Diamond Farms, Inc. v. Diamond Farm Workers Multi-Purpose Cooperative, G.R. No. 192999, 18 July 2012

Facts:

On July 2, 2002, petitioner filed a complaint⁷ for unlawful occupation, damages and attorney s fees against respondents. Petitioner alleged that as of November 1995, it was the holder of TCT Nos. 112068 and 112073 covering two parcels of land within the 109-hectare land. It alleged that it had been in possession for a long time of the two lands, which had a total area of 74.3393 hectares (74-hectare land), and grew thereon export-quality banana, producing on average 11,000 boxes per week worth P1.46 million. It alleged that the DAR s August 5, 2000. Respondents admitted that petitioner was the holder of TCT Nos. 112068 and 112073, covering the 74-hectare land and that the said land produces 11,000 boxes of export-quality bananas per week. However, were acquired by the government upon the issuance of TCTs in the name of the Republic of the Philippines.

During the proceedings before the Office of the Regional Adjudicator, petitioner submitted its computation of respondents production and profit share from the 109-hectare land for the years 1995 to 1999 and accordingly deposited the amount of P2.51 million.

The Regional Agrarian Reform Adjudicator ruled that petitioner lost its ownership of the subject land when the government acquired it and CLOAs were issued in favor of the 278 CARP beneficiaries.

Petitioner appealed to the DARAB, but the DARAB denied petitioner s appeal in a Decision dated December 11, 2006. The DARAB ruled that petitioner is unlawfully occupying the subject land; hence, its complaint against respondents for unlawful occupation lacks merit. It also ruled that petitioner is no longer entitled to possess the subject land; that petitioner lost its ownership thereof; that ownership was transferred to the 278 CARP beneficiaries; that the appeals from the Distribution Order concern distribution and will not restore petitioner s ownership; that the 278 CARP beneficiaries can now exercise their rights of ownership and possession; and that petitioner should have delivered possession of the 109-hectare land to the CARP beneficiaries on August 5, 2000 instead of remaining in possession and in control of farm operations.

Petitioner appealed to the CA. The CA in the assailed Decision affirmed the DARAB decision. 

Issue:

1. Whether or not respondents are guilty of unlawful occupation?

Ruling:

1. No, respondents are not guilty of unlawful occupation.

Article 429 of the Civil Code provides that the owner or lawful possessor of a thing has the right to exclude any person from the enjoyment and disposal thereof. For this purpose, he may use such force as may be reasonably necessary to repel or prevent an actual or threatened unlawful physical invasion or usurpation of his property.

In this case, petitioner is the farm operator and manager while respondents are the farm workers. Both parties enjoyed possession of the land. Together, they worked thereon. Before CARP, petitioner was the landowner, farm operator and manager. Respondents are its farm workers. After the deferment period, CARP finally dawned. Petitioner lost its status as landowner, but not as farm operator and manager. Respondents remained as petitioner s farm workers and received wages from petitioner. Now, the unrebutted claim of respondents in their answer and position paper is that they guarded the 74-hectare land to protect their rights as farm workers and CARP beneficiaries. They were compelled to do so when petitioner attempted to install other workers thereon, after it conspired with 67 CARP beneficiaries to occupy the 35-hectare land. They were fairly successful since the intruders were able to occupy the pumping structure. The government, including this Court, cannot condone petitioner s act to thwart the CARP s implementation. Installing workers on a CARP-covered land when the DAR has already identified the CARP beneficiaries of the land and has already ordered the distribution of the land to them serves no other purpose than to create an impermissible roadblock to installing the legitimate beneficiaries on the land. We also find the action taken by respondents to guard the land as reasonable and necessary to protect their legitimate possession and prevent precisely what petitioner attempted to do. 

Note:

Since respondents themselves have asked petitioner to resume its farm operation, petitioner s possession cannot be said to be illegal and unjustified.

Bradford United Church of Christ, Inc. v. Ando, G.R. No. 195669, May 30, 2016

Facts:

Before Branch 2 of the MTCC of Mandaue City, the petitioner Bradford United Church of Christ, Inc. (BUCCI) filed a Complaint for unlawful detainer and damages against herein respondents Dante Ando, Abenigo Augis, Edgar Cardones, Zacarias Gutierrez, Cornelio Ibarra, Jr., Zenaida Ibarra, Teofilo Lirasan, Eunice Lirasan, Ruth Mission, Dolly Resales and Eunice Tambangan, in their capacities as Members of the Mandaue Bradford Church Council, the Mandaue Bradford Church (MBC), and the United Church of Christ in the Philippines, Inc. (UCCPI). BUCCI failed to mention in its certification against non-forum-shopping a complete statement of the present status of another case concerning the recovery of ownership of certain parcels of land earlier filed before the Regional Trial Court (RTC) by the UCCPI and the MBC against BUCCI.

The RTC of Mandaue City-rendered its judgment in the recovery of ownership case against therein plaintiffs UCCPI and MBC and in favor of therein defendant BUCCI.  MTCC Branch 2 of Mandaue City, issued an Order dated March 31,2005 dismissing the unlawful detainer case with prejudice for BUCCI's failure to comply with the rule on certification against forum shopping. BUCCI appealed to the RTC.

Petitioner BUCCI's verification and certification against forum-shopping attached to the instant Petition, stated that UCCP had also filed an appeal with the CA pertaining to the recovery of ownership suit; and this appeal was docketed as CA-GR. No. 00983, then still pending adjudication before the CA. In the same verification and certification against forum-shopping, BUCCI stressed that the case for recovery of ownership of the disputed parcels of land was entirely different from the unlawful detainer case, because the first case does not involve at all the issue of material/ physical possession of Lot 3-F.

BUCCI posits that the most decisive factor in determining the existence of forum-shopping is the presence of all the elements of litis pendentia, namely, (1) identity of parties or representation in both cases; (2) identity of rights asserted and reliefs prayed for; (3) the reliefs are founded on the same facts; and (4) the identity of the preceding particulars should be such that any judgment which may be rendered in the other action, will, regardless of which party is successful, amount to res judicata in the action under consideration.

Issue:

Whether or not BUCCI committed forum-shopping when it failed to disclose in the certification on non-forum shopping of the unlawful detainer case a complete statement of the status of the action for recovery of ownership of property then pending before the RTC of Mandaue City?

Ruling:

No, BUCCI did not commit forum-shopping.

Section 5, Rule 7 of the Rules of Court, provides: The plaintiff or principal party shall certify under oath in the complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and simultaneously filed therewith: (a) that he has not theretofore commenced any action or filed any claim involving the same issues in any court, tribunal or quasi-judicial agency and, to the best of his knowledge, no such other action or claim is pending therein; (b) if there is such other pending action or claim, a complete statement of the present status thereof; and (c) if he should thereafter learn that the same or similar action or claim has been filed or is pending, he shall report that fact within five (5) days therefrom to the court wherein his aforesaid complaint or initiatory pleading has been filed.

Here, there is only identity of parties between the summary action of unlawful detainer and the land ownership recovery case. However, the issues raised are not identical or similar in the two cases. The issue in the unlawful detainer case is which party is entitled to, or should be awarded, the material or physical possession of the disputed parcel of land, (or possession thereof as a fact); whereas the issue in the action for recovery of ownership is which party has the right to be recognized as lawful owner of the disputed parcels of land. Petitioner and respondent are the same parties in the annulment and ejectment cases. The issue of ownership was likewise being contended, with same set of evidence being presented in both cases. However, it cannot be inferred that a judgment in the ejectment case would amount to res judicata in the annulment case, and vice-versa. in ejectment suits, the only issue for resolution is the physical or material possession of the property involved, independent of any claim of ownership by any of the party litigants. However, the issue of ownership may be provisionally ruled upon for the sole purpose of determining who is entitled to possession de facto. Therefore, the provisional determination of ownership in the ejectment case cannot be clothed with finality.

