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G.R. No.

L-630 November 15, 1947 full advantage of by many, with the circumstance that perhaps the constitutional
ALEXANDER A. KRIVENKO, petitioner-appellant, question may never come up again before this court, because both vendors and vendees
vs. will have no interest but to uphold the validity of their transactions, and very unlikely
THE REGISTER OF DEEDS, CITY OF MANILA, respondent and appellee. will the register of deeds venture to disobey the orders of their superior. Thus, the
Gibbs, Gibbs, Chuidian and Quasha of petitioner-appellant. possibility for this court to voice its conviction in a future case may be remote, with the
First Assistant Solicitor General Reyes and Solicitor Carreon for respondent-appellee. result that our indifference of today might signify a permanent offense to the
Marcelino Lontok appeared as amicus curies. Constitution.
MORAN, C.J.: All thse circumstances were thoroughly considered and weighted by this Court for a
Alenxander A. Kriventor alien, bought a residential lot from the Magdalena Estate, Inc., in number of days and the legal result of the last vote was a denial of the motion
December of 1941, the registration of which was interrupted by the war. In May, 1945, withdrawing the appeal. We are thus confronted, at this stage of the proceedings, with
he sought to accomplish said registration but was denied by the register of deeds of our duty, the constitutional question becomes unavoidable. We shall then proceed to
Manila on the ground that, being an alien, he cannot acquire land in this jurisdiction. decide that question.
Krivenko then brought the case to the fourth branch of the Court of First Instance of Article XIII, section 1, of the Constitutional is as follows:
Manila by means of a consulta, and that court rendered judgment sustaining the refusal Article XIII. — Conservation and utilization of natural resources.
of the register of deeds, from which Krivenko appealed to this Court. SECTION 1. All agricultural, timber, and mineral lands of the public domain,
There is no dispute as to these facts. The real point in issue is whether or not an alien water, minerals, coal, petroleum, and other mineral oils, all forces of potential
under our Constitution may acquire residential land. energy, and other natural resources of the Philippines belong to the State, and
It is said that the decision of the case on the merits is unnecessary, there being a motion their disposition, exploitation, development, or utilization shall be limited to
to withdraw the appeal which should have been granted outright, and reference is made citizens of the Philippines, or to corporations or associations at least sixty per
to the ruling laid down by this Court in another case to the effect that a court should not centum of the capital of which is owned by such citizens, subject to any existing
pass upon a constitutional question if its judgment may be made to rest upon other right, grant, lease, or concession at the time of the inaguration of the
grounds. There is, we believe, a confusion of ideas in this reasoning. It cannot be denied Government established uunder this Constitution. Natural resources, with the
that the constitutional question is unavoidable if we choose to decide this case upon the exception of public agricultural land, shall not be alienated, and no licence,
merits. Our judgment cannot to be made to rest upon other grounds if we have to render concession, or lease for the exploitation, development, or utilization of any of
any judgment at all. And we cannot avoid our judgment simply because we have to avoid the natural resources shall be granted for a period exceeding twenty-five years,
a constitutional question. We cannot, for instance, grant the motion withdrawing the renewable for another twenty-five years, except as to water rights for
appeal only because we wish to evade the constitutional; issue. Whether the motion irrigation, water supply, fisheries, or industrial uses other than the
should be, or should not be, granted, is a question involving different considerations now development of water "power" in which cases beneficial use may be the
to be stated. measure and the limit of the grant.
According to Rule 52, section 4, of the Rules of Court, it is discretionary upon this Court The scope of this constitutional provision, according to its heading and its language,
to grant a withdrawal of appeal after the briefs have been presented. At the time the embraces all lands of any kind of the public domain, its purpose being to establish a
motion for withdrawal was filed in this case, not only had the briefs been prensented, but permanent and fundamental policy for the conservation and utilization of all natural
the case had already been voted and the majority decision was being prepared. The resources of the Nation. When, therefore, this provision, with reference to lands of the
motion for withdrawal stated no reason whatsoever, and the Solicitor General was public domain, makes mention of only agricultural, timber and mineral lands, it means
agreeable to it. While the motion was pending in this Court, came the new circular of the that all lands of the public domain are classified into said three groups, namely,
Department of Justice, instructing all register of deeds to accept for registration all agricultural, timber and mineral. And this classification finds corroboration in the
transfers of residential lots to aliens. The herein respondent-appellee was naturally one circumstance that at the time of the adoption of the Constitution, that was the basic
of the registers of deeds to obey the new circular, as against his own stand in this case classification existing in the public laws and judicial decisions in the Philippines, and the
which had been maintained by the trial court and firmly defended in this Court by the term "public agricultural lands" under said classification had then acquired a technical
Solicitor General. If we grant the withdrawal, the the result would be that petitioner- meaning that was well-known to the members of the Constitutional Convention who
appellant Alexander A. Krivenko wins his case, not by a decision of this Court, but by the were mostly members of the legal profession.
decision or circular of the Department of Justice, issued while this case was pending As early as 1908, in the case of Mapa vs. Insular Government (10 Phil., 175, 182), this
before this Court. Whether or not this is the reason why appellant seeks the withdrawal Court said that the phrase "agricultural public lands" as defined in the Act of Congress of
of his appeal and why the Solicitor General readily agrees to that withdrawal, is now July 1, 1902, which phrase is also to be found in several sections of the Public Land Act
immaterial. What is material and indeed very important, is whether or not we should (No. 926), means "those public lands acquired from Spain which are neither mineral for
allow interference with the regular and complete exercise by this Court of its timber lands." This definition has been followed in long line of decisions of this Court.
constitutional functions, and whether or not after having held long deliberations and (See Montano vs.Insular Government, 12 Phil., 593; Ibañez de Aldecoa vs. Insular
after having reached a clear and positive conviction as to what the constitutional Government, 13 Phil., 159; Ramos vs. Director of Lands, 39 Phil., 175; Jocson vs. Director
mandate is, we may still allow our conviction to be silenced, and the constitutional of Forestry, 39 Phil., 560; Ankron vs. Government of the Philippines, 40 Phil., 10.) And
mandate to be ignored or misconceived, with all the harmful consequences that might be with respect to residential lands, it has been held that since they are neither mineral nor
brought upon the national patromony. For it is but natural that the new circular be taken
timber lands, of necessity they must be classified as agricultural. In Ibañez de lots are considered as agricultural lands, for, under the Constitution, only agricultural
Aldecoa vs. Insular Government (13 Phil., 159, 163), this Court said: lands may be alienated.
Hence, any parcel of land or building lot is susceptible of cultivation, and may It is true that in section 9 of said Commonwealth Act No. 141, "alienable or disposable
be converted into a field, and planted with all kinds of vegetation; for this public lands" which are the same "public agriculture lands" under the Constitution, are
reason, where land is not mining or forestal in its nature, it must necessarily be classified into agricultural, residential, commercial, industrial and for other puposes.
included within the classification of agricultural land, not because it is actually This simply means that the term "public agricultural lands" has both a broad and a
used for the purposes of agriculture, but because it was originally agricultural particular meaning. Under its broad or general meaning, as used in the Constitution, it
and may again become so under other circumstances; besides, the Act of embraces all lands that are neither timber nor mineral. This broad meaning is
Congress contains only three classification, and makes no special provision particularized in section 9 of Commonwealth Act No. 141 which classifies "public
with respect to building lots or urban lands that have ceased to be agricultural agricultural lands" for purposes of alienation or disposition, into lands that are stricly
land. agricultural or actually devoted to cultivation for agricultural puposes; lands that are
In other words, the Court ruled that in determining whether a parcel of land is residential; commercial; industrial; or lands for other purposes. The fact that these lands
agricultural, the test is not only whether it is actually agricultural, but also its are made alienable or disposable under Commonwealth Act No. 141, in favor of Filipino
susceptibility to cultivation for agricultural purposes. But whatever the test might be, the citizens, is a conclusive indication of their character as public agricultural lands under
fact remains that at the time the Constitution was adopted, lands of the public domain said statute and under the Constitution.
were classified in our laws and jurisprudence into agricultural, mineral, and timber, and It must be observed, in this connection that prior to the Constitution, under section 24 of
that the term "public agricultural lands" was construed as referring to those lands that Public Land Act No. 2874, aliens could acquire public agricultural lands used for
were not timber or mineral, and as including residential lands. It may safely be industrial or residential puposes, but after the Constitution and under section 23 of
presumed, therefore, that what the members of the Constitutional Convention had in Commonwealth Act No. 141, the right of aliens to acquire such kind of lands is
mind when they drafted the Constitution was this well-known classification and its completely stricken out, undoubtedly in pursuance of the constitutional limitation. And,
technical meaning then prevailing. again, prior to the Constitution, under section 57 of Public Land Act No. 2874, land of the
Certain expressions which appear in Constitutions, . . . are obviously technical; public domain suitable for residence or industrial purposes could be sold or leased to
and where such words have been in use prior to the adoption of a Constitution, aliens, but after the Constitution and under section 60 of Commonwealth Act No. 141,
it is presumed that its framers and the people who ratified it have used such such land may only be leased, but not sold, to aliens, and the lease granted shall only be
expressions in accordance with their technical meaning. (11 Am. Jur., sec. 66, p. valid while the land is used for the purposes referred to. The exclusion of sale in the new
683.) AlsoCalder vs. Bull, 3 Dall. [U.S.], 386; 1 Law. ed., 648; Act is undoubtedly in pursuance of the constitutional limitation, and this again is another
Bronson vs. Syverson, 88 Wash., 264; 152 P., 1039.) legislative construction that the term "public agricultural land" includes land for
It is a fundamental rule that, in construing constitutions, terms employed residence purposes.
therein shall be given the meaning which had been put upon them, and which Such legislative interpretation is also in harmony with the interpretation given by the
they possessed, at the time of the framing and adoption of the instrument. If a Executive Department of the Government. Way back in 1939, Secretary of Justice Jose
word has acquired a fixed, technical meaning in legal and constitutional history, Abad Santos, in answer to a query as to "whether or not the phrase 'public agricultural
it will be presumed to have been employed in that sense in a written lands' in section 1 of Article XII (now XIII) of the Constitution may be interpreted to
Constitution. (McKinney vs. Barker, 180 Ky., 526; 203 S.W., 303; L.R.A., 1918 E, include residential, commercial, and industrial lands for purposes of their disposition,"
581.) rendered the following short, sharp and crystal-clear opinion:
Where words have been long used in a technical sense and have been judicially Section 1, Article XII (now XIII) of the Constitution classifies lands of the public
construed to have a certain meaning, and have been adopted by the legislature domain in the Philippines into agricultural, timber and mineral. This is the basic
as having a certain meaning prior to a particular statute in which they are used, classification adopted since the enactment of the Act of Congress of July 1,
the rule of construction requires that the words used in such statute should be 1902, known as the Philippine Bill. At the time of the adoption of the
construed according to the sense in which they have been so previously used, Constitution of the Philippines, the term 'agricultural public lands' and,
although the sense may vary from strict literal meaning of the words. (II therefore, acquired a technical meaning in our public laws. The Supreme Court
Sutherland, Statutory Construction, p. 758.) of the Philippines in the leading case of Mapa vs. Insular Government, 10 Phil.,
Therefore, the phrase "public agricultural lands" appearing in section 1 of Article XIII of 175, held that the phrase 'agricultural public lands' means those public lands
the Constitution must be construed as including residential lands, and this is in acquired from Spain which are neither timber nor mineral lands. This definition
conformity with a legislative interpretation given after the adoption of the Constitution. has been followed by our Supreme Court in many subsequent case. . . .
Well known is the rule that "where the Legislature has revised a statute after a Residential commercial, or industrial lots forming part of the public domain
Constitution has been adopted, such a revision is to be regarded as a legislative must have to be included in one or more of these classes. Clearly, they are
construction that the statute so revised conforms to the Constitution." (59 C.J., 1102.) neither timber nor mineral, of necessity, therefore, they must be classified as
Soon after the Constitution was adopted, the National Assembly revised the Public Land agricultural.
Law and passed Commonwealth Act No. 141, and sections 58, 59 and 60 thereof permit Viewed from another angle, it has been held that in determining whether lands
the sale of residential lots to Filipino citizens or to associations or corporations are agricultural or not, the character of the land is the test (Odell vs. Durant, 62
controlled by such citizens, which is equivalent to a solemn declaration that residential N.W., 524; Lorch vs. Missoula Brick and Tile Co., 123 p.25). In other words, it is
the susceptibility of the land to cultivation for agricultural purposes by particularly having in mind that the purpose of the constitutional provision is the
ordinary farming methods which determines whether it is agricultural or not conservation of the national patrimony, and private residential lands are as much an
(State vs. Stewart, 190 p. 129). integral part of the national patrimony as the residential lands of the public domain.
Furthermore, as said by the Director of Lands, no reason is seen why a piece of Specially is this so where, as indicated above, the prohibition as to the alienable of public
land, which may be sold to a person if he is to devote it to agricultural, cannot residential lots would become superflous if the same prohibition is not equally applied to
be sold to him if he intends to use it as a site for his home. private residential lots. Indeed, the prohibition as to private residential lands will
This opinion is important not alone because it comes from a Secratary of Justice who eventually become more important, for time will come when, in view of the constant
later became the Chief Justice of this Court, but also because it was rendered by a disposition of public lands in favor of private individuals, almost all, if not all, the
member of the cabinet of the late President Quezon who actively participated in the residential lands of the public domain shall have become private residential lands.
drafting of the constitutional provision under consideration. (2 Aruego, Framing of the It is maintained that in the first draft of section 5, the words "no land of private
Philippine Constitution, p. 598.) And the opinion of the Quezon administration was ownership" were used and later changed into "no agricultural land of private
reiterated by the Secretary of Justice under the Osmeña administration, and it was firmly ownership," and lastly into "no private agricultural land" and from these changes it is
maintained in this Court by the Solicitor General of both administrations. argued that the word "agricultural" introduced in the second and final drafts was
It is thus clear that the three great departments of the Government — judicial, legislative intended to limit the meaning of the word "land" to land actually used for agricultural
and executive — have always maintained that lands of the public domain are classified purposes. The implication is not accurate. The wording of the first draft was amended for
into agricultural, mineral and timber, and that agricultural lands include residential lots. no other purpose than to clarify concepts and avoid uncertainties. The words "no land"
Under section 1 of Article XIII of the Constitution, "natural resources, with the exception of the first draft, unqualified by the word "agricultural," may be mistaken to include
of public agricultural land, shall not be aliented," and with respect to public agricultural timber and mineral lands, and since under section 1, this kind of lands can never be
lands, their alienation is limited to Filipino citizens. But this constitutional purpose private, the prohibition to transfer the same would be superfluous. Upon the other hand,
conserving agricultural resources in the hands of Filipino citizens may easily be defeated section 5 had to be drafted in harmony with section 1 to which it is supplementary, as
by the Filipino citizens themselves who may alienate their agricultural lands in favor of above indicated. Inasmuch as under section 1, timber and mineral lands can never be
aliens. It is partly to prevent this result that section 5 is included in Article XIII, and it private, and the only lands that may become private are agricultural lands, the words "no
reads as follows: land of private ownership" of the first draft can have no other meaning than "private
Sec. 5. Save in cases of hereditary succession, no private agricultural land will agricultural land." And thus the change in the final draft is merely one of words in order
be transferred or assigned except to individuals, corporations, or associations to make its subject matter more specific with a view to avoiding the possible confusion of
qualified to acquire or hold lands of the public domain in the Philippines. ideas that could have arisen from the first draft.
This constitutional provision closes the only remaining avenue through which If the term "private agricultural lands" is to be construed as not including residential lots
agricultural resources may leak into aliens' hands. It would certainly be futile to prohibit or lands not strictly agricultural, the result would be that "aliens may freely acquire and
the alienation of public agricultural lands to aliens if, after all, they may be freely so possess not only residential lots and houses for themselves but entire subdivisions, and
alienated upon their becoming private agricultural lands in the hands of Filipino citizens. whole towns and cities," and that "they may validly buy and hold in their names lands of
Undoubtedly, as above indicated, section 5 is intended to insure the policy of any area for building homes, factories, industrial plants, fisheries, hatcheries, schools,
nationalization contained in section 1. Both sections must, therefore, be read together for health and vacation resorts, markets, golf courses, playgrounds, airfields, and a host of
they have the same purpose and the same subject matter. It must be noticed that the other uses and purposes that are not, in appellant's words, strictly agricultural."
persons against whom the prohibition is directed in section 5 are the very same persons (Solicitor General's Brief, p. 6.) That this is obnoxious to the conservative spirit of the
who under section 1 are disqualified "to acquire or hold lands of the public domain in the Constitution is beyond question.
Philippines." And the subject matter of both sections is the same, namely, the non- One of the fundamental principles underlying the provision of Article XIII of the
transferability of "agricultural land" to aliens. Since "agricultural land" under section 1 Constitution and which was embodied in the report of the Committee on Nationalization
includes residential lots, the same technical meaning should be attached to "agricultural and Preservation of Lands and other Natural Resources of the Constitutional Convention,
land under section 5. It is a rule of statutory construction that "a word or phrase is "that lands, minerals, forests, and other natural resources constitute the exclusive
repeated in a statute will bear the same meaning throughout the statute, unless a heritage of the Filipino nation. They should, therefore, be preserved for those under the
different intention appears." (II Sutherland, Statutory Construction, p. 758.) The only sovereign authority of that nation and for their posterity." (2 Aruego, Framing of the
difference between "agricultural land" under section 5, is that the former is public and Filipino Constitution, p. 595.) Delegate Ledesma, Chairman of the Committee on
the latter private. But such difference refers to ownership and not to the class of land. Agricultural Development of the Constitutional Convention, in a speech delivered in
The lands are the same in both sections, and, for the conservation of the national connection with the national policy on agricultural lands, said: "The exclusion of aliens
patrimony, what is important is the nature or class of the property regardless of whether from the privilege of acquiring public agricultural lands and of owning real estate is a
it is owned by the State or by its citizens. necessary part of the Public Land Laws of the Philippines to keep pace with the idea of
Reference is made to an opinion rendered on September 19, 1941, by the Hon. Teofilo preserving the Philippines for the Filipinos." (Emphasis ours.) And, of the same tenor
Sison, then Secretary of Justice, to the effect that residential lands of the public domain was the speech of Delegate Montilla who said: "With the complete nationalization of our
may be considered as agricultural lands, whereas residential lands of private ownership lands and natural resources it is to be understood that our God-given birthright should
cannot be so considered. No reason whatsoever is given in the opinion for such a be one hundred per cent in Filipino hands . . .. Lands and natural resources are
distinction, and no valid reason can be adduced for such a discriminatory view, immovables and as such can be compared to the vital organs of a person's body, the lack
of possession of which may cause instant death or the shortening of life. If we do not same under the provisions of this Act, such persons, corporations, or
completely antionalize these two of our most important belongings, I am afraid that the associations shall be obliged to alienate said lands or improvements to others
time will come when we shall be sorry for the time we were born. Our independence will so capacitated within the precise period of five years, under the penalty of such
be just a mockery, for what kind of independence are we going to have if a part of our property reverting to the Government in the contrary case." (Public Land Act,
country is not in our hands but in those of foreigners?" (Emphasis ours.) Professor No. 2874.)
