for reconsideration. The lower court stood firm on its
ruling of August 30, 1957.16
Hence, this appeal.17 The defendants Director of Public Works, City Engineer of Manila, and Engrs. Busuego and Sese have
also appealed from the declaration made by the lower court that the northern two-fifths of the disputed area belongs to plaintiff
Hilario.
The parties herein have presented before this Court mixed questions of law and fact for resolution and adjudication. Foremost
among them is this legal query; when a river, leaving its old bed, changes its original course and opens a new one through
private property, would the new riverbanks lining said course be of public ownership also?18
The defendants answer in the affirmative. They claim that under the Law of Waters of August 3, 1866, the riverbanks are, by
definition, considered part of the riverbed which is always of public ownership. On the other hand, plaintiff would have the
question resolved in the negative. He maintains that not all riverbanks are of public ownership because: (1) Art. 372 of the old
Civil Code, which governs this particular case, speaks only of the new bed; nothing is said about the new banks; (2) Art. 73 of
the Law of Waters which defines the phrase "banks of a river" cannot be applied in the case at bar in conjunction with the other
articles cited by defendants since that article applies only to banks of natural riverbeds and the present, River is not in
its natural bed; and (3) if all banks were of public ownership, then Art. 553 of the old Civil Code and the second sentence, first
paragraph of Art. 73 of the Law of Waters can never have any application.
Since the change in the course of the River took place in 1937, long before the present Civil Code took effect, 19the question
before Us should be determined in accordance with the provisions of the old Civil Code and those of the Law of Waters of
August 3, 1866.
We agree with defendants that under the cited laws, all riverbanks are of public ownership including those formed when a
river leaves its old bed and opens a new course through a private estate. Art. 339 of the old Civil Code is very clear. Without
any qualifications, it provides:

The use the of words "of its bed [de susalveos]" clearly indicates the intent of the law to consider the banks for all
legal purposes as part of the riverbed. The lower court also ruled correctly that the banks of the River are
paint of its bed.20 Since undeniably all beds of rivers are of public ownership,21 it follows that the banks, which form
part of them, are also of public ownership.
Plaintiff's contention that Arts. 70 and 73 of the Law of Waters cannot apply because Art. 312 of the old Civil Code mentions
only the new bed but omits the banks, and that said articles only apply to natural meaning original bed and banks is
untenable. Art. 70, which defines beds of rivers and creeks, provides:
The natural bed or channel of a creek or river is the ground covered by its waters during the highest [ordinary]
floods.22 (Emphasis supplied)
Art. 372 of the old Civil Code which provides that
Whenever a navigable or floatable river changes its course from natural causes and opens a new bedthrough a
private estate, the new bed shall be of public ownership, but the owner of the estate shall recover it in the event that
the waters leave it dry again either naturally or as the result of any work legally authorized for this purpose.
(Emphasis supplied)
did not have to mention the banks because it was unnecessary. The nature of the banks always follows that of the
bed and the running waters of the river. A river is a compound concept consisting of three elements: (1) the running
waters, (2) the bed and (3) the banks. 23 All these constitute the river. American authorities are in accord with this
view:
'River' consists of water, a bed and banks.24
A "river" consists of water, a bed and banks, these several parts constituting the river, the whole river. It is a
compound idea; it cannot exist without all its paints. Evaporate the water, and you have a dry hollow. If you could
sink the bed, instead of a river, you would have a fathomless gulf. Remove the banks, and you have a boundless
flood.25
Since a river is but one compound concept, it should have only one nature, i.e., it should either be totally public or completely
private. And since rivers are of public ownership,26 it is implicit that all the three component elements be of the same nature
also. As Manresa commented:

Realmente no puedeimaginarseunrio sin alveo y sin ribera; de suerte que al decir el Codigo Civil que losrios son de
dominiopublico, parece que debeirimplicito el dominiopublico de anquellostreselementos que integran el rio.27
However, to dispel all possible doubts, the law expressly makes all three elements public. Thus, riverbanks and beds are
public under Arts. 339 and 407, respectively, of the Code, while the flowing waters are declared so under Art. 33, par. 2 of the
Law of Waters of 1866.
Articles 70, 72 and 73 of the Law of Waters speak of natural beds and their banks. Plaintiff now equates the term "natural" with
the word "original" so that a change in the course of a river would render those articles inapplicable. However, the premise is
incorrect. Diccionario De La Real Academia Espaola defines the word "natural" as follows:
NATURAL perteneciente a la naturaleza o conforme a la calidad o propriedad de las cosas; nativo, originario de
un pueblo o nacion; hecho con verdad, niartificio, mezclanicomposicionalguna; ingenuo y sin doblezensumodo de
proceder; dicezetambien de las cosas que imitar a la naturaleza con propiedad; regular y que comunmentesucede,
y poreso, facilmentecreible; que se produce porsolas las fuerzas de la naturaleza, comocontrapuesto a sobre
natural y milagroso, (Emphasis supplied)
"Natural" is not made synonymous to "original" or "prior condition". On the contrary, even if a river should leave its original
bed so long as it is due to the force of nature, the new course would still fall within the scope of the definition provided above.
Hence, the law must have used the word "natural" only because it is in keeping with the ordinary nature and concept of a river
always to have a bed and banks.
Plaintiff's third point is not lightly to be taken. Indeed, it would seem possible to acquire private ownership of banks under Art.
553 of the old Civil Code which provides:
Las riberas de losrios, auncuandosean de dominioprivado, estansujetasentodasu extension y ensusmargenes,
enuna zona de tres metros, a la servidumbre de usopublicoeninteres general de la navegacion, la flotacion, la
pesca y el salvamento. (Emphasis supplied) .
And plaintiff is not without jurisprudential backing for in Commonwealth vs. Gungun,28 it was said that the private
ownership of the banks was not prohibited. His point is then neatly brought home with the proposition that it is
precisely when a river changes its course and opens a new bed through a private estate that there can be private
ownership of the banks.
A study of the history of Art. 553 will however reveal that it was never intended to authorize the private acquisition of
riverbanks. That could not have been legally possible in view of the legislative policy clearly enunciated in Art. 339 of the Code
that all riverbanks were of public ownership. The article merely recognized and preserved the vested rights of riparian owners
who, because of prior law or custom, were able to acquire ownership over the banks. This was possible under
the SietePartidas which was promulgated in 1834 yet.29 Under Law 6, Title 28, Partidas 3, the banks of rivers belonged to the
riparian owners, following the Roman Law rule.30 In other words, they were privately owned then. But subsequent legislation
radically changed this rule. By the Law of Waters of August 3, 1866, riverbanks became of public ownership, albeit impliedly
only because considered part of the bed which was public by statutory definition. 31 But this law, while expressly repealing
all prior inconsistent laws, left undisturbed all vested rights then existing.32 So privately owned banks then continued to be so
under the new law, but they were subjected by the latter to an easement for public use. As Art. 73 provides:

Se entiendenporriberas de un rio las fajas o zonislaterales de susalveos que solamentesorbaadaspor las aguasen
las crecidas que no causaninundacion. El dominioprivado de las riberasestasuieto a la survidumbre de tres metros
de zona para usopublico, en el interest general de la navegacion, la flotacion, la pesca y el salvamento. ...
(Emphasis supplied).1wph1.t
This was perhaps the reconciliation effected between the private ownership of the banks, on the one hand, and the policy of
the law on the other hand, to devote all banks to public use.33 The easement would preserve the private ownership of the
banks and still effectuate the policy of the law. So, the easement in Art. 73 only recognized and preserved existing privately
owned banks; it did not authorize future private appropriation of riverbanks.
The foregoing observation is confirmed by the still subsequent Law of Waters of June 13, 1879, which was principally based
on the Law of August 3, 1865.34 Art. 36 of the new law, which was a substantial reenactment of Art. 73 of the Law of Waters of
August 3, 1866, reads:
Las riberas, auncuandosean de dominioprivadoenvirtud de antigue ley o de costumbre, estansujetasentodasu
extension las margenesenuna zona de tres metros, a la servidumbre de usopublicoeninteres general de la
navegacion, la flotacion la pesca y el salvamento. ... (Emphasis supplied)
The new law also affirmed the public ownership of rivers and their beds, and the treatment of the banks as part of the
bed.35 But nowhere in the law was there any provision authorizing the private appropriation of the banks. What it merely did
was to recognize the fact that at that time there were privately owned banks pursuant to theSiete Partidas, and to encumber
these with an easement for public use.
However, the public nature of riverbanks still obtained only by implication. But with the promulgation of the Civil Code of 1889,
this fact was finally made explicit in Art. 339 thereof. Riverbanks were declared as public property since they were destined for
public use. And the first paragraph of Art. 36 of the Law of Waters of 1879 was substantially reenacted in Art. 553 of the
Code.36 Hence, this article must also be understood not as authorizing the private acquisition of riverbanks but only as
recognizing the vested titles of riparian owners who already owned the banks.
The authority, then, for the private ownership of the banks is neither the old Civil Code nor the Law of Waters of 1866 but
the SietePartidas. Unfortunately, plaintiff cannot invoke it. Law 6, Title 28, Partida 3, which provides for private ownership of
banks, ceased to be of force in this jurisdiction as of 1871 yet when the Law of Waters of August 3, 1866, took effect. 37 Since
the change in the course of the River took place in 1937, the new banks which were formed could not have been subjected to
the provisions of the SietePartidas which had already been superseded by then.
Coming to the factual issues: both parties assail the conclusion made by the lower court that only the northern two-fifths of the
disputed area remained as plaintiff's private property. This conclusion was apparently based on the findings that the portion
where rice and corn were found38 in the ocular inspection of June 15, 1951, was on the northern two-fifths of the disputed area;
that this cannot be a part of the bed because of the existence of vegetation which could not have grown underwater, and that
this portion is man-made. However, there is no evidentiary basis for these findings. The area indicated by Nos. 1 and 2 in Exh.
D-1 where no excavations had been made, appears to be more on the south-western one-fourth of the disputed area. The
American cases39cited by the lower court cannot apply here. Our Law of Waters, in defining "beds" and considers the latter is
part of the former. Those cited cases did not involve a similar statutory provision. That plants can and do grow on the banks
which otherwise could not have grown in the bed which is constantly subjected to the flow of the waters proves the distinction
between "beds" and "banks" in the physical order. However, We are dealing with the legal order where legal definitions prevail.
And apart from these considerations, We also note the considerable difficulty which would attend the execution of the ruling of