Garcia v. Court of Appeals, G.R. No. 133140, August 10, 1999

Facts:

Atty. Pedro V. Garcia, in whose name TCT No. S-31269 covering a parcel of land identified as Lot 17 situated at Bel Air II Village, Makati, was registered, sold with the consent of his wife Remedios T. Garcia, the same to their daughter Ma. Luisa Magpayo and her husband Luisito Magpayo. The Magpayos mortgaged the land to the Philippine Bank of Communications (PBCom) to secure a loan. The Magpayos failed to pay their loan upon its maturity, hence, the mortgage was extrajudicially foreclosed and at the public auction sale, PBCom which was the highest bidder bought the land. PBCom filed at the Regional Trial Court (RTC) of Makati a petition for the issuance of a writ of possession over the land. Mrs. Magpayo's brother, Jose Ma. T. Garcia (Garcia), who was in possession of the land, refused to honor it and filed a motion for Intervention in the above-said PBCom petition, which motion was denied. PBCom averred, inter alia, that Garcia's claim over the land is belied by the fact that it is not among the properties owned by his mother listed in the Inventory of Real Estate. The Magpayos, on the other hand, asserted that title over the land was transferred to them by Mrs. Magpayo's parents to enable them (Magpayos) to borrow from PBCom.

RTC Ruling:

The court a quo denied the motion for summary judgment on the ground that PBCom raised in its answer both factual and legal issues.

CA Ruling:

CA reversed the Ruling of RTC.

Issue:

WON Garcia is the owner and possessor of the property?

Ruling:

No, Garcia is not the owner and the possessor of the property.

Ownership confers certain rights to the owner, one of which is the right to dispose of the thing by way of sale.  possession is defined as the holding of a thing or the enjoyment of a right. Literally, to possess means to actually and physically occupy a thing with or without right. Possession may be had in one of two ways: possession in the concept of an owner and possession of a holder. "A possessor in the concept of an owner may be the owner himself or one who claims to be so." On the other hand, "one who possesses as a mere holder acknowledges in another a superior right which he believes to be ownership, whether his belief be right or wrong.

In this case, Atty. Pedro Garcia and his wife Remedios exercised their right to dispose of what they owned when they sold the subject property to the Magpayo spouses. The records show that petitioner occupied the property not in the concept of an owner for his stay was merely tolerated by his parents. Petitioner's subsequent claim of ownership as successor to his mother's share in the conjugal asset is belied by the fact that the property was not included in the inventory of the estate submitted by his father to the intestate court. This buttresses the ruling that indeed the property was no longer considered owned by petitioner's parents. The Magpayo spouses were already the owners when they mortgaged the property to PBCom.

Hence, Garcia is not the owner and the possessor of the property.

Republic v. Tan, G.R. NO. 199537, February 10, 2016

Republic of Philippines vs Tan

Facts:

Tan applied for the original registration of title of Lot No. 4080, Cad. 545-D (new) situated in Casili, Consolacion, Cebu (the subject lot). She alleged that she is the absolute owner in fee simple of the said 7,807 square-meter parcel of residential land she purchased from a certain Julian Gonzaga on 

After complying with the jurisdictional requirements, the land registration court issued an order of general default, excepting the State which was duly represented by the Solicitor General.

Land Registration Court:

The land registration court granted Tan’s application. The court confirmed her title over the subject lot and ordered its registration.

The Republic appealed the case to the CA, arguing that Tan failed to prove that she is a Filipino citizen who has been in open, continuous, exclusive, and notorious possession and occupation of the subject lot, in the concept of an owner, since June 12, 1945, or earlier.

CA Ruling:

The CA denied the appeal. The CA observed that under the Public Land Act, there are two kinds of applicants for original registration: (1) those who had possessed the land since June 12, 1945; and (2) those who already acquired the property through prescription. The respondent’s application fell under the second category.

The CA noted that before land of the public domain can be acquired by prescription, it must have been declared alienable and disposable agricultural land. The CA pointed to the certification issued by the Community Environment and Natural Resources Office (CENRO) as evidence that the subject was classified as alienable and disposable on September 1, 1965

The Republic filed the present petition for review on certiorari.

Issue:

WON the land is under public domain?

Ruling:

Yes, the land is under public domain.

The court ruled that only private property can be acquired by prescription. Property of public dominion is outside the commerce of man. It cannot be the object of prescription  because prescription does not run against the State in its sovereign capacity. However, when property of public dominion is no longer intended for public use or for public service, it becomes part of the patrimonial property of the State.  When this happens, the property is withdrawn from public dominion and becomes property of private ownership, albeit still owned by the State. The property is now brought within the commerce of man and becomes susceptible to the concepts of legal possession and prescription.1avvphi1There must be an express declaration by the State that the public dominion property is no longer intended for public service or the development of the national wealth or that the property has been converted into patrimonial. Without such express declaration, the property, even if classified as alienable or disposable, remains property of the public dominion, pursuant to Article 420(2), and thus incapable of acquisition by prescription.

In this case, Even though it has been declared alienable and disposable, the property has not been withdrawn from public use or public service. Without this, prescription cannot begin to run because the property has not yet been converted into patrimonial property of the State. It remains outside the commerce of man and the respondent’s physical possession and occupation thereof do not produce any legal effect. The respondent has never acquired legal possession of the property.

Hence, the land is under public domain.

 

Binalay v. Manalo, G.R. No. 92161, March 18, 1991

Facts:

Respondent Guillermo Manalo acquired 8.65 hectares thereof from Faustina Taccad, daughter of Judge Juan Taccad. He then purchased another 1.80 hectares from Gregorio Taguba who had earlier acquired the same from Judge Juan Taccad. The two (2) parcels of land belonging to respondent Manalo were surveyed and consolidated into one lot, designated as Lot No. 307, Pls-964. Lot 307 which contains 4.6489 hectares includes: (a) the whole of the 1.80 hectares acquired from Gregorio Taguba; and (b) 2.8489 hectares out of the 8.65 hectares purchased from Faustina Taccad. As the survey was conducted on a rainy month, a portion of the land bought from Faustina Taccad then under water was left unsurveyed and was not included in Lot 307. The Sketch Plan submitted during the trial of this case and which was identified by respondent Manalo shows that the Cagayan River running from south to north, forks at a certain point to form two (2) branches—the western and the eastern branches—and then unites at the other end, further north, to form a narrow strip of land. The eastern branch of the river cuts through the land of respondent Manalo and is inundated with water only during the rainy season. The bed of the eastern branch is the submerged or the unsurveyed portion of the land belonging to respondent Manalo. For about eight (8) months of the year when the level of water at the point where the Cagayan River forks is at its ordinary depth, river water does not flow into the eastern branch. While this condition persists, the eastern bed is dry and is susceptible to cultivation. 

There is this Lot 821 which is located directly opposite Lot 307 and is separated from the latter only by the eastern branch of the Cagayan River during the rainy season and, during the dry season, by the exposed, dry river bed, being a portion of the land bought from Faustina Taccad. Respondent Manalo claims that Lot 821 also belongs to him by way of accretion to the submerged portion of the property to which it is adjacent. 

Petitioners who are in possession of Lot 821, upon the other hand, insist that they own Lot 821. They occupy the outer edges of Lot 821 along the river banks, i.e., the fertile portions on which they plant tobacco and other agricultural products.

On 24 July 1974, respondent Manalo filed a complaints before the then Court of First Instance of Isabela, Branch 3 for quieting of title, possession and damages against petitioners. He alleged ownership of the two (2) parcels of land he bought separately from Faustina Taccad and Gregorio Taguba for which reason he prayed that judgment be entered ordering petitioners to vacate the western strip of the unsurveyed portion. Respondent Manalo likewise prayed that judgment be entered declaring him as owner of Lot 821 on which he had laid his claim during the survey.

CFI Ruling;

CFI renders judgment against the defendants(petitioners) and in favor of the plaintiff(respondent).

CA Ruling:

Court of Appeals affirmed the decision of the trial court.

Issue:

WON Manolo own Lot 821 by way of accretion to the submerged portion of the property to which it is adjacent? 

Ruling:

No, Manolo does not own Lot 821 by way of accretion to the submerged portion of the property to which it is adjacent

Article 420 of the Civil Code states:

The following things are property of public dominion:

(1) Those intended for public use, such as roads, canals, rivers, torrents, ports and bridges constructed by the State, banks, shores, roadsteads, and others of similar character;

(2) Those which belong to the State, without being for public use, and are intended for some public service or for the development of the national wealth.

Accretion as a mode of acquiring property under Article 457 of the Civil Code requires the concurrence of three (3) requisites: (a) that the deposition of soil or sediment be gradual and imperceptible; (b) that it be the result of the action of the waters of the river (or sea); and (c) that the land where accretion takes place is adjacent to the banks of rivers (or the sea coast).

