E085 Benguet Corp. vs DENR

8/18/2019 E085 Benguet Corp. vs DENR

1/20

Republic of the Philippines

SUPREME COURTManila

SECOND DIVISION

BENGUET CORPORATION, G.R. No. 163101

Petitioner,

Present:

!ersus "UISUM#IN$, J., Chairperson,

C%RPIO,

C%RPIO MOR%&ES,

TIN$%, an'

DEPARTMENT OF ENVIRONMENT VE&%SCO, (R), JJ.

AND NATURAL RESOURCES-MINES ADJUDICATION BOARD

and J.G. REALT AND MINING Pro*ul+ate':

CORPORATION,

Respon'ents) ebruar- ./, 0112

33

D E C I S I O N

VELASCO, JR., J.!

The instant petition un'er Rule 45 of the Rules of Court see6s the annul*ent

of the Dece*ber 0, 0110 Decision.7.8 an' March .9, 011 Resolution0708 of the

Depart*ent of En!iron*ent an' Natural ResourcesMinin+ %';u'ication #oar'


2/20

011. Decision/7/8 of the M%# Panel of %rbitrators ;ointl- file' b- ()$) Realt- as clai*o?ner an'

#en+uet as operator)

In the R%@OP, #en+uet obli+ate' itself to perfect the ri+hts to the *inin+ clai*s

an'Bor other?ise acuire the *inin+ ri+hts to the *ineral clai*s) @ithin 0 *onths

fro* the e3ecution of the R%@OP, #en+uet shoul' also cause the e3a*ination of

the *inin+ clai*s for the purpose of 'eter*inin+ ?hether or not the- are ?orth

'e!elopin+ ?ith reasonable probabilit- of profitable pro'uction) #en+uet

un'ertoo6 also to furnish ()$) Realt- ?ith a report on the e3a*ination, ?ithin a

3[3] Id. at 42-47.

4[4] Id. at 73-111.

5[5] Id. at 112-115.


3/20

reasonable ti*e after the co*pletion of the e3a*ination) Moreo!er, also ?ithin the

e3a*ination perio', #en+uet shall con'uct all necessar- e3ploration in accor'ance

?ith a prepare' e3ploration pro+ra*) If it chooses to 'o so an' before the

e3piration of the e3a*ination perio', #en+uet *a- un'erta6e to 'e!elop the

*inin+ clai*s upon ?ritten notice to ()$) Realt-) #en+uet *ust then place the

*inin+ clai*s into co**ercial pro'ucti!e sta+e ?ithin 0 *onths fro* the ?ritten

notice)4748 It is also pro!i'e' in the R%@OP that if the *inin+ clai*s ?ere place'

in co**ercial pro'uction b- #en+uet, ()$) Realt- shoul' be entitle' to a ro-alt- of

fi!e percent , .>2>, the E3ecuti!e VicePresi'ent of #en+uet, %ntonio N)

Tachulin+, issue' a letter infor*in+ ()$) Realt- of its intention to 'e!elop the

*inin+ clai*s) Fo?e!er, on ebruar- >, .>>>, ()$) Realt-, throu+h its Presi'ent,

(ohnn- &) Tan, then sent a letter to the Presi'ent of #en+uet infor*in+ the latter

that it ?as ter*inatin+ the R%@OP on the follo?in+ +roun's:

a The fact that -our co*pan- has faile' to perfor* the obli+ations set forth in

the R%@OP, i)e), to un'erta6e 'e!elop*ent ?or6s ?ithin 0 -ears fro* the

e3ecution of the %+ree*entG

b Violation of the Contract b- allo?in+ hi+h +ra'ers to operate on our clai*)

c No stipulation ?as pro!i'e' ?ith respect to the ter* li*it of the R%@OP)

' Nonpa-*ent of the ro-alties thereon as pro!i'e' in the R%@OP)9798

6[6] Id. at 75-78.

7[7] Id. at 202.