the lower court. The latter failed to indicate fixed markers from which an exact delimitation of the boundaries of the portion
could be made. This flaw is conducive to future litigations.
Plaintiff's theory is that the disputed area, although covered at times by flood waters, cannot be considered as within the banks
of the River because: (1) such floods are only accidental, and (2) even if they are regular, the flooding of the area is due to the
excavations and extractions made by defendants which have caused the widening of the channel.40 Defendants claim,
however, that the area is always covered by the normal yearly floods and that the widening of the channel is due to natural
causes.
There is a gravel pit41 located along the west side of the River. This is about 500 meters long.42 A greater part of this pit
occupies a portion of the strip of land that was sliced by the River from the rest of the Hilario estate. As shown in Exhs. D and
D-1, this strip of land is that western segment of the Hilario estate bounded on the west by the same lines connecting stakes
23 through 27, which form part of the western boundary of the estate, and on the east, bounded by the western waterline of
the River.
Now, the disputed area, generally speaking,43 is only that part of the gravel pit which is within the strip of land. Its northern tip is
that point where the so-called "secondary bank" line intersects the west River waterline up north; its southern boundary is
along the line connecting stakes 23 and 24. From these two ends, the disputed area measures approximately 250 meters long.
The eastern boundary is the western River waterline at low tide and the western boundary is the "secondary bank" line, a line
passing near stake 24 and running almost parallel to the line connecting stakes 25 and 26. Around the later part of 1949, the
disputed area was about 150 to 160 meters wide.44 This increased to about 175 to 180 meters by the later part of 1950. And by
January, 1953, the distance from the "secondary bank" line to the west waterline was about 230 meters.45
This increasing width of the disputed area could be attributed to the gradual movement of the River to the east. Since it
entered into the Hilario estate, the River has not stayed put.46 Vicente Vicente, plaintiff's witness declared47 that after the River
changed its course in 1937, the distance between the old and the new river sites was about 100 meters. Exh. D-2 shows that
in 1943, the south end of the River was about 5 meters southeast of stake 24.48 Honorato Sta. Maria, another witness for
plaintiff, indicated the flow of this course with a blue line in Exh. D-1.49 This blue line is about 100 meters from the line
connecting stakes 25 and 26, which was also the east boundary of the old River.50 Around 1945 to 1949, the River was about
193 meters51 east of this line. This measurement is based on the testimonies of two defense witnesses52 and stated that during
that period, the River passed along the Excavated Area and the New Accretion Area53 sites, as shown in Exh. 54. By the later
part of 1949 up to November 1950, the west waterline was from 248 to 270 meters54 east of the aforesaid boundary line. And
finally in January, 1953, based on the scale in Exh. 3-Calalang, the west waterline was from 300 to 305 meters away already.
Hence, from 100 meters in 1937, the River had moved to 305 meters eastwardin 1953.
There are two questions to be resolved here. First, where on the strip of land are the lateral borders of the western riverbank?
And second, where have defendants made their extractions?
Anent the first question, the key is supplied by Art. 73 of the Law of Waters which defines the limits of banks of rivers
By the phrase "banks of a river" is understood those lateral strips or zones of its bed which are washed by the
stream only during such high floods as do not cause in inundations. ... (Emphasis supplied)
The farthest extremity of the bank on the west side would, therefore, be that lateral line or strip which is reached by
the waters during those high floods that do not cause inundations. In other words, the extent reached by the waters
when the River is at high tide.

However, there is a difference between the topography of the two sides immediately adjoining the River. The line indicated as
"primary bank"55 in Exh. 3-Calalang, which is on the east, is about 3 meters high and has a steep grade right at the edge where
it drops almost vertically to the watercourse level. The precipice here, which is near the east waterline, is very easily detectible.
But the opposite side has no such steep activity. In fact, it is almost flat with the bed of the River, especially near the water
edge, where it is about 30 to 50 cms. high only. But it gradually slopes up to a height of about 2 to 2- meters along the line
indicated as "secondary bank", which is quite far from the waterline. This "bank" line is about 1- meters higher than the level
of the gravel pit and there are erosions here. This is about 175 meters west from the November 1950 waterline, and about 100
meters west from the camachile tree.56
During the dry season, the waterlevel of the River is quite low about knee-deep only. However, during the rainy season, the
River generally becomes swollen, and the waterlevel rises, reaching up to the neck.57 However, considering the peculiar
characteristics of the two sides banking the river, the rise in the waterlevel would not have the same effect on the two sides.
Thus, on the east, the water would rise vertically, until the top of the "primary bank" is reached, but on the west, there would be
a low-angled inclined rise, the water covering more ground until the "secondary bank" line is reached. In other words, while the
water expansion on the east is vertical, that on the west is more or less lateral, or horizontal.
The evidence also shows that there are two types of floods in the area during the rainy season.58 One is the so-called
"ordinary" flood, when the river is swollen but the flowing water is kept within the confines, of the "primary" and "secondary"
banks. This occurs annually, about three to four times during the period. Then there is the "extraordinary" flood, when the
waters overflow beyond the said banks, and even inundate the surrounding areas. However, this flood does not happen
regularly. From 1947 to 1955, there were only three such floods.59 Now, considering that the "ordinary" flood easily cover the
west side since any vertical rise of the waterlevel on the east would necessarily be accompanied by a lateral water
expansion on the west the "inundations" which the law mentions must be those caused by the "extraordinary" floods which
reach and overflow beyond both "primary" and "secondary" banks. And since the "primary" bank is higher than the "secondary"
bank, it is only when the former is reached and overflowed that there can be an inundation of the banks the two banks. The
question therefore, may be stated thus: up to what extent on the west side do the highest flood waters reach when the
"primary" bank is not overflowed?
Defendants have presented several witnesses who testified on the extent reached by the ordinary flood waters. David Ross, a
bulldozer operator at the plant since 1945, testified60 that from 1945 to 1949, when the River was still passing along the site
where the camachile tree is located, the annual flood waters reached up to the "secondary bank" line. These floods usually
took from 3 to 5 days to recede, during which time their work was suspended. Corroboration is supplied by MacarioSuiza, a
crane operator in the plant since 1945, and by Fidel Villafuerte, a plant employee since 1946. Suiza stated61 that from 1947 to
1949, the area enclosed within the blue lines and marked as Exh. 54-B which includes the New Accretion Area was always
covered by water when it rained hard and they had to stop work temporarily. The western extremity of this area reaches up to
the "secondary bank" line. Villafuerte stated62 that in the ordinary floods when the water was just 50 cm. below the top of the
"primary bank", the waters would go beyond the camachile tree by as much as 100 meters westward and just about reach the
"secondary bank" line. Further corroboration is supplied by plaintiff's own evidence. Exh. 1-Calalang states that from 1947 to
1949, based on the casual observations made by geologist David Cruz, the area between the "primary" and "secondary" banks
were always covered by the non-inundating ordinary floods.
From 1950 to 1952, We have the testimony of Ross who stated63 that there were still floods but they were not as big anymore,
except one flood in 1952, since the River had already moved to the east. Engr. Ricardo Pacheco, who made a survey of the
disputed area in November 1952, and who conducted actual observations of the extent of the water reach when the river was
swollen, testified64 that the non-inundating flood regularly reached up to the blue zigzag line along the disputed area, as shown
in Exh. I-City Engineer Manila. This blue line, at the point where it intersects line BB, 65 is about 140 meters west of the
waterline and about 20 meters west of the camachile tree. His testimony was based on three floods 66 which he and his men

actually recorded. Corroboration is again supplied by Exh. 1-Calalang. According to Cruz' report, the floods in 1950 and 1951
barely covered the disputed area. During the normal days of the rainy season, the waters of the swollen river did not reach the
higher portions of the gravel pit which used to be submerged. One cause for this was the lesser amount of rainfall from 1949 to
1951. But two floods occurred from October 16 to 28, 1952, which overflowed the whole area and inundated the banks. From
1953 to 1955, when the River was farther away to the east, the flood waters still covered the west side. 67 Testifying on the
extent reached by the water during the rainy season in 1954, Ross stated68 that it reached up to the camachile tree only. The
last and latest data comes from Engr. MagbayaniLeao, the Engineer-in-charge of the plant from August 1954. He
testified69 that as of December 1955, when the disputed area was underwater, the water reach was about 20 meters or less to
the east from the camachile tree.
From all the foregoing, it can be safely concluded: (1) that from 1945 to 1949, the west bank of the River extended westward
up to the "secondary bank" line; (2) that from 1950 to 1952, this bank had moved, with the River, to the east its lateral borders
running along a line just 20 meters west of the camachile tree; and (3) that from 1953 to 1955, the extremities of the west bank
further receded eastward beyond the camachile tree, until they lay just about 20 meters east of said tree.
To counteract the testimonies of the defense witnesses, plaintiff presented two rebuttal witnesses70 who told a somewhat
different story. However, their testimonies are not convincing enough to offset the dovetailing testimonies of the defense
witnesses who were much better qualified and acquainted with the actual situs of the floods. And said defense witnesses were
corroborated by plaintiffs' own evidence which contradicts the aforesaid rebuttal witnesses.
However, plaintiff maintains that the floods which cover the area in question are merely accidental and hence, under Art. 77 of
the Law of Waters,71 and following the ruling in Government vs. Colegio de San Jose,72 he is deemed not to have lost the
inundated area. This is untenable. Plaintiff's own evidence73 shows that the river floods with annual regularity during the rainy
season. These floods can hardly be called "accidental." The Colegio de San Jose case is not exactly in point. What was mainly
considered there was Art. 74 of the Law of Waters relating to lakes, ponds and pools. In the case at bar, none of these is
involved.
Also untenable is plaintiff's contention that the regular flooding of the disputed area was due to the continuous extraction of
materials by defendants which had lowered the level of said area and caused the consequent widening of the channel and the
river itself. The excavations and extractions of materials, even from the American period, have been made only on the strip of
land west of the River.74 Under the "following-the-nature-of-things" argument advanced by plaintiff, the River should have
moved westward, where the level of the ground had been lowered. But the movement has been in the opposite direction
instead. Therefore, it cannot be attributed to defendants' operation. Moreover, plaintiff's own evidence indicates that the
movement eastward was all due to natural causes. Thus, Exh. 1-Calalang shows that the movement eastward of the channel
by as much as 31 meters, from 1950 to 1953, was due to two typhoons which caused the erosion of the east bank and the
depositing of materials on the west side which increased its level from as much as .93 to 2 meters.
Plaintiff's assertion that the defendants also caused the unnatural widening of the River is unfounded. Reliance is made on the
finding by the lower court that in 1943, the River was only 60 meters wide as shown in Exh. D-2, whereas in 1950, it was
already 140 meters wide as shown in Exh. D. However, Exh. D-2 only shows the width of the River near the southwestern
boundary of the Hilario estate. It does not indicate how wide it was in the other parts, especially up north. And Eligio Lorenzo,
plaintiff's own witness, admitted75 on cross-examination that the width of the new river was not uniform. This is confirmed by
Exhs. D and D-1 which show that the new river was wider by as much as 50% up north than it was down south. The 140-meter
distance in Exh. D was at the widest part up north whereas down south, near the mouth of the Bulobok River, it was only 70
meters wide. Lastly, the scale in Exh. 3-Calalang will show that in January 1953, the River, near the same point also, was less
than 50 meters wide.