Aruego says that since the opening days of the Constitutional Convention one of its fixed It is to be observed that the pharase "no land" used in these section refers to all private
and dominating objectives was the conservation and nationalization of the natural lands, whether strictly agricultural, residential or otherwise, there being practically no
resources of the country. (2 Aruego, Framing of the Philippine Constitution, p 592.) This private land which had not been acquired by any of the means provided in said two
is ratified by the members of the Constitutional Convention who are now members of sections. Therefore, the prohibition contained in these two provisions was, in effect, that
this Court, namely, Mr. Justice Perfecto, Mr. Justice Briones, and Mr. Justice Hontiveros. no private land could be transferred to aliens except "upon express authorization by the
And, indeed, if under Article XIV, section 8, of the Constitution, an alien may not even Philippine Legislature, to citizens of Philippine Islands the same right to acquire, hold,
operate a small jitney for hire, it is certainly not hard to understand that neither is he lease, encumber, dispose of, or alienate land." In other words, aliens were granted the
allowed to own a pieace of land. right to acquire private land merely by way of reciprocity. Then came the Constitution
This constitutional intent is made more patent and is strongly implemented by an act of and Commonwealth Act No. 141 was passed, sections 122 and 123 of which read as
the National Assembly passed soon after the Constitution was approved. We are follows:
referring again to Commonwealth Act No. 141. Prior to the Constitution, there were in SEC. 122. No land originally acquired in any manner under the provisions of
the Public Land Act No. 2874 sections 120 and 121 which granted aliens the right to this Act, nor any permanent improvement on such land, shall be encumbered,
acquire private only by way of reciprocity. Said section reads as follows: alienated, or transferred, except to persons, corporations, associations, or
SEC. 120. No land originally acquired in any manner under the provisions of partnerships who may acquire lands of the public domain under this Act or to
this Act, nor any permanent improvement on such land, shall be encumbered, corporations organized in the Philippines authorized thereof by their charters.
alienated, or transferred, except to persons, corporations, associations, or SEC. 123. No land originally acquired in any manner under the provisions of
partnerships who may acquire lands of the public domain under this Act; to any previous Act, ordinance, royal order, royal decree, or any other provision of
corporations organized in the Philippine Islands authorized therefor by their law formerly in force in the Philippines with regard to public lands terrenos
charters, and, upon express authorization by the Philippine Legislature, to baldios y realengos, or lands of any other denomination that were actually or
citizens of countries the laws of which grant to citizens of the Philippine Islands presumptively of the public domain, or by royal grant or in any other form, nor
the same right to acquire, hold, lease, encumber, dispose of, or alienate land, or any permanent improvement on such land, shall be encumbered, alienated, or
permanent improvements thereon, or any interest therein, as to their own conveyed, except to persons, corporations or associations who may acquire
citizens, only in the manner and to the extent specified in such laws, and while land of the public domain under this Act or to corporate bodies organized in the
the same are in force but not thereafter. Philippines whose charters authorize them to do so: Provided, however, That
SEC. 121. No land originally acquired in any manner under the provisions of the this prohibition shall not be applicable to the conveyance or acquisition by
former Public Land Act or of any other Act, ordinance, royal order, royal decree, reason of hereditary succession duly acknowledged and legalized by competent
or any other provision of law formerly in force in the Philippine Islands with courts: Provided, further, That in the event of the ownership of the lands and
regard to public lands, terrenos baldios y realengos, or lands of any other improvements mentioned in this section and in the last preceding section being
denomination that were actually or presumptively of the public domain or by transferred by judicial decree to persons, corporations or associations not
royal grant or in any other form, nor any permanent improvement on such legally capacitated to acquire the same under the provisions of this Act, such
land, shall be encumbered, alienated, or conveyed, except to persons, persons, corporations, or associations shall be obliged to alienate said lands or
corporations, or associations who may acquire land of the public domain under improvements to others so capacitated within the precise period of five years;
this Act; to corporate bodies organized in the Philippine Islands whose charters otherwise, such property shall revert to the Government.
may authorize them to do so, and, upon express authorization by the Philippine These two sections are almost literally the same as sections 120 and 121 of Act No. 2874,
Legislature, to citizens of the countries the laws of which grant to citizens of the the only difference being that in the new provisions, the right to reciprocity granted to
Philippine Islands the same right to acquire, hold, lease, encumber, dispose of, aliens is completely stricken out. This, undoubtedly, is to conform to the absolute policy
or alienate land or pemanent improvements thereon or any interest therein, as contained in section 5 of Article XIII of the Constitution which, in prohibiting the
to their own citizens, and only in the manner and to the extent specified in such alienation of private agricultural lands to aliens, grants them no right of reciprocity. This
laws, and while the same are in force, but not thereafter: Provided, however, legislative construction carries exceptional weight, for prominent members of the
That this prohibition shall not be applicable to the conveyance or acquisition by National Assembly who approved the new Act had been members of the Constitutional
reason of hereditary succession duly acknowledged and legalized by competent Convention.
courts, nor to lands and improvements acquired or held for industrial or It is said that the lot question does not come within the purview of sections
residence purposes, while used for such purposes: Provided, further, That in
the event of the ownership of the lands and improvements mentioned in this
section and in the last preceding section being transferred by judicial decree to
persons,corporations or associations not legally capacitated to acquire the
[G.R. No. 143958. July 11, 2003] name would appear in the deed of sale as the buyer of the property, as well as in the title
ALFRED FRITZ FRENZEL, petitioner, vs. EDERLINA P. CATITO, respondent. covering the same. After all, he was planning to marry Ederlina and he believed that after
DECISION their marriage, the two of them would jointly own the property. On January 23, 1984, a
CALLEJO, SR., J.: Contract to Sell was entered into between Victoria Binuya Steckel as the vendor and
Before us is a petition for review of the Decision[1] of the Court of Appeals in CA- Ederlina as the sole vendee. Alfred signed therein as a witness.[6] Victoria received from
G.R. CV No. 53485 which affirmed the Decision[2] of the Regional Trial Court of Davao Alfred, for and in behalf of Ederlina, the amount of US$10,000.00 as partial payment, for
City, Branch 14, in Civil Case No. 17,817 dismissing the petitioners complaint, and the which Victoria issued a receipt.[7] When Victoria executed the deed of absolute sale over
resolution of the Court of Appeals denying his motion for reconsideration of the said the property on March 6, 1984,[8] she received from Alfred, for and in behalf of Ederlina,
decision. the amount of US$10,000.00 as final and full payment. Victoria likewise issued a receipt
The Antecedents[3] for the said amount.[9] After Victoria had vacated the property, Ederlina moved into her
As gleaned from the evidence of the petitioner, the case at bar stemmed from the new house. When she left for Germany to visit Klaus, she had her father Narciso Catito
following factual backdrop: and her two sisters occupy the property.
Petitioner Alfred Fritz Frenzel is an Australian citizen of German descent. He is an Alfred decided to stay in the Philippines for good and live with Ederlina. He
electrical engineer by profession, but worked as a pilot with the New Guinea Airlines. He returned to Australia and sold his fiber glass pleasure boat to John Reid for $7,500.00 on
arrived in the Philippines in 1974, started engaging in business in the country two years May 4, 1984.[10] He also sold his television and video business in Papua New Guinea for
thereafter, and married Teresita Santos, a Filipino citizen. In 1981, Alfred and Teresita K135,000.00 to Tekeraoi Pty. Ltd.[11] He had his personal properties shipped to the
separated from bed and board without obtaining a divorce. Philippines and stored at No. 14 Fernandez Street, San Francisco del Monte, Quezon
Sometime in February 1983, Alfred arrived in Sydney, Australia for a vacation. He City. The proceeds of the sale were deposited in Alfreds account with the Hong Kong
went to Kings Cross, a night spot in Sydney, for a massage where he met Ederlina Catito, Shanghai Banking Corporation (HSBC), Kowloon Branch under Bank Account No. 018-2-
a Filipina and a native of Bajada, Davao City. Unknown to Alfred, she resided for a time in 807016.[12] When Alfred was in Papua New Guinea selling his other properties, the bank
Germany and was married to Klaus Muller, a German national. She left Germany and sent telegraphic letters updating him of his account.[13] Several checks were credited to
tried her luck in Sydney, Australia, where she found employment as a masseuse in the his HSBC bank account from Papua New Guinea Banking Corporation, Westpac Bank of
Kings Cross nightclub. She was fluent in German, and Alfred enjoyed talking with her. Australia and New Zealand Banking Group Limited and Westpac BankPNG-Limited.
The two saw each other again; this time Ederlina ended up staying in Alfreds hotel for Alfred also had a peso savings account with HSBC, Manila, under Savings Account No. 01-
three days. Alfred gave Ederlina sums of money for her services.[4] 725-183-01.[14]
Alfred was so enamored with Ederlina that he persuaded her to stop working at Once, when Alfred and Ederlina were in Hong Kong, they opened another account
Kings Cross, return to the Philippines, and engage in a wholesome business of her own. with HSBC, Kowloon, this time in the name of Ederlina, under Savings Account No. 018-0-
He also proposed that they meet in Manila, to which she assented. Alfred gave her money 807950.[15] Alfred transferred his deposits in Savings Account No. 018-2-807016 with
for her plane fare to the Philippines. Within two weeks of Ederlinas arrival in Manila, the said bank to this new account. Ederlina also opened a savings account with the Bank
Alfred joined her. Alfred reiterated his proposal for Ederlina to stay in the Philippines of America Kowloon Main Office under Account No. 30069016.[16]
and engage in business, even offering to finance her business venture. Ederlina was On July 28, 1984, while Alfred was in Papua New Guinea, he received a Letter dated
delighted at the idea and proposed to put up a beauty parlor. Alfred happily agreed. December 7, 1983 from Klaus Muller who was then residing in Berlin, Germany. Klaus
Alfred told Ederlina that he was married but that he was eager to divorce his wife informed Alfred that he and Ederlina had been married on October 16, 1978 and had a
in Australia. Alfred proposed marriage to Ederlina, but she replied that they should wait blissful married life until Alfred intruded therein. Klaus stated that he knew of Alfred and
a little bit longer. Ederlinas amorous relationship, and discovered the same sometime in November 1983
Ederlina found a building at No. 444 M.H. del Pilar corner Arquiza Street, Ermita, when he arrived in Manila. He also begged Alfred to leave Ederlina alone and to return
Manila, owned by one Atty. Jose Hidalgo who offered to convey his rights over the her to him, saying that Alfred could not possibly build his future on his (Klaus)
property for P18,000.00. Alfred and Ederlina accepted the offer. Ederlina put up a beauty misfortune.[17]
parlor on the property under the business name Edorial Beauty Salon, and had it Alfred had occasion to talk to Sally MacCarron, a close friend of Ederlina. He
registered with the Department of Trade and Industry under her name. Alfred paid Atty. inquired if there was any truth to Klaus statements and Sally confirmed that Klaus was
Hidalgo P20,000.00 for his right over the property and gave P300,000.00 to Ederlina for married to Ederlina. When Alfred confronted Ederlina, she admitted that she and Klaus
the purchase of equipment and furnitures for the parlor. As Ederlina was going to were, indeed, married. But she assured Alfred that she would divorce Klaus. Alfred was
Germany, she executed a special power of attorney on December 13, 1983 [5] appointing appeased. He agreed to continue the amorous relationship and wait for the outcome of
her brother, Aser Catito, as her attorney-in-fact in managing the beauty parlor Ederlinas petition for divorce. After all, he intended to marry her. He retained the
business. She stated in the said deed that she was married to Klaus Muller. Alfred went services of Rechtsanwltin Banzhaf with offices in Berlin, as her counsel who informed
back to Papua New Guinea to resume his work as a pilot. her of the progress of the proceedings.[18] Alfred paid for the services of the lawyer.
When Alfred returned to the Philippines, he visited Ederlina in her Manila In the meantime, Alfred decided to purchase another house and lot, owned by
residence and found it unsuitable for her. He decided to purchase a house and lot owned Rodolfo Morelos covered by TCT No. 92456 located in Pea Street, Bajada, Davao
byVictoria Binuya Steckel in San Francisco del Monte, Quezon City, covered by Transfer City.[19]Alfred again agreed to have the deed of sale made out in the name of Ederlina. On
Certificate of Title No. 218429 for US$20,000.00. Since Alfred knew that as an alien he September 7, 1984, Rodolfo Morelos executed a deed of absolute sale over the said
was disqualified from owning lands in the Philippines, he agreed that only Ederlinas
property in favor of Ederlina as the sole vendee for the amount of P80,000.00.[20] Alfred thereafter executed an affidavit-complaint charging Ederlina and Sally MacCarron with
paid US$12,500.00 for the property. malicious mischief.[31]
Alfred purchased another parcel of land from one Atty. Mardoecheo On October 15, 1985, Alfred wrote to Ederlinas father, complaining that Ederlina
Camporedondo, located in Moncado, Babak, Davao, covered by TCT No. 35251. Alfred had taken all his life savings and because of this, he was virtually penniless. He further
once more agreed for the name of Ederlina to appear as the sole vendee in the deed of accused the Catito family of acquiring for themselves the properties he had purchased
sale. On December 31, 1984, Atty. Camporedondo executed a deed of sale over the with his own money. He demanded the return of all the amounts that Ederlina and her
property for P65,000.00 in favor of Ederlina as the sole vendee.[21] Alfred, through family had stolen and turn over all the properties acquired by him and Ederlina during
Ederlina, paid the lot at the cost of P33,682.00 and US$7,000.00, respectively, for which their coverture.[32]
the vendor signed receipts.[22] On August 14, 1985, TCT No. 47246 was issued to Ederlina Shortly thereafter, Alfred filed a Complaint[33] dated October 28, 1985, against
as the sole owner of the said property.[23] Ederlina, with the Regional Trial Court of Quezon City, for recovery of real and personal
Meanwhile, Ederlina deposited on December 27, 1985, the total amount of properties located in Quezon City and Manila. In his complaint, Alfred alleged, inter alia,
US$250,000 with the HSBC Kowloon under Joint Deposit Account No. 018-462341- that Ederlina, without his knowledge and consent, managed to transfer funds from their
145.[24] joint account in HSBC Hong Kong, to her own account with the same bank. Using the said
The couple decided to put up a beach resort on a four-hectare land in Camudmud, funds, Ederlina was able to purchase the properties subject of the complaints. He also
Babak, Davao, owned by spouses Enrique and Rosela Serrano. Alfred purchased the alleged that the beauty parlor in Ermita was established with his own funds, and that the
property from the spouses for P90,000.00, and the latter issued a receipt therefor.[25] A Quezon City property was likewise acquired by him with his personal funds.[34]
draftsman commissioned by the couple submitted a sketch of the beach resort.[26] Beach Ederlina failed to file her answer and was declared in default. Alfred adduced his
houses were forthwith constructed on a portion of the property and were eventually evidence ex-parte.
rented out by Ederlinas father, Narciso Catito. The rentals were collected by Narciso, In the meantime, on November 7, 1985, Alfred also filed a complaint [35] against
while Ederlina kept the proceeds of the sale of copra from the coconut trees in the Ederlina with the Regional Trial Court, Davao City, for specific performance, declaration
property. By this time, Alfred had already spent P200,000.00 for the purchase, of ownership of real and personal properties, sum of money, and damages. He
construction and upkeep of the property. alleged, inter alia, in his complaint:
Ederlina often wrote letters to her family informing them of her life with Alfred. In 4. That during the period of their common-law relationship, plaintiff solely through his
a Letter dated January 21, 1985, she wrote about how Alfred had financed the purchases own efforts and resources acquired in the Philippines real and personal properties
of some real properties, the establishment of her beauty parlor business, and her petition valued more or less at P724,000.00; The defendants common-law wife or live-in partner
to divorce Klaus.[27] did not contribute anything financially to the acquisition of the said real and personal
Because Ederlina was preoccupied with her business in Manila, she executed on properties. These properties are as follows:
July 8, 1985, two special powers of attorney[28] appointing Alfred as attorney-in-fact to I. Real Properties
receive in her behalf the title and the deed of sale over the property sold by the spouses a. TCT No. T-92456 located at Bajada, Davao City, consisting of 286 square
Enrique Serrano. meters, (with residential house) registered in the name of the original
In the meantime, Ederlinas petition for divorce was denied because Klaus opposed title owner Rodolfo M. Morelos but already fully paid by plaintiff. Valued
the same. A second petition filed by her met the same fate. Klaus wanted half of all the at P342,000.00;
properties owned by Ederlina in the Philippines before he would agree to a divorce. b. TCT No. T-47246 (with residential house) located at Babak, Samal, Davao,
Worse, Klaus threatened to file a bigamy case against Ederlina.[29] consisting of 600 square meters, registered in the name of Ederlina Catito,
Alfred proposed the creation of a partnership to Ederlina, or as an alternative, the with the Register of Deeds of Tagum, Davao del Norte valued
establishment of a corporation, with Ederlina owning 30% of the equity thereof. She at P144,000.00;
initially agreed to put up a corporation and contacted Atty. Armando Dominguez to c. A parcel of agricultural land located at Camudmud, Babak, Samal, Davao del
prepare the necessary documents. Ederlina changed her mind at the last minute when Norte, consisting of 4.2936 hectares purchased from Enrique Serrano and
she was advised to insist on claiming ownership over the properties acquired by them Rosela B. Serrano. Already paid in full by plaintiff. Valued at P228,608.32;
during their coverture. II. Personal Properties:
Alfred and Ederlinas relationship started deteriorating. Ederlina had not been able a. Furniture valued at P10,000.00.
to secure a divorce from Klaus. The latter could charge her for bigamy and could even ...
involve Alfred, who himself was still married. To avoid complications, Alfred decided to 5. That defendant made no contribution at all to the acquisition of the above-mentioned
live separately from Ederlina and cut off all contacts with her. In one of her letters to properties as all the monies (sic) used in acquiring said properties belonged solely to
Alfred, Ederlina complained that he had ruined her life. She admitted that the money plaintiff;[36]
used for the purchase of the properties in Davao were his. She offered to convey the Alfred prayed that after hearing, judgment be rendered in his favor:
properties deeded to her by Atty. Mardoecheo Camporedondo and Rodolfo Morelos, WHEREFORE, in view of the foregoing premises, it is respectfully prayed that judgment
asking Alfred to prepare her affidavit for the said purpose and send it to her for her be rendered in favor of plaintiff and against defendant:
signature.[30] The last straw for Alfred came on September 2, 1985, when someone a) Ordering the defendant to execute the corresponding deeds of transfer
smashed the front and rear windshields of Alfreds car and damaged the windows. Alfred and/or conveyances in favor of plaintiff over those real and personal
properties enumerated in Paragraph 4 of this complaint;
b) Ordering the defendant to deliver to the plaintiff all the above real and WHEREFORE, premises considered, judgment is hereby rendered ordering the defendant
personal properties or their money value, which are in defendants name to perform the following:
and custody because these were acquired solely with plaintiffs money and (1) To execute a document waiving her claim to the house and lot in No. 14 Fernandez
resources during the duration of the common-law relationship between St., San Francisco Del Monte, Quezon City in favor of plaintiff or to return to the plaintiff
plaintiff and defendant, the description of which are as follows: the acquisition cost of the same in the amount of $20,000.00, or to sell the said property
(1) TCT No. T-92456 (with residential house) located at Bajada, Davao City, and turn over the proceeds thereof to the plaintiff;
consisting of 286 square meters, registered in the name of the original (2) To deliver to the plaintiff the rights of ownership and management of the beauty
title owner Rodolfo Morelos but already fully paid by plaintiff. Valued at parlor located at 444 Arquiza St., Ermita, Manila, including the equipment and fixtures
P342,000.00; therein;
(2) TCT No. T-47246 (with residential house) located at Babak, Samal, Davao, (3) To account for the earnings of rental of the house and lot in No. 14 Fernandez St., San
consisting of 600 square meters, registered in the name of Ederlina Catito, Francisco Del Monte, Quezon City, as well as the earnings in the beauty parlor at 444
with the Register of Deeds of Tagum, Davao del Norte, valued at Arquiza St., Ermita, Manila and turn over one-half of the net earnings of both properties
P144,000.00; to the plaintiff;
(3) A parcel of agricultural land located at Camudmud, Babak, Samal, Davao (4) To surrender or return to the plaintiff the personal properties of the latter left in the
del Norte, consisting of 4.2936 hectares purchased from Enrique Serrano house at San Francisco Del Monte, to wit:
and Rosela B. Serrano. Already fully paid by plaintiff. Valued at (1) Mamya automatic camera
P228,608.32; (1) 12 inch Sonny T.V. set, colored with remote control.
c) Declaring the plaintiff to be the sole and absolute owner of the above- (1) Micro oven
mentioned real and personal properties; (1) Electric fan (tall, adjustable stand)
d) Awarding moral damages to plaintiff in an amount deemed reasonable by (1) Office safe with (2) drawers and safe
the trial court; (1) Electric Washing Machine
e) To reimburse plaintiff the sum of P12,000.00 as attorneys fees for having (1) Office desk and chair
compelled the plaintiff to litigate; (1) Double bed suits
f) To reimburse plaintiff the sum of P5,000.00 incurred as litigation expenses (1) Mirror/dresser
also for having compelled the plaintiff to litigate; and (1) Heavy duty voice/working mechanic
g) To pay the costs of this suit; (1) Sony Beta-Movie camera
Plaintiff prays for other reliefs just and equitable in the premises.[37] (1) Suitcase with personal belongings
In her answer, Ederlina denied all the material allegations in the complaint, (1) Cardboard box with belongings
insisting that she acquired the said properties with her personal funds, and as (1) Guitar Amplifier
such, Alfred had no right to the same. She alleged that the deeds of sale, the receipts, and (1) Hanger with mens suit (white).
certificates of titles of the subject properties were all made out in her name.[38] By way of To return to the plaintiff, (1) Hi-Fi Stereo equipment left at 444 Arquiza Street, Ermita,
special and affirmative defense, she alleged that Alfred had no cause of action against Manila, as well as the Fronte Suzuki car.
her. She interposed counterclaims against the petitioner.[39] (4) To account for the monies (sic) deposited with the joint account of the plaintiff and
In the meantime, the petitioner filed a Complaint dated August 25, 1987, against defendant (Account No. 018-0-807950); and to restore to the plaintiff all the monies (sic)
the HSBC in the Regional Trial Court of Davao City[40] for recovery of bank deposits and spent by the defendant without proper authority;
damages.[41] He prayed that after due proceedings, judgment be rendered in his favor, (5) To pay the amount of P5,000.00 by way of attorneys fees, and the costs of suit.
thus: SO ORDERED.[43]
WHEREFORE, plaintiff respectfully prays that the Honorable Court adjudge defendant However, after due proceedings in the RTC of Davao City, in Civil Case No. 17,817,
bank, upon hearing the evidence that the parties might present, to pay plaintiff: the trial court rendered judgment on September 28, 1995 in favor of Ederlina, the
1. ONE HUNDRED TWENTY SIX THOUSAND TWO HUNDRED AND THIRTY U.S. DOLLARS dispositive portion of which reads:
AND NINETY EIGHT CENTS (US$126,230.98) plus legal interests, either of Hong Kong or WHEREFORE, the Court cannot give due course to the complaint and hereby orders its
of the Philippines, from 20 December 1984 up to the date of execution or satisfaction of dismissal. The counterclaims of the defendant are likewise dismissed.
judgment, as actual damages or in restoration of plaintiffs lost dollar savings; SO ORDERED.[44]
2.The same amount in (1) above as moral damages; The trial court ruled that based on documentary evidence, the purchaser of the
3. Attorneys fees in the amount equivalent to TWENTY FIVE PER CENT (25%) of (1) and three parcels of land subject of the complaint was Ederlina. The court further stated that
(2) above; even if Alfred was the buyer of the properties, he had no cause of action against Ederlina
4. Litigation expenses in the amount equivalent to TEN PER CENT (10%) of the amount for the recovery of the same because as an alien, he was disqualified from acquiring and
in (1) above; and owning lands in the Philippines. The sale of the three parcels of land to the petitioner
5. For such other reliefs as are just and equitable under the circumstances.[42] was null and void ab initio. Applying the pari delicto doctrine, the petitioner was
On April 28, 1986, the RTC of Quezon City rendered its decision in Civil Case No. Q- precluded from recovering the properties from the respondent.