Pursuant to Article 420 of the Civil Code, respondent Manalo did not acquire private ownership of the bed of the eastern branch of the river even if it was included in the deeds of absolute sale executed by Gregorio Taguba and Faustina Taccad in his favor. These vendors could not have validly sold land that constituted property of public dominion. The Court considers that there was no evidence to prove that Lot 821 is an increment to Lot 307 and the bed of the eastern branch of the river. As it is, the claimed accretion (Lot 821) lies on the bank of the river not adjacent to Lot 307 but directly opposite Lot 307 across the river.

Hence, Manolo does not own Lot 821 by way of accretion to the submerged portion of the property to which it is adjacent.

Overall SC Ruling:

1. Respondent Manalo is hereby declared the owner of Lot 307.
2. The regularly submerged portion or the eastern bed of the Cagayan River is hereby DECLARED to be property of public dominion.
3. The ownership of Lot 821 shall be determined in an appropriate action that may be instituted by the interested parties inter se. If respondent Manalo had proved prior possession, it was limited physically to Lot 307 and the depressed portion or the eastern river bed. The testimony of Dominga Malana who was a tenant for Justina Taccad did not indicate that she was also cultivating Lot 821. The tax declarations presented by petitioners conflict with those of respondent Manalo. The evidence of record on this point is less than satisfactory and the Court feels compelled to refrain from determining the ownership and possession of Lot 821, adjudging neither petitioners nor respondent Manalo as owner(s) thereof.

Republic v. Tri-Plus Corporation, G.R. No. 150000, September 26, 2006

Facts:

Tri-Plus alleged that it is the owner in fee simple of the subject parcels of land, including the improvements thereon, having acquired the same through purchase; and that it is in actual, continuous, public, notorious, exclusive and peaceful possession of the subject properties in the concept of an owner for more than 30 years, including that of its predecessors-in-interest.

On September 4, 1997, the trial court received an Opposition to the Application for Registration filed by the Republic of the Philippines through the Office of the Solicitor General (OSG) on the grounds that neither the applicant nor its predecessors-in-interest have been in open, continuous, exclusive and notorious possession and occupation of the land in question since June 12, 1945 or prior thereto; that the muniments of title submitted by the applicant which consists, among others, of tax declarations and receipts of tax payments, do not constitute competent and sufficient evidence of a bona fide acquisition of the land applied for or of its open, continuous, exclusive and notorious possession and occupation thereof in the concept of owner since June 12, 1945 or prior thereto.

MTC Ruling:

The totality of the evidence, both documentary and testimonial, of the applicant clearly shows that it and its predecessors-in-interest had been in actual, public, exclusive and continuous possession in concept of owner of the parcels of land above-mentioned for no less than thirty (30) years prior to the filing of the instant petition for registration of its imperfect title. 

CA Ruling:

The CA rendered the presently assailed Decision finding no reversible error in the appealed judgment, thereby, affirming the same.

Petitioner contends that since the applicant failed to discharge the burden of proving that the subject properties are alienable and disposable, there is no basis for the CA to rule that these properties are private lands.

Issue:

WON the assailed land is a private land?

Ruling:

No, the assailed land is not a private land.

Section 6 of Commonwealth Act No. 141, as amended, provides that the classification and reclassification of public lands into alienable or disposable, mineral or forest land is the prerogative of the Executive Department. Under the Regalian doctrine, which is embodied in our Constitution, all lands of the public domain belong to the State, which is the source of any asserted right to any ownership of land. All lands not appearing to be clearly within private ownership are presumed to belong to the State. Accordingly, public lands not shown to have been reclassified or released as alienable agricultural land or alienated to a private person by the State remain part of the inalienable public domain.

Applicants for confirmation of imperfect title must prove the following: (a) that the land forms part of the alienable and disposable agricultural lands of the public domain; and (b) that they have been in open, continuous, exclusive and notorious possession and occupation of the same under a bona fide claim of ownership either since time immemorial or since June 12, 1945.

In the present case, the Court finds merit in petitioner's contention that respondent failed to prove the first requirement that the properties sought to be titled forms part of the alienable and disposable agricultural lands of the public domain. Respondents failed to submit a certification from the proper government agency to prove that the lands subject for registration are indeed alienable and disposable. As to the second requirement, respondent and its predecessors-in-interest failed to prove that they had been in open, continuous, exclusive and notorious possession of the subject properties under a bona fide claim of ownership since June 12, 1945 or earlier, as required by law.

Hence, the assailed land is not a private land.

Bachrach Motor Co. v. Ledesma, G.R. No. L-42462, August 31, 1937

Facts:

The plaintiff, the Bachrach Motor Co., Inc., on June 30, 1927, obtained judgment in civil case No. 31597 of the Court of First Instance of Manila against the defendant Mariano Lacson Ledesma, in the sum of P3,442.75, with interest thereon from March 30, 1927, with costs. That a writ of execution of said judgment was issued on August 20, 1927, and Jose Y. Orosa was appointed Special sheriff to execute it. That on October 4, 1927, said Jose Y. Orosa, as special sheriff, in compliance with the writ of execution in question, attached all right, title to and interest which the defendant Mariano Lacson Ledesma may have in "Any bonus, dividend, share of stock, money, or other property which that defendant is entitle to receive from the Talisay-Silay Milling Co., Inc., by virtue of the fact that such defendant has mortgage his land in favor of the Philippine National Bank to guarantee the indebtedness of the Talisay-Silay Milling Co., Inc., or which such defendant is entitled to receive from the Talisay-Silay Milling Co., Inc., on account of being a stockholder in the corporation or which he is entitled to receive from that corporation for any other cause or pretext whatsoever." That notice of said attachment was served not only upon the defendant Mariano Lacson Ledesma but also upon the herein defendant the Talisay-Silay Milling Co., Inc., which received a copy of the notice of attachment, as evidenced by the Annex A attached to this stipulation of facts. That on October 3, 1927, the herein plaintiff, the Bachrach Motor Co., Inc., obtained judgment in case No. 31821 of the Court of First Instance of Manila against the defendant Mariano Lacson Ledesma, in the sum of four thousand four hundred pesos and seventy-eight centavos with interest at 10 per cent per annum on the sum of P3,523.82 from April 30, 1927; in the sum of P14,171, 52 with interest at 10 per cent per annum on the sum of P13,290.89 from April 30, 1927; and in the sum of P1,150.72 with the legal interest of 6 per cent per annum thereon from May 25, 1927, and the costs. A copy of said judgment is attached to this stipulation of facts and marked Annex B. That a writ of execution of said judgment was issue, thereby causing the attachment, sale and adjudication to the plaintiff the Bachrach Motor Co., Inc., for the sum of P100, Philippine currency, of the defendant Mariano Lacson Ledesma's right of redemption over the following properties to wit: "Original certificate of title No. 1929 (Lot No. 1473 of the Cadastral Survey of Bacolod) containing an area of 2,647 square meters, more or less. It appears stipulated by the parties that, by virtue of the letters of the Philippine National Bank and having been so asked by Mariano Lacson Ledesma, certificate No. 772 covering the 6,300 stock dividends was delivered as security to Attorney Roman Lacson as representative of the bank, on February 27, 1930, in view of the fact that the original shares covered by certificate Nos. 145, 146 and 147 had been previously mortgaged to the same bank. On February 25, 1931, the Talisay-Silay Milling Co., Inc., in conformity with the letter of the Philippines National Bank of the 19th of said month, cancelled certificate No. 772 and in lieu thereof issued certificate No. 1155 in favor of said bank, which certificate includes the 6,300 stock dividends, among other shares. On the other hand, the garnishment obtained by the plaintiff, upon which it bases all its alleged preferred right was notified to the parties and became effective on August 11, 1930, more than five months after the delivery of certificate No. 772. The plaintiff, in its second assignment of error, maintains that the pledge is ineffective as against it because evidence of its date was not made to appear in a public instrument and concludes that its right to the 6,300 stock dividends is superior and preferred. It is admitted that the delivery of the certificate in question and the pledge thereof were not made to appear in a public instrument.

 

Issue:

WON  the pledge of   the 6300 stocks dividend is valid?

Ruling:

Yes, the pledge of the 6300 stocks dividend is valid.