4/20

In response, #en+uetAs Mana+er for &e+al Ser!ices, Re-nal'o P) Men'oa,

?rote ()$) Realt- a letter 'ate' March 2, .>>>,2728 therein alle+in+ that #en+uet

co*plie' ?ith its obli+ations un'er the R%@OP b- in!estin+ PhP 0) *illion to

rehabilitate the *ines, an' that the co**ercial operation ?as ha*pere' b- the

nonissuance of a Mines Te*porar- Per*it b- the Mines an' $eosciences #ureau


5/20

On March .>, 011., the PO% issue' a Decision,.17.18 '?ellin+ upon the issues of 29 7R%@OP8 an' itsSupple*ental %+ree*ent is hereb- 'eclare' cancelle' an' ?ithout effect)

#EN$UET is hereb- e3clu'e' fro* the ;oint MPS% %pplication o!er the *ineral

clai*s 'eno*inate' as H#ONITOI, H#ONITOII, H#ONITOIII an'H#ONITOIV)

SO ORDERED)

Therefro*, #en+uet file' a Notice of %ppeal..7..8 ?ith the M%# on %pril 0/, 011.,

'oc6ete' as Mines %'*inistrati!e Case No) RM01111.) Thereafter, the M%#

issue' the assaile' Dece*ber 0, 0110 Decision) #en+uet then file' a Motion for

Reconsi'eration of the assaile' Decision ?hich ?as 'enie' in the March .9, 011

Resolution of the M%#) Fence, #en+uet file' the instant petition)

T"# I&&'#&

. There ?as serious an' palpable error ?hen the Fonorable #oar' faile' to rulethat the contractual obli+ation of the parties to arbitrate un'er the Ro-alt-

%+ree*ent is *an'ator-)

0 The Fonorable #oar' e3cee'e' its ;uris'iction ?hen it sustaine' the

cancellation of the Ro-alt- %+ree*ent for alle+e' breach of contract 'espite

the absence of e!i'ence)

10[10] Id. at 42-47.

11[11] Id. at 48.


6/20

/ The "uestione' Decision of the Fonorable #oar' in cancellin+ the R%@OP

pre;u'ice7'8 the substantial ri+hts of #en+uet un'er the contract to the un;ust

enrich*ent of ($ Realt-).07.08

Restate', the issues are:


7/20

Constitution ?ithout its a'!ice an' consent) On the other han', Section 9> of R%

No) 9>0 pro!i'es that 'ecisions of the M%# *a- be re!ie?e' b- this Court on a

Hpetition for re!ie? b- certiorari) This pro!ision is ob!iousl- an e3pansion of theCourtAs appellate ;uris'iction, an e3pansion to ?hich this Court has not consente')

In'iscri*inate enact*ent of le+islation enlar+in+ the appellate ;uris'iction of this

Court ?oul' unnecessaril- bur'en it)Second, ?hen the Supre*e Court, in the e3ercise of its rule*a6in+

po?er, transfers to the C% pen'in+ cases in!ol!in+ a re!ie? of a uasi;u'icial

bo'-As 'ecisions, such transfer relates onl- to proce'ureG hence, it 'oes not i*pair the substanti!e an' !este' ri+hts of the parties) The a++rie!e' part-As ri+ht to

appeal is preser!e'G ?hat is chan+e' is onl- the proce'ure b- ?hich the appeal is

to be *a'e or 'eci'e') The parties still ha!e a re*e'- an' a co*petent tribunal to

+rant this re*e'-)

!ird, the Re!ise' Rules of Ci!il Proce'ure inclu'e' Rule / to pro!i'e a

unifor* rule on appeals fro* uasi;u'icial a+encies) Un'er the rule, appeals

fro* their ;u'+*ents an' final or'ers are no? reuire' to be brou+ht to the C% ona !erifie' petition for re!ie?) % uasi;u'icial a+enc- or bo'- has been 'efine' as

an or+an of +o!ern*ent, other than a court or le+islature, ?hich affects the ri+htsof pri!ate parties throu+h either a';u'ication or rule*a6in+) M%# falls un'er

this 'efinitionG hence, it is no 'ifferent fro* the other uasi;u'icial bo'ies

enu*erate' un'er Rule /) #esi'es, the intro'uctor- ?or's in Section . of Circular No) .>.KKHa*on+ these a+encies areKKin'icate that the enu*eration is

not e3clusi!e or conclusi!e an' ac6no?le'+e the e3istence of other uasi;u'icial

a+encies ?hich, thou+h not e3pressl- liste', shoul' be 'ee*e' inclu'e' therein)