The only remaining question now is to determine if the defendants have really confined their operations within the banks of the
River as alleged by them. To resolve this, We have to find out from what precise portion in the disputed area the defendants
have extracted gravel and sand since they did not extract indiscriminately from within the entire area. None of the parties'
briefs were very helpful but the evidence on record discloses that defendants made their extractions only within specified areas
during definite periods.
From 1947 to the early part of 1949, the defendants conducted their operations only in the New Accretion Area along a narrow
longitudinal zone contiguous to the watercourse then. This zone, marked as Exh. 2-City Engineer Manila, is about one (1) km.
long and extends northward up to pt. 50.35 in Exh. 54. However, no extractions nor excavations were undertaken west of this
zone, i.e., above the "temporary bank" line.76 These facts are corroborated by plaintiff's witnesses. That the extractions were
near the river then finds support in Vicente's testimony77 while Leon Angeles and Mrs. Salud Hilario confirm the fact that
defendants have not gone westward beyond the "temporary bank" line.78 This line is located east of the "secondary bank" line,
the lateral extremity of the west bank then.
In the later part of 1949, plaintiff prohibited the defendants from extracting along the New Accretion Area and constructed a
fence across the same. This forced the defendants to go below southeast of the "Excavated Area" and the New Accretion
Area sites in Exh. 54.79 Engr. Busuego, testifying80 in 1952, indicated their are of extraction as that enclosed within the red
dotted line in Exh. D-1 which lies on the south end of the strip of land. Only a small portion of the southeastern boundary of the
disputed area is included. The ocular inspection conducted on June 15, 1951, confirms this.81 Exh. 4-Calalang shows the total
amount of materials taken from within the area from 1949 to 1951.82 Thus, from 1950 up to 1953, although the defendants
were able to continue their operations because of the agreement between the plaintiff and the Director of Public Works, 83 they
were confined only to the southeastern portion of the disputed area. On the other hand, the lateral extremities of the west bank
then ran along a line about 20 meters west of the camachile tree in the New Accretion Area.
From 1954 to 1955, defendants' area of operation was still farther near of the New Accretion Area. They were working within a
confined area along the west waterline, the northern and western boundaries of which were 20 meters away east from the
camachile tree.84 Ross indicated85 this zone in Exh. 54 as that portion on the southern end of the disputed area between the
blue lines going through the words "Marikina River Bed" and the red zigzag line indicating the watercourse then. Engr. Leao
even stated, 86 that they got about 80% of the materials from the river itself and only 20% from the dry bed. The sand and
gravel covered by Exhs. LL to LL-55 were all taken from here. The foregoing facts are not only corroborated by Mrs.
Hilario87 but even admitted by the plaintiff in his opposition88 to defendants' petition to extend their area of operation west of the
camachile tree. And because their petition was denied, defendants could not, and have not,89 gone beyond the lateral line
about 20 meters east from said tree, which has already been established as the lateral extremity of the west bank during the
period.
It appears sufficiently established, therefore, that defendants have not gone beyond the receding western extremities of the
west riverbank. They have confined their extraction of gravel and sand only from within the banks of the river which constitute
part of the public domain wherein they had the right to operate. Plaintiff has not presented sufficient evidence that
defendants have gone beyond the limits of the west bank, as previously established, and have invaded his private estate. He
cannot, therefore, recover from them.
As a parting argument, plaintiff contends that to declare the entire disputed area as part of the riverbanks would be tantamount
to converting about half of his estate to public ownership without just compensation. He even adds that defendants have
already exhausted the supply in that area and have unjustly profited at his expense. These arguments, however, do not detract
from the above conclusions.

First of all, We are not declaring that the entire channel, i.e., all that space between the "secondary bank" line and the "primary
bank" line, has permanently become part of the riverbed. What We are only holding is that at the time the defendants made
their extractions, the excavations were within the confines of the riverbanks then. The "secondary bank" line was the western
limit of the west bank around 1945 to 1949 only. By 1955, this had greatly receded to the line just 20 meters east of the
camachile tree in the New Accretion Area. All that space to the west of said receding line 90 would still be part of plaintiff's
property and also whatever portion adjoining the river is, at present, no longer reached by the non-inundating ordinary
floods.
Secondly, it is not correct to say that plaintiff would be deprived of his property without any compensation at all. Under Art. 370
of the old Civil Code, the abandoned bed of the old river belongs to the riparian owners either fully or in part with the other
riparian owners. And had the change occurred under the Civil Code of the Philippines, plaintiff would even be entitled to all of
the old bed in proportion to the area he has lost.91

PINEDA, RENATO GOZUN, ALFREDO MERCADO, BIENVENIDO MACHADA, and the REGIONAL DIRECTOR of the
DEPARTMENT OF AGRARIAN REFORM, REGION III, Respondents.
x - - - - - - - - - - - - - - - - - - - - - - -x
G.R. No. 157598
REYNALDO VILLANUEVA, CENON GUINTO, CELESTINO DIZON, CARMELITA VDA. DE DAVID, FORTUNATO
TIMBANG, OSCAR SANTIAGO, CELESTINO ESGUERRA, ANTONIO DIZON, and TEODULO DIZON,Petitioners,
vs.
COURT OF APPEALS and GEORGE LIZARES, Respondents.
DECISION

And, lastly, defendants cannot be accused of unjustly profiting at plaintiff's expense. They were not responsible for the shifting
of the River. It was due to natural causes for which no one can be blamed. And defendants were extracting from public
property then, under proper authorization. The government, through the defendants, may have been enriched by chance, but
not unjustly.
Considering the conclusions We have thus reached, the other questions involved in the remaining assignments of errors
particularly those apropos the doctrine of state immunity from suit and the liability of defendant City of Manila are rendered
moot.

VELASCO, JR., J.:

Did the owner of two (2) lots by a subsequent affidavit validly and legally revoke the first affidavit voluntarily surrendering said
lots for land acquisition under the Comprehensive Agrarian Reform Law? The answer will determine the rights of the parties in
the instant petitionsthe heirs of the lot owner vis--vis the tenants declared to be beneficiaries of the Operation Land
Transfer (OLT) under Presidential Decree No. (PD) 27.1
The Case

Wherefore, the decision and orders appealed from are hereby set aside and another judgment is hereby entered as follows:
(1) Defendants City of Manila and the Director of Public Works and his agents and employees are hereby absolved
from liability to plaintiff since they did not extract materials from plaintiff's property but from the public domain.
(2) All that portion within the strip of land in question, starting from the line running parallel to the western waterline
of the river and twenty meters east from the camachile tree in the New Accretion Area measured along line AA in
Exhs. 3-Calalang, 13 and 54, and going to the west up to the western boundaries of the Hilario estate, is hereby
declared as not part of the public domain and confirmed as part of plaintiff's private property. No costs. So ordered.

Before us are two petitions. The first is a Petition for Review on Certiorari2 under Rule 45 docketed as G.R. No. 148777, which
seeks to set aside the November 29, 2000 Amended Decision3 of the Court of Appeals (CA) in CA-G.R. SP No. 47502, which
affirmed the August 7, 1997 Decision4 of the Department of Agrarian Reform Adjudication Board (DARAB) in DARAB Case
Nos. 4558-4561; and the June 26, 2001 Resolution5 disregarding the Motion for Reconsideration6 of said Amended Decision.
The other is a Petition for Certiorari and Mandamus7under Rule 65 docketed as G.R. No. 157598, which seeks to set aside the
November 14, 2002 CA Resolution8which denied petitioners Motion for Entry of Judgment,9 and the January 24, 2003 CA
Resolution10 likewise denying petitioners Motion for Reconsideration.11
Through our August 27, 2003 Resolution,12 these cases were consolidated as they arose out of the same factual milieu.
The Facts
EncarnacionVda. De Panlilio is the owner of the disputed landholdings over a vast tract of land, with an aggregate area of
115.41 hectares called Hacienda Masamat located in Masamat, Mexico, Pampanga covered by Transfer Certificates of Title
(TCT) Nos. 3510, 3513, 3514, 3515, 3522, 3523, 3524, 3525, 3526, 3528, 3530, 3531, 3532, 3533, RT-499 (9191), and RT500 (11670),13 all of the Pampanga Registry of Deeds.

G.R. No. 148777

October 18, 2007

ESTATE OF THE LATE ENCARNACION VDA. DE PANLILIO, represented by GEORGE LIZARES, Petitioner,
vs.
GONZALO DIZON, RICARDO GUINTU, ROGELIO MUNOZ, ELISEO GUINTU, ROBERTO DIZON, EDILBERTO CATU,
HERMINIGILDO FLORES, CIPRIANO DIZON, JUANARIO MANIAGO, GORGONIO CANLAS, ANTONIO LISING, CARLOS

On April 19, 1961, Panlilio entered into a contract of lease over the said landholdings with Paulina Mercado, wife of Panlilios
nephew. The contract of lease was subsequently renewed on October 13, 196414 and September 18, 1974,15 covering
agricultural years from 1961 to 1979.
Sometime in 1973, pursuant to the OLT under PD 27, the Department of Agrarian Reform (DAR) issued thirty eight (38)
Certificates of Land Transfer (CLTs) to Panlilios tenants. The tenant-awardees were made defendants in the instant
consolidated complaints filed by petitioner Lizares.

On November 26, 1973, lessee Paulina Mercado filed a letter-complaint with the DAR questioning the issuance of CLTs to
Panlilios tenants, alleging, among others, that the DAR should not have issued the CLTs since the land involved was
principally being planted with sugar and was outside the coverage of PD 27. She claimed that respondents surreptitiously
planted palay (rice plant) instead of sugar in order to bring the land within the purview of the law. After proper investigation, the
DAR concluded that the CLTs were "properly and regularly issued."
Paulina Mercado likewise filed a similar complaint with the Court of Agrarian Relations (CAR) at San Fernando, Pampanga,
docketed as CAR Case No. 1649-P74.

government. Therefore, the instant case should be dismissed. Necessarily, all pending incidents should be deemed disposed
of. 17
On December 29, 1986, Panlilio died.
Thereafter, sometime in 1993, the DAR issued Emancipation Patents (EPs) to the following tenants of Panlilio:
EP Nos.