The Court ruled that a contract of pledge or chattel mortgage should be deemed legally entered into and should produce all its effects and consequences, provided it appears to have been in some manner perfected and that the things pledged have been delivered, and in a contrary case, and even if the creditor has not received them or has not retained them in his custody, provided that the contract of pledge or chattel mortgage appears in a notarial document and is inscribed in the registry of deeds of the province.

In this case, the pledge of the 6,300 stock dividends is valid against the plaintiff for the reason that the certificate was delivered to the creditor bank, notwithstanding the fact that the contract does not appear in a public instrument.

 

The plaintiff further contends that the pledge could not legally exist because the certificate was not the shares themselves, making it understood that a certificate of stock or of stock dividends can not be the subject matter of the contract of pledge or of chattel mortgage. Neither is this contention tenable. Certificates of stock or of stock dividends, under the Corporation Law, are quasi negotiable instruments in the sense that they may be given in pledge or mortgage to secure an obligation.

Hence, the pledge of the 6300 stocks dividend is valid.

Philippine Refining Co. v. Jarque, 61 Phil 229

Facts:

^{The mere mortgage of a ship is a contract entered into by the parties to it without reference to navigation or perils of the sea, and does not, therefore, confer admiralty jurisdiction. (Bogart vs. Steamboat John Jay [1854], 17 How., 399.)}

^{Coming now to the merits, it appears that on varying dates the Philippine Refining Co., Inc., and Francisco Jarque executed three mortgages on the motor vessels Pandan and Zaragoza. These documents were recorded in the record of transfers and incumbrances of vessels for the port of Cebu and each was therein denominated a "chattel mortgage". Neither of the first two mortgages had appended an affidavit of good faith. The third mortgage contained such an affidavit, but this mortgage was not registered in the customs house until May 17, 1932, or within the period of thirty days prior to the commencement of insolvency proceedings against Francisco Jarque; also, while the last mentioned mortgage was subscribed by Francisco Jarque and M. N. Brink, there was nothing to disclose in what capacity the said M. N. Brink signed. A fourth mortgage was executed by Francisco Jarque and Ramon Aboitiz on the motorship Zaragoza and was entered in the chattel mortgage registry of the register of deeds on May 12, 1932, or again within the thirty-day period before the institution of insolvency proceedings. These proceedings were begun on June 2, 1932, when a petition was filed with the Court of First Instance of Cebu in which it was prayed that Francisco Jarque be declared an insolvent debtor, which soon thereafter was granted, with the result that an assignment of all the properties of the insolvent was executed in favor of Jose Corominas.}

^{On these facts, Judge Jose M. Hontiveros declined to order the foreclosure of the mortgages, but on the contrary sustained the special defenses of fatal defectiveness of the mortgages. In so doing we believe that the trial judge acted advisedly.}

Issue:

WON vessels are personal property?

Rulings:

Yes, vessels are personal property.

^{Vessels are considered personal property under the civil law. (Code of Commerce, article 585.) Similarly under the common law, vessels are personal property although occasionally referred to as a peculiar kind of personal property. (Reynolds vs. Nielson [1903], 96 Am. Rep., 1000; Atlantic Maritime Co vs. City of Gloucester [1917], 117 N. E., 924.) Since the term "personal property" includes vessels, they are subject to mortgage agreeably to the provisions of the Chattel Mortgage Law. (Act No. 1508, section 2.) Indeed, it has heretofore been accepted without discussion that a mortgage on a vessel is in nature a chattel mortgage. (McMicking vs. Banco Español-Filipino [1909], 13 Phil., 429; Arroyo vs. Yu de Sane [1930], 54 Phil., 511.) The only difference between a chattel mortgage of a vessel and a chattel mortgage of other personalty is that it is not now necessary for a chattel mortgage of a vessel to be noted n the registry of the register of deeds, but it is essential that a record of documents affecting the title to a vessel be entered in the record of the Collector of Customs at the port of entry. (Rubiso and Gelito vs. Rivera [1917], 37 Phil., 72; Arroyo vs. Yu de Sane, supra.) Otherwise a mortgage on a vessel is generally like other chattel mortgages as to its requisites and validity. (58 C.J., 92.)}

Makati Leasing & Finance Corp. v. Wearever Textile Mills, Inc., G.R. No. 58469, May 16, 1983

Full text: https://www.lawphil.net/judjuris/juri1983/may1983/gr_l_58469_1983.html

Facts:

It appears that in order to obtain financial accommodations from herein petitioner Makati Leasing and Finance Corporation, the private respondent Wearever Textile Mills, Inc., discounted and assigned several receivables with the former under a Receivable Purchase Agreement. To secure the collection of the receivables assigned, private respondent executed a Chattel Mortgage over certain raw materials inventory as well as a machinery described as an Artos Aero Dryer Stentering Range. Upon private respondent's default, petitioner filed a petition for extrajudicial foreclosure of the properties mortgage to it. However, the Deputy Sheriff assigned to implement the foreclosure failed to gain entry into private respondent's premises and was not able to effect the seizure of the aforedescribed machinery. Petitioner thereafter filed a complaint for judicial foreclosure with the Court of First Instance of Rizal, Branch VI, docketed as Civil Case No. 36040, the case before the lower court. Acting on petitioner's application for replevin, the lower court issued a writ of seizure, the enforcement of which was however subsequently restrained upon private respondent's filing of a motion for reconsideration. The Court of Appeals, in certiorari and prohibition proceedings subsequently filed by herein private respondent, set aside the Orders of the lower court and ordered the return of the drive motor seized by the sheriff pursuant to said Orders, after ruling that the machinery in suit cannot be the subject of replevin, much less of a chattel mortgage, because it is a real property pursuant to Article 415 of the new Civil Code, the same being attached to the ground by means of bolts and the only way to remove it from respondent's plant would be to drill out or destroy the concrete floor, the reason why all that the sheriff could do to enforce the writ was to take the main drive motor of said machinery. When petitioner returned the subject motor drive, it made itself unequivocably clear that said action was without prejudice to a motion for reconsideration of the Court of Appeals decision, as shown by the receipt duly signed by respondent's representative.  Considering that petitioner has reserved its right to question the propriety of the Court of Appeals' decision, the contention of private respondent that this petition has been mooted by such return may not be sustained.

            

The next and the more crucial question to be resolved in this Petition is whether the machinery in suit is real or personal property from the point of view of the parties, with petitioner arguing that it is a personality, while the respondent claiming the contrary, and was sustained by the appellate court, which accordingly held that the chattel mortgage constituted thereon is null and void, as contended by said respondent.

Issue:

WON a machinery can be a personal property?

Ruling:

Yes, a machinery can be a personal property. 

The court used the ruling in the case of Tumalad v. Vicencio,  where this Court, ruled that although there is no specific statement referring to the subject house as personal property, yet by ceding, selling or transferring a property by way of chattel mortgage defendants-appellants could only have meant to convey the house as chattel, or at least, intended to treat the same as such, so that they should not now be allowed to make an inconsistent stand by claiming otherwise. Moreover, the subject house stood on a rented lot to which defendants-appellants merely had a temporary right as lessee, and although this can not in itself alone determine the status of the property, it does so when combined with other factors to sustain the interpretation that the parties, particularly the mortgagors, intended to treat the house as personality. subject house as personality.

 

In the present case from the application of the abovequoted pronouncement. If a house of strong materials, like what was involved in the above Tumalad case, may be considered as personal property for purposes of executing a chattel mortgage thereon as long as the parties to the contract so agree and no innocent third party will be prejudiced thereby, there is absolutely no reason why a machinery, which is movable in its nature and becomes immobilized only by destination or purpose, may not be likewise treated as such. This is really because one who has so agreed is estopped from denying the existence of the chattel mortgage. As stated in Standard Oil Co. of New York v. Jaramillo, it is undeniable that the parties to a contract may by agreement treat as personal property that which by nature would be real property, as long as no interest of third parties would be prejudiced thereby.

 

Hence, a machinery can be a personal property.