Fourt!, the Court realies that un'er #atas Pa*bansa as

a*en'e' b- R% No) 9>10, factual contro!ersies are usuall- in!ol!e' in 'ecisions

of uasi;u'icial bo'iesG an' the C%, ?hich is li6e?ise tas6e' to resol!e uestionsof fact, has *ore elbo? roo* to resol!e the*) #- inclu'in+ uestions of fact

a*on+ the issues that *a- be raise' in an appeal fro* uasi;u'icial a+encies to

the C%, Section / of Re!ise' %'*inistrati!e Circular No) .>5 an' Section / of Rule / e3plicitl- e3pan'e' the list of such issues)

%ccor'in+ to Section / of Rule /, H7a8n appeal un'er this Rule *a- be

ta6en to the Court of %ppeals ?ithin the perio' an' in the *anner herein pro!i'e'?hether the appeal in!ol!es uestions of fact, of la?, or *i3e' uestions of fact

an' la?) Fence, appeals fro* uasi;u'icial a+encies e!en onl- on uestions of

la? *a- be brou+ht to the C%)

Fift!, the ;u'icial polic- of obser!in+ the hierarch- of courts 'ictates that

'irect resort fro* a'*inistrati!e a+encies to this Court ?ill not be entertaine',unless the re'ress 'esire' cannot be obtaine' fro* the appropriate lo?er tribunals,

or unless e3ceptional an' co*pellin+ circu*stances ;ustif- a!ail*ent of a re*e'-

fallin+ ?ithin an' callin+ for the e3ercise of our pri*ar- ;uris'iction).7.8

14[14] Id. at 138-141.


8/20

The abo!e principle ?as reiterate' in "sap!il Construction and Development

Corporation v. uason, Jr )


9/20

O@NER an' the thir' to be selecte' b- the afore*entione' t?o arbitrators so

appointe')

3 3 3 3

..)10 Court %ction

No action shall be institute' in court as to an- *atter in 'ispute as

hereinabo!e state', e3cept to enforce the 'ecision of the *a;orit- of the%rbitrators).47.48

Thus, #en+uet ar+ues that the PO% shoul' ha!e first referre' the case to

!oluntar- arbitration before ta6in+ co+niance of the case, citin+ Sec) 0 of R% 294

on persons an' *atters sub;ect to arbitration)

On the other han', in 'en-in+ such ar+u*ent, the PO% rule' that:

@hile the parties *a- establish such stipulations clauses, ter*s an'

con'itions as the- *a- 'ee* con!enient, the sa*e *ust not be contrar- to la?

an' public polic-) %t a +lance, there is nothin+ ?ron+ ?ith the ter*s an'

con'itions of the a+ree*ent) #ut to state that an a++rie!e' part- cannot initiate anaction ?ithout +oin+ to arbitration ?oul' be t-in+ oneAs han' e!en if there is a

la? ?hich allo?s hi* to 'o so).97.98

The M%#, *ean?hile, 'enie' #en+uetAs contention on the +roun' of estoppel,

statin+:

#esi'es, b- its o?n act, #en+uet is alrea'- estoppe' in uestionin+ the ;uris'iction of the Panel of %rbitrators to hear an' 'eci'e the case) %s pointe' out

in the appeale' Decision, #en+uet initiate' an' file' an %'!erse Clai* 'oc6ete'

as M%CRM011110 o!er the sa*e *inin+ clai*s ?ithout un'er+oin+

contractual arbitration) In this particular case


10/20

the case but also file' an %ns?er ?ith counterclai* see6in+ affir*ati!e reliefs

fro* the Panel of %rbitrators).27.28

Moreo!er, the M%# rule' that the contractual pro!ision on arbitration *erel-

pro!i'es for an a''itional foru* or !enue an' 'oes not 'i!est the PO% of the

;uris'iction to hear the case).>7.>8

In its (ul- 01, 011 Co**ent,017018 ()$) Realt- reiterate' the abo!e rulin+s of the