On December 4, 1976, the tenants of the portion of the land planted with sugar cane petitioned the DAR to cause the reversion
of their sugarland to riceland so that it may be covered by the Agrarian Reform Law. The petition was with the conformity of
Panlilio.

Hermenegildo Flores

690774
143627

CelestinoDizon

690960
683355
45390

1. That I am the owner of an agricultural landholding situated [in] Mexico, Pampanga, with an area of 115.4
hectares, more or less, dedicated at present to the production of palay and sugarcane crops;

Gonzalo Dizon

680524

Roberto Dizon

690758

2. That I have been informed that 50.22 hectares comprising the portion dedicated to palay crop have been placed
under the provisions and coverage of P.D. No. 27 and that Certificates of Land Transfer have been issued to the
tenant-farmers thereon;

CiprianoDizon

45260
45256

Antonio Dizon

681072

TeoduloDizon

45326

JuanarioManiago

143207

Celestino Esguerra

45265
45219

Florentino Lapuz

690759
45259

Gorgonio Canlas

143508

Carlos Pineda

197097
45254

Renato Gozun

143208

Romeo Pangilinan

475341

Jose Serrano

475340

Wenceslao Pangilinan

476572

Guillermo del Rosario

475339

CandidoTimbang

143931
45262
45257

Arsenio Legaspi

4526618

Thus, on January 12, 1977, Panlilio executed an Affidavit, partly quoted as follows:

3. That as owner of the abovementioned property, I interpose no objection to the action taken by the Department of
Agrarian Reform in placing the aforesaid portion dedicated to palay crop within the coverage of P.D. No. 27;
4. That lately, all the tenants of my said property including those in the sugarcane portions, have filed a petition
dated December 4, 1976 with the Honorable Secretary Conrado F. Estrella, Secretary of Agrarian Reform,
requesting for the reversion of the sugarcane portion of my property adverted to [the] palay land which is the
original classification of my entire subject property;
5. That the aforesaid petition dated December 4, 1976 of the tenants of my property which was filed with the DAR
carries my written conformity;
6. That it is my desire that my entire subject property which is referred to as Hacienda Masamat be placed under
the coverage of P.D. 27 without exception and that thereafter the same be sold to tenant-petitioners. 16 (Emphasis
supplied.)
On January 20, 1977, by virtue of the said Affidavit, the DAR Secretary, through Director Gaudencio Besa, ordered Director
Severino Santiago, Regional Director of Region III, San Fernando, Pampanga, "to distribute all land transfer certificates, in
view of the desire of EncarnacionVda. dePanlilio to place her property under the Land Transfer Program of the government."
On the basis of the action of the DAR Secretary, the CAR, on March 17, 1978, issued an Order dismissing the complaint of
Paulina Mercado (lessee) in CAR Case No. 1649-P74, thus:
With this development, the resolution of the principal issue in the instant case has become moot and academic, it being
already settled in the DAR proceedings the placement of the land in question under the land transfer program of the

Subsequently, in June 1994, the Bacolod City Regional Trial Court (RTC), Branch 49 appointed petitioner George Lizares as
executor of the estate of Panlilio.19 Records show that petitioner Lizares is the son of the late Jesus Lizares, Panlilios
administrator of Hacienda Masamat during her lifetime.
On February 28, 1994, petitioner Lizares filed his first complaint with the Provincial Agrarian Reform Adjudicator (PARAD),
Region III, San Fernando, Pampanga, docketed as DARAB Case No. 638 P94,20 for annulment of coverage of landholdings
under PD 27 and ejectment against Reynaldo Villanueva, et al. who filed their Answer with Counterclaim21 on April 12, 1994.
On April 10, 1995, petitioner filed with the PARAD three more complaints for cancellation of EPs, docketed as DARAB Case
Nos. 933-P95,22 934-P95,23 and 935-P95,24 against the rest of respondents who filed their motions to dismiss25 on grounds of
lack of cause of action and lack of jurisdiction. On July 13, 1995, the PARAD denied the motions. 26 Respondents then filed
their Answer with Counterclaim.27
Upon petitioners motion, all the cases were consolidated. The PARAD then directed the parties to submit their respective
position papers,28 and, thereafter, considered the cases submitted for decision.
The three (3) complaints filed in 1995 for cancellation of EPs have the following defendants: (1) in DARAB Case No. 933-P95,
Herminigildo Flores and the Regional Director, DAR, Region III; (2) in DARAB Case No. 934-P95, CelestinoDizon, Gonzalo
Dizon, Roberto Dizon, and the Regional Director, DAR, Region III; and (3) in DARAB Case No. 935-P95, CiprianoDizon,
Antonio Dizon, TeoduloDizon, JuanarioManiago, Celestino Esguerra, Florentino Lapuz, Gorgonio Canlas, Antonio Lising,
Carlos Pineda, Renato Gozun, Alfredo Mercado, Romeo Pangilinan, Jose Serrano, Wenceslao Pangilinan, Guillermo del
Rosario, CandidoTimbang, BienvenidoMechada, and Arsenio Legaspi, and the Regional Director, DAR, Region III.
Thus, aside from public respondent DAR Regional Director, Region III, DARAB Case No. 638-P94 had 15 defendants,
DARAB Case No. 933-P95 had a sole defendant, DARAB Case No. 934-P95 had three defendants, and DARAB Case No.
935-P95 had 18 defendants. All the four (4) consolidated cases were against 37 defendants.
The Ruling of the PARAD in DARAB Case
Nos. 638-P94, 933-P95, 934-P95 and 935-P95
On November 14, 1995, the PARAD rendered a Joint Decision29 dismissing petitioner Lizares complaint on the ground that the
subject landholdings have been properly placed under the coverage of PD 27 through the January 12, 1977 Affidavit30 of
Panlilio, unequivocally placing her entire property within the coverage of the OLT. In addition, the PARAD relied on the report of
the DAR and the Bureau of Lands personnel that the subject landholding is devoted to palay. And, finally, the PARAD applied
the equitable remedy of laches, in that Panlilio failed during her lifetime to bring to the attention of the DAR and CAR her
February 3, 1977 Affidavit31 ostensibly revoking her previous January 12, 1977 Affidavit.
The Ruling of the DARAB in DARAB Case Nos. 4558-4561
(DARAB Case Nos. 638-P94, 933-P95, 934-P95 and 935-P95)
Aggrieved, petitioner Lizares appealed the PARAD decision before the DARAB, which, on August 7, 1997, rendered a
Decision32 affirming the PARAD decision.
The DARAB likewise disregarded petitioner Lizares Motion for Reconsideration33 of the August 7, 1997 Decision.
Prior to the issuance of the August 7, 1997 DARAB Decision, petitioner Lizares and defendant-appellees Wenceslao
Pangilinan, Romeo Pangilinan, Jose Serrano, and Guillermo del Rosario filed their February 10, 1997 Joint Partial Motion to
Dismiss34 with the DARAB, seeking dismissal of their respective claims in DARAB Case No. 4561 (DARAB Case No. 935-

P95) based on an Affidavit of Cancellation of Lis Pendens Annotation of TCT Nos. 14321, 14322, 14323, and 14324, all of the
Pampanga Register of Deeds,35 which was executed by petitioner Lizares. Apparently, petitioner Lizares received from a
certain Ms. PetronilaCatap the amount of PhP 1,356,619 for the settlement of DARAB Case No. 4561 (DARAB Case No. 935P95) against the abovementioned defendant-appellees.36
Earlier on, petitioner Lizares filed his April 19, 1996 Motion to Withdraw Appeal in favor of defendant-appellees Reynaldo
Villanueva, Cenon Guinto, Carmelita Vda. de David, Oscar Santiago, CelestinoDizon, Fortunato Timbang, and Florentino
Lapuz in DARAB Case No. 4558 (DARAB Case No. 638-P94); defendant-appellee CelestinoDizon in DARAB Case No. 4559
(DARAB Case No. 933-P95); and defendant-appellees Antonio Dizon, TeoduloDizon, Celestino Esguerra, Florentino Lapuz,
and CandidoTimbang in DARAB Case No. 4561 (DARAB Case No. 935-P95), as said defendant-appellees agreed to settle
and compromise with petitioner Lizares. The motion was however resisted by other defendant-appellees through a May 27,
1996 Counter-Motion to the Plaintiff-Appellant Motion to Withdraw Appeal,37 on the ground that a piece-meal withdrawal is not
proper as the matter in controversy is common and the same to all.
Unfortunately, the Motion to Withdraw Appeal was not resolved as petitioner Lizares did not attend the DARAB scheduled
hearings. Thus, the August 7, 1997 Decision was subsequently promulgated in favor of all defendant-appellees.
Petitioner Lizares elevated the DARAB consolidated cases to the CA for review in CA-G.R. SP No. 47502 under Rule 43 of the
Rules of Court.
The Ruling of the Court of Appeals
The April 11, 2000 CA Decision
At the outset, the CA saw it differently.
On April 11, 2000, the CA rendered a Decision sustaining petitioners position and granted relief, thus:
WHEREFORE, the petition is GRANTED. The decision of the Department of Agrarian Reform Adjudication Board affirming the
decision of the Provincial Agrarian Reform Adjudication Board, Region III, San Fernando, Pampanga is REVERSED and SET
ASIDE. The Certificates of Land Transfer issued to private respondents insofar as they pertain to sugarlands are hereby
declared NULL and VOID.38
The CA primarily anchored its ruling on Panlilios February 3, 1977 Affidavit ostensibly revoking her January 12, 1977 Affidavit
and ascribed error to both the PARAD and DARAB in ignoring Panlilios second affidavit. Moreover, it relied on the November
26, 1973 letter-complaint of Paulina Mercado to the DAR Secretary and the CAR Resolution in CAR Case No. 1649-P74, that
the subject landholding in question is principally devoted to the production of sugar cane as buttressed by the report and
findings of Atty. Gregorio D. Sapera, Legal Officer III of the DAR Central Office.
The November 29, 2000 CA Amended Decision
Unconvinced, Reynaldo Villanueva, et al. interposed a Motion for Reconsideration or in the alternative, Motion to Remand for
New Trial39 of said Decision, where they contended that:
1. Petitioners complaints should have been dismissed for his failure to implead therein indispensable parties,
namely the Land Bank of the Philippines which paid Panlilio the amortizations on the land and the third persons
who purchased the landholdings from the tenants;

2. [The CA] disturbed and reversed the findings of fact by the PARAD and the DARAB supported by substantial
evidence. x xx
3. It is not the job of the appellate court to sieve through the evidence considered by the administrative agency in
adjudicating the case before it, following the doctrine of primary jurisdiction. x xx