Tumalad vs Vicencio, G.R. No. L-30173, September 30, 1971

Full text: https://www.lawphil.net/judjuris/juri1971/sep1971/gr_30173_1971.html

Facts:

It appears on the records that on 1 September 1955 defendants-appellants executed a chattel mortgage in favor of plaintiffs-appellees over their house of strong materials located at No. 550 Int. 3, Quezon Boulevard, Quiapo, Manila, over Lot Nos. 6-B and 7-B, Block No. 2554, which were being rented from Madrigal & Company, Inc. The mortgage was registered in the Registry of Deeds of Manila on 2 September 1955. The herein mortgage was executed to guarantee a loan of P4,800.00 received from plaintiffs-appellees, payable within one year at 12% per annum. The mode of payment was P150.00 monthly, starting September, 1955, up to July 1956, and the lump sum of P3,150 was payable on or before August, 1956. It was also agreed that default in the payment of any of the amortizations, would cause the remaining unpaid balance to becomeimmediately due and Payable. When defendants-appellants defaulted in paying, the mortgage was extrajudicially foreclosed, and on 27 March 1956, the house was sold at public auction pursuant to the said contract. As highest bidder, plaintiffs-appellees were issued the corresponding certificate of sale. Thereafter, on 18 April 1956, plaintiffs-appellant commenced Civil Case No. 43073 in the municipal court of Manila, praying, among other things, that the house be vacated and its possession surrendered to them, and for defendants-appellants to pay rent of P200.00 monthly from 27 March 1956 up to the time the possession is surrendered. Defendants-appellants, in their answers in both the municipal court and court a quo impugned the legality of the chattel mortgage, claiming that they are still the owners of the house; but they waived the right to introduce evidence, oral or documentary. Instead, they relied on their memoranda in support of their motion to dismiss, predicated mainly on the grounds that: (a) the municipal court did not have jurisdiction to try and decide the case because (1) the issue involved, is ownership, and (2) there was no allegation of prior possession; and (b) failure to prove prior demand pursuant to Section 2, Rule 72, of the Rules of Court. 

Defendants-appellants submitted numerous assignments of error which can be condensed into two questions, namely: .

 

(a) Whether the municipal court from which the case originated had jurisdiction to adjudicate the same;

(b) Whether the defendants are, under the law, legally bound to pay rentals to the plaintiffs during the period of one (1) year provided by law for the redemption of the extrajudicially foreclosed house.

 

We will consider these questions seriatim.

(a) Defendants-appellants mortgagors question the jurisdiction of the municipal court from which the case originated, and consequently, the appellate jurisdiction of the Court of First Instance a quo, on the theory that the chattel mortgage is void ab initio; whence it would follow that the extrajudicial foreclosure, and necessarily the consequent auction sale, are also void. Thus, the ownership of the house still remained with defendants-appellants who are entitled to possession and not plaintiffs-appellees. Therefore, it is argued by defendants-appellants, the issue of ownership will have to be adjudicated first in order to determine possession. lt is contended further that ownership being in issue, it is the Court of First Instance which has jurisdiction and not the municipal court. Defendants-appellants predicate their theory of nullity of the chattel mortgage on two grounds, which are: (a) that, their signatures on the chattel mortgage were obtained through fraud, deceit, or trickery; and (b) that the subject matter of the mortgage is a house of strong materials, and, being an immovable, it can only be the subject of a real estate mortgage and not a chattel mortgage. On the charge of fraud, deceit or trickery, the Court of First Instance found defendants-appellants' contentions as not supported by evidence and accordingly dismissed the charge, confirming the earlier finding of the municipal court that "the defense of ownership as well as the allegations of fraud and deceit ... are mere allegations."

 

Issue:

WON the house of strong materials can be subject to chattel mortgage?

 

Held:

Yes, the house of strong materials can be subject to chattel mortgage. 

The court used a ruling in the case of Lopez vs. Orosa, Jr. and Plaza Theatre Inc., cited in Associated Insurance Surety Co., Inc. vs. Iya, et al. in which that the inclusion of the building, separate and distinct from the land, in the enumeration of what may constitute real properties could only mean one thing — that a building is by itself an immovable property irrespective of whether or not said structure and the land on which it is adhered to belong to the same owner. The court also used the ruling in the case of Manarang and Manarang vs. Ofilada in which this Court stated that "it is undeniable that the parties to a contract may by agreement treat as personal property that which by nature would be real property", citing. In the latter case, the mortgagor conveyed and transferred to the mortgagee by way of mortgage "the following described personal property."  The "personal property" consisted of leasehold rights and a building. Again, in the case of Luna vs. Encarnacion, the subject of the contract designated as Chattel Mortgage was a house of mixed materials, and this Court hold therein that it was a valid Chattel mortgage because it was so expressly designated and specifically that the property given as security "is a house of mixed materials, which by its very nature is considered personal property." In the later case of Navarro vs. Pineda, this Court stated that the view that parties to a deed of chattel mortgage may agree to consider a house as personal property for the purposes of said contract, "is good only insofar as the contracting parties are concerned. It is based, partly, upon the principle of estoppel" 

 

In this case, the house on rented land is not only expressly designated as Chattel Mortgage; it specifically provides that "the mortgagor ... voluntarily CEDES, SELLS and TRANSFERS by way of Chattel Mortgage the property together with its leasehold rights over the lot on which it is constructed and participation ..."  Although there is no specific statement referring to the subject house as personal property, yet by ceding, selling or transferring a property by way of chattel mortgage defendants-appellants could only have meant to convey the house as chattel, or at least, intended to treat the same as such, so that they should not now be allowed to make an inconsistent stand by claiming otherwise. Moreover, the subject house stood on a rented lot to which defendats-appellants merely had a temporary right as lessee, and although this can not in itself alone determine the status of the property, it does so when combined with other factors to sustain the interpretation that the parties, particularly the mortgagors, intended to treat the house as personalty. It is the defendants-appellants themselves, as debtors-mortgagors, who are attacking the validity of the chattel mortgage in this case. The doctrine of estoppel therefore applies to the herein defendants-appellants, having treated the subject house as personalty. 

 

Hence, the house of strong materials can be subject to chattel mortgage.

Eurotech Industrial Technologies, Inc. v. Cuizon, 521 SCRA 584, G.R. No. 167552

Full text: https:www.lawphil.net/judjuris/juri2007/apr2007/gr_167552_2007.html

Facts:

From January to April 1995, petitioner sold to Impact Systems various products. Respondents sought to buy from petitioner one unit of sludge pump valued at ₱250,000.00 with respondents making a down payment of ₱50,000.00. When the sludge pump arrived from the United Kingdom, petitioner refused to deliver the same to respondents without their having fully settled their indebtedness to petitioner. Respondent EDWIN and Alberto de Jesus, general manager of petitioner, executed a Deed of Assignment of receivables in favor of petitioner. Following the execution of the Deed of Assignment, petitioner delivered to respondents the sludge pump.

RTC Ruling:

The trial court granted petitioner’s prayer for the issuance of writ of preliminary attachment. A study of the complaint shows that in the Deed of Assignment, defendant Edwin B. Cuizon acted in behalf of or represented Impact Systems Sales; that Impact Systems Sale is a single proprietorship entity and the complaint shows that defendant Erwin H. Cuizon is the proprietor; that plaintiff corporation is represented by its general manager Alberto de Jesus in the contract which is dated June 28, 1995. Another study reveals that Impact Systems Sales which is owned solely by defendant Erwin H. Cuizon, made a down payment of ₱50,000.00, thereby showing that Impact Systems Sales ratified the act of Edwin B. Cuizon; the records further show that plaintiff knew that Impact Systems Sales, the principal, ratified the act of Edwin B. Cuizon, the agent, when it accepted the down payment of ₱50,000.00. Plaintiff, therefore, cannot say that it was deceived by defendant Edwin B. Cuizon, since in the instant case the principal has ratified the act of its agent and plaintiff knew about said ratification. Plaintiff could not say that the subject contract was entered into by Edwin B. Cuizon in excess of his powers since [Impact] Systems Sales made a down payment of ₱50,000.00 two days later. In view of the Foregoing, the Court directs that defendant Edwin B. Cuizon be dropped as party defendant.

CA Ruling:

Aggrieved by the adverse ruling of the trial court, petitioner brought the matter to the Court of Appeals which, however, affirmed the 29 January 2002 Order of the court a quo. Petitioner’s motion for reconsideration was denied by the appellate court.

Issue:

WON respondent EDWIN acted beyond the authority granted by his principal?

SC Ruling:

No, Edwin did not act beyond the authority granted by his principal.

Legal Basis:

“Art. 1897. The agent who acts as such is not personally liable to the party with whom he contracts, unless he expressly binds himself or exceeds the limits of his authority without giving such party sufficient notice of his powers”.