46350, in favor of Alfred, the decretal portion of which reads as follows:
Alfred appealed the decision to the Court of Appeals[45] in which the petitioner Save in cases of hereditary succession, no private land shall be transferred or conveyed
posited the view that although he prayed in his complaint in the court a quo that he be except to individuals, corporations, or associations qualified to acquire or hold lands in
declared the owner of the three parcels of land, he had no intention of owning the same the public domain.[50]
permanently. His principal intention therein was to be declared the transient owner for Lands of the public domain, which include private lands, may be transferred or
the purpose of selling the properties at public auction, ultimately enabling him to recover conveyed only to individuals or entities qualified to acquire or hold private lands or
the money he had spent for the purchase thereof. lands of the public domain. Aliens, whether individuals or corporations, have been
On March 8, 2000, the CA rendered a decision affirming in toto the decision of the disqualified from acquiring lands of the public domain. Hence, they have also been
RTC. The appellate court ruled that the petitioner knowingly violated the Constitution; disqualified from acquiring private lands.[51]
hence, was barred from recovering the money used in the purchase of the three parcels Even if, as claimed by the petitioner, the sales in question were entered into by him
of land. It held that to allow the petitioner to recover the money used for the purchase of as the real vendee, the said transactions are in violation of the Constitution; hence, are
the properties would embolden aliens to violate the Constitution, and defeat, rather than null and void ab initio.[52] A contract that violates the Constitution and the law, is null and
enhance, the public policy.[46] void and vests no rights and creates no obligations. It produces no legal effect at
Hence, the petition at bar. all.[53]The petitioner, being a party to an illegal contract, cannot come into a court of law
The petitioner assails the decision of the court contending that: and ask to have his illegal objective carried out. One who loses his money or property by
THE HONORABLE COURT OF APPEALS ERRED IN APPLYING THE RULE OF IN PARI knowingly engaging in a contract or transaction which involves his own moral
DELICTO IN THE INSTANT CASE BECAUSE BY THE FACTS AS NARRATED IN THE turpitude may not maintain an action for his losses. To him who moves in deliberation
DECISION IT IS APPARENT THAT THE PARTIES ARE NOT EQUALLY GUILTY BUT and premeditation, the law is unyielding.[54] The law will not aid either party to an illegal
RATHER IT WAS THE RESPONDENT WHO EMPLOYED FRAUD AS WHEN SHE DID NOT contract or agreement; it leaves the parties where it finds them.[55] Under Article 1412 of
INFORM PETITIONER THAT SHE WAS ALREADY MARRIED TO ANOTHER GERMAN the New Civil Code, the petitioner cannot have the subject properties deeded to him or
NATIONAL AND WITHOUT SUCH FRAUDULENT DESIGN PETITIONER COULD NOT HAVE allow him to recover the money he had spent for the purchase thereof.[56] Equity as a rule
PARTED WITH HIS MONEY FOR THE PURCHASE OF THE PROPERTIES.[47] will follow the law and will not permit that to be done indirectly which, because of public
and policy, cannot be done directly.[57] Where the wrong of one party equals that of the other,
THE HONORABLE COURT OF APPEALS ERRED IN NOT HOLDING THAT THE INTENTION the defendant is in the stronger position ... it signifies that in such a situation, neither a
OF THE PETITIONER IS NOT TO OWN REAL PROPERTIES IN THE PHILIPPINES BUT TO court of equity nor a court of law will administer a remedy.[58] The rule is expressed in
SELL THEM AT PUBLIC AUCTION TO BE ABLE TO RECOVER HIS MONEY USED IN the maxims: EX DOLO MALO NON ORITUR ACTIO and IN PARI DELICTO POTIOR EST
PURCHASING THEM.[48] CONDITIO DEFENDENTIS.[59]
Since the assignment of errors are intertwined with each other, the Court shall The petitioner cannot feign ignorance of the constitutional proscription, nor claim
resolve the same simultaneously. that he acted in good faith, let alone assert that he is less guilty than the respondent. The
The petitioner contends that he purchased the three parcels of land subject of his petitioner is charged with knowledge of the constitutional prohibition. [60] As can be
complaint because of his desire to marry the respondent, and not to violate the gleaned from the decision of the trial court, the petitioner was fully aware that he was
Philippine Constitution. He was, however, deceived by the respondent when the latter disqualified from acquiring and owning lands under Philippine law even before he
failed to disclose her previous marriage to Klaus Muller. It cannot, thus, be said that he purchased the properties in question; and, to skirt the constitutional prohibition, the
and the respondent are equally guilty; as such, the pari delicto doctrine is not applicable petitioner had the deed of sale placed under the respondents name as the sole vendee
to him. He acted in good faith, on the advice of the respondents uncle, Atty. Mardoecheo thereof:
Camporedondo. There is no evidence on record that he was aware of the constitutional Such being the case, the plaintiff is subject to the constitutional restrictions governing
prohibition against aliens acquiring real property in the Philippines when he purchased the acquisition of real properties in the Philippines by aliens.
the real properties subject of his complaint with his own funds. The transactions were From the plaintiffs complaint before the Regional Trial Court, National Capital Judicial
not illegal per se but merely prohibited, and under Article 1416 of the New Civil Code, he Region, Branch 84, Quezon City in Civil Case No. Q-46350 he alleged:
is entitled to recover the money used for the purchase of the properties. At any rate, the xxx That on account that foreigners are not allowed by the Philippine laws to acquire real
petitioner avers, he filed his complaint in the court a quo merely for the purpose of properties in their name as in the case of my vendor Miss Victoria Vinuya (sic) although
having him declared as the owner of the properties, to enable him to sell the same at married to a foreigner, we agreed and I consented in having the title to subject property
public auction. Applying by analogy Republic Act No. 133 [49] as amended by Rep. Act No. placed in defendants name alone although I paid for the whole price out of my own
4381 and Rep. Act No. 4882, the proceeds of the sale would be remitted to him, by way of exclusive funds. (paragraph IV, Exhibit W.)
refund for the money he used to purchase the said properties. To bar the petitioner from and his testimony before this Court which is hereby quoted:
recovering the subject properties, or at the very least, the money used for the purchase ATTY. ABARQUEZ:
thereof, is to allow the respondent to enrich herself at the expense of the petitioner in Q. In whose name the said house and lot placed, by the way, where is his
violation of Article 22 of the New Civil Code. house and lot located?
The petition is bereft of merit. A. In 14 Fernandez St., San Francisco, del Monte, Manila.
Section 14, Article XIV of the 1973 Constitution provides, as follows: Q. In whose name was the house placed?
A. Ederlina Catito because I was informed being not a Filipino, I cannot own
the property. (tsn, p. 11, August 27, 1986).
xxx xxx xxx The provision applies only to those contracts which are merely prohibited, in order
COURT: to benefit private interests. It does not apply to contracts void ab initio. The sales of three
Q. So you understand that you are a foreigner that you cannot buy land in the parcels of land in favor of the petitioner who is a foreigner is illegal per se. The
Philippines? transactions are void ab initio because they were entered into in violation of the
A. That is correct but as she would eventually be my wife that would be Constitution. Thus, to allow the petitioner to recover the properties or the money used in
owned by us later on. (tsn, p. 5, September 3, 1986) the purchase of the parcels of land would be subversive of public policy.
xxx xxx xxx Neither may the petitioner find solace in Rep. Act No. 133, as amended by Rep. Act
Q. What happened after that? No. 4882, which reads:
A. She said you foreigner you are using Filipinos to buy property. SEC. 1. Any provision of law to the contrary notwithstanding, private real property may
Q. And what did you answer? be mortgaged in favor of any individual, corporation, or association, but the mortgagee
A. I said thank you very much for the property I bought because I gave you a or his successor-in- interest, if disqualified to acquire or hold lands of the public domain
lot of money (tsn., p. 14, ibid). in the Philippines, shall not take possession of the mortgaged property during the
It is evident that the plaintiff was fully aware that as a non-citizen of the existence of the mortgage and shall not take possession of mortgaged property except
Philippines, he was disqualified from validly purchasing any land within after default and for the sole purpose of foreclosure, receivership, enforcement or other
the country.[61] proceedings and in no case for a period of more than five years from actual possession
The petitioners claim that he acquired the subject properties because of his desire and shall not bid or take part in any sale of such real property in case of
to marry the respondent, believing that both of them would thereafter jointly own the foreclosure: Provided, That said mortgagee or successor-in-interest may take possession
said properties, is belied by his own evidence. It is merely an afterthought to salvage a of said property after default in accordance with the prescribed judicial procedures for
lost cause. The petitioner admitted on cross-examination that he was all along legally foreclosure and receivership and in no case exceeding five years from actual
married to Teresita Santos Frenzel, while he was having an amorous relationship with possession.[65]
the respondent: From the evidence on record, the three parcels of land subject of the complaint
ATTY. YAP: were not mortgaged to the petitioner by the owners thereof but were sold to the
Q When you were asked to identify yourself on direct examination you respondent as the vendee, albeit with the use of the petitioners personal funds.
claimed before this Honorable Court that your status is that of being Futile, too, is petitioners reliance on Article 22 of the New Civil Code which reads:
married, do you confirm that? Art. 22. Every person who through an act of performance by another, or any other
A Yes, sir. means, acquires or comes into possession of something at the expense of the latter
Q To whom are you married? without just or legal ground, shall return the same to him.[66]
A To a Filipina, since 1976. The provision is expressed in the maxim: MEMO CUM ALTERIUS DETER
Q Would you tell us who is that particular person you are married since DETREMENTO PROTEST (No person should unjustly enrich himself at the expense of
1976? another). An action for recovery of what has been paid without just cause has been
A Teresita Santos Frenzel. designated as an accion in rem verso.[67] This provision does not apply if, as in this case,
Q Where is she now? the action is proscribed by the Constitution or by the application of the pari
A In Australia. delicto doctrine.[68] It may be unfair and unjust to bar the petitioner from filing an accion
Q Is this not the person of Teresita Frenzel who became an Australian citizen? in rem verso over the subject properties, or from recovering the money he paid for the
A I am not sure, since 1981 we were separated. said properties, but, as Lord Mansfield stated in the early case of Holman vs.
Q You were only separated, in fact, but not legally separated? Johnson:[69] The objection that a contract is immoral or illegal as between the plaintiff
A Thru my counsel in Australia I filed a separation case. and the defendant, sounds at all times very ill in the mouth of the defendant. It is not for
Q As of the present you are not legally divorce[d]? his sake, however, that the objection is ever allowed; but it is founded in general
A I am still legally married.[62] principles of policy, which the defendant has the advantage of, contrary to the real
The respondent was herself married to Klaus Muller, a German citizen. Thus, the justice, as between him and the plaintiff.
petitioner and the respondent could not lawfully join in wedlock. The evidence on record IN LIGHT OF ALL THE FOREGOING, the petition is DISMISSED. The decision of the
shows that the petitioner in fact knew of the respondents marriage to another man, but Court of Appeals is AFFIRMED in toto.
nonetheless purchased the subject properties under the name of the respondent and Costs against the petitioner.
paid the purchase prices therefor. Even if it is assumed gratia arguendi that the SO ORDERED.
respondent and the petitioner were capacitated to marry, the petitioner is still Bellosillo, J., (Chairman), Austria-Martinez, and Tinga, JJ., concur.
disqualified to own the properties in tandem with the respondent.[63] Quisumbing, on leave.
The petitioner cannot find solace in Article 1416 of the New Civil Code which reads:
Art. 1416. When the agreement is not illegal per se but is merely prohibited, and the
prohibition by the law is designed for the protection of the plaintiff, he may, if public
policy is thereby enhanced, recover what he has paid or delivered.[64]
EN BANC Paraaque issued Transfer Certificates of Title Nos. 7309, 7311, and 7312, in the name of
[G.R. No. 133250. July 9, 2002] PEA, covering the three reclaimed islands known as the Freedom Islands located at the
FRANCISCO I. CHAVEZ, petitioner, vs. PUBLIC ESTATES AUTHORITY and AMARI southern portion of the Manila-Cavite Coastal Road, Paraaque City. The Freedom Islands
COASTAL BAY DEVELOPMENT CORPORATION,respondents. have a total land area of One Million Five Hundred Seventy Eight Thousand Four
DECISION Hundred and Forty One (1,578,441) square meters or 157.841 hectares.
CARPIO, J.: On April 25, 1995, PEA entered into a Joint Venture Agreement (JVA for brevity)
This is an original Petition for Mandamus with prayer for a writ of preliminary with AMARI, a private corporation, to develop the Freedom Islands. The JVA also
injunction and a temporary restraining order. The petition seeks to compel the Public required the reclamation of an additional 250 hectares of submerged areas surrounding
Estates Authority (PEA for brevity) to disclose all facts on PEAs then on-going these islands to complete the configuration in the Master Development Plan of the
renegotiations with Amari Coastal Bay and Development Corporation (AMARI for Southern Reclamation Project-MCCRRP. PEA and AMARI entered into the JVA through
brevity) to reclaim portions of Manila Bay. The petition further seeks to enjoin PEA from negotiation without public bidding.[4] On April 28, 1995, the Board of Directors of PEA, in
signing a new agreement with AMARI involving such reclamation. its Resolution No. 1245, confirmed the JVA. [5] On June 8, 1995, then President Fidel V.
The Facts Ramos, through then Executive Secretary Ruben Torres, approved the JVA.[6]
On November 20, 1973, the government, through the Commissioner of Public On November 29, 1996, then Senate President Ernesto Maceda delivered a
Highways, signed a contract with the Construction and Development Corporation of the privilege speech in the Senate and denounced the JVA as the grandmother of all scams.
Philippines (CDCP for brevity) to reclaim certain foreshore and offshore areas of Manila As a result, the Senate Committee on Government Corporations and Public Enterprises,
Bay. The contract also included the construction of Phases I and II of the Manila-Cavite and the Committee on Accountability of Public Officers and Investigations, conducted a
Coastal Road. CDCP obligated itself to carry out all the works in consideration of fifty joint investigation. The Senate Committees reported the results of their investigation in
percent of the total reclaimed land. Senate Committee Report No. 560 dated September 16, 1997.[7] Among the conclusions
On February 4, 1977, then President Ferdinand E. Marcos issued Presidential of their report are: (1) the reclaimed lands PEA seeks to transfer to AMARI under the JVA
Decree No. 1084 creating PEA. PD No. 1084 tasked PEA to reclaim land, including are lands of the public domain which the government has not classified as alienable
foreshore and submerged areas, and to develop, improve, acquire, x x x lease and sell any lands and therefore PEA cannot alienate these lands; (2) the certificates of title covering
and all kinds of lands.[1] On the same date, then President Marcos issued Presidential the Freedom Islands are thus void, and (3) the JVA itself is illegal.
Decree No. 1085 transferring to PEA the lands reclaimed in the foreshore and offshore of On December 5, 1997, then President Fidel V. Ramos issued Presidential
the Manila Bay[2] under the Manila-Cavite Coastal Road and Reclamation Project Administrative Order No. 365 creating a Legal Task Force to conduct a study on the
(MCCRRP). legality of the JVA in view of Senate Committee Report No. 560. The members of the
On December 29, 1981, then President Marcos issued a memorandum directing Legal Task Force were the Secretary of Justice,[8] the Chief Presidential Legal
PEA to amend its contract with CDCP, so that [A]ll future works in MCCRRP x x x shall be Counsel,[9] and the Government Corporate Counsel.[10] The Legal Task Force upheld the
funded and owned by PEA. Accordingly, PEA and CDCP executed a Memorandum of legality of the JVA, contrary to the conclusions reached by the Senate Committees.[11]
Agreement dated December 29, 1981, which stated: On April 4 and 5, 1998, the Philippine Daily Inquirer and Today published reports
(i) CDCP shall undertake all reclamation, construction, and such other works in the that there were on-going renegotiations between PEA and AMARI under an order issued
MCCRRP as may be agreed upon by the parties, to be paid according to progress of works by then President Fidel V. Ramos. According to these reports, PEA Director Nestor Kalaw,
on a unit price/lump sum basis for items of work to be agreed upon, subject to price PEA Chairman Arsenio Yulo and retired Navy Officer Sergio Cruz composed the
escalation, retention and other terms and conditions provided for in Presidential Decree negotiating panel of PEA.
No. 1594. All the financing required for such works shall be provided by PEA. On April 13, 1998, Antonio M. Zulueta filed before the Court a Petition for
xxx Prohibition with Application for the Issuance of a Temporary Restraining Order and
(iii) x x x CDCP shall give up all its development rights and hereby agrees to cede and Preliminary Injunction docketed as G.R. No. 132994 seeking to nullify the JVA. The Court
transfer in favor of PEA, all of the rights, title, interest and participation of CDCP in and to dismissed the petition for unwarranted disregard of judicial hierarchy, without prejudice
all the areas of land reclaimed by CDCP in the MCCRRP as of December 30, 1981 which to the refiling of the case before the proper court.[12]
have not yet been sold, transferred or otherwise disposed of by CDCP as of said date, On April 27, 1998, petitioner Frank I. Chavez (Petitioner for brevity) as a taxpayer,
which areas consist of approximately Ninety-Nine Thousand Four Hundred Seventy filed the instant Petition for Mandamus with Prayer for the Issuance of a Writ of
Three (99,473) square meters in the Financial Center Area covered by land pledge No. 5 Preliminary Injunction and Temporary Restraining Order. Petitioner contends the
and approximately Three Million Three Hundred Eighty Two Thousand Eight Hundred government stands to lose billions of pesos in the sale by PEA of the reclaimed lands to
Eighty Eight (3,382,888) square meters of reclaimed areas at varying elevations above AMARI. Petitioner prays that PEA publicly disclose the terms of any renegotiation of the
Mean Low Water Level located outside the Financial Center Area and the First JVA, invoking Section 28, Article II, and Section 7, Article III, of the 1987 Constitution on
Neighborhood Unit.[3] the right of the people to information on matters of public concern. Petitioner assails the
On January 19, 1988, then President Corazon C. Aquino issued Special Patent No. sale to AMARI of lands of the public domain as a blatant violation of Section 3, Article XII
3517, granting and transferring to PEA the parcels of land so reclaimed under the of the 1987 Constitution prohibiting the sale of alienable lands of the public domain to
Manila-Cavite Coastal Road and Reclamation Project (MCCRRP) containing a total area of private corporations. Finally, petitioner asserts that he seeks to enjoin the loss of billions
one million nine hundred fifteen thousand eight hundred ninety four (1,915,894) square of pesos in properties of the State that are of public dominion.
meters. Subsequently, on April 9, 1988, the Register of Deeds of the Municipality of
After several motions for extension of time,[13] PEA and AMARI filed their act on the issue. Presidential approval does not resolve the constitutional issue or
Comments on October 19, 1998 and June 25, 1998, respectively. Meanwhile, on remove it from the ambit of judicial review.
