#9.1Didipio Earth Savers Multipurpose Association et al vs. DENR Sec Elisea Gozun et al G.R. No.

157882 March 30, 2006 FACTS: In 1987, Cory rolled out EO 279 w/c empowered DENR to stipulate with foreign companies when it comes to either technical or financial large scale exploration or mining. In 1995, Ramos signed into law RA 7942 or the Philippine Mining Act. In 1994, Ramos already signed an FTAA with Arimco Mining Co, an Australian company. The FTAA authorized AMC (later CAMC) to explore 37,000 ha of land in Quirino and Nueva Vizcaya including Brgy. Didipio. After the passage of the law, DENR rolled out its implementing Rules and Regulations. Didipio petitioned to have the law and the Rules and Regulation to be annulled as it is unconstitutional and it constitutes unlawful taking of property. In seeking to nullify Rep. Act No. 7942 and its implementing rules DAO 9640 as unconstitutional, petitioners set their sight on Section 76 of Rep. Act No. 7942 and Section 107 of DAO 96-40. Subsequently, AMC consolidated with Climax Mining Limited to form a single company that now goes under the new name of Climax-Arimco Mining Corporation (CAMC), the controlling 99% of stockholders of which are Australian nationals. Petitioners filed a demand letter addressed to then DENR Secretary Heherson Alvarez, for the cancellation of the CAMC FTAA for the primary reason that Rep. Act No. 7942 and its Implementing Rules and Regulations DAO 96-40 are unconstitutional. Petitioners thus filed the present petition for prohibition and mandamus, with a prayer for a temporary restraining order. ISSUE: 1. Whether or not RA 7942 and the DENR Rules and Regulations are valid for sanctioning an unconstitutional administrative process of determining just compensation? 2. Whether or not the State, through Republic Act No. 7942 and the CAMC FTAA, abdicated its primary responsibility to the full control and supervision over natural resources? 3. WHETHER OR NOT THE 1987 CONSTITUTION PROHIBITS SERVICE CONTRACTS? HELD: 1. The SC ruled against Didipio. The SC noted the requisites of eminent domain. They are:

(1) the expropriator must enter a private property;(2) the entry must be for more than a momentary period;(3) the entry must be under warrant or color of legal authority; (4) The property must be devoted to public use or otherwise informally appropriated or Injuriously affected ;(5) the utilization of the property for public use must be in such a way as to oust the owner and deprive him of beneficial enjoyment of the property. In the case at bar, Didipio failed to show that the law is invalid. Indeed there is taking involved but it is not w/o just compensation. Sec 76 of RA 7942 provides for just compensation as well as section 107 of the DENR Rules and Regulations. Furthermore, mining is a public policy and the government can invoke eminent domain to exercise entry, acquisition and use of private lands. 2. It has been ruled that the State may likewise compel the contractors compliance with mandatory requirements on mine safety, health and environmental protection, and the use of anti-pollution technology and facilities. Moreover, the contractor is also obligated to assist in the development of the mining community and to pay royalties to the indigenous peoples concerned. Cancellation of the FTAA may be the penalty for violation of any of its terms and conditions and/or noncompliance with statutes or regulations. Overall, considering the provisions of the statute and the regulations, the State definitely possesses the means by which it can have the ultimate word in the operation of the enterprise, set directions and objectives, and detect deviations and noncompliance by the contractor; likewise, it has the capability to enforce compliance and to impose sanctions, should the occasion therefore arise. In other words, the FTAA contractor is not free to do whatever it pleases and get away with it; on the contrary, it will have to follow the government line if it wants to stay in the enterprise. Ineluctably then, RA 7942 and DAO 96-40 vest in the government more than a sufficient degree of control and supervision over the conduct of mining operations. 3. As written by the framers and ratified and adopted by the people, the Constitution allows the continued use of service contracts with foreign corporations as contractors who would invest in and operate and manage extractive enterprises, subject to the full control and supervision of the State sans the abuses of the past regime. The purpose is clear: to develop and utilize our mineral, petroleum and other resources on a large scale for the immediate and tangible benefit of the Filipino people. The instant petition for prohibition and mandamus is hereby DISMISSED. Section 76

of Republic Act No. 7942 and Section 107 of DAO 96-40; Republic Act No. 7942 and its Implementing Rules and Regulations contained in DAO 96-40 insofar as they relate to financial and technical assistance agreements referred to in paragraph 4 of Section 2 of Article XII of the Constitution are NOT UNCONSTITUTIONAL. WHAT IS INHERENT POWERS OF THE STATE? >The power of the government or state to enforce and money mandatory or compulsory money contribution from the people to support the needs of the nation. 3 Inherent Powers of the State 1. POLICE POWER- is the power of promoting the public welfare by restraining and regulating the use of both liberty and property of all the people. It is considered to be the most all-encompassing of the three powers. It may be exercised only by the government. The property taken in the exercise of this power is destroyed because it is noxious or intended for a noxious purpose. Tests of the Police Power 1. Lawful Subject 2. Lawful Means
*LAWFUL SUBJECT--The activity or property sought to be regulated affects the public welfare. It requires the primacy of the welfare of the many over the interests of the few. Taxicab Operators of Metro Manila v. Board of Transportation: phasing out taxicabs more than 6 yrs. old- to protect the riding public and promote their comfort and convenience. *LAWFUL MEANS---Both the end and the means must be legitimate. Ynot v. IAC: the prohibition of the interprovincial transport of carabaos cannot prevent the indiscriminate slaughter because they can be killed anywhere.