Article 1897 reinforces the familiar doctrine that an agent, who acts as such, is not personally liable to the party with whom he contracts. The same provision, however, presents two instances when an agent becomes personally liable to a third person. The first is when he expressly binds himself to the obligation and the second is when he exceeds his authority. In the last instance, the agent can be held liable if he does not give the third-party sufficient notice of his powers.

The powers of an agent are particularly broad in the case of one acting as a general agent or manager; such a position presupposes a degree of confidence reposed and investiture with liberal powers for the exercise of judgment and discretion in transactions and concerns which are incidental or appurtenant to the business entrusted to his care and management. In the absence of an agreement to the contrary, a managing agent may enter into any contracts that he deems reasonably necessary or requisite for the protection of the interests of his principal entrusted to his management.

Application:

Edwin Cuizon acted well-within his authority when he signed the Deed of Assignment. To recall, petitioner refused to deliver the one unit of sludge pump unless it received, in full, the payment for Impact Systems’ indebtedness. The significant amount of time spent on the negotiation for the sale of the sludge pump underscores Impact Systems’ perseverance to get hold of the said equipment. There is, therefore, no doubt in our mind that respondent EDWIN’s participation in the Deed of Assignment was "reasonably necessary" or was required in order for him to protect the business of his principal. Had he not acted in the way he did, the business of his principal would have been adversely affected and he would have violated his fiduciary relation with his principal. It must be pointed out that in case of excess of authority by the agent, like what petitioner claims exists here, the law does not say that a third person can recover from both the principal and the agent

Hence, Edwin did not act beyond the authority granted by his principal.

Other laws/rulings/cases used in this case:

In a contract of agency, a person binds himself to render some service or to do something in representation or on behalf of another with the latter’s consent. The underlying principle of the contract of agency is to accomplish results by using the services of others – to do a great variety of things like selling, buying, manufacturing, and transporting. Its purpose is to extend the personality of the principal or the party for whom another acts and from whom he or she derives the authority to act. It is said that the basis of agency is representation, that is, the agent acts for and on behalf of the principal on matters within the scope of his authority and said acts have the same legal effect as if they were personally executed by the principal.

The elements of the contract of agency are: (1) consent, express or implied, of the parties to establish the relationship; (2) the object is the execution of a juridical act in relation to a third person; (3) the agent acts as a representative and not for himself; (4) the agent acts within the scope of his authority.

The Province of North Cotabato et al. v. The Government of the Republic of the Philippines et al. G.R. Nos. 183591, 183752, 183893, 183951, and 183962, 14 October 2008

The Province of North Cotabato et al. v. The Government of the Republic of the Philippines et al.

G.R. Nos. 183591, 183752, 183893, 183951, and 183962, 14 October 2008

 

Facts:

On August 5, 2008, the Government of the Republic of the Philippines (GRP) and the MILF, through the Chairpersons of their respective peace negotiating panels, were scheduled to sign a Memorandum of Agreement on the Ancestral Domain (MOA-AD) Aspect of the GRP-MILF Tripoli Agreement on Peace of 2001 in Kuala Lumpur, Malaysia.

The Solicitor General, who represents respondents, summarizes the MOA-AD by stating that the same contained, among others, the commitment of the parties to pursue peace negotiations, protect and respect human rights, negotiate with sincerity in the resolution and pacific settlement of the conflict, and refrain from the use of threat or force to attain undue advantage while the peace negotiations on the substantive agenda are on-going.

When President Gloria Macapagal-Arroyo assumed office, the military offensive against the MILF was suspended and the government sought a resumption of the peace talks. The MILF, according to a leading MILF member, initially responded with deep reservation, but when President Arroyo asked the Government of Malaysia through Prime Minister Mahathir Mohammad to help convince the MILF to return to the negotiating table, the MILF convened its Central Committee to seriously discuss the matter and, eventually, decided to meet with the GRP.

The parties met in Kuala Lumpur on March 24, 2001, with the talks being facilitated by the Malaysian government, the parties signing on the same date the Agreement on the General Framework for the Resumption of Peace Talks Between the GRP and the MILF. The MILF thereafter suspended all its military actions.

Formal peace talks between the parties were held in Tripoli, Libya from June 20-22, 2001, the outcome of which was the GRP-MILF Tripoli Agreement on Peace (Tripoli Agreement 2001) containing the basic principles and agenda on the following aspects of the negotiation: Security Aspect, Rehabilitation Aspect, and Ancestral Domain Aspect. With regard to the Ancestral Domain Aspect, the parties in Tripoli Agreement 2001 simply agreed "that the same be discussed further by the Parties in their next meeting."

A second round of peace talks was held in Cyberjaya, Malaysia on August 5-7, 2001 which ended with the signing of the Implementing Guidelines on the Security Aspect of the Tripoli Agreement 2001 leading to a ceasefire status between the parties. This was followed by the Implementing Guidelines on the Humanitarian Rehabilitation and Development Aspects of the Tripoli Agreement 2001, which was signed on May 7, 2002 at Putrajaya, Malaysia. Nonetheless, there were many incidence of violence between government forces and the MILF from 2002 to 2003.

In 2005, several exploratory talks were held between the parties in Kuala Lumpur, eventually leading to the crafting of the draft MOA-AD in its final form, which, as mentioned, was set to be signed last August 5, 2008.

On July 23, 2008, the Province of North Cotabato and Vice-Governor Emmanuel Piñol filed a petition, docketed as G.R. No. 183591, for Mandamus and Prohibition with Prayer for the Issuance of Writ of Preliminary Injunction and Temporary Restraining Order. Invoking the right to information on matters of public concern, petitioners seek to compel respondents to disclose and furnish them the complete and official copies of the MOA-AD including its attachments, and to prohibit the slated signing of the MOA-AD, pending the disclosure of the contents of the MOA-AD and the holding of a public consultation thereon. Supplementarily, petitioners pray that the MOA-AD be declared unconstitutional.

This initial petition was followed by another one, docketed as G.R. No. 183752, also for Mandamus and Prohibition filed by the City of Zamboanga, Mayor Celso Lobregat, Rep. Ma. Isabelle Climaco and Rep. Erico Basilio Fabian who likewise pray for similar injunctive reliefs. Petitioners herein moreover pray that the City of Zamboanga be excluded from the Bangsamoro Homeland and/or Bangsamoro Juridical Entity and, in the alternative, that the MOA-AD be declared null and void.

By Resolution of August 4, 2008, the Court issued a Temporary Restraining Order commanding and directing public respondents and their agents to cease and desist from formally signing the MOA-AD. The Court also required the Solicitor General to submit to the Court and petitioners the official copy of the final draft of the MOA-AD, to which she complied.

Meanwhile, the City of Iligan filed a petition for Injunction and/or Declaratory Relief, docketed as G.R. No. 183893, praying that respondents be enjoined from signing the MOA-AD or, if the same had already been signed, from implementing the same, and that the MOA-AD be declared unconstitutional. Petitioners herein additionally implead Executive Secretary Eduardo Ermita as respondent.

The Province of Zamboanga del Norte, Governor Rolando Yebes, Vice-Governor Francis Olvis, Rep. Cecilia Jalosjos-Carreon, Rep. Cesar Jalosjos, and the members of the Sangguniang Panlalawigan of Zamboanga del Norte filed on August 15, 2008 a petition for Certiorari, Mandamus and Prohibition, docketed as G.R. No. 183951. They pray, inter alia, that the MOA-AD be declared null and void and without operative effect, and that respondents be enjoined from executing the MOA-AD.

On August 19, 2008, Ernesto Maceda, Jejomar Binay, and Aquilino Pimentel III filed a petition for Prohibition, docketed as G.R. No. 183962, praying for a judgment prohibiting and permanently enjoining respondents from formally signing and executing the MOA-AD and or any other agreement derived therefrom or similar thereto, and nullifying the MOA-AD for being unconstitutional and illegal. Petitioners herein additionally implead as respondent the MILF Peace Negotiating Panel represented by its Chairman Mohagher Iqbal.

Issues:

1. Whether or not the petitions have become moot and academic?

2. Whether or not the constitutionality and the legality of the MOA is ripe for adjudication?

3. Whether or not there is a violation of the people's right to information on matters of public concern under a state policy of full disclosure of all its transactions involving public interest including public?