December 28, 1998, petitioner filed an Omnibus Motion: (a) to require PEA to submit the We rule that the signing of the Amended JVA by PEA and AMARI and its approval
terms of the renegotiated PEA-AMARI contract; (b) for issuance of a temporary by the President cannot operate to moot the petition and divest the Court of its
restraining order; and (c) to set the case for hearing on oral argument. Petitioner filed a jurisdiction. PEA and AMARI have still to implement the Amended JVA. The prayer to
Reiterative Motion for Issuance of a TRO dated May 26, 1999, which the Court denied in enjoin the signing of the Amended JVA on constitutional grounds necessarily includes
a Resolution dated June 22, 1999. preventing its implementation if in the meantime PEA and AMARI have signed one in
In a Resolution dated March 23, 1999, the Court gave due course to the petition and violation of the Constitution. Petitioners principal basis in assailing the renegotiation of
required the parties to file their respective memoranda. the JVA is its violation of Section 3, Article XII of the Constitution, which prohibits the
On March 30, 1999, PEA and AMARI signed the Amended Joint Venture Agreement government from alienating lands of the public domain to private corporations. If the
(Amended JVA, for brevity). On May 28, 1999, the Office of the President under the Amended JVA indeed violates the Constitution, it is the duty of the Court to enjoin its
administration of then President Joseph E. Estrada approved the Amended JVA. implementation, and if already implemented, to annul the effects of such
Due to the approval of the Amended JVA by the Office of the President, petitioner unconstitutional contract.
now prays that on constitutional and statutory grounds the renegotiated contract be The Amended JVA is not an ordinary commercial contract but one which seeks
declared null and void.[14] to transfer title and ownership to 367.5 hectares of reclaimed lands and submerged
The Issues areas of Manila Bay to a single private corporation. It now becomes more compelling
The issues raised by petitioner, PEA[15] and AMARI[16] are as follows: for the Court to resolve the issue to insure the government itself does not violate a
I. WHETHER THE PRINCIPAL RELIEFS PRAYED FOR IN THE PETITION ARE provision of the Constitution intended to safeguard the national patrimony. Supervening
MOOT AND ACADEMIC BECAUSE OF SUBSEQUENT EVENTS; events, whether intended or accidental, cannot prevent the Court from rendering a
II. WHETHER THE PETITION MERITS DISMISSAL FOR FAILING TO OBSERVE decision if there is a grave violation of the Constitution. In the instant case, if the
THE PRINCIPLE GOVERNING THE HIERARCHY OF COURTS; Amended JVA runs counter to the Constitution, the Court can still prevent the transfer of
III. WHETHER THE PETITION MERITS DISMISSAL FOR NON-EXHAUSTION OF title and ownership of alienable lands of the public domain in the name of AMARI. Even
ADMINISTRATIVE REMEDIES; in cases where supervening events had made the cases moot, the Court did not hesitate
IV. WHETHER PETITIONER HAS LOCUS STANDI TO BRING THIS SUIT; to resolve the legal or constitutional issues raised to formulate controlling principles to
V. WHETHER THE CONSTITUTIONAL RIGHT TO INFORMATION INCLUDES guide the bench, bar, and the public.[17]
OFFICIAL INFORMATION ON ON-GOING NEGOTIATIONS BEFORE A Also, the instant petition is a case of first impression. All previous decisions of the
FINAL AGREEMENT; Court involving Section 3, Article XII of the 1987 Constitution, or its counterpart
VI. WHETHER THE STIPULATIONS IN THE AMENDED JOINT VENTURE provision in the 1973 Constitution,[18] covered agricultural lands sold to private
AGREEMENT FOR THE TRANSFER TO AMARI OF CERTAIN LANDS, corporations which acquired the lands from private parties. The transferors of the
RECLAIMED AND STILL TO BE RECLAIMED, VIOLATE THE 1987 private corporations claimed or could claim the right to judicial confirmation of their
CONSTITUTION; AND imperfect titles[19] under Title II of Commonwealth Act. 141 (CA No. 141 for brevity). In
VII. WHETHER THE COURT IS THE PROPER FORUM FOR RAISING THE ISSUE the instant case, AMARI seeks to acquire from PEA, a public corporation, reclaimed lands
OF WHETHER THE AMENDED JOINT VENTURE AGREEMENT IS GROSSLY and submerged areas for non-agricultural purposes by purchase under PD No. 1084
DISADVANTAGEOUS TO THE GOVERNMENT. (charter of PEA) and Title III of CA No. 141. Certain undertakings by AMARI under the
The Courts Ruling Amended JVA constitute the consideration for the purchase. Neither AMARI nor PEA can
First issue: whether the principal reliefs prayed for in the petition are moot and claim judicial confirmation of their titles because the lands covered by the Amended JVA
academic because of subsequent events. are newly reclaimed or still to be reclaimed. Judicial confirmation of imperfect title
The petition prays that PEA publicly disclose the terms and conditions of the on- requires open, continuous, exclusive and notorious occupation of agricultural lands of
going negotiations for a new agreement. The petition also prays that the Court enjoin the public domain for at least thirty years since June 12, 1945 or earlier. Besides, the
PEA from privately entering into, perfecting and/or executing any new agreement with deadline for filing applications for judicial confirmation of imperfect title expired on
AMARI. December 31, 1987.[20]
PEA and AMARI claim the petition is now moot and academic because AMARI Lastly, there is a need to resolve immediately the constitutional issue raised in this
furnished petitioner on June 21, 1999 a copy of the signed Amended JVA containing the petition because of the possible transfer at any time by PEA to AMARI of title and
terms and conditions agreed upon in the renegotiations. Thus, PEA has satisfied ownership to portions of the reclaimed lands. Under the Amended JVA, PEA is obligated
petitioners prayer for a public disclosure of the renegotiations. Likewise, petitioners to transfer to AMARI the latters seventy percent proportionate share in the reclaimed
prayer to enjoin the signing of the Amended JVA is now moot because PEA and AMARI areas as the reclamation progresses. The Amended JVA even allows AMARI to mortgage
have already signed the Amended JVA on March 30, 1999. Moreover, the Office of the at any time the entire reclaimed area to raise financing for the reclamation project.[21]
President has approved the Amended JVA on May 28, 1999. Second issue: whether the petition merits dismissal for failing to observe the
Petitioner counters that PEA and AMARI cannot avoid the constitutional issue by principle governing the hierarchy of courts.
simply fast-tracking the signing and approval of the Amended JVA before the Court could 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 concern. Second is the application of a constitutional provision intended to insure the
involving factual issues. The instant case, however, raises constitutional issues of equitable distribution of alienable lands of the public domain among Filipino
transcendental importance to the public.[22] The Court can resolve this case without citizens. The thrust of the first issue is to compel PEA to disclose publicly information on
determining any factual issue related to the case. Also, the instant case is a petition the sale of government lands worth billions of pesos, information which the Constitution
for mandamus which falls under the original jurisdiction of the Court under Section 5, and statutory law mandate PEA to disclose. The thrust of the second issue is to prevent
Article VIII of the Constitution. We resolve to exercise primary jurisdiction over the PEA from alienating hundreds of hectares of alienable lands of the public domain in
instant case. violation of the Constitution, compelling PEA to comply with a constitutional duty to the
Third issue: whether the petition merits dismissal for non-exhaustion of nation.
administrative remedies. Moreover, the petition raises matters of transcendental importance to the
PEA faults petitioner for seeking judicial intervention in compelling PEA to disclose public. In Chavez v. PCGG,[28] the Court upheld the right of a citizen to bring a taxpayers
publicly certain information without first asking PEA the needed information. PEA claims suit on matters of transcendental importance to the public, thus -
petitioners direct resort to the Court violates the principle of exhaustion of Besides, petitioner emphasizes, the matter of recovering the ill-gotten wealth of the
administrative remedies. It also violates the rule that mandamus may issue only if there Marcoses is an issue of transcendental importance to the public. He asserts that ordinary
is no other plain, speedy and adequate remedy in the ordinary course of law. taxpayers have a right to initiate and prosecute actions questioning the validity of acts or
PEA distinguishes the instant case from Taada v. Tuvera[23] where the Court orders of government agencies or instrumentalities, if the issues raised are of paramount
granted the petition for mandamus even if the petitioners there did not initially demand public interest, and if they immediately affect the social, economic and moral well being
from the Office of the President the publication of the presidential decrees. PEA points of the people.
out that in Taada, the Executive Department had an affirmative statutory duty under Moreover, the mere fact that he is a citizen satisfies the requirement of personal interest,
Article 2 of the Civil Code[24] and Section 1 of Commonwealth Act No. 638[25] to publish when the proceeding involves the assertion of a public right, such as in this case. He
the presidential decrees. There was, therefore, no need for the petitioners in Taada to invokes several decisions of this Court which have set aside the procedural matter
make an initial demand from the Office of the President. In the instant case, PEA claims it of locus standi, when the subject of the case involved public interest.
has no affirmative statutory duty to disclose publicly information about its renegotiation xxx
of the JVA.Thus, PEA asserts that the Court must apply the principle of exhaustion of In Taada v. Tuvera, the Court asserted that when the issue concerns a public right and
administrative remedies to the instant case in view of the failure of petitioner here to the object of mandamus is to obtain the enforcement of a public duty, the people are
demand initially from PEA the needed information. regarded as the real parties in interest; and because it is sufficient that petitioner is a
The original JVA sought to dispose to AMARI public lands held by PEA, a citizen and as such is interested in the execution of the laws, he need not show that he
government corporation. Under Section 79 of the Government Auditing Code,[26]2 the has any legal or special interest in the result of the action. In the aforesaid case, the
disposition of government lands to private parties requires public bidding. PEA was petitioners sought to enforce their right to be informed on matters of public concern, a
under a positive legal duty to disclose to the public the terms and conditions for the right then recognized in Section 6, Article IV of the 1973 Constitution, in connection with
sale of its lands. The law obligated PEA to make this public disclosure even without the rule that laws in order to be valid and enforceable must be published in the Official
demand from petitioner or from anyone. PEA failed to make this public disclosure Gazette or otherwise effectively promulgated. In ruling for the petitioners' legal standing,
because the original JVA, like the Amended JVA, was the result of a negotiated contract, the Court declared that the right they sought to be enforced is a public right recognized
not of a public bidding. Considering that PEA had an affirmative statutory duty to make by no less than the fundamental law of the land.
the public disclosure, and was even in breach of this legal duty, petitioner had the right Legaspi v. Civil Service Commission, while reiterating Taada, further declared that when a
to seek direct judicial intervention. mandamus proceeding involves the assertion of a public right, the requirement of
Moreover, and this alone is determinative of this issue, the principle of exhaustion personal interest is satisfied by the mere fact that petitioner is a citizen and, therefore,
of administrative remedies does not apply when the issue involved is a purely legal or part of the general 'public' which possesses the right.
constitutional question.[27] The principal issue in the instant case is the capacity of Further, in Albano v. Reyes, we said that while expenditure of public funds may not have
AMARI to acquire lands held by PEA in view of the constitutional ban prohibiting the been involved under the questioned contract for the development, management and
alienation of lands of the public domain to private corporations. We rule that the operation of the Manila International Container Terminal, public interest [was] definitely
principle of exhaustion of administrative remedies does not apply in the instant case. involved considering the important role [of the subject contract] . . . in the economic
Fourth issue: whether petitioner has locus standi to bring this suit development of the country and the magnitude of the financial consideration involved.
PEA argues that petitioner has no standing to institute mandamus proceedings to We concluded that, as a consequence, the disclosure provision in the Constitution would
enforce his constitutional right to information without a showing that PEA refused to constitute sufficient authority for upholding the petitioner's standing.
perform an affirmative duty imposed on PEA by the Constitution. PEA also claims that Similarly, the instant petition is anchored on the right of the people to information and
petitioner has not shown that he will suffer any concrete injury because of the signing or access to official records, documents and papers a right guaranteed under Section 7,
implementation of the Amended JVA. Thus, there is no actual controversy requiring the Article III of the 1987 Constitution. Petitioner, a former solicitor general, is a Filipino
exercise of the power of judicial review. citizen. Because of the satisfaction of the two basic requisites laid down by decisional law
The petitioner has standing to bring this taxpayers suit because the petition seeks to sustain petitioner's legal standing, i.e. (1) the enforcement of a public right (2)
to compel PEA to comply with its constitutional duties. There are two constitutional espoused by a Filipino citizen, we rule that the petition at bar should be allowed.
issues involved here. First is the right of citizens to information on matters of public
We rule that since the instant petition, brought by a citizen, involves the Mr. Ople: The transactions used here, I suppose is generic and therefore, it can cover
enforcement of constitutional rights - to information and to the equitable diffusion of both steps leading to a contract and already a consummated contract, Mr. Presiding
natural resources - matters of transcendental public importance, the petitioner has the Officer.
requisite locus standi. Mr. Suarez: This contemplates inclusion of negotiations leading to the
Fifth issue: whether the constitutional right to information includes official consummation of the transaction.
information on on-going negotiations before a final agreement. Mr. Ople: Yes, subject only to reasonable safeguards on the national interest.
Section 7, Article III of the Constitution explains the peoples right to information on Mr. Suarez: Thank you.[32] (Emphasis supplied)
matters of public concern in this manner: AMARI argues there must first be a consummated contract before petitioner can invoke
Sec. 7. The right of the people to information on matters of public concern shall be the right. Requiring government officials to reveal their deliberations at the pre-
recognized. Access to official records, and to documents, and papers pertaining to decisional stage will degrade the quality of decision-making in government
official acts, transactions, or decisions, as well as to government research data used as agencies. Government officials will hesitate to express their real sentiments during
basis for policy development, shall be afforded the citizen, subject to such limitations as deliberations if there is immediate public dissemination of their discussions, putting
may be provided by law. (Emphasis supplied) them under all kinds of pressure before they decide.
The State policy of full transparency in all transactions involving public interest We must first distinguish between information the law on public bidding requires
reinforces the peoples right to information on matters of public concern. This State PEA to disclose publicly, and information the constitutional right to information requires
policy is expressed in Section 28, Article II of the Constitution, thus: PEA to release to the public. Before the consummation of the contract, PEA must, on its
Sec. 28. Subject to reasonable conditions prescribed by law, the State adopts and own and without demand from anyone, disclose to the public matters relating to the
implements a policy of full public disclosure of all its transactions involving public disposition of its property. These include the size, location, technical description and
interest. (Emphasis supplied) nature of the property being disposed of, the terms and conditions of the disposition, the
These twin provisions of the Constitution seek to promote transparency in policy- parties qualified to bid, the minimum price and similar information. PEA must prepare
making and in the operations of the government, as well as provide the people sufficient all these data and disclose them to the public at the start of the disposition process, long
information to exercise effectively other constitutional rights. These twin provisions are before the consummation of the contract, because the Government Auditing Code
essential to the exercise of freedom of expression. If the government does not disclose its requires public bidding. If PEA fails to make this disclosure, any citizen can demand
official acts, transactions and decisions to citizens, whatever citizens say, even if from PEA this information at any time during the bidding process.
expressed without any restraint, will be speculative and amount to nothing. These twin Information, however, on on-going evaluation or review of bids or proposals
provisions are also essential to hold public officials at all times x x x accountable to the being undertaken by the bidding or review committee is not immediately accessible
people,[29] for unless citizens have the proper information, they cannot hold public under the right to information. While the evaluation or review is still on-going, there are
officials accountable for anything. Armed with the right information, citizens can no official acts, transactions, or decisions on the bids or proposals. However, once the
participate in public discussions leading to the formulation of government policies and committee makes its official recommendation, there arises a definite proposition on
their effective implementation. An informed citizenry is essential to the existence and the part of the government. From this moment, the publics right to information attaches,
proper functioning of any democracy. As explained by the Court in Valmonte v. and any citizen can access all the non-proprietary information leading to such definite
Belmonte, Jr.[30] proposition. In Chavez v. PCGG,[33] the Court ruled as follows:
An essential element of these freedoms is to keep open a continuing dialogue or process Considering the intent of the framers of the Constitution, we believe that it is incumbent
of communication between the government and the people. It is in the interest of the upon the PCGG and its officers, as well as other government representatives, to disclose
State that the channels for free political discussion be maintained to the end that the sufficient public information on any proposed settlement they have decided to take up
government may perceive and be responsive to the peoples will. Yet, this open dialogue with the ostensible owners and holders of ill-gotten wealth. Such information, though,
can be effective only to the extent that the citizenry is informed and thus able to must pertain to definite propositions of the government, not necessarily to intra-
formulate its will intelligently. Only when the participants in the discussion are aware of agency or inter-agency recommendations or communications during the stage when
the issues and have access to information relating thereto can such bear fruit. common assertions are still in the process of being formulated or are in the exploratory
PEA asserts, citing Chavez v. PCGG,[31] that in cases of on-going negotiations the stage. There is need, of course, to observe the same restrictions on disclosure of
right to information is limited to definite propositions of the government. PEA maintains information in general, as discussed earlier such as on matters involving national
the right does not include access to intra-agency or inter-agency recommendations or security, diplomatic or foreign relations, intelligence and other classified
communications during the stage when common assertions are still in the process of information. (Emphasis supplied)
being formulated or are in the exploratory stage. Contrary to AMARIs contention, the commissioners of the 1986 Constitutional
Also, AMARI contends that petitioner cannot invoke the right at the pre-decisional Commission understood that the right to information contemplates inclusion of
stage or before the closing of the transaction. To support its contention, AMARI cites the negotiations leading to the consummation of the transaction. Certainly, a
following discussion in the 1986 Constitutional Commission: consummated contract is not a requirement for the exercise of the right to
Mr. Suarez. And when we say transactions which should be distinguished from information. Otherwise, the people can never exercise the right if no contract is
contracts, agreements, or treaties or whatever, does the Gentleman refer to the steps consummated, and if one is consummated, it may be too late for the public to expose its
leading to the consummation of the contract, or does he refer to the contract itself? defects.
Requiring a consummated contract will keep the public in the dark until the similar matters affecting national security and public order.[40] Congress has also
contract, which may be grossly disadvantageous to the government or even illegal, prescribed other limitations on the right to information in several legislations.[41]
becomes a fait accompli. This negates the State policy of full transparency on matters of Sixth issue: whether stipulations in the Amended JVA for the transfer to AMARI of
public concern, a situation which the framers of the Constitution could not have lands, reclaimed or to be reclaimed, violate the Constitution.
intended. Such a requirement will prevent the citizenry from participating in the public The Regalian Doctrine
discussion of any proposed contract, effectively truncating a basic right enshrined in the The ownership of lands reclaimed from foreshore and submerged areas is rooted in
Bill of Rights. We can allow neither an emasculation of a constitutional right, nor a the Regalian doctrine which holds that the State owns all lands and waters of the public
retreat by the State of its avowed policy of full disclosure of all its transactions involving domain. Upon the Spanish conquest of the Philippines, ownership of all lands, territories
public interest. and possessions in the Philippines passed to the Spanish Crown.[42] The King, as the
The right covers three categories of information which are matters of public sovereign ruler and representative of the people, acquired and owned all lands and
concern, namely: (1) official records; (2) documents and papers pertaining to official territories in the Philippines except those he disposed of by grant or sale to private
acts, transactions and decisions; and (3) government research data used in formulating individuals.
policies. The first category refers to any document that is part of the public records in the The 1935, 1973 and 1987 Constitutions adopted the Regalian doctrine substituting,
custody of government agencies or officials. The second category refers to documents however, the State, in lieu of the King, as the owner of all lands and waters of the public
and papers recording, evidencing, establishing, confirming, supporting, justifying or domain. The Regalian doctrine is the foundation of the time-honored principle of land
explaining official acts, transactions or decisions of government agencies or officials. The ownership that all lands that were not acquired from the Government, either by
third category refers to research data, whether raw, collated or processed, owned by the purchase or by grant, belong to the public domain.[43] Article 339 of the Civil Code of
government and used in formulating government policies. 1889, which is now Article 420 of the Civil Code of 1950, incorporated the Regalian
The information that petitioner may access on the renegotiation of the JVA includes doctrine.
evaluation reports, recommendations, legal and expert opinions, minutes of meetings, Ownership and Disposition of Reclaimed Lands
terms of reference and other documents attached to such reports or minutes, all relating The Spanish Law of Waters of 1866 was the first statutory law governing the
to the JVA. However, the right to information does not compel PEA to prepare lists, ownership and disposition of reclaimed lands in the Philippines. On May 18, 1907, the
abstracts, summaries and the like relating to the renegotiation of the JVA.[34] The right Philippine Commission enacted Act No. 1654 which provided for the lease, but not the
only affords access to records, documents and papers, which means the opportunity to sale, of reclaimed lands of the government to corporations and individuals. Later, on
inspect and copy them. One who exercises the right must copy the records, documents November 29, 1919, the Philippine Legislature approved Act No. 2874, the Public Land
and papers at his expense. The exercise of the right is also subject to reasonable Act, which authorized the lease, but not the sale, of reclaimed lands of the government
regulations to protect the integrity of the public records and to minimize disruption to to corporations and individuals. On November 7, 1936, the National Assembly passed
government operations, like rules specifying when and how to conduct the inspection Commonwealth Act No. 141, also known as the Public Land Act, which authorized the
and copying.[35] lease, but not the sale, of reclaimed lands of the government to corporations and
The right to information, however, does not extend to matters recognized as individuals. CA No. 141 continues to this day as the general law governing the
privileged information under the separation of powers.[36] The right does not also apply classification and disposition of lands of the public domain.