PO% an' M%#) It ar+ue' that R% 9>0 or the HPhilippine Minin+ %ct of .>>5 is a

special la? ?hich shoul' pre!ail o!er the stipulations of the parties an' o!er a

+eneral la?, such as R% 294) It also ar+ue' that the PO% cannot be consi'ere' as a

Hcourt un'er the conte*plation of R% 294 an' that ;urispru'ence sa-in+ that there

*ust be prior resort to arbitration before filin+ a case ?ith the courts is

inapplicable to the instant case as the PO% is itself alrea'- en+a+e' in arbitration)

On this issue, ?e rule for #en+uet)

Sec) 0 of R% 294 eluci'ates the scope of arbitration:

Section 0) #ersons and matters su$ject to ar$itration. KK To o( 2o(#

#(&on& o( a(%+#& 2a &'/2+% %o %"# a(/+%(a%+on o on# o( 2o(# a(/+%(a%o(&

an $on%(o#(& #4+&%+n /#%##n %"#2 a% %"# %+2# o %"# &'/2+&&+on and

"+$" 2a /# %"# &'/5#$% o an a$%+on, o( %"# a(%+#& %o an $on%(a$% 2a +n

&'$" $on%(a$% a(## %o %%*# / a(/+%(a%+on a $on%(o#(& %"#(#a%#( a(+&+n

/#%##n %"#2. S'$" &'/2+&&+on o( $on%(a$% &"a** /# a*+d, #no($#a/*# and

+((#o$a/*#, &a# 'on &'$" (o'nd& a& #4+&% a% *a o( %"# (#o$a%+on o an

$on%(a$%.

18[18] Id. at 31.

19[19] Id. at 32.

20[20] Id. at 150-273.


11/20

Such sub*ission or contract *a- inclu'e uestion7s8 arisin+ out of

!aluations, appraisals or other contro!ersies ?hich *a- be collateral, inci'ental,

prece'ent or subseuent to an- issue bet?een the parties) 0 pre!ails o!er R% 294 presupposes a

conflict bet?een the t?o la?s) Such is not the case here) To reiterate, a!ail*ent of

!oluntar- arbitration before resort is *a'e to the courts or uasi;u'icial a+encies

of the +o!ern*ent is a !ali' contractual stipulation that *ust be a'here' to b- the

parties) %s state' in Secs) 4 an' 9 of R% 294:

Section 4) %earing $y court. KK A a(% a(+##d / %"# a+*'(#, n#*#$%

o( (#'&a* o ano%"#( %o #(o(2 'nd#( an a(##2#n% +n (+%+n (o+d+n o(

a(/+%(a%+on 2a #%+%+on %"# $o'(% o( an o(d#( d+(#$%+n %"a% &'$"

a(/+%(a%+on (o$##d +n %"# 2ann#( (o+d#d o( +n &'$" a(##2#n%) i!e 'a-s

notice in ?ritin+ of the hearin+ of such application shall be ser!e' either

personall- or b- re+istere' *ail upon the part- in 'efault) T"# $o'(% &"a** "#a(

%"# a(%+#&, and 'on /#+n &a%+&+#d %"a% %"# 2a+n o %"# a(##2#n% o(

&'$" a+*'(# %o $o2* %"#(#+%" +& no% +n +&&'#, &"a** 2a# an o(d#( d+(#$%+n

%"# a(%+#& %o (o$##d %o a(/+%(a%+on +n a$$o(dan$# +%" %"# %#(2& o %"#

a(##2#n%. I %"# 2a+n o %"# a(##2#n% o( d#a'*% /# +n +&&'# %"# $o'(%

21[21] BF Corporation v. CA, G.. !". 120105, (arc) 27, 1998, 288 '# 267*

Puromines v. CA, G.. !". 91228, (arc) 22, 1993, 220 '# 281* General Insurance

and Surety Corporation v. Union Insurance Society of Canton, et al., G.. !"s.

30475-76, !"ve+er 22, 1989, 179 '# 530* Gascon v. Arroyo, G.. !". 78389,

ct"er 16, 1989, 178 '# 582* Bengson v. Can, !". -27283, /$ly 29, 1977, 78

'# 113* !indanao Portland Cement Corporation v. !c"onoug Construction

Company of Florida, !". -23390, #pril 24, 1967, 19 '# 808.