4. Whether or not, the provisions of MOA-AD establishes an associative relationship with the Philippine Government and the BJE resulting to the latter as a separate independent state or a juridical, territorial, political subdivision not recognized by law?

5. Whether or not the MOA-AD is inconsistent with the Philippine Constitution and laws? 

6. Whether or not the MOA-AD is inconsistent with the International laws?

7. Whether or not the MOA-AD is binding as an international agreement?

8. Whether the Executive Branch has the authority to so bind the Government of the Republic of the Philippines with BJE?

Rulings:

1. No, the petition have not become moot and academic.

In David v. Macapagal-Arroyo, the Court held that it will decide cases, otherwise moot and academic, if it finds that (a) there is a grave violation of the Constitution; (b) the situation is of exceptional character and paramount public interest is involved; (c) the constitutional issue raised requires formulation of controlling principles to guide the bench, the bar, and the public; and (d) the case is capable of repetition yet evading review.

In this case, the non-signing of the MOA-AD and the eventual dissolution of the GRP Peace Panel did not moot the present petitions. The present petitions are not confined to the terms and provisions of the MOA-AD, but to other on-going and future negotiations and agreements necessary for its realization. The petitions have not, therefore, been rendered moot and academic simply by the public disclosure of the MOA-AD, the manifestation that it will not be signed as well as the disbanding of the GRP Panel not withstanding.Furthermore, the petitions are imbued with paramount public interest, as it involves a significant part of the country's territory and the wide-ranging political modifications of affected LGUs. The assertion that the MOA-AD is subject to further legal enactments including possible Constitutional amendments more than ever provides impetus for the Court to formulate controlling principles to guide the bench, the bar, the public and, in this case, the government and its negotiating entity. There is a reasonable expectation that petitioners, particularly the Provinces of North Cotabato, Zamboanga del Norte and Sultan Kudarat, the Cities of Zamboanga, Iligan and Isabela, and the Municipality of Linamon, will again be subjected to the same problem in the future as respondents' actions are capable of repetition, in another or any form.

Henceforth, the petition have not become mot and academic.

 

2. Yes, the constitutionality and the legality of the MOA is ripe for adjudication.

An actual case or controversy involves a conflict of legal rights, an assertion of opposite legal claims, susceptible of judicial resolution as distinguished from a hypothetical or abstract difference or dispute. There must be a contrariety of legal rights that can be interpreted and enforced on the basis of existing law and jurisprudence. Related to the requirement of an actual case or controversy is the requirement of ripeness. A question is ripe for adjudication when the act being challenged has had a direct adverse effect on the individual challenging it.  For a case to be considered ripe for adjudication, it is a prerequisite that something had then been accomplished or performed by either branch before a court may come into the picture, and the petitioner must allege the existence of an immediate or threatened injury to itself as a result of the challenged action. He must show that he has sustained or is immediately in danger of sustaining some direct injury as a result of the act complained of. Also, the Court has the discretion to relax the procedural technicality on locus standi, where technicalities of procedure were brushed aside, the constitutional issues raised being of paramount public interest or of transcendental importance deserving the attention of the Court in view of their seriousness, novelty and weight as precedents

In this case, the petitions allege that respondents GRP Panel and PAPP Esperon drafted the terms of the MOA-AD without consulting the local government units or communities affected, nor informing them of the proceedings. Such omission, by itself, constitutes a departure by respondents from their mandate under E.O. No. 3.Furthermore, the petitions allege that the provisions of the MOA-AD violate the Constitution. The MOA-AD provides that "any provisions of the MOA-AD requiring amendments to the existing legal framework shall come into force upon the signing of a Comprehensive Compact and upon effecting the necessary changes to the legal framework," implying an amendment of the Constitution to accommodate the MOA-AD. This stipulation, in effect, guaranteed to the MILF the amendment of the Constitution. Such act constitutes another violation of its authority. As the petitions allege acts or omissions on the part of respondent that exceed their authority, by violating their duties under E.O. No. 3 and the provisions of the Constitution and statutes, the petitions make a prima facie case for Certiorari, Prohibition, and Mandamus, and an actual case or controversy ripe for adjudication exists. When an act of a branch of government is seriously alleged to have infringed the Constitution, it becomes not only the right but in fact the duty of the judiciary to settle the dispute. Furthermore, the petitioners have locus standi in view of the direct and substantial injury that they, as LGUs, would suffer as their territories, whether in whole or in part, are to be included in the intended domain of the BJE. These petitioners allege that they did not vote for their inclusion in the ARMM which would be expanded to form the BJE territory. Petitioners' legal standing is thus beyond doubt. Other petitioners, invoked that the issue at hand where of undeniable transcendental importance which the court has granted them locus standi.

Hence, the constitutionality and the legality of the MOA is ripe for adjudication.

 

3. Yes, there is a violation of the people's right to information on matters of public concern under a state policy of full disclosure of all its transactions involving public interest including public resulting to the Government of the Republic of the Philippines Peace Panel’s grave abuse of discretion amounting to lack or excess of jurisdiction when it negotiated and initiated the MOA.

Section 7, Article III on the Bill of Rights provides that the right of the people to information on matters of public concern shall be recognized. Access to official records, and to documents, and papers pertaining to official acts, transactions, or decisions, as well as to government research data used as basis for policy development, shall be afforded the citizen, subject to such limitations as may be provided by law. Also under Section 28, Article II of the Constitution provides that subject to reasonable conditions prescribed by law, the State adopts and implements a policy of full public disclosure of all its transactions involving public interest. Furthermore, the Local Government Code (LGC) of 1991 declares it a State policy to "require all national agencies and offices to conduct periodic consultations with appropriate local government units, non-governmental and people's organizations, and other concerned sectors of the community before any project or program is implemented in their respective jurisdictions" is well-taken.

In this case, the MOA-AD is of public concern, involving as it does the sovereignty and territorial integrity of the State, which directly affects the lives of the public at large. It unequivocally and unilaterally vests ownership of a vast territory to the Bangsamoro people, which could pervasively and drastically result to the diaspora or displacement of a great number of inhabitants from their total environment. As such, the MOA-AD, an instrument recognizing ancestral domain, failed to justify its non-compliance with the clear-cut mechanisms ordained in said Act, which entails, among other things, the observance of the free and prior informed consent of the indigenous cultural communities/indigenous peoples. The PAPP committed grave abuse of discretion when he failed to carry out the pertinent consultation. The furtive process by which the MOA-AD was designed and crafted runs contrary to and in excess of the legal authority, and amounts to a whimsical, capricious, oppressive, arbitrary and despotic exercise thereof. It illustrates a gross evasion of positive duty and a virtual refusal to perform the duty enjoined.

Hence, there is a violation of the people's right to information on matters of public concern under a state policy of full disclosure of all its transactions involving public interest including public resulting to the Government of the Republic of the Philippines Peace Panel’s grave abuse of discretion amounting to lack or excess of jurisdiction when it negotiated and initiated the MOA.

 

 

4. Yes, the provisions of MOA-AD establishes an associative relationship with the Philippine Government and the BJE resulting to the latter as a separate independent state or a juridical, territorial, political subdivision not recognized by law.

The court used the definition of Keitner and Reisman that an association is formed when two states of unequal power voluntarily establish durable links. In the basic model, one state, the associate, delegates certain responsibilities to the other, the principal, while maintaining its international status as a state. Free associations represent a middle ground between integration and independence. Also it bears noting that in international practice, free association is understood as an international association between sovereigns. In international practice, the "associated state" arrangement has usually been used as a transitional device of former colonies on their way to full independence. In the Philippines, the concept of association is not recognized under the present Constitution

In this case, paragraph 4 under Governance in the MOA-AD provides that The relationship between the Central Government and the Bangsamoro juridical entity shall be associative characterized by shared authority and responsibility with a structure of governance based on executive, legislative, judicial and administrative institutions with defined powers and functions in the comprehensive compact. A period of transition shall be established in a comprehensive peace compact specifying the relationship between the Central Government and the BJE. The provisions of the MOA which is consistent with the international concept of association indicate, among other things, that the Parties aimed to vest in the BJE the status of an associated state or, at any rate, a status closely approximating it. It also implies the recognition of the associated entity as a state. The Constitution, however, does not contemplate any state in this jurisdiction other than the Philippine State, much less does it provide for a transitory status that aims to prepare any part of Philippine territory for independence. BJE is a state in all but name as it meets the criteria of a state laid down in the Montevideo Convention, namely, a permanent population, a defined territory, a government, and a capacity to enter into relations with other states. As such, while there may be a semblance of unity because of the associative ties between the BJE and the national government, the act of placing a portion of Philippine territory in a status which, in international practice, has generally been a preparation for independence, is certainly not conducive to national unity. The provisions in the MOA-AD indicates enough of BJE’s aim of being a separate state from the Philippines.