to information on military and diplomatic secrets, information affecting national The Spanish Law of Waters of 1866 and the Civil Code of 1889
security, and information on investigations of crimes by law enforcement agencies Under the Spanish Law of Waters of 1866, the shores, bays, coves, inlets and all
before the prosecution of the accused, which courts have long recognized as waters within the maritime zone of the Spanish territory belonged to the public domain
confidential.[37] The right may also be subject to other limitations that Congress may for public use.[44] The Spanish Law of Waters of 1866 allowed the reclamation of the sea
impose by law. under Article 5, which provided as follows:
There is no claim by PEA that the information demanded by petitioner is privileged Article 5. Lands reclaimed from the sea in consequence of works constructed by the
information rooted in the separation of powers. The information does not cover State, or by the provinces, pueblos or private persons, with proper permission, shall
Presidential conversations, correspondences, or discussions during closed-door Cabinet become the property of the party constructing such works, unless otherwise provided by
meetings which, like internal deliberations of the Supreme Court and other collegiate the terms of the grant of authority.
courts, or executive sessions of either house of Congress,[38] are recognized as Under the Spanish Law of Waters, land reclaimed from the sea belonged to the party
confidential. This kind of information cannot be pried open by a co-equal branch of undertaking the reclamation, provided the government issued the necessary permit and
government.A frank exchange of exploratory ideas and assessments, free from the glare did not reserve ownership of the reclaimed land to the State.
of publicity and pressure by interested parties, is essential to protect the independence Article 339 of the Civil Code of 1889 defined property of public dominion as
of decision-making of those tasked to exercise Presidential, Legislative and Judicial follows:
power.[39] This is not the situation in the instant case. Art. 339. Property of public dominion is
We rule, therefore, that the constitutional right to information includes official 1. That devoted to public use, such as roads, canals, rivers, torrents, ports and
information on on-going negotiations before a final contract. The information, however, bridges constructed by the State, riverbanks, shores, roadsteads, and that
must constitute definite propositions by the government and should not cover of a similar character;
recognized exceptions like privileged information, military and diplomatic secrets and 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 On November 29, 1919, the Philippine Legislature enacted Act No. 2874, the Public
defense of the territory, and mines, until granted to private individuals. Land Act.[46] The salient provisions of Act No. 2874, on reclaimed lands, were as follows:
Property devoted to public use referred to property open for use by the public. In Sec. 6. The Governor-General, upon the recommendation of the Secretary of
contrast, property devoted to public service referred to property used for some specific Agriculture and Natural Resources, shall from time to time classify the lands of the
public service and open only to those authorized to use the property. public domain into
Property of public dominion referred not only to property devoted to public use, (a) Alienable or disposable,
but also to property not so used but employed to develop the national wealth. This (b) Timber, and
class of property constituted property of public dominion although employed for some (c) Mineral lands, x x x.
economic or commercial activity to increase the national wealth. Sec. 7. For the purposes of the government and disposition of alienable or disposable
Article 341 of the Civil Code of 1889 governed the re-classification of property of public lands, the Governor-General, upon recommendation by the Secretary of
public dominion into private property, to wit: Agriculture and Natural Resources, shall from time to time declare what lands are
Art. 341. Property of public dominion, when no longer devoted to public use or to the open to disposition or concession under this Act.
defense of the territory, shall become a part of the private property of the State. Sec. 8. Only those lands shall be declared open to disposition or concession which
This provision, however, was not self-executing. The legislature, or the executive have been officially delimited or classified x x x.
department pursuant to law, must declare the property no longer needed for public use xxx
or territorial defense before the government could lease or alienate the property to Sec. 55. Any tract of land of the public domain which, being neither timber nor mineral
private parties.[45] land, shall be classified as suitable for residential purposes or for commercial,
Act No. 1654 of the Philippine Commission industrial, or other productive purposes other than agricultural purposes, and shall
On May 8, 1907, the Philippine Commission enacted Act No. 1654 which regulated be open to disposition or concession, shall be disposed of under the provisions of this
the lease of reclaimed and foreshore lands. The salient provisions of this law were as chapter, and not otherwise.
follows: Sec. 56. The lands disposable under this title shall be classified as follows:
Section 1. The control and disposition of the foreshore as defined in existing law, and (a) Lands reclaimed by the Government by dredging, filling, or other
the title to all Government or public lands made or reclaimed by the Governmentby means;
dredging or filling or otherwise throughout the Philippine Islands, shall be retained by (b) Foreshore;
the Government without prejudice to vested rights and without prejudice to rights (c) Marshy lands or lands covered with water bordering upon the shores or
conceded to the City of Manila in the Luneta Extension. banks of navigable lakes or rivers;
Section 2. (a) The Secretary of the Interior shall cause all Government or public lands (d) Lands not included in any of the foregoing classes.
made or reclaimed by the Government by dredging or filling or otherwise to be divided x x x.
into lots or blocks, with the necessary streets and alleyways located thereon, and shall Sec. 58. The lands comprised in classes (a), (b), and (c) of section fifty-six shall be
cause plats and plans of such surveys to be prepared and filed with the Bureau of Lands. disposed of to private parties by lease only and not otherwise, as soon as the
(b) Upon completion of such plats and plans the Governor-General shall give notice to Governor-General, upon recommendation by the Secretary of Agriculture and
the public that such parts of the lands so made or reclaimed as are not needed for Natural Resources, shall declare that the same are not necessary for the public
public purposes will be leased for commercial and business purposes, x x x. service and are open to disposition under this chapter. The lands included in class (d)
xxx may be disposed of by sale or lease under the provisions of this Act.(Emphasis
(e) The leases above provided for shall be disposed of to the highest and best supplied)
bidder therefore, subject to such regulations and safeguards as the Governor-General Section 6 of Act No. 2874 authorized the Governor-General to classify lands of the
may by executive order prescribe. (Emphasis supplied) public domain into x x x alienable or disposable[47] lands. Section 7 of the Act empowered
Act No. 1654 mandated that the government should retain title to all lands the Governor-General to declare what lands are open to disposition or concession.
reclaimed by the government. The Act also vested in the government control and Section 8 of the Act limited alienable or disposable lands only to those lands which have
disposition of foreshore lands. Private parties could lease lands reclaimed by the been officially delimited and classified.
government only if these lands were no longer needed for public purpose. Act No. 1654 Section 56 of Act No. 2874 stated that lands disposable under this title [48] shall be
mandated public bidding in the lease of government reclaimed lands. Act No. 1654 made classified as government reclaimed, foreshore and marshy lands, as well as other lands.
government reclaimed lands sui generis in that unlike other public lands which the All these lands, however, must be suitable for residential, commercial, industrial or other
government could sell to private parties, these reclaimed lands were available only for productive non-agricultural purposes. These provisions vested upon the Governor-
lease to private parties. General the power to classify inalienable lands of the public domain into disposable
Act No. 1654, however, did not repeal Section 5 of the Spanish Law of Waters of lands of the public domain. These provisions also empowered the Governor-General to
1866. Act No. 1654 did not prohibit private parties from reclaiming parts of the sea classify further such disposable lands of the public domain into government reclaimed,
under Section 5 of the Spanish Law of Waters. Lands reclaimed from the sea by private foreshore or marshy lands of the public domain, as well as other non-agricultural lands.
parties with government permission remained private lands. Section 58 of Act No. 2874 categorically mandated that disposable lands of the
Act No. 2874 of the Philippine Legislature 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 prohibit individuals and corporations from acquiring government reclaimed and marshy
lands were not necessary for the public service. Act No. 2874 reiterated the State policy lands of the public domain that were classified as agricultural lands under existing public
to lease and not to sell government reclaimed, foreshore and marshy lands of the public land laws. Section 2, Article XIII of the 1935 Constitution provided as follows:
domain, a policy first enunciated in 1907 in Act No. 1654. Government reclaimed, Section 2. No private corporation or association may acquire, lease, or hold public
foreshore and marshy lands remained sui generis, as the only alienable or disposable agricultural lands in excess of one thousand and twenty four hectares, nor may any
lands of the public domain that the government could not sell to private parties. individual acquire such lands by purchase in excess of one hundred and forty
The rationale behind this State policy is obvious. Government reclaimed, foreshore hectares, or by lease in excess of one thousand and twenty-four hectares, or by
and marshy public lands for non-agricultural purposes retain their inherent potential as homestead in excess of twenty-four hectares. Lands adapted to grazing, not exceeding
areas for public service. This is the reason the government prohibited the sale, and only two thousand hectares, may be leased to an individual, private corporation, or
allowed the lease, of these lands to private parties. The State always reserved these lands association. (Emphasis supplied)
for some future public service. Still, after the effectivity of the 1935 Constitution, the legislature did not repeal Section
Act No. 2874 did not authorize the reclassification of government reclaimed, 58 of Act No. 2874 to open for sale to private parties government reclaimed and marshy
foreshore and marshy lands into other non-agricultural lands under Section 56 lands of the public domain. On the contrary, the legislature continued the long
(d). Lands falling under Section 56 (d) were the only lands for non-agricultural purposes established State policy of retaining for the government title and ownership of
the government could sell to private parties. Thus, under Act No. 2874, the government government reclaimed and marshy lands of the public domain.
could not sell government reclaimed, foreshore and marshy lands to private Commonwealth Act No. 141 of the Philippine National Assembly
parties, unless the legislature passed a law allowing their sale.[49] On November 7, 1936, the National Assembly approved Commonwealth Act No.
Act No. 2874 did not prohibit private parties from reclaiming parts of the sea 141, also known as the Public Land Act, which compiled the then existing laws on lands
pursuant to Section 5 of the Spanish Law of Waters of 1866. Lands reclaimed from the of the public domain. CA No. 141, as amended, remains to this day the existing general
sea by private parties with government permission remained private lands. law governing the classification and disposition of lands of the public domain other than
Dispositions under the 1935 Constitution timber and mineral lands.[51]
On May 14, 1935, the 1935 Constitution took effect upon its ratification by the Section 6 of CA No. 141 empowers the President to classify lands of the public
Filipino people. The 1935 Constitution, in adopting the Regalian doctrine, declared in domain into alienable or disposable[52] lands of the public domain, which prior to such
Section 1, Article XIII, that classification are inalienable and outside the commerce of man. Section 7 of CA No. 141
Section 1. All agricultural, timber, and mineral lands of the public domain, waters, authorizes the President to declare what lands are open to disposition or concession.
minerals, coal, petroleum, and other mineral oils, all forces of potential energy and other Section 8 of CA No. 141 states that the government can declare open for disposition or
natural resources of the Philippines belong to the State, and their disposition, concession only lands that are officially delimited and classified. Sections 6, 7 and 8 of CA
exploitation, development, or utilization shall be limited to citizens of the Philippines or No. 141 read as follows:
to corporations or associations at least sixty per centum of the capital of which is owned Sec. 6. The President, upon the recommendation of the Secretary of Agriculture and
by such citizens, subject to any existing right, grant, lease, or concession at the time of the Commerce, shall from time to time classify the lands of the public domain into
inauguration of the Government established under this Constitution. Natural resources, (a) Alienable or disposable,
with the exception of public agricultural land, shall not be alienated, and no license, (b) Timber, and
concession, or lease for the exploitation, development, or utilization of any of the natural (c) Mineral lands,
resources shall be granted for a period exceeding twenty-five years, renewable for and may at any time and in like manner transfer such lands from one class to
another twenty-five years, except as to water rights for irrigation, water supply, fisheries, another,[53] for the purpose of their administration and disposition.
or industrial uses other than the development of water power, in which cases beneficial Sec. 7. For the purposes of the administration and disposition of alienable or disposable
use may be the measure and limit of the grant. (Emphasis supplied) public lands, the President, upon recommendation by the Secretary of Agriculture
The 1935 Constitution barred the alienation of all natural resources except public and Commerce, shall from time to time declare what lands are open to disposition or
agricultural lands, which were the only natural resources the State could alienate. Thus, concession under this Act.
foreshore lands, considered part of the States natural resources, became inalienable by Sec. 8. Only those lands shall be declared open to disposition or concession which
constitutional fiat, available only for lease for 25 years, renewable for another 25 have been officially delimited and classified and, when practicable, surveyed,
years.The government could alienate foreshore lands only after these lands were and which have not been reserved for public or quasi-public uses, nor appropriated by
reclaimed and classified as alienable agricultural lands of the public domain. Government the Government, nor in any manner become private property, nor those on which a
reclaimed and marshy lands of the public domain, being neither timber nor mineral private right authorized and recognized by this Act or any other valid law may be
lands, fell under the classification of public agricultural lands.[50] However, government claimed, or which, having been reserved or appropriated, have ceased to be so. x x x.
reclaimed and marshy lands, although subject to classification as disposable public Thus, before the government could alienate or dispose of lands of the public domain, the
agricultural lands, could only be leased and not sold to private parties because of Act No. President must first officially classify these lands as alienable or disposable, and then
2874. declare them open to disposition or concession. There must be no law reserving these
The prohibition on private parties from acquiring ownership of government lands for public or quasi-public uses.
reclaimed and marshy lands of the public domain was only a statutory prohibition and The salient provisions of CA No. 141, on government reclaimed, foreshore and
the legislature could therefore remove such prohibition. The 1935 Constitution did not marshy lands of the public domain, are as follows:
Sec. 58. Any tract of land of the public domain which, being neither timber nor be alienated and sold to private parties. The disposition of the reclaimed land was
mineral land, is intended to be used for residential purposes or for commercial, only by lease. The land remained property of the State. (Emphasis supplied)
industrial, or other productive purposes other than agricultural, and is open to As observed by Justice Puno in his concurring opinion, Commonwealth Act No. 141 has
disposition or concession, shall be disposed of under the provisions of this chapter remained in effect at present.
and not otherwise. The State policy prohibiting the sale to private parties of government reclaimed,
Sec. 59. The lands disposable under this title shall be classified as follows: foreshore and marshy alienable lands of the public domain, first implemented in 1907
(a) Lands reclaimed by the Government by dredging, filling, or other was thus reaffirmed in CA No. 141 after the 1935 Constitution took effect. The
means; prohibition on the sale of foreshore lands, however, became a constitutional edict under
(b) Foreshore; the 1935 Constitution. Foreshore lands became inalienable as natural resources of the
(c) Marshy lands or lands covered with water bordering upon the shores or State, unless reclaimed by the government and classified as agricultural lands of the
banks of navigable lakes or rivers; public domain, in which case they would fall under the classification of government
(d) Lands not included in any of the foregoing classes. reclaimed lands.
Sec. 60. Any tract of land comprised under this title may be leased or sold, as the case After the effectivity of the 1935 Constitution, government reclaimed and marshy
may be, to any person, corporation, or association authorized to purchase or lease public disposable lands of the public domain continued to be only leased and not sold to private
lands for agricultural purposes. x x x. parties.[56] These lands remained sui generis, as the only alienable or disposable lands of
Sec. 61. The lands comprised in classes (a), (b), and (c) of section fifty-nine shall be the public domain the government could not sell to private parties.
disposed of to private parties by lease only and not otherwise, as soon as the Since then and until now, the only way the government can sell to private parties
President, upon recommendation by the Secretary of Agriculture, shall declare that the government reclaimed and marshy disposable lands of the public domain is for the
same are not necessary for the public service and are open to disposition under this legislature to pass a law authorizing such sale. CA No. 141 does not authorize the
chapter. The lands included in class (d) may be disposed of by sale or lease under the President to reclassify government reclaimed and marshy lands into other non-
provisions of this Act. (Emphasis supplied) agricultural lands under Section 59 (d). Lands classified under Section 59 (d) are the only
Section 61 of CA No. 141 readopted, after the effectivity of the 1935 Constitution, alienable or disposable lands for non-agricultural purposes that the government could
Section 58 of Act No. 2874 prohibiting the sale of government reclaimed, foreshore and sell to private parties.
marshy disposable lands of the public domain. All these lands are intended for Moreover, Section 60 of CA No. 141 expressly requires congressional authority
residential, commercial, industrial or other non-agricultural purposes. As before, Section before lands under Section 59 that the government previously transferred to
61 allowed only the lease of such lands to private parties. The government could sell to government units or entities could be sold to private parties. Section 60 of CA No. 141
private parties only lands falling under Section 59 (d) of CA No. 141, or those lands for declares that
non-agricultural purposes not classified as government reclaimed, foreshore and marshy Sec. 60. x x x The area so leased or sold shall be such as shall, in the judgment of the
disposable lands of the public domain. Foreshore lands, however, became inalienable Secretary of Agriculture and Natural Resources, be reasonably necessary for the
under the 1935 Constitution which only allowed the lease of these lands to qualified purposes for which such sale or lease is requested, and shall not exceed one hundred and
private parties. forty-four hectares: Provided, however, That this limitation shall not apply to grants,
Section 58 of CA No. 141 expressly states that disposable lands of the public donations, or transfers made to a province, municipality or branch or subdivision of the
domain intended for residential, commercial, industrial or other productive purposes Government for the purposes deemed by said entities conducive to the public
other than agricultural shall be disposed of under the provisions of this chapter and interest; but the land so granted, donated, or transferred to a province, municipality
not otherwise. Under Section 10 of CA No. 141, the term disposition includes lease of the or branch or subdivision of the Government shall not be alienated, encumbered, or
land.Any disposition of government reclaimed, foreshore and marshy disposable lands otherwise disposed of in a manner affecting its title, except when authorized by
for non-agricultural purposes must comply with Chapter IX, Title III of CA No. Congress: x x x. (Emphasis supplied)
141,[54] unless a subsequent law amended or repealed these provisions. The congressional authority required in Section 60 of CA No. 141 mirrors the legislative
In his concurring opinion in the landmark case of Republic Real Estate authority required in Section 56 of Act No. 2874.
Corporation v. Court of Appeals,[55] Justice Reynato S. Puno summarized succinctly the One reason for the congressional authority is that Section 60 of CA No. 141
law on this matter, as follows: exempted government units and entities from the maximum area of public lands that
Foreshore lands are lands of public dominion intended for public use. So too are lands could be acquired from the State. These government units and entities should not just
reclaimed by the government by dredging, filling, or other means. Act 1654 mandated turn around and sell these lands to private parties in violation of constitutional or
that the control and disposition of the foreshore and lands under water remained in the statutory limitations. Otherwise, the transfer of lands for non-agricultural purposes to
national government. Said law allowed only the leasing of reclaimed land. The Public government units and entities could be used to circumvent constitutional limitations on
Land Acts of 1919 and 1936 also declared that the foreshore and lands reclaimed by the ownership of alienable or disposable lands of the public domain. In the same manner,
government were to be disposed of to private parties by lease only and not otherwise. such transfers could also be used to evade the statutory prohibition in CA No. 141 on the
Before leasing, however, the Governor-General, upon recommendation of the Secretary sale of government reclaimed and marshy lands of the public domain to private
of Agriculture and Natural Resources, had first to determine that the land reclaimed was parties. Section 60 of CA No. 141 constitutes by operation of law a lien on these lands.[57]
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
In case of sale or lease of disposable lands of the public domain falling under resources shall not be alienated, and no license, concession, or lease for the
Section 59 of CA No. 141, Sections 63 and 67 require a public bidding. Sections 63 and exploration, development, exploitation, or utilization of any of the natural resources shall
67 of CA No. 141 provide as follows: be granted for a period exceeding twenty-five years, renewable for not more than
Sec. 63. Whenever it is decided that lands covered by this chapter are not needed for twenty-five years, except as to water rights for irrigation, water supply, fisheries, or
public purposes, the Director of Lands shall ask the Secretary of Agriculture and industrial uses other than the development of water power, in which cases, beneficial use
Commerce (now the Secretary of Natural Resources) for authority to dispose of the may be the measure and the limit of the grant. (Emphasis supplied)
same. Upon receipt of such authority, the Director of Lands shall give notice by public The 1973 Constitution prohibited the alienation of all natural resources with the
advertisement in the same manner as in the case of leases or sales of agricultural public exception of agricultural, industrial or commercial, residential, and resettlement lands of
land, x x x. the public domain. In contrast, the 1935 Constitution barred the alienation of all natural
Sec. 67. The lease or sale shall be made by oral bidding; and adjudication shall be resources except public agricultural lands. However, the term public agricultural lands in
made to the highest bidder. x x x. (Emphasis supplied) the 1935 Constitution encompassed industrial, commercial, residential and resettlement
Thus, CA No. 141 mandates the Government to put to public auction all leases or sales of lands of the public domain.[60] If the land of public domain were neither timber nor
alienable or disposable lands of the public domain.[58] mineral land, it would fall under the classification of agricultural land of the public
Like Act No. 1654 and Act No. 2874 before it, CA No. 141 did not repeal Section 5 of domain. Both the 1935 and 1973 Constitutions, therefore, prohibited the alienation
the Spanish Law of Waters of 1866. Private parties could still reclaim portions of the sea of all natural resources except agricultural lands of the public domain.