12/20

&"a** (o$##d %o &'22a(+* "#a( &'$" +&&'#. I %"# +nd+n /# %"a% no

a(##2#n% +n (+%+n (o+d+n o( a(/+%(a%+on a& 2ad#, o( %"a% %"#(# +& no

d#a'*% +n %"# (o$##d+n %"#(#'nd#(, %"# (o$##d+n &"a** /# d+&2+&d. I %"#

+nd+n /# %"a% a (+%%#n (o+&+on o( a(/+%(a%+on a& 2ad# and %"#(# +& a

d#a'*% +n (o$##d+n %"#(#'nd#(, an o(d#( &"a** /# 2ad# &'22a(+*

d+(#$%+n %"# a(%+#& %o (o$##d +%" %"# a(/+%(a%+on +n a$$o(dan$# +%" %"#%#(2& %"#(#o.

3 3 3 3

Section 9) Stay of civil action. KKIf an- suit or procee'in+ be brou+ht upon

an issue arisin+ out of an a+ree*ent pro!i'in+ for the arbitration thereof, the court

in ?hich such suit or procee'in+ is pen'in+, upon bein+ satisfie' that the issuein!ol!e' in such suit or procee'in+ is referable to arbitration, shall sta- the action

or procee'in+ until an arbitration has been ha' in accor'ance ?ith the ter*s of the

a+ree*ent: Pro!i'e', That the applicant, for the sta- is not in 'efault in

procee'in+ ?ith such arbitration)


13/20

co*pulsor- arbitration) In &udo and &uym Corporation v. Saordino, the Court ha'

the occasion to 'istin+uish bet?een the t?o t-pes of arbitrations:

Co*parati!el-, in Reformist 'nion of R.B. &iner, (nc. vs. )&RC , co*pulsor-

arbitration has been 'efine' both as Hthe process of settle*ent of labor 'isputes

b- a o#(n2#n% a#n$ "+$" "a& %"# a'%"o(+% %o +n#&%+a%# and %o 2a#an aa(d ?hich is bin'in+ on all the parties, an' as a *o'e of arbitration ?here

the parties are co*pelle' to accept the resolution of their 'ispute throu+h

arbitration b- a thir' part-) @hile a !oluntar- arbitrator is no% a(% o %"#

o#(n2#n%a* 'n+% o( *a/o( d#a(%2#n%)& #(&onn#*, sai' arbitrator ren'ers

arbitration ser!ices pro!i'e' for un'er labor la?s)0/70/8


14/20

arbitration, freel- entere' into b- the parties, *ust be hel' bin'in+ a+ainst the*)05

7058

In su*, on the issue of ?hether PO% shoul' ha!e referre' the case to !oluntar-

arbitration, ?e fin' that, in'ee', PO% has no ;uris'iction o!er the 'ispute ?hich is

+o!erne' b- R% 294, the arbitration la?)

Fo?e!er, ?e fin' that #en+uet is alrea'- estoppe' fro* uestionin+ the

PO%As ;uris'iction) %s it ?ere, ?hen ()$) Realt- file' DENR Case No) 01111.,

#en+uet file' its ans?er an' participate' in the procee'in+s before the PO%,

Re+ion V) Secon'l-, ?hen the a'!erse March .>, 011. PO% Decision ?as

ren'ere', it file' an appeal ?ith the M%# in Mines %'*inistrati!e Case No) RM

01111. an' a+ain participate' in the M%# procee'in+s) @hen the a'!erse

Dece*ber 0, 0110 M%# Decision ?as pro*ul+ate', it file' a *otion for

reconsi'eration ?ith the M%#) @hen the a'!erse March .9, 011 M%#

Resolution ?as issue', #en+uet file' a petition ?ith this Court pursuant to Sec) 9>

of R% 9>0 i*plie'l- reco+niin+ M%#As ;uris'iction) In this factual *ilieu, the

Court rules that the ;uris'iction of PO% an' that of M%# can no lon+er be

uestione' b- #en+uet at this late hour) @hat #en+uet shoul' ha!e 'one ?as to

i**e'iatel- challen+e the PO%As ;uris'iction b- a special ci!il action for certiorari