Thus, we have this Petition for Review on Certiorari against only 15 private respondents from the original defendants below,
namely: Gonzalo Dizon, Ricardo Guintu, Rogelio Munoz, Eliseo Guintu, Roberto Dizon, EdilbertoCatu, Herminigildo Flores,
CiprianoDizon, JuanarioManiago, Gorgonio Canlas, Antonio Lising, Carlos Pineda, Renato Gozun, Alfredo Mercado, and
BienvenidoMachada.
Petition for certiorari under G.R. No. 157598

4. [The CA] violated the principle of res judicata in reversing the CAR resolution dismissing the complaint in Case
No. 1649-P74 rendered twenty-two years ago. Likewise, estoppel and laches bar the instant actions. x xx
5. Lastly, the petition should be dismissed in favor of Romeo Pangilinan, Wenceslao Pangilinan, Jose Serrano and
Guillermo del Rosario in view of the compromise agreement in DARAB Case No. 4561 between them and petitioner
herein. They submitted, as proof, their joint motion to dismiss the complaint executed on February 10, 1997 and
petitioner Lizares receipt from them of P1,356,619.00 as consideration for the dismissal of his complaints against
them.40
After considering the above contentions together with petitioner Lizares Comment on the Motion for Reconsideration dated
May 2, 2000 with Motion for Correction of the Dispositive Portion of the Decision,41respondents Reply42 to said comment, and
petitioners Rejoinder,43 the appellate court rendered on November 29, 2000 the assailed Amended Decision on a vote of 3-2,
the dispositive portion of which reads:

Consequent to the filing of the Petition for Review on Certiorari by petitioner Lizares, on January 28, 2002, the other original
defendants in the consolidated cases before the PARAD and DARAB, who were not made respondents in G.R. No. 148777,
namely: Reynaldo Villanueva, Cenon Guinto, CelestinoDizon, CarmelitaVda. de David, Florentino Lapuz, Fortunato Timbang,
Oscar Santiago, CandidoTimbang, Celestino Esguerra, Antonio Dizon, and TeoduloDizon, filed before the CA a Motion for
Entry of Judgment46 of the November 29, 2000 Amended Decision in CA-G.R. SP No. 47502 based on the out-of-court
settlement during the pendency of the case. On July 4, 2002, a second Motion for Entry of Judgment 47 with the same
averments was filed reiterating their plea for execution.
The November 14, 2002 CA Resolution48 denied their motions for entry of judgment. A Motion for Reconsideration49 having
been turned down through the January 24, 2003 CA Resolution,50 petitioners now register the instant Petition for Certiorari and
Mandamus in G.R. No. 157598, assailing the aforesaid Resolutions for grave abuse of discretion.
The Issues

WHEREFORE, respondents motion for reconsideration of Our Decision is hereby GRANTED. The petition is ordered
DISMISSED and the challenged DARAB decision is AFFIRMED. Costs against petitioner.44

In G.R. No. 148777, petitioner Lizares presents the following issues for our consideration:

In reversing its earlier April 11, 2000 Decision, the CA concluded that the February 3, 1977 Affidavit was not executed by
Panlilio, ratiocinating that if she indeed made the second affidavit which purportedly repudiated her earlier January 12, 1977
Affidavit, the natural course of action to take was for her to submit the second affidavit to the DAR to exclude the majority of
her landholdings planted with sugar cane from the coverage of the OLT under PD 27. Her failure to effectuate the removal of
her land from the Comprehensive Agrarian Reform Program (CARP) coverage for nine (9) years until her death on December
29, 1986 led the court a quo to believe that the second affidavit was not genuine. Moreover, Jesus Lizares, Panlilios
administrator and father of petitioner Lizares, likewise did not take any action, in accordance with the second affidavit showing
that he was not aware of such affidavit of revocation. The CA even doubted petitioner Lizares contention that the second
affidavit was submitted to the DAR and CAR but was not acted upon for such averment was not substantiated.

1. Whether or not in its 29 November 2000 Amended Decision, the Court of Appeals erred gravely in reversing its
ruling in the 11 April 2000 Decision on the import and significance of the second affidavit executed by Encarnacion
L. Vda. de Panlilio revoking or repudiating her first affidavit (by which she purportedly agreed to have her land at
Hacienda Masamat, which was dedicated to sugarcane, placed under the coverage of P.D. No. 27);

The appellate court also found Panlilio and her successors-in-interest guilty of laches, pointing out that aside from the alleged
second affidavit of revocation, there was no indication of Panlilios intention to recover the disputed landholdings.

3. Whether or not in its 29 November 2000 Amended Decision, the Court of Appeals erred gravely in finding
Encarnacion L. Vda. dePanlilio and petitioner guilty of laches or estoppel;

On the issue of fraud and collusion on the part of the DAR personnel, the CA found that no preponderance of evidence was
evinced to prove the accusation.

4. Whether or not res judicata applies in the instant case;

In fine, the CA recognized and applied the principle of res judicata to the March 17, 1978 CAR Order rendered more than 20
years ago, holding that the resolution of said court placing the entire landholdings in question under the coverage of PD 27 had
long become final and executory.
Petitioner Lizares plea for recall of the assailed Amended Decision was rejected through the assailed June 26, 2001 CA
Resolution.45
Petition for review on certiorari under G.R. No. 148777

2. Whether or not in its 29 November 2000 Amended Decision, the Court of Appeals erred gravely in setting aside
the 11 April 2000 Decisions ruling that the land in question being planted with sugarcane is not covered by P.D. No.
27, by instead declaring that "the fact that land is sugarland has become inconsequential to the coverage under
P.D. No. 27 in the light of the affidavit dated January 12, 1977";

5. Whether or not in its 29 November 2000 Amended Decision, the Court of Appeals erred gravely in failing to rule
that there was fraud and collusion on the part of the respondents in the coverage of the subject parcels of land;
6. Whether or not the Court of Appeals acted with grave abuse of discretion in declaring the transfer made by the
private respondents to third persons valid;
7. Whether or not forum-shopping or a false certification of non-forum shopping [is present] here; and

8. Whether or not the instant petition complies with the nature and requisites of an appeal by certiorari under Rule
45.51
In G.R. No. 157598, petitioners raise the sole issue of "whether the petitioners are entitled to an entry of judgment."52
The Courts Ruling
G.R. No. 148777

Time and again, the court has reminded prospective petitioners and lawyers alike that it is necessary that they attach to the
petition under Rule 45 all the material portions of the case records of the lower courts or quasi-judicial bodies which at one
time or another had adjudicated the case or complaint. These documents are required to support the grounds presented in the
petition under Rule 45.56 Any decision, order, pleading, or document forming parts of the records that is relevant or important to
the petition should be appended to it so that the court, in reviewing the petition, will have easy access to these papers. More
importantly, the submission will obviate delay as the court can readily decide the petition without need of the elevation of the
records of the court or quasi-judicial body a quo.
Now we move on to the substantive issues.

Before we go to the substantial issues, we tackle first the procedural issues raised in the last two issues in G.R. No. 148777 on
whether the instant petition complies with the requirements of Rule 45 and whether forum shopping is present.
Petition complied with requisites for review on certiorari

Main Issue: Genuineness and authenticity

of the February 3, 1977 Affidavit
The pith of the dispute is whether or not the February 3, 1977 affidavit of the lot owner, the late EncarnacionVda. dePanlilio, is
genuine or authentic.

Private respondents contend that the grounds relied upon by petitioner are factual in nature and thus outside the purview of a
review on certiorari by this Court. Petitioner disagrees and posits that the petition raises issues of both fact and law which are
so intimately intertwined and that issues of law permeate the controversy between the parties.

We rule in the negative.

We find for petitioner. The rule is clearquestions of facts are proscribed by Rule 45. A question of law exists when the doubt
or controversy concerns the correct application of law or jurisprudence to a certain set of facts; or when the issue does not call
for an examination of the probative value of the evidence presented, the truth or falsehood of facts being admitted. A question
of fact exists when the doubt or difference arises as to the truth or falsehood of facts or when the query invites calibration of
the whole evidence considering mainly the credibility of the witnesses, the existence and relevancy of specific surrounding
circumstances, as well as their relation to each other and to the whole, and the probability of the situation. 53

In a slew of cases, the principle is firmly entrenched in this jurisdiction that this Court is not a trier of facts, and is not tasked to
calibrate and assess the probative weight of evidence adduced by the parties during trial all over again.57 However, in rare
occasions, exceptions are allowed. One exception is when there are competing factual findings by the different triers of fact,
such as those made by the quasi-agencies on the one hand and the CA on the other, this Court is compelled to go over the
records of the case, as well as the submissions of the parties, and resolve the factual issues. 58 In this case, however, there is
coalescence in the findings of the appellate court with that of the two quasi-judicial agencies belowthe PARAD and
DARABon the issue of the authenticity of the second Panlilio Affidavit.

The rule is subject to exceptions. One such exception exists in this case. Mixed questions of law and facts are raised
pertaining to the applicability of PD 27 on a large portion of subject landholdings that were planted with sugar cane, which
would have been otherwise exempt, but were voluntary waived through an affidavit by the lot owner to be placed under the
OLT pursuant to said law; the import and significance of the purported affidavit of revocation; and, the interpretation of
Executive Order No. (EO) 22854 in relation to subsequent land transfer made by the farmer-beneficiaries.

It being a question of fact, we find no reason to disturb the findings and conclusions of the court a quo in its questioned
November 29, 2000 Amended Decision holding that the challenged February 3, 1977 Panlilio Affidavit is not an authentic
document. We quote with approval the factual findings of the CA which completely gave full accord and affirmed the findings of
the PARAD and DARAB, viz:

At the very least, the instant petition complies with the requisites of Rule 45, particularly Section 6, as we have given the
instant petition due course.55
No forum shopping
Private respondents argue that petitioner Lizares is guilty of forum shopping for having pursued other civil cases allegedly
involving the same subject matter and on the same grounds raised in this petition. Petitioner Lizares counters that there is no
forum shopping, first, as the instant petition is a mere continuation of a pending action, that is, the consolidated cases filed with
the PARAD; second, the causes of action and issues raised in the other civil cases lodged with the RTC were different.
Respondents postulation cannot be entertained.
Private respondents failed to furnish us copies of portions of the relevant records of the other civil cases instituted by petitioner
Lizares needed to determine the existence of forum shopping. Absent such necessary pleadings, we are constrained to take
petitioners assertion at face value that the other cases, particularly Civil Case Nos. 11342, 11344, 11345, 11346 and 11347,
filed before the RTC differ from the instant case as to the issues raised, the reliefs prayed for, and the parties impleaded.