with government permission. However, the reclaimed land could become private land The 1973 Constitution, however, limited the alienation of lands of the public
only if classified as alienable agricultural land of the public domain open to domain to individuals who were citizens of the Philippines. Private corporations, even if
disposition under CA No. 141. The 1935 Constitution prohibited the alienation of all wholly owned by Philippine citizens, were no longer allowed to acquire alienable lands
natural resources except public agricultural lands. of the public domain unlike in the 1935 Constitution. Section 11, Article XIV of the 1973
The Civil Code of 1950 Constitution declared that
The Civil Code of 1950 readopted substantially the definition of property of public Sec. 11. The Batasang Pambansa, taking into account conservation, ecological, and
dominion found in the Civil Code of 1889. Articles 420 and 422 of the Civil Code of 1950 development requirements of the natural resources, shall determine by law the size of
state that land of the public domain which may be developed, held or acquired by, or leased to, any
Art. 420. The following things are property of public dominion: qualified individual, corporation, or association, and the conditions therefor. No private
(1) Those intended for public use, such as roads, canals, rivers, torrents, ports corporation or association may hold alienable lands of the public domain except by
and bridges constructed by the State, banks, shores, roadsteads, and lease not to exceed one thousand hectares in area nor may any citizen hold such lands by
others of similar character; lease in excess of five hundred hectares or acquire by purchase, homestead or grant, in
(2) Those which belong to the State, without being for public use, and are excess of twenty-four hectares. No private corporation or association may hold by lease,
intended for some public service or for the development of the national concession, license or permit, timber or forest lands and other timber or forest resources
wealth. in excess of one hundred thousand hectares. However, such area may be increased by the
x x x. Batasang Pambansa upon recommendation of the National Economic and Development
Art. 422. Property of public dominion, when no longer intended for public use or for Authority. (Emphasis supplied)
public service, shall form part of the patrimonial property of the State. Thus, under the 1973 Constitution, private corporations could hold alienable lands
Again, the government must formally declare that the property of public dominion of the public domain only through lease. Only individuals could now acquire alienable
is no longer needed for public use or public service, before the same could be classified lands of the public domain, and private corporations became absolutely barred from
as patrimonial property of the State.[59] In the case of government reclaimed and marshy acquiring any kind of alienable land of the public domain. The constitutional ban
lands of the public domain, the declaration of their being disposable, as well as the extended to all kinds of alienable lands of the public domain, while the statutory ban
manner of their disposition, is governed by the applicable provisions of CA No. 141. under CA No. 141 applied only to government reclaimed, foreshore and marshy alienable
Like the Civil Code of 1889, the Civil Code of 1950 included as property of public lands of the public domain.
dominion those properties of the State which, without being for public use, are intended PD No. 1084 Creating the Public Estates Authority
for public service or the development of the national wealth. Thus, government On February 4, 1977, then President Ferdinand Marcos issued Presidential Decree
reclaimed and marshy lands of the State, even if not employed for public use or public No. 1084 creating PEA, a wholly government owned and controlled corporation with a
service, if developed to enhance the national wealth, are classified as property of public special charter. Sections 4 and 8 of PD No. 1084, vests PEA with the following purposes
dominion. and powers:
Dispositions under the 1973 Constitution Sec. 4. Purpose. The Authority is hereby created for the following purposes:
The 1973 Constitution, which took effect on January 17, 1973, likewise adopted the (a) To reclaim land, including foreshore and submerged areas, by
Regalian doctrine. Section 8, Article XIV of the 1973 Constitution stated that dredging, filling or other means, or to acquire reclaimed land;
Sec. 8. All lands of the public domain, waters, minerals, coal, petroleum and other (b) To develop, improve, acquire, administer, deal in, subdivide,
mineral oils, all forces of potential energy, fisheries, wildlife, and other natural resources dispose, lease and sell any and all kinds of lands, buildings, estates and
of the Philippines belong to the State. With the exception of agricultural, industrial or other forms of real property, owned, managed, controlled and/or operated by
commercial, residential, and resettlement lands of the public domain, natural the government;
(c) To provide for, operate or administer such service as may be necessary for the exploration, development, and utilization of natural resources shall be under the full
efficient, economical and beneficial utilization of the above properties. control and supervision of the State. x x x.
Sec. 5. Powers and functions of the Authority. The Authority shall, in carrying out the Section 3. Lands of the public domain are classified into agricultural, forest or timber,
purposes for which it is created, have the following powers and functions: mineral lands, and national parks. Agricultural lands of the public domain may be further
(a)To prescribe its by-laws. classified by law according to the uses which they may be devoted. Alienable lands of
xxx the public domain shall be limited to agricultural lands. Private corporations or
(i) To hold lands of the public domain in excess of the area permitted to associations may not hold such alienable lands of the public domain except by lease,
private corporations by statute. for a period not exceeding twenty-five years, renewable for not more than twenty-
(j) To reclaim lands and to construct work across, or otherwise, any stream, five years, and not to exceed one thousand hectares in area. Citizens of the Philippines
watercourse, canal, ditch, flume x x x. may lease not more than five hundred hectares, or acquire not more than twelve
xxx hectares thereof by purchase, homestead, or grant.
(o) To perform such acts and exercise such functions as may be necessary for the Taking into account the requirements of conservation, ecology, and development, and
attainment of the purposes and objectives herein specified. (Emphasis supplied) subject to the requirements of agrarian reform, the Congress shall determine, by law, the
PD No. 1084 authorizes PEA to reclaim both foreshore and submerged areas of the size of lands of the public domain which may be acquired, developed, held, or leased and
public domain. Foreshore areas are those covered and uncovered by the ebb and flow of the conditions therefor. (Emphasis supplied)
the tide.[61] Submerged areas are those permanently under water regardless of the ebb The 1987 Constitution continues the State policy in the 1973 Constitution banning
and flow of the tide.[62] Foreshore and submerged areas indisputably belong to the public private corporations from acquiring any kind of alienable land of the public
domain[63] and are inalienable unless reclaimed, classified as alienable lands open to domain.Like the 1973 Constitution, the 1987 Constitution allows private corporations to
disposition, and further declared no longer needed for public service. hold alienable lands of the public domain only through lease. As in the 1935 and 1973
The ban in the 1973 Constitution on private corporations from acquiring alienable Constitutions, the general law governing the lease to private corporations of reclaimed,
lands of the public domain did not apply to PEA since it was then, and until today, a fully foreshore and marshy alienable lands of the public domain is still CA No. 141.
owned government corporation. The constitutional ban applied then, as it still applies The Rationale behind the Constitutional Ban
now, only to private corporations and associations. PD No. 1084 expressly empowers The rationale behind the constitutional ban on corporations from acquiring, except
PEA to hold lands of the public domain even in excess of the area permitted to private through lease, alienable lands of the public domain is not well understood. During the
corporations by statute. Thus, PEA can hold title to private lands, as well as title to deliberations of the 1986 Constitutional Commission, the commissioners probed the
lands of the public domain. rationale behind this ban, thus:
In order for PEA to sell its reclaimed foreshore and submerged alienable lands of FR. BERNAS: Mr. Vice-President, my questions have reference to page 3, line 5 which
the public domain, there must be legislative authority empowering PEA to sell these says:
lands.This legislative authority is necessary in view of Section 60 of CA No.141, which `No private corporation or association may hold alienable lands of the public
states domain except by lease, not to exceed one thousand hectares in area.
Sec. 60. x x x; but the land so granted, donated or transferred to a province, municipality, If we recall, this provision did not exist under the 1935 Constitution, but this was
or branch or subdivision of the Government shall not be alienated, encumbered or introduced in the 1973 Constitution. In effect, it prohibits private corporations from
otherwise disposed of in a manner affecting its title, except when authorized by acquiring alienable public lands. But it has not been very clear in jurisprudence what
Congress; x x x. (Emphasis supplied) the reason for this is. In some of the cases decided in 1982 and 1983, it was indicated
Without such legislative authority, PEA could not sell but only lease its reclaimed that the purpose of this is to prevent large landholdings. Is that the intent of this
foreshore and submerged alienable lands of the public domain. Nevertheless, any provision?
legislative authority granted to PEA to sell its reclaimed alienable lands of the public MR. VILLEGAS: I think that is the spirit of the provision.
domain would be subject to the constitutional ban on private corporations from FR. BERNAS: In existing decisions involving the Iglesia ni Cristo, there were instances
acquiring alienable lands of the public domain. Hence, such legislative authority could where the Iglesia ni Cristo was not allowed to acquire a mere 313-square meter land
only benefit private individuals. where a chapel stood because the Supreme Court said it would be in violation of
Dispositions under the 1987 Constitution this. (Emphasis supplied)
The 1987 Constitution, like the 1935 and 1973 Constitutions before it, has adopted In Ayog v. Cusi,[64] the Court explained the rationale behind this constitutional ban
the Regalian doctrine. The 1987 Constitution declares that all natural resources in this way:
are owned by the State, and except for alienable agricultural lands of the public domain, Indeed, one purpose of the constitutional prohibition against purchases of public
natural resources cannot be alienated. Sections 2 and 3, Article XII of the 1987 agricultural lands by private corporations is to equitably diffuse land ownership or to
Constitution state that encourage owner-cultivatorship and the economic family-size farm and to prevent a
Section 2. All lands of the public domain, waters, minerals, coal, petroleum and other recurrence of cases like the instant case. Huge landholdings by corporations or private
mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife, flora and persons had spawned social unrest.
fauna, and other natural resources are owned by the State. With the exception of However, if the constitutional intent is to prevent huge landholdings, the Constitution
agricultural lands, all other natural resources shall not be alienated. The 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 the net usable area, totaling 367.5 hectares, will be issued in the name of AMARI.Section
domain under the 1973 Constitution, and not more than 12 hectares under the 1987 5.2 (c) of the Amended JVA provides that
Constitution. x x x, PEA shall have the duty to execute without delay the necessary deed of transfer or
If the constitutional intent is to encourage economic family-size farms, placing the conveyance of the title pertaining to AMARIs Land share based on the Land Allocation
land in the name of a corporation would be more effective in preventing the break-up of Plan. PEA, when requested in writing by AMARI, shall then cause the issuance and
farmlands. If the farmland is registered in the name of a corporation, upon the death of delivery of the proper certificates of title covering AMARIs Land Share in the name of
the owner, his heirs would inherit shares in the corporation instead of subdivided AMARI, x x x; provided, that if more than seventy percent (70%) of the titled area at any
parcels of the farmland. This would prevent the continuing break-up of farmlands into given time pertains to AMARI, PEA shall deliver to AMARI only seventy percent (70%) of
smaller and smaller plots from one generation to the next. the titles pertaining to AMARI, until such time when a corresponding proportionate area
In actual practice, the constitutional ban strengthens the constitutional limitation of additional land pertaining to PEA has been titled. (Emphasis supplied)
on individuals from acquiring more than the allowed area of alienable lands of the public Indisputably, under the Amended JVA AMARI will acquire and own a maximum of
domain. Without the constitutional ban, individuals who already acquired the maximum 367.5 hectares of reclaimed land which will be titled in its name.
area of alienable lands of the public domain could easily set up corporations to acquire To implement the Amended JVA, PEA delegated to the unincorporated PEA-AMARI
more alienable public lands. An individual could own as many corporations as his means joint venture PEAs statutory authority, rights and privileges to reclaim foreshore and
would allow him. An individual could even hide his ownership of a corporation by submerged areas in Manila Bay. Section 3.2.a of the Amended JVA states that
putting his nominees as stockholders of the corporation. The corporation is a convenient PEA hereby contributes to the joint venture its rights and privileges to perform Rawland
vehicle to circumvent the constitutional limitation on acquisition by individuals of Reclamation and Horizontal Development as well as own the Reclamation Area, thereby
alienable lands of the public domain. granting the Joint Venture the full and exclusive right, authority and privilege to
The constitutional intent, under the 1973 and 1987 Constitutions, is to transfer undertake the Project in accordance with the Master Development Plan.
ownership of only a limited area of alienable land of the public domain to a qualified The Amended JVA is the product of a renegotiation of the original JVA dated April 25,
individual. This constitutional intent is safeguarded by the provision prohibiting 1995 and its supplemental agreement dated August 9, 1995.
corporations from acquiring alienable lands of the public domain, since the vehicle to The Threshold Issue
circumvent the constitutional intent is removed. The available alienable public lands are The threshold issue is whether AMARI, a private corporation, can acquire and own
gradually decreasing in the face of an ever-growing population. The most effective way under the Amended JVA 367.5 hectares of reclaimed foreshore and submerged areas in
to insure faithful adherence to this constitutional intent is to grant or sell alienable lands Manila Bay in view of Sections 2 and 3, Article XII of the 1987 Constitution which state
of the public domain only to individuals. This, it would seem, is the practical benefit that:
arising from the constitutional ban. Section 2. All lands of the public domain, waters, minerals, coal, petroleum, and other
The Amended Joint Venture Agreement mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife, flora and
The subject matter of the Amended JVA, as stated in its second Whereas clause, fauna, and other natural resources are owned by the State. With the exception of
consists of three properties, namely: agricultural lands, all other natural resources shall not be alienated. x x x.
1. [T]hree partially reclaimed and substantially eroded islands along Emilio xxx
Aguinaldo Boulevard in Paranaque and Las Pinas, Metro Manila, with a Section 3. x x x Alienable lands of the public domain shall be limited to agricultural
combined titled area of 1,578,441 square meters; lands. Private corporations or associations may not hold such alienable lands of the
2. [A]nother area of 2,421,559 square meters contiguous to the three islands; public domain except by lease, x x x.(Emphasis supplied)
and Classification of Reclaimed Foreshore and Submerged Areas
3. [A]t AMARIs option as approved by PEA, an additional 350 hectares more PEA readily concedes that lands reclaimed from foreshore or submerged areas of
or less to regularize the configuration of the reclaimed area.[65] Manila Bay are alienable or disposable lands of the public domain. In its
PEA confirms that the Amended JVA involves the development of the Freedom Islands Memorandum,[67]PEA admits that
and further reclamation of about 250 hectares x x x, plus an option granted to AMARI to Under the Public Land Act (CA 141, as amended), reclaimed lands are classified as
subsequently reclaim another 350 hectares x x x.[66] alienable and disposable lands of the public domain:
In short, the Amended JVA covers a reclamation area of 750 hectares. Only 157.84 Sec. 59. The lands disposable under this title shall be classified as follows:
hectares of the 750-hectare reclamation project have been reclaimed, and the rest of (a) Lands reclaimed by the government by dredging, filling, or
the 592.15 hectares are still submerged areas forming part of Manila Bay. other means;
Under the Amended JVA, AMARI will reimburse PEA the sum of P1,894,129,200.00 x x x. (Emphasis supplied)
for PEAs actual cost in partially reclaiming the Freedom Islands. AMARI will also Likewise, the Legal Task Force[68] constituted under Presidential Administrative
complete, at its own expense, the reclamation of the Freedom Islands. AMARI will further Order No. 365 admitted in its Report and Recommendation to then President Fidel V.
shoulder all the reclamation costs of all the other areas, totaling 592.15 hectares, still to Ramos, [R]eclaimed lands are classified as alienable and disposable lands of the
be reclaimed. AMARI and PEA will share, in the proportion of 70 percent and 30 percent, public domain.[69] The Legal Task Force concluded that
respectively, the total net usable area which is defined in the Amended JVA as the total D. Conclusion
reclaimed area less 30 percent earmarked for common areas. Title to AMARIs share in 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 islands. Thus, the Freedom Islands were no longer part of Manila Bay but part of the land
without violating the Constitution or any statute. mass. Section 3, Article XII of the 1987 Constitution classifies lands of the public domain
The constitutional provision prohibiting private corporations from holding public land, into agricultural, forest or timber, mineral lands, and national parks. Being neither
except by lease (Sec. 3, Art. XVII,[70] 1987 Constitution), does not apply to reclaimed timber, mineral, nor national park lands, the reclaimed Freedom Islands necessarily fall
lands whose ownership has passed on to PEA by statutory grant. under the classification of agricultural lands of the public domain. Under the 1987
Under Section 2, Article XII of the 1987 Constitution, the foreshore and submerged Constitution, agricultural lands of the public domain are the only natural resources that
areas of Manila Bay are part of the lands of the public domain, waters x x x and other the State may alienate to qualified private parties. All other natural resources, such as the
natural resources and consequently owned by the State. As such, foreshore and seas or bays, are waters x x x owned by the State forming part of the public domain, and
submerged areas shall not be alienated, unless they are classified as agricultural lands of are inalienable pursuant to Section 2, Article XII of the 1987 Constitution.
the public domain. The mere reclamation of these areas by PEA does not convert these AMARI claims that the Freedom Islands are private lands because CDCP, then a
inalienable natural resources of the State into alienable or disposable lands of the public private corporation, reclaimed the islands under a contract dated November 20, 1973
domain. There must be a law or presidential proclamation officially classifying these with the Commissioner of Public Highways. AMARI, citing Article 5 of the Spanish Law of
reclaimed lands as alienable or disposable and open to disposition or Waters of 1866, argues that if the ownership of reclaimed lands may be given to the
concession.Moreover, these reclaimed lands cannot be classified as alienable or party constructing the works, then it cannot be said that reclaimed lands are lands of the
disposable if the law has reserved them for some public or quasi-public use.[71] public domain which the State may not alienate.[75] Article 5 of the Spanish Law of
Section 8 of CA No. 141 provides that only those lands shall be declared open to Waters reads as follows:
disposition or concession which have been officially delimited and classified.[72] The Article 5. Lands reclaimed from the sea in consequence of works constructed by the
President has the authority to classify inalienable lands of the public domain into State, or by the provinces, pueblos or private persons, with proper permission, shall
alienable or disposable lands of the public domain, pursuant to Section 6 of CA No. become the property of the party constructing such works, unless otherwise provided
141. In Laurel vs. Garcia,[73] the Executive Department attempted to sell the Roppongi by the terms of the grant of authority. (Emphasis supplied)
property in Tokyo, Japan, which was acquired by the Philippine Government for use as Under Article 5 of the Spanish Law of Waters of 1866, private parties could reclaim
the Chancery of the Philippine Embassy. Although the Chancery had transferred to from the sea only with proper permission from the State. Private parties could own the
another location thirteen years earlier, the Court still ruled that, under Article 422 [74] of reclaimed land only if not otherwise provided by the terms of the grant of authority. This
the Civil Code, a property of public dominion retains such character until formally clearly meant that no one could reclaim from the sea without permission from the State
declared otherwise. The Court ruled that because the sea is property of public dominion. It also meant that the State could grant or
The fact that the Roppongi site has not been used for a long time for actual Embassy withhold ownership of the reclaimed land because any reclaimed land, like the sea from
service does not automatically convert it to patrimonial property. Any such conversion which it emerged, belonged to the State. Thus, a private person reclaiming from the sea
happens only if the property is withdrawn from public use (Cebu Oxygen and Acetylene without permission from the State could not acquire ownership of the reclaimed land
Co. v. Bercilles, 66 SCRA 481 [1975]. A property continues to be part of the public which would remain property of public dominion like the sea it replaced.[76] Article 5 of
domain, not available for private appropriation or ownership until there is a formal the Spanish Law of Waters of 1866 adopted the time-honored principle of land
declaration on the part of the government to withdraw it from being such (Ignacio v. ownership that all lands that were not acquired from the government, either by purchase
Director of Lands, 108 Phil. 335 [1960]. (Emphasis supplied) or by grant, belong to the public domain.[77]
PD No. 1085, issued on February 4, 1977, authorized the issuance of special land Article 5 of the Spanish Law of Waters must be read together with laws
patents for lands reclaimed by PEA from the foreshore or submerged areas of Manila subsequently enacted on the disposition of public lands. In particular, CA No. 141
Bay. On January 19, 1988 then President Corazon C. Aquino issued Special Patent No. requires that lands of the public domain must first be classified as alienable or
3517 in the name of PEA for the 157.84 hectares comprising the partially reclaimed disposable before the government can alienate them. These lands must not be reserved
Freedom Islands. Subsequently, on April 9, 1999 the Register of Deeds of the for public or quasi-public purposes.[78] Moreover, the contract between CDCP and the
Municipality of Paranaque issued TCT Nos. 7309, 7311 and 7312 in the name of PEA government was executed after the effectivity of the 1973 Constitution which barred
pursuant to Section 103 of PD No. 1529 authorizing the issuance of certificates of title private corporations from acquiring any kind of alienable land of the public domain. This
corresponding to land patents. To this day, these certificates of title are still in the name contract could not have converted the Freedom Islands into private lands of a private
of PEA. corporation.
PD No. 1085, coupled with President Aquinos actual issuance of a special patent Presidential Decree No. 3-A, issued on January 11, 1973, revoked all laws
covering the Freedom Islands, is equivalent to an official proclamation classifying the authorizing the reclamation of areas under water and revested solely in the National
Freedom Islands as alienable or disposable lands of the public domain. PD No. 1085 and Government the power to reclaim lands. Section 1 of PD No. 3-A declared that
President Aquinos issuance of a land patent also constitute a declaration that the The provisions of any law to the contrary notwithstanding, the reclamation of areas
Freedom Islands are no longer needed for public service. The Freedom Islands are thus under water, whether foreshore or inland, shall be limited to the National Government
alienable or disposable lands of the public domain, open to disposition or concession or any person authorized by it under a proper contract. (Emphasis supplied)
to qualified parties. x x x.
