G.R. No. 157882 – 520 Phil. 457 – 485 SCRA 586 – Political Law – Constitutional Law – Police Power – Eminent Domain
In 1987, EO 279 was promulgated which allowed the DENR Secretary to allow foreign corporations to conduct mining explorations in the Philippines.
In 1994, the government entered into a Financial and Technical Assistance Agreement (FTAA) with the Arimco Mining Corporation (CAMC), an Australian corporation, which allowed CAMC to mine in the Philippines. Their area of operation is in Quirino and Nueva Vizcaya.
In 1995, the Philippine Mining Act (RA 7942) was enacted. The law continued to allow foreign corporations to mine resources in the Philippines. The DENR, as the implementing agency, promulgated DAO No. 96-40 as the law’s IRR.
In 2001, the Didipio Earth-Savers-Multipurpose Association (DESMA), based in Brgy. Didipio, Kasibu, Nueva Vizcaya, and other concerned groups sought the nullification of the FTAA agreement, RA 7942, and DAO 96-40, on the ground that they violated Sec. 9, Art. III of the Constitution – that they allowed foreign corporations to take over private properties without just compensation.
DENR argued that RA 7942 and its IRR is not an exercise of eminent domain but rather it was an exercise of police power.
ISSUE: Whether or not the taking of property in this case is an exercise of eminent domain or an exercise of police power.
HELD: It is an exercise of eminent domain. The elements of eminent domain are:
(1) the expropriator must enter a private property;
(2) the entry must be for more than a momentary period.
(3) the entry must be under warrant or color of legal authority;
(4) the property must be devoted to public use or otherwise informally appropriated or injuriously affected;
(5) the utilization of the property for public use must be in such a way as to oust the owner and deprive him of beneficial enjoyment of the property.
These are all present in this case.
DESMA is wrong, RA 7942 provides for just compensation:
Section 76. xxx Provided, that any damage to the property of the surface owner, occupant, or concessionaire as a consequence of such operations shall be properly compensated as may be provided for in the implementing rules and regulations.
Section 107. Compensation of the Surface Owner and Occupant- Any damage done to the property of the surface owners, occupant, or concessionaire thereof as a consequence of the mining operations or as a result of the construction or installation of the infrastructure mentioned in 104 above shall be properly and justly compensated.
How was the requirement that the “property must be utilized for public use” complied with when the properties here were taken for a private mining firm to utilize?
The mining industry plays a pivotal role in the economic development of the country and is a vital tool in the governments thrust of accelerated recovery. Mineral production is a major support of the national economy, and therefore the intensified discovery, exploration, development and wise utilization of the country’s mineral resources are urgently needed for national development. Mining is an industry which is of public benefit.
Public use as a requirement for the valid exercise of the power of eminent domain is now synonymous with public interest, public benefit, public welfare and public convenience. It includes the broader notion of indirect public benefit or advantage. Public use as traditionally understood as actual use by the public has already been abandoned.
Why is the law not an exercise of police power?
Property condemned under police power is usually noxious or intended for a noxious purpose; hence, no compensation shall be paid. Likewise, in the exercise of police power, property rights of private individuals are subjected to restraints and burdens in order to secure the general comfort, health, and prosperity of the state. In the exercise of its police power regulation, the state restricts the use of private property, but none of the property interests in the bundle of rights which constitute ownership is appropriated for use by or for the benefit of the public. Use of the property by the owner was limited, but no aspect of the property is used by or for the public. The deprivation of use can in fact be total and it will not constitute compensable taking if nobody else acquires use of the property or any interest therein.