After assessing the grounds raised by respondents in their motion for reconsideration and a meticulous review of the records,
We are now in serious doubts as to the correctness of Our Decision. Our reasons are:
First, according to petitioner Lizares, Panlilios second affidavit (revoking her first affidavit) upon which this Court anchors its
assailed Decision, was executed as early as February 2, 1977. If it were true, Panlilios natural reaction was to submit her
second affidavit or affidavit of revocation to the DAR in order to exclude her landholdings from the coverage of the Operation
Land Transfer under P.D. 27. Significantly, Panlilio died on December 29, 1986. She had therefore, nine (9) years from the
date of execution of her second affidavit, within which to have her land excluded by the DAR from such coverage considering
that it was principally planted [with] sugar and that she was misled by DAR lawyer, Atty. Pepito Sanchez, into signing her first
affidavit. But she did not. Petitioners father, Jesus Lizares, was her administrator. Yet he did not also take any action for
apparently he was not aware of such affidavit of revocation.
Moreover, in her second affidavit, Panlilio specifically stated:
"That another reason for my desire not to place my entire property referred to as Hacienda Masamat in Mexico, Pampanga,
under P.D. 27 is the fact that the said Hacienda Masamat is leased to my nephews wife, Mrs. Paulina Y. Mercado, and the

lease contract I executed in her favor covering my said Hacienda Masamat is still subsisting and in force and will expire only
after the agricultural crop year 1978-1979;"
If Panlilio indeed signed her affidavit of revocation, why did she not inform her niece Paulina about it in order to protect her
right as a lessee? It must be remembered that at that time, the latters complaints (for cancellation of CLTs) against the tenants
of Panlilio were still pending in the DAR and the CAR. Had Panlilio given Paulina a copy of such second affidavit, she could
have brought it to the attention of the CAR and the DAR. Certainly, the subject landholdings could not have been placed
entirely under Operation Land Transfer. We need not emphasize here that being a lessee, Paulina would not want to part with
her Aunts landholdings.
Out of the blue, the second affidavit surfaced only in 1994 and 1995 when petitioner Lizares brought the instant actions against
Panlilios tenants or after eighteen (18) years from the date of its alleged execution. At this juncture, We can only conclude
without hesitation that Panlilio did not execute the second affidavit.
Petitioner alleged in his position paper that the same affidavit of revocation was submitted to the DAR and the CAR, but they
were not acted upon because of the dismissal of the cases for cancellation of CLTs filed by Paulina Mercado. Petitioners claim
is a mere allegation. It has not been substantiated. Again, if it were true, why did Panlilio and Paulina fail to pursue any further
action?59
We respect and accord finality to the aforequoted findings of facts of the CA, being the tribunal tasked to undertake a final
review of the facts of the case subject of course to certain tolerated exceptional situations. Once again we reiterate the
prevailing rule that the findings of fact of the trial court, particularly when affirmed by the Court of Appeals are binding upon this
Court.60
Second Issue: There is valid waiver through
the January 12, 1977 Affidavit
The CA likewise did not err in reversing its April 11, 2000 Decision that the subject land was properly covered by PD 27 since
Panlilio surrendered said lot to the DAR for coverage under PD 27 pursuant to her January 12, 1977 Affidavit. The nonexistence of the February 3, 1977 Affidavit supports the inclusion of the entire lot in the CARP of the Government.
On the other hand, petitioner Lizares argues that there was no valid waiver under PD 27.
We are not convinced.
Considering the non-revocation of the January 12, 1977 Panlilio Affidavit,, the CA considered the land of Panlilio planted with
sugar cane as falling under the coverage of PD 27, thus:
[W]hile the proceedings in the CAR tend to establish the land as principally sugarland, hence outside the coverage of P.D. 27,
still, Panlilios consent to have the entire land covered by the said law as alleged in her first affidavit, cannot be construed as a
violation of its provisions. In fact, in executing the said affidavit, she did not defeat, nor contravene the express intent of the law
to emancipate her tenants from the bondage of the soil. In doing so, she even supported its implementation.

We agree with the CA.

While PD 27 clearly applies to private agricultural lands primarily devoted to rice and corn under a system of sharecrop or
lease-tenancy, whether classified as landed estate or not, it does not preclude nor prohibit the disposition of landholdings
planted with other crops to the tenants by express will of the landowner under PD 27.
In the instant case, a large portion of Hacienda Masamat with an aggregate area of 115.41 hectares was planted with sugar
cane. It is undisputed, as was duly shown in the January 12, 1977 Panlilio Affidavit, that only 50.22 hectares were planted with
palay. Thus, approximately 65.19 hectares of the subject landholdings were planted with sugar cane aside from the portions
used for the residences of the tenants and planted with crops for their daily sustenance. Needless to say, with the January 12,
1977 Panlilio Affidavit, she expressed her intent to include the 65.19 hectares to be placed under the OLT pursuant to PD 27 in
favor of her tenants which otherwise would have been exempt. Indeed, waiver or an intentional and voluntary surrender of a
right can give rise to a valid title or ownership of a property in favor of another under Article 6 of the Civil Code. Thus, such
disposition through the OLT pursuant to PD 27 is indeed legal and proper and no irregularity can be attributed to the DAR
which merely relied on the January 12, 1977 Panlilio Affidavit.
Third Issue: Equitable remedy of laches
The court a quo correctly ruled that Panlilio and her successors-in-interest are bound by the coverage of the lot under PD 27
by reason of laches.
Even granting arguendo that the February 3, 1977 Affidavit of revocation is genuine and was furnished both the DAR and the
CAR, still, no relief can be accorded petitioner Lizares on account of laches.
Laches and its elements
Delay for a prolonged period of time can result in loss of rights and actions. The equitable defense of laches does not even
concern itself with the character of the defendants title, but only with plaintiffs long inaction or inexcusable neglect to bar the
latters action as it would be inequitable and unjust to the defendant.
According to settled jurisprudence, "laches" means "the failure or neglect, for an unreasonable and unexplained length of time,
to do that whichby the exercise of due diligencecould or should have been done earlier."62Verily, laches serves to deprive
a party guilty of it of any judicial remedies. Its elements are: (1) conduct on the part of the defendant, or of one under whom the
defendant claims, giving rise to the situation which the complaint seeks a remedy; (2) delay in asserting the complainants
rights, the complainant having had knowledge or notice of the defendants conduct as having been afforded an opportunity to
institute a suit; (3) lack of knowledge or notice on the part of the defendant that the complainant would assert the right in which
the defendant bases the suit; and (4) injury or prejudice to the defendant in the event relief is accorded to the complainant, or
the suit is not held barred.63
In Santiago v. Court of Appeals, we explained that there is "no absolute rule as to what constitutes laches or staleness of
demand; each case is to be determined according to its particular circumstances."64
Laches has set in

In Our challenged Decision We found that the subject land was principally planted [with] sugar and therefore outside the pale
of P.D. 27. But We overlooked the fact that Panlilio in her first affidavit, which was not validly revoked, expressed her desire to
have her entire landholdings placed within the coverage of Operation Land Transfer. To be sure, the fact that Panlilios land is
sugarland has become inconsequential in the light of her first affidavit.61

The records demonstrate clear signs of laches. The first element is undisputed. Panlilios erstwhile tenants were issued CLTs
sometime in 1973 and subsequently EPs in 1993. CAR Case No. 1649-P74 filed by Panlilios lessee, Paulina Mercado, was
dismissed with finality on March 17, 1978 as no appeal was pursued. Since then, Panlilio and her administrator for the subject

landholdings in Hacienda Masamat, Jesus Lizares, did not take any action to revoke the CLTs. With the dismissal of the land
case in 1978, with finality, the possession of the tenants of Panlilio was fully recognized by her and her successors-in-interest.
It cannot be disputed that Panlilios tenants, the private respondents, occupied portions of the subject landholdings in an open,
continuous, and adverse manner in the concept of owners from 1978 until 1994 and 1995 when the subject cases were
instituted by petitioner Lizares or for more than sixteen (16) years. Private respondents possession of said portions for a
lengthy period of time gave cause to petitioner to complain and take legal steps to protect Panlilios rights of ownership and
title over the disputed lot. No such action was taken.
Likewise, the second element of laches is amply shown. Panlilio and her successors-in-interest did not take any administrative
or judicial action to protect her rights for more than 16 years.
As it is, if Panlilio indeed executed the affidavit of revocation in February 3, 1977, why did she not pursue any action to
implement her affidavit disregarding her January 12, 1977 Affidavit? Indeed, Panlilio, during her lifetime, did not lift a finger to
regain her land. After she died on December 29, 1986, Jesus Lizares, her administrator for Hacienda Masamat, likewise did
not initiate any legal action to effectuate her alleged wish. Unfortunately for petitioner Lizares, the cases initiated by him in
1994 and 1995 were belatedly filed and much delay had transpired which proved to be prejudicial to his interests.
Anent the third element, private respondents did not know nor anticipate that their possession, occupancy, and ownership of
the subject landholdings after 16 years would still be questioned. In fact, private respondents did not only continue tilling the
land, but later on had conveyed their lots to innocent third parties for value. Moreover, we take judicial notice that numerous
commercial buildings, residential houses, and a large mall stand on major portions of former Hacienda Masamat. In fact, the
subject landholdings are now much different from what they were more than two decades ago. Thus, after more than sixteen
(16) years of unquestioned, peaceful, and uninterrupted possession, private respondents did not expect that petitioner Lizares
would still assert any right over the landholdings after the lapse of such a long period of occupation.
Finally, grave prejudice and serious damage would befall private respondents, in general, who relied on their CLTs and EPs,
and subsequent purchasers for value of the lots forming parts of the former hacienda who relied on private respondents titles if
the complaints of petitioner were not barred. As a matter of fact, some buyers not impleaded in the instant case opted to settle
out-of-court with petitioner Lizares rather than be disturbed in their possession and their right of ownership.