At the time then President Aquino issued Special Patent No. 3517, PEA had already PD No. 3-A repealed Section 5 of the Spanish Law of Waters of 1866 because reclamation
reclaimed the Freedom Islands although subsequently there were partial erosions on of areas under water could now be undertaken only by the National Government or by a
some areas. The government had also completed the necessary surveys on these 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 of these reclaimed lands would obviously be needed for public service, there must be a
permission as provided in Section 5 of the Spanish Law of Waters of 1866. formal declaration segregating reclaimed lands no longer needed for public service from
Executive Order No. 525, issued on February 14, 1979, designated PEA as the those still needed for public service.
National Governments implementing arm to undertake all reclamation projects of the Section 3 of EO No. 525, by declaring that all lands reclaimed by PEA shall belong to
government, which shall be undertaken by the PEA or through a proper contract or be owned by the PEA, could not automatically operate to classify inalienable lands
executed by it with any person or entity. Under such contract, a private party receives into alienable or disposable lands of the public domain. Otherwise, reclaimed foreshore
compensation for reclamation services rendered to PEA. Payment to the contractor may and submerged lands of the public domain would automatically become alienable once
be in cash, or in kind consisting of portions of the reclaimed land, subject to the reclaimed by PEA, whether or not classified as alienable or disposable.
constitutional ban on private corporations from acquiring alienable lands of the public The Revised Administrative Code of 1987, a later law than either PD No. 1084 or
domain. The reclaimed land can be used as payment in kind only if the reclaimed land is EO No. 525, vests in the Department of Environment and Natural Resources (DENR for
first classified as alienable or disposable land open to disposition, and then declared no brevity) the following powers and functions:
longer needed for public service. Sec. 4. Powers and Functions. The Department shall:
The Amended JVA covers not only the Freedom Islands, but also an additional (1) x x x
592.15 hectares which are still submerged and forming part of Manila Bay. There is no xxx
legislative or Presidential act classifying these submerged areas as alienable or (4) Exercise supervision and control over forest lands, alienable and disposable
disposable lands of the public domain open to disposition. These submerged areas are public lands, mineral resources and, in the process of exercising such control, impose
not covered by any patent or certificate of title. There can be no dispute that these appropriate taxes, fees, charges, rentals and any such form of levy and collect such
submerged areas form part of the public domain, and in their present state revenues for the exploration, development, utilization or gathering of such resources;
are inalienable and outside the commerce of man. Until reclaimed from the sea, these xxx
submerged areas are, under the Constitution, waters x x x owned by the State, forming (14) Promulgate rules, regulations and guidelines on the issuance of licenses,
part of the public domain and consequently inalienable. Only when actually reclaimed permits, concessions, lease agreements and such other privileges concerning the
from the sea can these submerged areas be classified as public agricultural lands, which development, exploration and utilization of the countrys marine, freshwater, and
under the Constitution are the only natural resources that the State may alienate. Once brackish water and over all aquatic resources of the country and shall continue to
reclaimed and transformed into public agricultural lands, the government may then oversee, supervise and police our natural resources; cancel or cause to cancel such
officially classify these lands as alienable or disposable lands open to privileges upon failure, non-compliance or violations of any regulation, order, and for all
disposition. Thereafter, the government may declare these lands no longer needed for other causes which are in furtherance of the conservation of natural resources and
public service. Only then can these reclaimed lands be considered alienable or disposable supportive of the national interest;
lands of the public domain and within the commerce of man. (15) Exercise exclusive jurisdiction on the management and disposition of all lands
The classification of PEAs reclaimed foreshore and submerged lands into alienable of the public domain and serve as the sole agency responsible for classification, sub-
or disposable lands open to disposition is necessary because PEA is tasked under its classification, surveying and titling of lands in consultation with appropriate
charter to undertake public services that require the use of lands of the public agencies.[80] (Emphasis supplied)
domain. Under Section 5 of PD No. 1084, the functions of PEA include the following: [T]o As manager, conservator and overseer of the natural resources of the State, DENR
own or operate railroads, tramways and other kinds of land transportation, x x x; [T]o exercises supervision and control over alienable and disposable public lands. DENR also
construct, maintain and operate such systems of sanitary sewers as may be necessary; exercises exclusive jurisdiction on the management and disposition of all lands of the
[T]o construct, maintain and operate such storm drains as may be necessary. PEA is public domain. Thus, DENR decides whether areas under water, like foreshore or
empowered to issue rules and regulations as may be necessary for the proper use by submerged areas of Manila Bay, should be reclaimed or not. This means that PEA needs
private parties of any or all of the highways, roads, utilities, buildings and/or any of authorization from DENR before PEA can undertake reclamation projects in Manila Bay,
its properties and to impose or collect fees or tolls for their use. Thus, part of the or in any part of the country.
reclaimed foreshore and submerged lands held by the PEA would actually be needed for DENR also exercises exclusive jurisdiction over the disposition of all lands of the
public use or service since many of the functions imposed on PEA by its charter public domain. Hence, DENR decides whether reclaimed lands of PEA should be
constitute essential public services. classified as alienable under Sections 6[81] and 7[82] of CA No. 141. Once DENR decides
Moreover, Section 1 of Executive Order No. 525 provides that PEA shall be that the reclaimed lands should be so classified, it then recommends to the President the
primarily responsible for integrating, directing, and coordinating all reclamation projects issuance of a proclamation classifying the lands as alienable or disposable lands of the
for and on behalf of the National Government. The same section also states that [A]ll public domain open to disposition. We note that then DENR Secretary Fulgencio S.
reclamation projects shall be approved by the President upon recommendation of the Factoran, Jr. countersigned Special Patent No. 3517 in compliance with the Revised
PEA, and shall be undertaken by the PEA or through a proper contract executed by it Administrative Code and Sections 6 and 7 of CA No. 141.
with any person or entity; x x x. Thus, under EO No. 525, in relation to PD No. 3-A and PD In short, DENR is vested with the power to authorize the reclamation of areas
No.1084, PEA became the primary implementing agency of the National Government to under water, while PEA is vested with the power to undertake the physical reclamation
reclaim foreshore and submerged lands of the public domain. EO No. 525 recognized of areas under water, whether directly or through private contractors. DENR is also
PEA as the government entity to undertake the reclamation of lands and ensure their empowered to classify lands of the public domain into alienable or disposable lands
maximum utilization in promoting public welfare and interests.[79] Since large portions
subject to the approval of the President. On the other hand, PEA is tasked to develop, sell The Secretary of Public Highways and the General Manager of the Public Estates
or lease the reclaimed alienable lands of the public domain. Authority shall execute such contracts or agreements, including appropriate agreements
Clearly, the mere physical act of reclamation by PEA of foreshore or submerged with the Construction and Development Corporation of the Philippines, as may be
areas does not make the reclaimed lands alienable or disposable lands of the public necessary to implement the above.
domain, much less patrimonial lands of PEA. Likewise, the mere transfer by the National Special land patent/patents shall be issued by the Secretary of Natural Resources in
Government of lands of the public domain to PEA does not make the lands alienable or favor of the Public Estates Authority without prejudice to the subsequent transfer to
disposable lands of the public domain, much less patrimonial lands of PEA. the contractor or his assignees of such portion or portions of the land reclaimed or
Absent two official acts a classification that these lands are alienable or disposable to be reclaimed as provided for in the above-mentioned contract. On the basis of such
and open to disposition and a declaration that these lands are not needed for public patents, the Land Registration Commission shall issue the corresponding certificate
service, lands reclaimed by PEA remain inalienable lands of the public domain. Only such of title. (Emphasis supplied)
an official classification and formal declaration can convert reclaimed lands into On the other hand, Section 3 of EO No. 525, issued on February 14, 1979, provides
alienable or disposable lands of the public domain, open to disposition under the that -
Constitution, Title I and Title III[83] of CA No. 141 and other applicable laws.[84] Sec. 3. All lands reclaimed by PEA shall belong to or be owned by the PEA which shall
PEAs Authority to Sell Reclaimed Lands be responsible for its administration, development, utilization or disposition in
PEA, like the Legal Task Force, argues that as alienable or disposable lands of the accordance with the provisions of Presidential Decree No. 1084. Any and all income that
public domain, the reclaimed lands shall be disposed of in accordance with CA No. 141, the PEA may derive from the sale, lease or use of reclaimed lands shall be used in
the Public Land Act. PEA, citing Section 60 of CA No. 141, admits that reclaimed lands accordance with the provisions of Presidential Decree No. 1084.
transferred to a branch or subdivision of the government shall not be alienated, There is no express authority under either PD No. 1085 or EO No. 525 for PEA to
encumbered, or otherwise disposed of in a manner affecting its title, except when sell its reclaimed lands. PD No. 1085 merely transferred ownership and administration
authorized by Congress: x x x.[85] (Emphasis by PEA) of lands reclaimed from Manila Bay to PEA, while EO No. 525 declared that lands
In Laurel vs. Garcia,[86] the Court cited Section 48 of the Revised Administrative reclaimed by PEA shall belong to or be owned by PEA. EO No. 525 expressly states that
Code of 1987, which states that PEA should dispose of its reclaimed lands in accordance with the provisions of
Sec. 48. Official Authorized to Convey Real Property. Whenever real property of the Presidential Decree No. 1084, the charter of PEA.
Government is authorized by law to be conveyed, the deed of conveyance shall be PEAs charter, however, expressly tasks PEA to develop, improve, acquire,
executed in behalf of the government by the following: x x x. administer, deal in, subdivide, dispose, lease and sell any and all kinds of lands x x x
Thus, the Court concluded that a law is needed to convey any real property belonging to owned, managed, controlled and/or operated by the government.[87] (Emphasis
the Government. The Court declared that - supplied) There is, therefore, legislative authority granted to PEA to sell its lands,
It is not for the President to convey real property of the government on his or her own whether patrimonial or alienable lands of the public domain. PEA may sell to private
sole will. Any such conveyance must be authorized and approved by a law enacted by parties its patrimonial properties in accordance with the PEA charter free from
the Congress. It requires executive and legislative concurrence. (Emphasis supplied) constitutional limitations. The constitutional ban on private corporations from acquiring
PEA contends that PD No. 1085 and EO No. 525 constitute the legislative authority alienable lands of the public domain does not apply to the sale of PEAs patrimonial lands.
allowing PEA to sell its reclaimed lands. PD No. 1085, issued on February 4, 1977, PEA may also sell its alienable or disposable lands of the public domain to
provides that private individuals since, with the legislative authority, there is no longer any statutory
The land reclaimed in the foreshore and offshore area of Manila Bay pursuant to the prohibition against such sales and the constitutional ban does not apply to
contract for the reclamation and construction of the Manila-Cavite Coastal Road Project individuals. PEA, however, cannot sell any of its alienable or disposable lands of the
between the Republic of the Philippines and the Construction and Development public domain to private corporations since Section 3, Article XII of the 1987
Corporation of the Philippines dated November 20, 1973 and/or any other contract or Constitution expressly prohibits such sales. The legislative authority benefits only
reclamation covering the same area is hereby transferred, conveyed and assigned to individuals. Private corporations remain barred from acquiring any kind of alienable
the ownership and administration of the Public Estates Authority established land of the public domain, including government reclaimed lands.
pursuant to PD No. 1084; Provided, however, That the rights and interests of the The provision in PD No. 1085 stating that portions of the reclaimed lands could be
Construction and Development Corporation of the Philippines pursuant to the aforesaid transferred by PEA to the contractor or his assignees (Emphasis supplied) would not
contract shall be recognized and respected. apply to private corporations but only to individuals because of the constitutional
Henceforth, the Public Estates Authority shall exercise the rights and assume the ban. Otherwise, the provisions of PD No. 1085 would violate both the 1973 and 1987
obligations of the Republic of the Philippines (Department of Public Highways) arising Constitutions.
from, or incident to, the aforesaid contract between the Republic of the Philippines and The requirement of public auction in the sale of reclaimed lands
the Construction and Development Corporation of the Philippines. Assuming the reclaimed lands of PEA are classified as alienable or disposable lands
In consideration of the foregoing transfer and assignment, the Public Estates Authority open to disposition, and further declared no longer needed for public service, PEA would
shall issue in favor of the Republic of the Philippines the corresponding shares of stock in have to conduct a public bidding in selling or leasing these lands. PEA must observe the
said entity with an issued value of said shares of stock (which) shall be deemed fully paid provisions of Sections 63 and 67 of CA No. 141 requiring public auction, in the absence of
and non-assessable. a law 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 Reclamation under the BOT Law and the Local Government Code
that the provisions of CA No. 141 apply to the disposition of reclaimed alienable lands of The constitutional prohibition in Section 3, Article XII of the 1987 Constitution is
the public domain unless otherwise provided by law. Executive Order No. 654,[89] which absolute and clear: Private corporations or associations may not hold such alienable
authorizes PEA to determine the kind and manner of payment for the transfer of its lands of the public domain except by lease, x x x. Even Republic Act No. 6957 (BOT Law,
assets and properties, does not exempt PEA from the requirement of public auction. EO for brevity), cited by PEA and AMARI as legislative authority to sell reclaimed lands to
No. 654 merely authorizes PEA to decide the mode of payment, whether in kind and in private parties, recognizes the constitutional ban. Section 6 of RA No. 6957 states
installment, but does not authorize PEA to dispense with public auction. Sec. 6. Repayment Scheme. - For the financing, construction, operation and maintenance
Moreover, under Section 79 of PD No. 1445, otherwise known as the Government of any infrastructure projects undertaken through the build-operate-and-transfer
Auditing Code, the government is required to sell valuable government property through arrangement or any of its variations pursuant to the provisions of this Act, the project
public bidding. Section 79 of PD No. 1445 mandates that proponent x x x may likewise be repaid in the form of a share in the revenue of the
Section 79. When government property has become unserviceable for any cause, or is project or other non-monetary payments, such as, but not limited to, the grant of a
no longer needed, it shall, upon application of the officer accountable therefor, be portion or percentage of the reclaimed land, subject to the constitutional requirements
inspected by the head of the agency or his duly authorized representative in the presence with respect to the ownership of the land: x x x. (Emphasis supplied)
of the auditor concerned and, if found to be valueless or unsaleable, it may be destroyed A private corporation, even one that undertakes the physical reclamation of a
in their presence. If found to be valuable, it may be sold at public auction to the government BOT project, cannot acquire reclaimed alienable lands of the public domain
highest bidder under the supervision of the proper committee on award or similar body in view of the constitutional ban.
in the presence of the auditor concerned or other authorized representative of the Section 302 of the Local Government Code, also mentioned by PEA and AMARI,
Commission, after advertising by printed notice in the Official Gazette, or for not less authorizes local governments in land reclamation projects to pay the contractor or
than three consecutive days in any newspaper of general circulation, or where the developer in kind consisting of a percentage of the reclaimed land, to wit:
value of the property does not warrant the expense of publication, by notices posted for Section 302. Financing, Construction, Maintenance, Operation, and Management of
a like period in at least three public places in the locality where the property is to be Infrastructure Projects by the Private Sector. x x x
sold. In the event that the public auction fails, the property may be sold at a private xxx
sale at such price as may be fixed by the same committee or body concerned and In case of land reclamation or construction of industrial estates, the repayment plan may
approved by the Commission. consist of the grant of a portion or percentage of the reclaimed land or the industrial
It is only when the public auction fails that a negotiated sale is allowed, in which case the estate constructed.
Commission on Audit must approve the selling price.[90] The Commission on Audit Although Section 302 of the Local Government Code does not contain a proviso similar to
implements Section 79 of the Government Auditing Code through Circular No. 89- that of the BOT Law, the constitutional restrictions on land ownership automatically
296[91] dated January 27, 1989. This circular emphasizes that government assets must be apply even though not expressly mentioned in the Local Government Code.
disposed of only through public auction, and a negotiated sale can be resorted to only in Thus, under either the BOT Law or the Local Government Code, the contractor or
case of failure of public auction. developer, if a corporate entity, can only be paid with leaseholds on portions of the
At the public auction sale, only Philippine citizens are qualified to bid for PEAs reclaimed land. If the contractor or developer is an individual, portions of the reclaimed
reclaimed foreshore and submerged alienable lands of the public domain. Private land, not exceeding 12 hectares[96] of non-agricultural lands, may be conveyed to him in
corporations are barred from bidding at the auction sale of any kind of alienable land of ownership in view of the legislative authority allowing such conveyance. This is the only
the public domain. way these provisions of the BOT Law and the Local Government Code can avoid a direct
PEA originally scheduled a public bidding for the Freedom Islands on December 10, collision with Section 3, Article XII of the 1987 Constitution.
1991. PEA imposed a condition that the winning bidder should reclaim another 250 Registration of lands of the public domain
hectares of submerged areas to regularize the shape of the Freedom Islands, under a 60- Finally, PEA theorizes that the act of conveying the ownership of the reclaimed
40 sharing of the additional reclaimed areas in favor of the winning bidder. [92] No one, lands to public respondent PEA transformed such lands of the public domain to private
however, submitted a bid. On December 23, 1994, the Government Corporate Counsel lands. This theory is echoed by AMARI which maintains that the issuance of the special
advised PEA it could sell the Freedom Islands through negotiation, without need of patent leading to the eventual issuance of title takes the subject land away from the land
another public bidding, because of the failure of the public bidding on December 10, of public domain and converts the property into patrimonial or private property. In
1991.[93] short, PEA and AMARI contend that with the issuance of Special Patent No. 3517 and the
However, the original JVA dated April 25, 1995 covered not only the Freedom corresponding certificates of titles, the 157.84 hectares comprising the Freedom Islands
Islands and the additional 250 hectares still to be reclaimed, it also granted an option to have become private lands of PEA. In support of their theory, PEA and AMARI cite the
AMARI to reclaim another 350 hectares. The original JVA, a negotiated contract, enlarged following rulings of the Court:
the reclamation area to 750 hectares.[94] The failure of public bidding on December 10, 1. Sumail v. Judge of CFI of Cotabato,[97] where the Court held
1991, involving only 407.84 hectares,[95] is not a valid justification for a negotiated sale of Once the patent was granted and the corresponding certificate of title was
750 hectares, almost double the area publicly auctioned. Besides, the failure of public issued, the land ceased to be part of the public domain and became
bidding happened on December 10, 1991, more than three years before the signing of private property over which the Director of Lands has neither control nor
the original JVA on April 25, 1995. The economic situation in the country had greatly jurisdiction.
improved during the intervening period. 2. Lee Hong Hok v. David,[98] where the Court declared -
After the registration and issuance of the certificate and duplicate Registration of land under Act No. 496 or PD No. 1529 does not vest in the
certificate of title based on a public land patent, the land covered thereby registrant private or public ownership of the land. Registration is not a mode of
automatically comes under the operation of Republic Act 496 subject to acquiring ownership but is merely evidence of ownership previously conferred by any of
all the safeguards provided therein. the recognized modes of acquiring ownership. Registration does not give the registrant a
3. Heirs of Gregorio Tengco v. Heirs of Jose Aliwalas,[99] where the Court ruled - better right than what the registrant had prior to the registration. [102] The registration of
While the Director of Lands has the power to review homestead patents, lands of the public domain under the Torrens system, by itself, cannot convert public
he may do so only so long as the land remains part of the public domain lands into private lands.[103]
and continues to be under his exclusive control; but once the patent is Jurisprudence holding that upon the grant of the patent or issuance of the
registered and a certificate of title is issued, the land ceases to be part of certificate of title the alienable land of the public domain automatically becomes private
the public domain and becomes private property over which the Director land cannot apply to government units and entities like PEA. The transfer of the Freedom
of Lands has neither control nor jurisdiction. Islands to PEA was made subject to the provisions of CA No. 141 as expressly stated in
4. Manalo v. Intermediate Appellate Court,[100] where the Court held Special Patent No. 3517 issued by then President Aquino, to wit:
When the lots in dispute were certified as disposable on May 19, 1971, NOW, THEREFORE, KNOW YE, that by authority of the Constitution of the Philippines
and free patents were issued covering the same in favor of the private and in conformity with the provisions of Presidential Decree No. 1084, supplemented by
respondents, the said lots ceased to be part of the public domain and, Commonwealth Act No. 141, as amended, there are hereby granted and conveyed unto
therefore, the Director of Lands lost jurisdiction over the same. the Public Estates Authority the aforesaid tracts of land containing a total area of one
5.Republic v. Court of Appeals,[101] where the Court stated million nine hundred fifteen thousand eight hundred ninety four (1,915,894) square
Proclamation No. 350, dated October 9, 1956, of President Magsaysay meters; the technical description of which are hereto attached and made an integral part
legally effected a land grant to the Mindanao Medical Center, Bureau of hereof. (Emphasis supplied)
Medical Services, Department of Health, of the whole lot, validly sufficient Thus, the provisions of CA No. 141 apply to the Freedom Islands on matters not
for initial registration under the Land Registration Act. Such land grant is covered by PD No. 1084. Section 60 of CA No. 141 prohibits, except when authorized by
constitutive of a fee simple title or absolute title in favor of petitioner Congress, the sale of alienable lands of the public domain that are transferred to
Mindanao Medical Center. Thus, Section 122 of the Act, which governs the government units or entities. Section 60 of CA No. 141 constitutes, under Section 44 of
registration of grants or patents involving public lands, provides that PD No. 1529, a statutory lien affecting title of the registered land even if not annotated on
Whenever public lands in the Philippine Islands belonging to the the certificate of title.[104] Alienable lands of the public domain held by government
Government of the United States or to the Government of the Philippines entities under Section 60 of CA No. 141 remain public lands because they cannot be
are alienated, granted or conveyed to persons or to public or private alienated or encumbered unless Congress passes a law authorizing their
corporations, the same shall be brought forthwith under the operation of disposition. Congress, however, cannot authorize the sale to private corporations of
this Act (Land Registration Act, Act 496) and shall become registered reclaimed alienable lands of the public domain because of the constitutional ban. Only
lands. individuals can benefit from such law.