2. EMINENT DOMAIN- It is the power of the State to forcibly take private property for public use upon payment of just compensation. Like police power, it is based on the overriding public necessity and is exercisable by the legislative department of the State. But unlike police power, eminent domain may be exercised

by private entities with the express valid delegation from the legislature. It can likewise be exercised by the President, administrative agencies and local governments. The power is usually exercised through the formal expropriation proceedings before a court which, when granted by the latter, will result to the actual taking of the property from its owners upon payment of just compensation. Requisites of Taking in Eminent Domain; 1. The expropriator must enter a private property. 2. The entry must be for more than a momentary period. 3. The entry must be under warrant or color of legal authority. 4. The property must be devoted to public use or otherwise informally appropriated or injuriously affected. 5. The utilization of the property for public use must be in such a way as to oust the owner and deprive him of beneficial enjoyment of the property. 3. TAXATION-It is the power by which the State exacts enforced proportional contribution from the people, property and exercise of a right within its territory to raise revenue for the purpose of defraying the necessary expenses of the government. The main theory supporting the exercise of the power is the so-called "lifeblood theory". The theory states that taxes are the lifeblood of the nation. Without the revenue raised from taxation, the government will not survive resulting to the detriment of the society. Without taxes, the government would be paralyzed for lack of motive power to activate and operate it. Another theory is the benefits-received theory which states that tax are imposed because of the reciprocal duties of protection and support between the State and the taxpayer. The taxpayer is liable to pay tax because of the protection it receives from the State. Summary: 1. Police Power for public good or welfare 2. Power of Eminent Domain for public use 3. Power of Taxation for revenue

9.2 CITY GOVERNMENT OF QUEZON CITY VS. ERICTA [122 SCRA 759; G.R. No. L-34915; 24 Jun 1983] Facts: Section 9 of Ordinance No. 6118, S-64, entitled "Ordinance Regulating The Establishment, Maintenance And Operation Of Private Memorial Type Cemetery Or Burial Ground Within The Jurisdiction Of Quezon City And Providing Penalties For The Violation Thereof" provides: Sec. 9. At least six (6) percent of the total area of the memorial park cemetery shall be set aside for charity burial of deceased persons who are paupers and have been residents of Quezon City for at least 5 years prior to their death, to be determined by competent City Authorities. The area so designated shall immediately be developed and should be open for operation not later than six months from the date of approval of the application. For several years, the afore quoted section of the Ordinance was not enforced but seven years after the enactment of the ordinance, the Quezon City Council passed a resolution to request the City Engineer, Quezon City, to stop any further selling and/or transaction of memorial park lots in Quezon City where the owners thereof have failed to donate the required 6% space intended for paupers burial. The Quezon City Engineer then notified respondent Himalayang Pilipino, Inc. in writing that Section 9 of the ordinance would be enforced. Respondent Himalayang Pilipino reacted by filing a petition for declaratory relief, prohibition and mandamus with preliminary injunction seeking to annul Section 9 of the Ordinance in question. Respondent alleged that the same is contrary to the Constitution, the Quezon City Charter, the Local Autonomy Act, and the Revised Administrative Code. Issue: Whether or Not Section 9 of the ordinance in question is a valid exercise of police power. Held: Section 9 of the City ordinance in question is not a valid exercise of police power. Section 9 cannot be justified under the power granted to Quezon City to tax, fix the license fee, and regulate such other business, trades, and occupation as may be established or practiced in the City.

Bill of rights states that 'no person shall be deprived of life, liberty or property without due process of law' (Art. Ill, Section 1 subparagraph 1, Constitution). On the other hand, there are three inherent powers of government by which the state interferes with the property rights, namely-. (1) police power, (2) eminent domain, (3) taxation. The police power of Quezon City is defined in sub-section 00, Sec. 12, Rep. Act 537 that reads as follows: To make such further ordinance and regulations not repugnant to law as may be necessary to carry into effect and discharge the powers and duties conferred by this act and such as it shall deem necessary and proper to provide for the health and safety, , and for the protection of property therein; and enforce obedience thereto with such lawful fines or penalties as the City Council may prescribe under the provisions of subsection (jj) of this section. The power to regulate does not include the power to prohibit. The power to regulate does not include the power to confiscate. The ordinance in question not only confiscates but also prohibits the operation of a memorial park cemetery, because under Section 13 of said ordinance, 'Violation of the provision thereof is punishable with a fine and/or imprisonment and that upon conviction thereof the permit to operate and maintain a private cemetery shall be revoked or cancelled. The confiscatory clause and the penal provision in effect deter one from operating a memorial park cemetery. Moreover, police power is defined by Freund as 'the power of promoting the public welfare by restraining and regulating the use of liberty and property'. It is usually exerted in order to merely regulate the use and enjoyment of property of the owner. If he is deprived of his property outright, it is not taken for public use but rather to destroy in order to promote the general welfare. It seems to the court that Section 9 of Ordinance No. 6118, Series of 1964 of Quezon City is not a mere police regulation but an outright confiscation. It deprives a person of his private property without due process of law, nay, even without compensation.