The doctrine of res judicata thus lays down two main rules which may be stated as follows: 1) The judgment or decree of a
court of competent jurisdiction on the merits concludes the parties and their privies to the litigation and constitutes a bar to a
new action or suit involving the same cause of action either before the same or any other tribunal; and 2) Any right, fact, or
matter in issue directly adjudicated or necessarily involved in the determination of an action before a competent court in which
a judgment or decree is rendered on the merits is conclusively settled by the judgment therein and cannot again be litigated
between the parties and their privies whether or not the claim or demand, purpose or subject matter of the two suits is the
same. These two main rules mark the distinction between the principles governing the two typical cases in which a judgment
may operate as evidence. In speaking of these cases, the first general rule above stated, and which corresponds to the
aforequoted paragraph (b) of Section 49, is referred to as "bar by former judgment" while the second general rule, which is
embodied in paragraph (c) of the same section, is known as "conclusiveness of judgment."
Stated otherwise, when we speak of res judicata in its concept as a "bar by former judgment," the judgment rendered in the
first case is an absolute bar to the subsequent action since said judgment is conclusive not only as to the matters offered and
received to sustain that judgment but also as to any other matter which might have been offered for that purpose and which
could have been adjudged therein. This is the concept in which the termres judicata is more commonly and generally used and
in which it is understood as the bar by prior judgment constituting a ground for a motion to dismiss in civil cases.
On the other hand, the less familiar concept or less terminological usage of res judicata as a rule on conclusiveness of
judgment refers to the situation where the judgment in the prior action operates as an estoppel only as to the matters actually
determined therein or which were necessarily included therein. Consequently, since other admissible and relevant matters
which the parties in the second action could properly offer are not concluded by the said judgment, the same is not a bar to or
a ground for dismissal of the second action.
At bottom, the other elements being virtually the same, the fundamental difference between the rule of res judicata as a bar by
former judgment and as merely a rule on the conclusiveness of judgment is that, in the first, there is an identity in the cause of
action in both cases involved whereas, in the second, the cause of action in the first case is different from that in the second
case.65
Premised on the foregoing disquisition, the principle of res judicata requires the concurrence of the following requisites:
a) The former judgment or order must be final;

Considering the foregoing discussion, we uphold the finding of laches. Verily, it would be a grave injustice if private
respondents and the subsequent purchasers for value would now be made to suffer after petitioner Lizares and his
predecessors-in-interest had slept on their rights for more than 16 years.
Fourth Issue: Principle of res judicata inapplicable
Private respondents contend that the dismissal in CAR Case No. 1649-P74 constitutes res judicata over the instant case.
CAR Case No. 1649-P74 involved Panlilios lessee against private respondents with the issue of the crops being planted on
subject landholdings, while the instant case involves Panlilios successor-in-interest petitioner Lizares against private
respondents involving the issue of the alleged affidavit of revocation.

b) It must be a judgment or order on the merits, that is, it was rendered after a consideration of the evidence or
stipulations submitted by the parties at the trial of the case;
c) It must have been rendered by a court having jurisdiction over the subject matter and the parties; and
d) There must be, between the first and second actions, identity of parties, of subject matter and of cause of action.
This requisite is satisfied if the two actions are substantially between the same parties. 66

The reliance on res judicata is misplaced.

For want of the fourth requisite that there must be, between the first and second actions, identity of parties, subject matter, and
cause of action, the instant case is thus removed from the operation of the principle of res judicata. Stated differently, there is
no identity of parties and issues in CAR Case No. 1649-P74 and the instant case.

Res judicata, either in the concept of bar by former judgment or conclusiveness of judgment, cannot be applied to the present
case.

Nevertheless, while res judicata is not applicable in the instant case, still, it will not accord legal relief to petitioner with respect
to his claim of ownership over the lots in dispute.

In Vda. deCruzo v. Carriaga, Jr., we discussed the doctrine of res judicata, as follows:

Fifth Issue: Fraud and collusion not proven

Petitioner Lizares accuses the DAR personnel and private respondents of fraud and collusion. Absent any proof, such
allegation falls flat.
In the recent case of Heirs of Cipriano Reyes v. Calumpang, we elucidated on this same issue of the required evidential proof,
thus:
Basic is the rule of actoriincumbit onus probandi, or the burden of proof lies with the plaintiff. Differently stated, upon the
plaintiff in a civil case, the burden of proof never parts. In the case at bar, petitioners must therefore establish their case by a
preponderance of evidence, that is, evidence that has greater weight, or is more convincing than that which is offered in
opposition to itwhich petitioners utterly failed to do so. Besides, it is an age-old rule in civil cases that one who alleges a fact
has the burden of proving it and a mere allegation is not evidence. Fraud is never presumed, but must be established by clear
and convincing evidence. Thus, by admitting that Victorino, Luis, and Jovito, all surnamed Reyes, indeed executed the Deed of
Quitclaim coupled with the absence of evidence substantiating fraud and mistake in its execution, we are constrained to
uphold the appellate courts conclusion that the execution of the Deed of Quitclaim was valid.67
Hence, we uphold the CAs pronouncement that there was no collusion and fraud especially considering that no clear and
convincing evidence was presented to overwhelm and rebut the presumption that official duty has been regularly
performed68 by the DAR personnel.
Sixth Issue: Subsequent transfers valid only
to qualified farmer-beneficiaries
Petitioner Lizares asseverates that ownership of lands granted to tenant-farmers under PD 27 may not be transferred or
conveyed to third parties except by hereditary succession or to the Government. He contends that the CA committed grave
abuse of discretion in declaring the sale of the land by private respondents Gonzalo Dizon, et al. to third persons valid. The CA
ratiocinated that EO 228 was enacted after PD 27 and since EO 228 is a later law, it will prevail over PD 27. Thus, the
ownership of the lot may now be transferred to persons other than the heirs of the beneficiary or the Government.
Petitioner is correct.
EO 228 not inconsistent with PD 27 on prohibition of transfers

On the other hand, Sec. 6 of EO 228 provides, thus:

Sec. 6 The total cost of the land including interest at the rate of six percent (6%) per annum with a two percent (2%) interest
rebate for amortizations paid on times, shall be paid by the farmer-beneficiary or his heirs to the Land Bank over a period of up
to twenty (20) years in twenty (20) equal annual amortizations. Lands already valued and financed by Land Bank are likewise
extended a 20-year period of payment of twenty (20) equal annual amortizations. However, the farmer-beneficiary if he so
elects, may pay in full before the twentieth year or may request the Land Bank to structure a repayment period of less than
twenty (20) years if the amount to amount to be financed and the corresponding annual obligations are well within the farmers
capacity to meet. Ownership of lands acquired by farmer-beneficiary may be transferred after full payment of amortizations.
(Emphasis supplied.)
The CA highlighted and made much of the last sentence of Sec. 6 which authorizes the transfer of the ownership of the lands
acquired by the farmer-beneficiary after full payment of amortizations. It construed said provision to mean that the farmerbeneficiary can sell the land even to a non-qualified person.
This is incorrect.
First of all, the provision in question is silent as to who can be the transferees of the land acquired through the CARP. The rule
in statutory construction is that statutes in parimateria should be construed together and harmonized.69 Since there appears to
be no irreconcilable conflict between PD 27 and Sec. 6 of EO 228, then the two (2) provisions can be made compatible by
maintaining the rule in PD 27 that lands acquired under said decree can only be transferred to the heirs of the original
beneficiary or to the Government. Second, PD 27 is the specific law on agrarian reform while EO 228 was issued principally to
implement PD 27. This can easily be inferred from EO 228 which provided for the mode of valuation of lands subject of PD 27
and the manner of payment by the farmer-beneficiary and mode of compensation to the land owner. Third, implied repeals are
not favored. A perusal of the aforequoted Sec. 6 of EO 228 readily reveals that it confers upon the beneficiary the privilege of
paying the value of the land on a twenty (20)-year annual amortization plan at six percent (6%) interest per annum. He may
elect to pay in full the installments or have the payment plan restructured. Said provision concludes by saying that after full
payment, ownership of the land may already be transferred. Thus, it is plain to see that Sec. 6 principally deals with payment
of amortization and not on who qualify as legal transferees of lands acquired under PD 27. Since there is no incompatibility
between PD 27 and EO 228 on the qualified transferees of land acquired under PD 27, ergo, the lands acquired under said
law can only be transferred to the heirs of the beneficiary or to the Government for eventual transfer to qualified beneficiaries
by the DAR pursuant to the explicit proscription in PD 27.

The prohibition in PD 27, the Tenants Emancipation Decree, which took effect on October 21, 1972, states that "[t]itle to land
acquired pursuant to this Decree or the Land Reform Program of the Government shall not be transferable except by
hereditary succession or to the Government in accordance with the provisions of this Decree, the Code of Agrarian Reforms
and other existing laws and regulations (emphasis supplied)."

Thus, the alleged transfers made by private respondents in G.R. No. 148777 of lands acquired under PD 27 to non-qualified
persons are illegal and null and void.70

Hereditary succession means succession by intestate succession or by will to the compulsory heirs under the Civil Code, but
does not pertain to testamentary succession to other persons. "Government" means the DAR through the Land Bank of the
Philippines which has superior lien by virtue of mortgages in its favor.

The law is clear and leaves no room for doubt. Upon the promulgation of Presidential Decree No. 27 on October 21, 1972,
petitioner was DEEMED OWNER of the land in question. As of that date, he was declared emancipated from the bondage of
the soil. As such, he gained the rights to possess, cultivate, and enjoy the landholding for himself. Those rights over that
particular property were granted by the government to him and to no other. To insure his continued possession and enjoyment
of the property, he could not, under the law, make any valid form of transfer except to the government or by hereditary
succession, to his successors.71

Thus, PD 27 is clear that after full payment and title to the land is acquired, the land shall not be transferred except to the heirs
of the beneficiary or the Government. If the amortizations for the land have not yet been paid, then there can be no transfer to
anybody since the lot is still owned by the Government. The prohibition against transfers to persons other than the heirs of
other qualified beneficiaries stems from the policy of the Government to develop generations of farmers to attain its avowed
goal to have an adequate and sustained agricultural production. With certitude, such objective will not see the light of day if
lands covered by agrarian reform can easily be converted for non-agricultural purposes.

