Upload 2 - DESAMA V Gozun
Upload 2 - DESAMA V Gozun
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CASE SUMMARY
25 July 1987 - then President Cory Aquino promulgated EO No. 279 which authorized the DENR
Secretary to accept, consider and evaluate proposals from foreign-owned corporations or foreign
investors for contracts of agreements involving either technical or financial assistance for large-scale
exploration, development, and utilization of minerals, which, upon appropriate recommendation of the
Secretary, the President may execute with the foreign proponent.
20 June 1994 - then President Ramos executed an FTAA with Arimco Mining Corporation (AMC) over a
total land area of 37,000 hectares covering the provinces of Nueva Vizcaya and Quirino. Included in
this area is Barangay Dipidio, Kasibu, Nueva Vizcaya.
March 1995 - President Ramos signed into law RA No. 7942 known as the Philippine Mining Act of
1995
AMC consolidated with Climax Mining Limited to form a single company that now goes under the new
name of Climax-Arimco Mining Corporation (CAMC), the controlling 99% of stockholders of which are
Australian nationals.
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ISSUES & HELD
Petitioner’s arguments:
1. Section 76 of Rep. Act No. 7942 and Section 107 of DAO 96-40 allow the unlawful and
unjust "taking" of private property for private purpose in violation of Section 9, Article III of
the 1987 Constitution mandating that private property shall not be taken except for public use
and the corresponding payment of just compensation.
2. CAMC’s entry into the private property amount to taking as defined in Republic v. Vda.
de Castellvi. – “Taking” under the concept of eminent domain is entering upon private property
for more than a momentary period, and, under the warrant or color of legal authority, devoting it
to a public use, or otherwise informally appropriating or injuriously affecting it in such a way as
to substantially oust the owner and deprive him of all beneficial enjoyment thereof.
the entry into a private property by CAMC, pursuant to its FTAA, is for more than a
momentary period, i.e. , for 25 years, and renewable for another 25 years;
the entry into the property is under the warrant or color of legal authority pursuant to
the FTAA executed between the government and CAMC;
the entry substantially ousts the owner or possessor and deprives him of all
beneficial enjoyment of the property.
3. the nature of the mining activity, the extent of the land area covered by the CAMC FTAA and
the various rights granted to the FTAA holder result in a taking of private property
4. If there is no absolute physical taking, Section 76 establishes, at the very least, a legal
easement which falls within the purview of eminent domain
Respondents’ arguments:
1. Section 76 is not a taking provision but a valid exercise of the police power and by virtue of
which, the state may prescribe regulations to promote the health, morals, peace, education,
good order, safety and general welfare of the people.
2. by entering private lands and concession areas, FTAA holders do not oust the owners thereof
nor deprive them of all beneficial enjoyment of their properties as the said entry merely
establishes a legal easement upon surface owners, occupants and concessionaires of a
mining contract area
SC:
1. Section 76 of Rep. Act No. 7942 is a Taking Provision
o The entry referred to in Section 76 is not just a simple right-of-way which is ordinarily
allowed under the provisions of the Civil Code. Here, the holders of mining rights enter
private lands for purposes of conducting mining activities such as exploration, extraction
and processing of minerals. Mining right holders build mine infrastructure, dig mine
shafts and connecting tunnels, prepare tailing ponds, storage areas and vehicle depots,
install their machinery, equipment and sewer systems. On top of this, under Section 75,
easement rights are accorded to them where they may build warehouses, port facilities,
electric transmission, railroads and other infrastructures necessary for mining
operations. All these will definitely oust the owners or occupants of the affected
areas the beneficial ownership of their lands. Without a doubt, taking occurs once
mining operations commence.
2. Sec. 76 being a taking provision does not mean that it is unconstitutional on the ground
that it allows taking of private property without the determination of public use and the payment
of just compensation
o The taking to be valid must be for public use.
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.
Mining is an industry which is of public benefit. It plays a pivotal role in the
economic development of the country
o There is no basis for the claim that the Mining Act and its IRR do not provide for
just compensation in expropriating private properties. Section 76 of Rep. Act No.
7942 and Section 107 of DAO 96-40 provide for the payment of just compensation
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RULING: Petition dismissed (in favor of Respondents)
WHEREFORE, the instant petition for prohibition and mandamus is hereby DISMISSED. Section 76 of
Republic Act No. 7942 and Section 107 of DAO 96-40; Republic Act No. 7942 and its Implementing Rules and
Regulations contained in DAO 96-40 — insofar as they relate to financial and technical assistance agreements
referred to in paragraph 4 of Section 2 of Article XII of the Constitution are NOT UNCONSTITUTIONAL.
SO ORDERED.
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NOTES
Section 76 of Rep. Act No. 7942 and Section 107 of DAO 96-40
Section 76. . . . 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. Such compensation shall be based on the agreement entered
into between the holder of mining rights and the surface owner, occupant or concessionaire thereof, where
appropriate, in accordance with P.D. No. 512.