?hen PO% rule' that it has ;uris'iction o!er the 'ispute) To re'o the procee'in+s

full- participate' in b- the parties after the lapse of se!en -ears fro* 'ate of

institution of the ori+inal action ?ith the PO% ?oul' be anathe*a to the spee'-

an' efficient a'*inistration of ;ustice)

S#$ond I&&'#! T"# $an$#**a%+on o %"# RA7OP

25[25] Can v. CA, G.. !". 147999, er$ary 27, 2004, 424 '# 127, 134.


15/20

a& &'o(%#d / #+d#n$#

The cancellation of the R%@OP b- the PO% ?as base' on t?o +roun's:


16/20

pa-*ents ?hich *a- beco*e 'ue the O@NER un'er this %+ree*ent as ?ell as

the purchase price herein a+ree' upon in the e!ent that #EN$UET shall e3ercise

the option to purchase pro!i'e' for in the %+ree*ent) An and a** d#o&+%& &o

2ad# / BENGUET &"a** /# a '** and $o2*#%# a$8'+%%an$# and (#*#a %o

7sic8 BENGUET (o2 an '(%"#( *+a/+*+% %o %"# O7NER o %"# a2o'n%&

(#(#n%#d / &'$" d#o&+%&.


17/20

In the instant case, the obli+ation of #en+uet to pa- ro-alties to ()$) Realt-

has been a'*itte' an' supporte' b- the pro!isions of the R%@OP) Thus, the

bur'en to pro!e such obli+ation rests on #en+uet)

It shoul' also be borne in *in' that MPS% %pplication No) %PS%V111> has

been pen'in+ ?ith the M$# for a consi'erable len+th of ti*e) #en+uet, in the

R%@OP, obli+ate' itself to perfect the ri+hts to the *inin+ clai*s an'Bor other?ise

acuire the *inin+ ri+hts to the *ineral clai*s but faile' to present an- e!i'ence

sho?in+ that it e3erte' efforts to spee' up an' ha!e the application appro!e') In

fact, #en+uet ne!er e!en alle+e' that it continuousl- follo?e'up the application

?ith the M$# an' that it ?as in constant co**unication ?ith the +o!ern*ent

a+enc- for the e3pe'itious resolution of the application) Such alle+ations ?oul'

sho? that, in'ee', #en+uet ?as re*iss in prosecutin+ the MPS% application an'

clearl- faile' to co*pl- ?ith its obli+ation in the R%@OP)

T"+(d I&&'#! T"#(# +& no 'n5'&% #n(+$"2#n% +n %"# +n&%an% $a

#ase' on the fore+oin+ 'iscussion, the cancellation of the R%@OP ?as

base' on !ali' +roun's an' is, therefore, ;ustifie') The necessar- i*plication of the

cancellation is the cessation of #en+uetAs ri+ht to prosecute MPS% %pplication No)

%PS%V111> an' to further 'e!elop such *inin+ clai*s)

In Car Cool #!ilippines, (nc. v. 's!io Realty and Development Corporation,

?e 'efine' un;ust enrich*ent, as follo?s:

27[27] G.. !". 116960, #pril 2, 1996, 256 '# 84, 89.


18/20

@e ha!e hel' that H7t8here is un;ust enrich*ent ?hen a person 'n5'&%*retains a benefit to the loss of another, or ?hen a person retains *one- or propert-

of another a+ainst the fun'a*ental principles of ;ustice, euit- an' +oo'conscience) %rticle 00 of the Ci!il Co'e pro!i'es that H7e8!er- person ?ho

throu+h an act of perfor*ance b- another, or another *eans, acuires or co*es

into possession of so*ethin+ at the e3pense of the latter ?ithout ;ust or le+al+roun', shall return the sa*e to hi*) The principle of un;ust enrich*ent un'er

%rticle 00 reuires t?o con'itions:


19/20

Chairperson

ANTONIO T. CARPIO CONC


20/20

Chief (ustice

Documents

E085 Benguet Corp. vs DENR