The ruling in Victorino Torres v. Leon Ventura sheds light on the policy behind the prohibition, thus:

In addition, the prohibition was expanded not only to cover the title issued to the tenant-farmer but also the rights and interests
of the farmer in the land while he is still paying the amortizations on it. A contrary ruling would make the farmer an "easy prey
to those who would like to tempt [him/her] with cash in exchange for inchoate title over the same," and PD 27 could be easily
circumvented and the title shall eventually be acquired by non-tillers of the soil.72

Anent the contravention of the prohibition under PD 27, we ruled in Siacor v. Gigantana73 and more recently in CaliwagCarmona v. Court of Appeals,74 that sales or transfers of lands made in violation of PD 27 and EO 228 in favor of persons other
than the Government by other legal means or to the farmers successor by hereditary succession are null and void. The
prohibition even extends to the surrender of the land to the former landowner. The sales or transfers are void ab initio, being
contrary to law and public policy under Art. 5 of the Civil Code that "acts executed against the provisions of mandatory or
prohibiting laws shall be void x xx." In this regard, the DAR is duty-bound to take appropriate measures to annul the illegal
transfers and recover the land unlawfully conveyed to non-qualified persons for disposition to qualified beneficiaries. In the
case at bar, the alleged transfers made by some if not all of respondents Gonzalo Dizon, et al. (G.R. No. 148777) of lands
covered by PD 27 to non-qualified persons are illegal and null and void.
G.R. No. 157598
Finally, we resolve the sole issue raised in G.R. No. 157598 on whether petitioners Reynaldo Villanueva, et al. are entitled to a
partial entry of judgment of the Amended Decision in CA-G.R. SP No. 47502.
Petitioners in G.R. No. 157598 are not entitled to a partial entry of judgment in CA-G.R. SP No. 47502
Petitioners contend that they are entitled to a partial entry of judgment in CA-G.R. SP No. 47502 as respondent George
Lizares in G.R. No. 148777 deliberately excluded them on account of the amicable settlement concluded between them. Thus,
they contend that any judgment rendered by the Court in G.R. No. 148777 will not affect them. In gist, petitioners strongly
assert that the Amended Decision in CA-G.R. SP No. 47502 is already final and executory with respect to them.
Respondent Lizares, on the other hand, has continually affirmed that he deliberately excluded petitioners in his petition for
review under G.R. No. 148777 as they had amicably settled with him; and that he has released, discharged, and waived any
and all claims against petitioners on account of the petition. Thus, respondent Lizares interposes no objection for the issuance
of a partial entry of judgment in CA-G.R. SP No. 47502 insofar as petitioners are concerned, as the issues and reliefs he is
seeking in G.R. No. 148777 do not concern nor prejudice petitioners.
We disagree.
It is clear that petitioners, though they settled with respondent Lizares out-of-court, were not able to get a favorable ruling from
the DARAB approving the motion to withdraw appeal filed by respondent Lizares in DARAB Case Nos. 4558, 4559, and 4561.
This motion for the recall of the appeal remained unacted upon until the August 7, 1997 DARAB Decision was rendered in
favor of all the defendants and appellees.

the filing of the petition, the finality of the Court of Appeals decision was stayed, andthere could be no entry of judgment
therein, and hence, no premature execution could be had. In that case, the High Court emphatically declared that when this
Court adopted a resolution granting execution pending appeal after the petition for review was already filed in the Supreme
Court, the Court of Appeals encroached on the hallowed grounds of the Supreme Court. Thus, We find no legal basis or
justification to allow [the] motions for partial entry of judgment even on the ground that private [respondent]-movants were not
impleaded in G.R. No. 148777 and in the absence of opposition from herein petitioner who had allegedly concluded an out-ofcourt settlement with private [respondent]-movants.75
We fully agree with the CA that there should be no partial entry of judgment for petitioners Reynaldo Villanueva, et al. since
their motion to withdraw was not acted upon by the DARAB nor by the CA. Thus, there is nothing to record in the Book of Entry
of Judgments.
More importantly, it appears that the transfers made by some or all of petitioners Reynaldo Villanueva, et al. (G.R. No. 157598)
to non-qualified persons are proscribed under PD 27. Such finding necessarily preludes the entry of judgment in favor of said
petitioners. Consequently, the alleged transfers made by petitioners Villanueva, et al., being in contravention of a prohibitory
provision of PD 27, are null and void, and the titles issued to non-qualified individuals have to be cancelled and new ones
issued to the Government.1wphi1
WHEREFORE, the petition in G.R. No. 148777 is partly granted. The November 29, 2000 Amended Decision of the CA in CAG.R. SP No. 47502 is affirmed with the modification that the transfers made by private respondents to non-qualified persons, if
any, under PD 27 are illegal and declared NULL and VOID, and the titles issued based on the transfers are likewise NULL and
VOID. The DAR is ORDERED to investigate the transfers covering the subject landholdings and, based on the findings of
illegal transfers for violations of PD 27 and EO 228, to coordinate with the Register of Deeds of Pampanga for the cancellation
of the titles registered in the names of the transferees or to their subsequent transferees and to issue new titles to the
Government for disposition to qualified beneficiaries. The November 14, 1995 PARAD Joint Decision in DARAB Cases Nos.
638-P94, 933-P95, 934-P95, and 935-P95, as affirmed by the August 7, 1997 DARAB Decision in DARAB Case Nos. 4558,
4559, 4560, and 4561, is accordingly MODIFIED.
The petition in G.R. No. 157598 is DISMISSED for lack of merit. The transfers made by petitioners Reynaldo, et al. to nonqualified persons, if any, under PD 27 are likewise declared NULL and VOID. Similarly, the DAR is ORDERED to investigate
the transfers covering the subject landholdings and, based on the findings of illegal transfers for violations of PD 27 and EO
228, to coordinate with the Register of Deeds of Pampanga for the cancellation of the titles concerned registered in the names
of the transferees or to their subsequent transferees and to issue new titles to the Government for disposition to qualified
beneficiaries.
SO ORDERED.

Subsequently, the DARAB cases were elevated for review to the CA and docketed as CA-G.R. SP No. 47502.
In its November 29, 2000 Amended Decision, the CA upheld the DARAB Decision.
On January 28, 2002, petitioners Reynaldo Villanueva, et al. filed a Motion for Entry of Judgment based on their out-of-court
settlement with petitioner Lizares while the DARAB case was pending. On July 4, 2002, a second motion for entry of judgment
was filed which was denied together with the first motion by the CA on November 14, 2002.
The reason for the denial by the CA of the aforementioned prayers for entry of judgment is as follows:
Our Amended Decision in this case had long been elevated to the Supreme Court by a petition for review on certiorari under
Rule 45. As held by the Supreme Court in Heirs of the Late Justice Jose B. L. Reyes vs. Court of Appeals, by the mere fact of

GUTIERREZ DAVID, J.:

This is an action filed with the Court of First Instance of Iloilo for the recovery of the possession of a portion of land designated
as Lot No. 908-Q with an area of 5,931 square meters, which is alleged to have been seperated from plaintiff's lands by the
"natural change" in the course of a river. The case having been decided adversely against the plaintiff, the latter appealed to
the Court of Appeals. The court, however, certified the caseto this Court on the ground that it was decided upon a stipulation of
facts and for that reason questions of fact can no longer be raised on appeal.
It appears that the land in dispute was formerly a part of Lot No. 908 of the Cadastral Survey of Jaro, Iloilo, which lot was
acquired by plaintiff C.N. Hodges from SalustianoMirasol in January, 1950, and subsequently registered in his name as
evidenced by Transfer Certificate of Title No. T-2504 issued by the Register of Deeds of Iloilo. This property was bounded on
the north by the Salog River. Adjoining that river on the other side is Lot No. 2290, which was purchased by defendant Amador
D. Garcia from Dr. Manuel Hechanova on April 15, 1950. On July 12 of that same year, defendant had the land, which was
originally surveyed in 1912 and was then bounded on the SE and SW by the Salog river, had inreased in area by the river
bank, and that the added area, which bounds the land on the SE and SW, is in turn bounded on the SE and SW by the Salog
river. In due time, defendant applied for the registration of the additional area under the Land Registration Act, and on March
22, 1952, the cadastral court rendered a decision holding that the land sought to be registered is an accretion to Lot No. 2290
and decreeing that the land be registered in his name. On June 30, 1952, the corresponding Original Certificate of Title No. O229 was issued in favor of the defendant.

G.R. No. L-12730

August 22, 1960

C.N. HODGES, plaintiff-appellant,

vs.
AMADOR D. GARCIA, defendant-appellee.
Gellada, Mirasol and Vallar for appellant.
Roque E. Evidente for appellee.

Plaintiff claims in these proceedings that the Salog river changed its course and that the land in dispute which appears to be
a portion of the area added to Lot No. 2290 as above mentioned was separated from his Lot No. 908 by the current of the
river, and the separation was abrupt, like in avulsion, so that under Art. 374 of the Civil Code (Art. 463 of the new) he retains
ownership thereof. No evidence, however, was presented by plaintiff to show that the change in the course of the river was
sudden or that it occurred through avulsion. In the absence of such evidence, the presumption is that the change was gradual
and caused by accretion and erosion. (Payatas Estate Improvement Co. vs. Tuason, 53 Phil., 55) In any event, it was agreed
upon by the parties in open court that "from the year 1917 until the construction of the dike (in 1939) along the river . . ., the
course of the Salog river, starting from the edge of lot 2290, gradually ate up the bank towards the side of the poblacion of
Jaro and at the same time gradually deposited sediments towards the side of Lot No. 2290;" that "when the defendant bought
lot No. 2290 from Dr. Manuel Hechanova in 1950, he found out that there was an accretion along one side of said lot, as now
shown on this plan, PSU-12743-A;" that "by virtue of such accretion towards lot 2290, the defendant applied for its registration
under the Land Registration Act, and decision was on March 22, 1950 by the Court of First Instance of Iloilo;" that "effectively,
original certificate of title No. O-229, dated June 30, 1952, was issued to the defendant;" and that "because of the gradual
deposit of sediments of the Salog River along his land, lot 2290, the defendant has been in possession of said land since 1950
until now, while the plaintiff and his predecessors in interest since the gradual loss of lot No 908-Q, covered by water, has
never been in actual possession of the said lot." The foregoing facts have never been denied or contradicted by plaintiff, and
they clearly show that the increase in area of Lot No. 2290 by the river bank was due to alluvion or accretions which it
gradually received (from 1917 to 1939, or for a period of 22 years) from the effects of the current of the river.
It should here be stated that in the cadastral proceedings wherein the land object of this action was sought to be registered by
herein defendant Amador D. Garcia, plaintiff C.N. Hodges did not file any opposition despite due publication of the notice of the
application and hearing. The record also shows that the land now being claimed by plaintiff had been litigated in three civil
cases. (Exhs. "4", "5" and "6".) In those cases, herein defendant was recognized as the owner of the land and held legally
entitled to its possession. In fact, the land in question had been adjudged to be owned by him as an accretion to his lot No.
2290. (See exh. "6" decision of the Court of Appeals in Candelaria Efe, et al. vs. Amador D. Garcia, CA-G.R. No. 9306-R,
October 28, 1952, Reyes, J.B.L., J.,ponente.)

It clearly appearing that the land in question has become part of defendant's estate as a result of accretion, it follows that said
land now belongs to him. The fact that the accretion to his land used to pertain to plaintiff's estate, which is covered by a
Torrens certificate of title, cannot preclude him (defendant) from being the owner thereof. Registration does not protect the
riparian owner against the diminution of the area of his land through gradual changes in the course of the adjoining stream.
Accretions which the banks of rivers may gradually receive from the effect of the current become the property of the owners of
the banks. (Art. 366 of the old Civil Code; art. 457 of the new.) Such accretions are natural incidents to land bordering on

running streams and the provisions of the Civil Code in that respect are not affected by the Land Registration Act. (Payatas
Estate Improvement Co. vs. Tuason, supra).
In view of the foregoing, the decision appealed from is affirmed, with costs against plaintiff-appellant.