The first four cases cited involve petitions to cancel the land patents and the The grant of legislative authority to sell public lands in accordance with Section 60
corresponding certificates of titles issued to private parties. These four cases uniformly of CA No. 141 does not automatically convert alienable lands of the public domain into
hold that the Director of Lands has no jurisdiction over private lands or that upon private or patrimonial lands. The alienable lands of the public domain must be
issuance of the certificate of title the land automatically comes under the Torrens transferred to qualified private parties, or to government entities not tasked to dispose
System. The fifth case cited involves the registration under the Torrens System of a 12.8- of public lands, before these lands can become private or patrimonial lands. Otherwise,
hectare public land granted by the National Government to Mindanao Medical Center, a the constitutional ban will become illusory if Congress can declare lands of the public
government unit under the Department of Health. The National Government transferred domain as private or patrimonial lands in the hands of a government agency tasked to
the 12.8-hectare public land to serve as the site for the hospital buildings and other dispose of public lands. This will allow private corporations to acquire directly from
facilities of Mindanao Medical Center, which performed a public service. The Court government agencies limitless areas of lands which, prior to such law, are concededly
affirmed the registration of the 12.8-hectare public land in the name of Mindanao public lands.
Medical Center under Section 122 of Act No. 496. This fifth case is an example of a public Under EO No. 525, PEA became the central implementing agency of the National
land being registered under Act No. 496 without the land losing its character as a Government to reclaim foreshore and submerged areas of the public domain. Thus, EO
property of public dominion. No. 525 declares that
In the instant case, the only patent and certificates of title issued are those in the EXECUTIVE ORDER NO. 525
name of PEA, a wholly government owned corporation performing public as well as Designating the Public Estates Authority as the Agency Primarily Responsible for all
proprietary functions. No patent or certificate of title has been issued to any private Reclamation Projects
party. No one is asking the Director of Lands to cancel PEAs patent or certificates of Whereas, there are several reclamation projects which are ongoing or being proposed to
title. In fact, the thrust of the instant petition is that PEAs certificates of title should be undertaken in various parts of the country which need to be evaluated for consistency
remain with PEA, and the land covered by these certificates, being alienable lands of the with national programs;
public domain, should not be sold to a private corporation.
Whereas, there is a need to give further institutional support to the Governments floodgates to corporations and even individuals acquiring hundreds of hectares of
declared policy to provide for a coordinated, economical and efficient reclamation of alienable lands of the public domain under the guise that in the hands of PEA these lands
lands; are private lands. This will result in corporations amassing huge landholdings never
Whereas, Presidential Decree No. 3-A requires that all reclamation of areas shall be before seen in this country - creating the very evil that the constitutional ban was
limited to the National Government or any person authorized by it under proper designed to prevent. This will completely reverse the clear direction of constitutional
contract; development in this country. The 1935 Constitution allowed private corporations to
Whereas, a central authority is needed to act on behalf of the National Government acquire not more than 1,024 hectares of public lands.[105] The 1973 Constitution
which shall ensure a coordinated and integrated approach in the reclamation of prohibited private corporations from acquiring any kind of public land, and the 1987
lands; Constitution has unequivocally reiterated this prohibition.
Whereas, Presidential Decree No. 1084 creates the Public Estates Authority as a The contention of PEA and AMARI that public lands, once registered under Act No.
government corporation to undertake reclamation of lands and ensure their 496 or PD No. 1529, automatically become private lands is contrary to existing
maximum utilization in promoting public welfare and interests; and laws.Several laws authorize lands of the public domain to be registered under the
Whereas, Presidential Decree No. 1416 provides the President with continuing authority Torrens System or Act No. 496, now PD No. 1529, without losing their character as public
to reorganize the national government including the transfer, abolition, or merger of lands.Section 122 of Act No. 496, and Section 103 of PD No. 1529, respectively, provide
functions and offices. as follows:
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of Act No. 496
the powers vested in me by the Constitution and pursuant to Presidential Decree No. Sec. 122. Whenever public lands in the Philippine Islands belonging to the x x x
1416, do hereby order and direct the following: Government of the Philippine Islands are alienated, granted, or conveyed to persons or
Section 1. The Public Estates Authority (PEA) shall be primarily responsible for the public or private corporations, the same shall be brought forthwith under the
integrating, directing, and coordinating all reclamation projects for and on behalf of operation of this Act and shall become registered lands.
the National Government. All reclamation projects shall be approved by the President PD No. 1529
upon recommendation of the PEA, and shall be undertaken by the PEA or through a Sec. 103. Certificate of Title to Patents. Whenever public land is by the Government
proper contract executed by it with any person or entity; Provided, that, reclamation alienated, granted or conveyed to any person, the same shall be brought forthwith under
projects of any national government agency or entity authorized under its charter shall the operation of this Decree. (Emphasis supplied)
be undertaken in consultation with the PEA upon approval of the President. Based on its legislative history, the phrase conveyed to any person in Section 103 of PD
xxx. No. 1529 includes conveyances of public lands to public corporations.
As the central implementing agency tasked to undertake reclamation projects Alienable lands of the public domain granted, donated, or transferred to a province,
nationwide, with authority to sell reclaimed lands, PEA took the place of DENR as the municipality, or branch or subdivision of the Government, as provided in Section 60 of
government agency charged with leasing or selling reclaimed lands of the public CA No. 141, may be registered under the Torrens System pursuant to Section 103 of PD
domain. The reclaimed lands being leased or sold by PEA are not private lands, in the No. 1529. Such registration, however, is expressly subject to the condition in Section 60
same manner that DENR, when it disposes of other alienable lands, does not dispose of of CA No. 141 that the land shall not be alienated, encumbered or otherwise disposed
private lands but alienable lands of the public domain. Only when qualified private of in a manner affecting its title, except when authorized by Congress. This provision
parties acquire these lands will the lands become private lands. In the hands of the refers to government reclaimed, foreshore and marshy lands of the public domain that
government agency tasked and authorized to dispose of alienable of disposable have been titled but still cannot be alienated or encumbered unless expressly authorized
lands of the public domain, these lands are still public, not private lands. by Congress. The need for legislative authority prevents the registered land of the public
Furthermore, PEAs charter expressly states that PEA shall hold lands of the public domain from becoming private land that can be disposed of to qualified private parties.
domain as well as any and all kinds of lands. PEA can hold both lands of the public The Revised Administrative Code of 1987 also recognizes that lands of the public
domain and private lands. Thus, the mere fact that alienable lands of the public domain domain may be registered under the Torrens System. Section 48, Chapter 12, Book I of
like the Freedom Islands are transferred to PEA and issued land patents or certificates of the Code states
title in PEAs name does not automatically make such lands private. Sec. 48. Official Authorized to Convey Real Property. Whenever real property of the
To allow vast areas of reclaimed lands of the public domain to be transferred to Government is authorized by law to be conveyed, the deed of conveyance shall be
PEA as private lands will sanction a gross violation of the constitutional ban on private executed in behalf of the government by the following:
corporations from acquiring any kind of alienable land of the public domain. PEA will (1) x x x
simply turn around, as PEA has now done under the Amended JVA, and transfer several (2) For property belonging to the Republic of the Philippines, but titled in the name
hundreds of hectares of these reclaimed and still to be reclaimed lands to a single private of any political subdivision or of any corporate agency or instrumentality, by the
corporation in only one transaction. This scheme will effectively nullify the constitutional executive head of the agency or instrumentality. (Emphasis supplied)
ban in Section 3, Article XII of the 1987 Constitution which was intended to diffuse Thus, private property purchased by the National Government for expansion of a public
equitably the ownership of alienable lands of the public domain among Filipinos, now wharf may be titled in the name of a government corporation regulating port operations
numbering over 80 million strong. in the country. Private property purchased by the National Government for expansion of
This scheme, if allowed, can even be applied to alienable agricultural lands of the an airport may also be titled in the name of the government agency tasked to administer
public domain since PEA can acquire x x x any and all kinds of lands. This will open the 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 natural resources of the State, or seek to circumvent the constitutional ban on alienation
become properties of the public domain, and if already registered under Act No. 496 or of lands of the public domain to private corporations, do so at their own risk.
PD No. 1529, remain registered land. There is no requirement or provision in any We can now summarize our conclusions as follows:
existing law for the de-registration of land from the Torrens System. 1. The 157.84 hectares of reclaimed lands comprising the Freedom Islands,
Private lands taken by the Government for public use under its power of eminent now covered by certificates of title in the name of PEA, are alienable
domain become unquestionably part of the public domain. Nevertheless, Section 85 of lands of the public domain. PEA may lease these lands to private
PD No. 1529 authorizes the Register of Deeds to issue in the name of the National corporations but may not sell or transfer ownership of these lands to
Government new certificates of title covering such expropriated lands. Section 85 of PD private corporations. PEA may only sell these lands to Philippine citizens,
No. 1529 states subject to the ownership limitations in the 1987 Constitution and existing
Sec. 85. Land taken by eminent domain. Whenever any registered land, or interest laws.
therein, is expropriated or taken by eminent domain, the National Government, province, 2. The 592.15 hectares of submerged areas of Manila Bay remain inalienable
city or municipality, or any other agency or instrumentality exercising such right shall natural resources of the public domain until classified as alienable or
file for registration in the proper Registry a certified copy of the judgment which shall disposable lands open to disposition and declared no longer needed for
state definitely by an adequate description, the particular property or interest public service. The government can make such classification and
expropriated, the number of the certificate of title, and the nature of the public use. A declaration only after PEA has reclaimed these submerged areas. Only
memorandum of the right or interest taken shall be made on each certificate of title by then can these lands qualify as agricultural lands of the public domain,
the Register of Deeds, and where the fee simple is taken, a new certificate shall be which are the only natural resources the government can alienate. In their
issued in favor of the National Government, province, city, municipality, or any other present state, the 592.15 hectares of submerged areas are inalienable
agency or instrumentality exercising such right for the land so taken. The legal expenses and outside the commerce of man.
incident to the memorandum of registration or issuance of a new certificate of title shall 3. Since the Amended JVA seeks to transfer to AMARI, a private corporation,
be for the account of the authority taking the land or interest therein. (Emphasis ownership of 77.34 hectares[110] of the Freedom Islands, such transfer is
supplied) void for being contrary to Section 3, Article XII of the 1987 Constitution
Consequently, lands registered under Act No. 496 or PD No. 1529 are not exclusively which prohibits private corporations from acquiring any kind of alienable
private or patrimonial lands. Lands of the public domain may also be registered pursuant land of the public domain.
to existing laws. 4. Since the Amended JVA also seeks to transfer to AMARI ownership of
AMARI makes a parting shot that the Amended JVA is not a sale to AMARI of the 290.156 hectares[111] of still submerged areas of Manila Bay, such transfer
Freedom Islands or of the lands to be reclaimed from submerged areas of Manila Bay. In is void for being contrary to Section 2, Article XII of the 1987 Constitution
the words of AMARI, the Amended JVA is not a sale but a joint venture with a stipulation which prohibits the alienation of natural resources other than agricultural
for reimbursement of the original cost incurred by PEA for the earlier reclamation and lands of the public domain. PEA may reclaim these submerged areas.
construction works performed by the CDCP under its 1973 contract with the Thereafter, the government can classify the reclaimed lands as alienable
Republic. Whether the Amended JVA is a sale or a joint venture, the fact remains that the or disposable, and further declare them no longer needed for public
Amended JVA requires PEA to cause the issuance and delivery of the certificates of title service. Still, the transfer of such reclaimed alienable lands of the public
conveying AMARIs Land Share in the name of AMARI.[107] domain to AMARI will be void in view of Section 3, Article XII of the 1987
This stipulation still contravenes Section 3, Article XII of the 1987 Constitution Constitution which prohibits private corporations from acquiring any
which provides that private corporations shall not hold such alienable lands of the public kind of alienable land of the public domain.
domain except by lease. The transfer of title and ownership to AMARI clearly means that Clearly, the Amended JVA violates glaringly Sections 2 and 3, Article XII of the 1987
AMARI will hold the reclaimed lands other than by lease. The transfer of title and Constitution. Under Article 1409[112] of the Civil Code, contracts whose object or purpose
ownership is a disposition of the reclaimed lands, a transaction considered a sale or is contrary to law, or whose object is outside the commerce of men, are inexistent and
alienation under CA No. 141,[108] the Government Auditing Code,[109] and Section 3, void from the beginning. The Court must perform its duty to defend and uphold the
Article XII of the 1987 Constitution. Constitution, and therefore declares the Amended JVA null and void ab initio.
The Regalian doctrine is deeply implanted in our legal system. Foreshore and Seventh issue: whether the Court is the proper forum to raise the issue of whether
submerged areas form part of the public domain and are inalienable. Lands reclaimed the Amended JVA is grossly disadvantageous to the government.
from foreshore and submerged areas also form part of the public domain and are also Considering that the Amended JVA is null and void ab initio, there is no necessity to
inalienable, unless converted pursuant to law into alienable or disposable lands of the rule on this last issue. Besides, the Court is not a trier of facts, and this last issue involves
public domain. Historically, lands reclaimed by the government are sui generis, not a determination of factual matters.
available for sale to private parties unlike other alienable public lands. Reclaimed lands WHEREFORE, the petition is GRANTED. The Public Estates Authority and Amari
retain their inherent potential as areas for public use or public service. Alienable lands of Coastal Bay Development Corporation are PERMANENTLY ENJOINED from
the public domain, increasingly becoming scarce natural resources, are to be distributed implementing the Amended Joint Venture Agreement which is hereby declared NULL
equitably among our ever-growing population. To insure such equitable distribution, the and VOID ab initio.
1973 and 1987 Constitutions have barred private corporations from acquiring any kind SO ORDERED.
of alienable land of the public domain. Those who attempt to dispose of inalienable
Davide, Jr., C.J., Bellosillo, Puno, Vitug, Kapunan, Mendoza, Panganiban, Quisumbing, FACTS:
Ynares-Santiago, Sandoval-Gutierrez, Austria-Martinez, and Corona, JJ., concur. President Marcos through a presidential decree created PEA, which was tasked
with the development, improvement, and acquisition, lease, and sale of all kinds of
ALEXANDER A. KRIVENKO, petitioner-appelant, vs. THE REGISTER OF DEEDS, CITY OF lands. The then president also transferred to PEA the foreshore and offshore lands of
MANILA, respondent and appellee. Manila Bay under the Manila-Cavite Coastal
Road and Reclamation Project.

FACTS: Thereafter, PEA was granted patent to the reclaimed areas of land and then, years
later, PEA entered into a JVA with AMARI for the development of the Freedom Islands.
Alexander Krivenko, an alien, bought a residential lot in December of 1941. The These two entered into a joint venture in the absence of any public bidding.
registration was interrupted by war. In 1945, he sought to accomplish the registration
but was denied by the register of deed on ground that, being an alien, he cannot acquire Later, a privilege speech was given by Senator President Maceda denouncing
land within the jurisdiction. Krivenko appealed to the Court. the JVA as the grandmother of all scams. An investigation was conducted and it was
concluded that the lands that PEA was conveying to AMARI were lands of the public
ISSUES: domain; the certificates of title over the
Freedom Islands were void; and the JVA itself was illegal. This prompted Ramos to form
1. Whether or not an alien under our Constitution may acquire residential land? an investigatory committee on the legality of the JVA.
2. Whether or not the prohibitions of the rights to acquire residential lot that was already
of private ownership prior to the approval of this Constitutions is applicable at the case Petitioner now comes and contends that the government stands to lose billions by
at bar? the conveyance or sale of the reclaimed areas to AMARI. He also asked for the full
disclosure of the renegotiations happening between the parties.

RULING: ISSUE:
W/N stipulations in the amended JVA for the transfer to AMARI of the lands,
1. NO. Under the Article XIII, Section 1, of the Constitution states that: All agricultural, reclaimed or to be reclaimed, violate the Constitution.
timber, and mineral lands of the public domain, water, minerals, coal, petroleum, and
other mineral oils, all forces of potential energy, and other natural resources of the HELD:
Philippines belong to the State, and their disposition, exploitation, development, or The ownership of lands reclaimed from foreshore and submerged areas is rooted in the
utilization shall be limited to citizens of the Philippines, or to corporations or Regalian doctrine, which holds that the State owns all lands and waters of the public
associations at least sixty per centum of the capital of which is owned by such citizens, domain.
subject to any existing right, grant, lease, or concession at the time of the inauguration of
the Government established under this Constitution. This means to say that, under the The 1987 Constitution recognizes the Regalian doctrine. It declares that all natural
provisions of the Constitutions, aliens are not allowed to acquire the ownership of urban resources are owned by the State and except for alienable agricultural lands of the
or residential lands in the Philippines and, as consequence, all acquisitions made in public domain, natural resources cannot be alienated.
contravention of the prohibitions since the fundamental law became effective are null
and void per se and ab initio. 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 area are
2. Prior to the Constitution, there were in the Public Land Act No. 2874 sections 120 and still submerged areas forming part of Manila Bay. Further, it is provided that AMARI
121 which granted aliens the right to acquire private only by way of reciprocity. It is to will reimburse the actual costs in reclaiming the areas of land and it will shoulder the
be observed that the pharase "no land" used in this section refers to all private lands, other reclamation costs to be incurred.
whether strictly agricultural, residential or otherwise, there being practically no private
land which had not been acquired by any of the means provided in said two sections. The foreshore and submerged areas of Manila Bay are part of the lands of the public
Therefore, the prohibition contained in these two provisions was, in effect, that no domain, waters and other natural resources and consequently owned by the State.
private land could be transferred to aliens except "upon express authorization by the As such, foreshore and submerged areas shall not be alienable unless they are
Philippine Legislature, to citizens of Philippine Islands the same right to acquire, hold, classified as agricultural lands of the public domain. The mere reclamation of these
lease, encumber, dispose of, or alienate land." In other words, aliens were granted the areas by the PEA doesn’t convert these inalienable natural resources of the State into
right to acquire private land merely by way of reciprocity. alienable and disposable lands of the public domain. There must be a law or
presidential
CHAVEZ V. PUBLIC ESTATES AUTHORITY proclamation officially classifying these reclaimed lands as alienable and disposable
384 SCRA 152 if the law has reserved them for some public or quasi-public use.
FRENZEL v. CATITO
G.R. No. 143958. July 11, 2003
Ponente: J. CALLEJO Sr.

DOCTRINE:
A contract that violates the Constitution and the law, is null and void and vests no rights
and creates no obligations. It produces no legal effect at all. The petitioner, being a party
to an illegal contract, cannot come into a court of law and ask to have his illegal objective
carried out

FACTS:

Petitioner Alfred Fritz Frenzel is an Australian citizen of German descent. He was so


enamored with Ederlina that he bought her numerous properties such as house and lot
in Quezon City and in Davao City. He also put up a beauty parlor business in the name of
Ederlina. Alfred was unaware that Ederlina was married until her spouse Klaus Muller
wrote a letter to Alfred begging the latter to leave her wife alone.

When Alfred and Ederlinas relationship started deteriorating. Ederlina had not been able
to secure a divorce from Klaus. The latter could charge her for bigamy and could even
involve Alfred, who himself was still married. To avoid complications, Alfred decided to
live separately from Ederlina and cut off all contacts with her.

On October 15, 1985, Alfred wrote to Ederlinas father, complaining that Ederlina had
taken all his life savings and because of this, he was virtually penniless. He further
accused the Catito family of acquiring for themselves the properties he had purchased
with his own money. He demanded the return of all the amounts that Ederlina and her
family had stolen and turn over all the properties acquired by him and Ederlina during
their coverture.

ISSUE:

Whether the petitioner could recover the money used in purchasing the several
properties

HELD:

No, even if, as claimed by the petitioner, the sales in question were entered into by him
as the real vendee, the said transactions are in violation of the Constitution; hence, are
null and void ab initio. A contract that violates the Constitution and the law, is null and
void and vests no rights and creates no obligations. It produces no legal effect at all. The
petitioner, being a party to an illegal contract, cannot come into a court of law and ask to
have his illegal objective carried out. One who loses his money or property by knowingly
engaging in a contract or transaction which involves his own moral turpitude may not
maintain an action for his losses. To him who moves in deliberation and premeditation,
the law is unyielding. The law will not aid either party to an illegal contract or
agreement; it leaves the parties where it finds them

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