Hence, the provisions of MOA-AD establishes an associative relationship with the Philippine Government and the BJE resulting to the latter as a separate independent state or a juridical, territorial, political subdivision not recognized by law.

 

5. Yes, the MOA-AD is inconsistent with the Philippine Constitution and laws.

·    Article X, Section 18 of the Constitution provides that "[t]he creation of the autonomous region shall be effective when approved by a majority of the votes cast by the constituent units in a plebiscite called for the purpose, provided that only provinces, cities, and geographic areas voting favorably in such plebiscite shall be included in the autonomous region."

 

In this case, paragraph 2(c) on TERRITORY in relation to 2(d) and 2(e), the present geographic area of the ARMM and, in addition, the municipalities of Lanao del Norte which voted for inclusion in the ARMM during the 2001 plebiscite - Baloi, Munai, Nunungan, Pantar, Tagoloan and Tangkal - are automatically part of the BJE without need of another plebiscite, in contrast to the areas under Categories A and B mentioned earlier in the overview. That the present components of the ARMM and the above-mentioned municipalities voted for inclusion therein in 2001, however, does not render another plebiscite unnecessary under the Constitution, precisely because what these areas voted for then was their inclusion in the ARMM, not the BJE.

·         Art. X, SECTION 20 of the constitution provides that within its territorial jurisdiction and subject to the provisions of this Constitution and national laws, the organic act of autonomous regions shall provide for legislative powers over:

(1) Administrative organization;

(2) Creation of sources of revenues;

(3) Ancestral domain and natural resources;

(4) Personal, family, and property relations;

(5) Regional urban and rural planning development;

(6) Economic, social, and tourism development;

(7) Educational policies;

(8) Preservation and development of the cultural heritage; and

(9) Such other matters as may be authorized by law for the promotion of the general welfare of the people of the region.

In this case, on the premise that the BJE may be regarded as an autonomous region, the MOA-AD would require an amendment that would expand the above-quoted provision. The mere passage of new legislation pursuant to sub-paragraph No. 9 of said constitutional provision would not suffice, since any new law that might vest in the BJE the powers found in the MOA-AD must, itself, comply with other provisions of the Constitution. It would not do, for instance, to merely pass legislation vesting the BJE with treaty-making power in order to accommodate paragraph 4 of the strand on RESOURCES which states: "The BJE is free to enter into any economic cooperation and trade relations with foreign countries: provided, however, that such relationships and understandings do not include aggression against the Government of the Republic of the Philippines." Under our constitutional system, it is only the President who has that power. 

·         Article II, Section 22 of the Constitution provides "The State recognizes and promotes the rights of indigenous cultural communities within the framework of national unity and development."

 

In this case, an associative arrangement does not uphold national unity. While there may be a semblance of unity because of the associative ties between the BJE and the national government, the act of placing a portion of Philippine territory in a status which, in international practice, has generally been a preparation for independence, is certainly not conducive to national unity.

 

·         Article X, Section 3 of RA 9054 provides that "As used in this Organic Act, the phrase "indigenous cultural community" refers to Filipino citizens residing in the autonomous region who are:

(a) Tribal peoples. These are citizens whose social, cultural and economic conditions distinguish them from other sectors of the national community; and

(b) Bangsa Moro people. These are citizens who are believers in Islam and who have retained some or all of their own social, economic, cultural, and political institutions."

 

In this case, MOA-AD, paragraph 1 on Concepts and Principles state that: It is the birthright of all Moros and all Indigenous peoples of Mindanao to identify themselves and be accepted as "Bangsamoros". The Bangsamoro people refers to those who are natives or original inhabitants of Mindanao and its adjacent islands including Palawan and the Sulu archipelago at the time of conquest or colonization of its descendants whether mixed or of full blood. Spouses and their descendants are classified as Bangsamoro. The freedom of choice of the Indigenous people shall be respected. This use of the term Bangsamoro sharply contrasts with that found in the Article X, Section 3 of the Organic Act, which, rather than lumping together the identities of the Bangsamoro and other indigenous peoples living in Mindanao, clearly distinguishes between Bangsamoro people and Tribal peoples.

·         Chapter VIII of the IPRA lays down a detailed procedure for the delineation and recognition of ancestral domains.

 

In this case, The MOA-AD's manner of delineating the ancestral domain of the Bangsamoro people is a clear departure from that procedure. By paragraph 1 of Territory, the Parties simply agree that, subject to the delimitations in the agreed Schedules, "the Bangsamoro homeland and historic territory refer to the land mass as well as the maritime, terrestrial, fluvial and alluvial domains, and the aerial domain, the atmospheric space above it, embracing the Mindanao-Sulu-Palawan geographic region."

 

Hence, the MOA-AD is inconsistent with the Philippine Constitution and laws.

 

6. Yes, the MOA-AD is inconsistent with the International laws.

Article 1 of both covenants, International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights state, that all peoples, by virtue of the right of self-determination, "freely determine their political status and freely pursue their economic, social, and cultural development." The people's right to self-determination should not, however, be understood as extending to a unilateral right of secession.

In the REPORT OF THE INTERNATIONAL COMMITTEE OF JURISTS ON THE LEGAL ASPECTS OF THE AALAND ISLANDS QUESTION, the Committee stated the rule as follows:

In the absence of express provisions in international treaties, the right of disposing of national territory is essentially an attribute of the sovereignty of every State. Positive International Law does not recognize the right of national groups, as such, to separate themselves from the State of which they form part by the simple expression of a wish, any more than it recognizes the right of other States to claim such a separation. Generally speaking, the grant or refusal of the right to a portion of its population of determining its own political fate by plebiscite or by some other method, is, exclusively, an attribute of the sovereignty of every State which is definitively constituted. A dispute between two States concerning such a question, under normal conditions therefore, bears upon a question which International Law leaves entirely to the domestic jurisdiction of one of the States concerned.

In the UN DRIP, while upholding the right of indigenous peoples to autonomy, does not obligate States to grant indigenous peoples the near-independent status of an associated state. All the rights recognized in that document are qualified in Article 46 as follows:

Nothing in this Declaration may be interpreted as implying for any State, people, group or person any right to engage in any activity or to perform any act contrary to the Charter of the United Nations or construed as authorizing or encouraging any action which would dismember or impair, totally or in part, the territorial integrity or political unity of sovereign and independent States.

 

In this case, the MOA-AD have provisions that would make the BJE a separate independent state from the Philippines. As mentioned before, the act of placing a portion of Philippine territory in a status which, in international practice, has generally been a preparation for independence, is certainly not conducive to national unity. Such provisions are not consistent to the Philippine Constitution and also to international laws.

Hence, the MOA-AD is inconsistent with the International laws.

 

7. No, the MOA-AD is not binding as an international agreement.

The court used the ruling in the Lomé Accord Amnesty (the Lomé Accord case) of the Special Court of Sierra Leone, in which the Lome Accord is not a treaty and that it can only create binding obligations and rights between the parties in municipal law, not in international law. An international agreement in the nature of a treaty must create rights and obligations regulated by international law so that a breach of its terms will be a breach determined under international law which will also provide principle means of enforcement. The Lomé Agreement created neither rights nor obligations capable of being regulated by international law. An agreement such as the Lomé Agreement which brings to an end an internal armed conflict no doubt creates a factual situation of restoration of peace that the international community acting through the Security Council may take note of. That, however, will not convert it to an international agreement which creates an obligation enforceable in international, as distinguished from municipal, law. A peace agreement which settles an internal armed conflict cannot be ascribed the same status as one which settles an international armed conflict which, essentially, must be between two or more warring States. The Lomé Agreement cannot be characterized as an international instrument.

Also in the Nuclear Test Case, the ICJ ruled that when it is the intention of the State making the declaration that it should become bound according to its terms, that intention confers on the declaration the character of a legal undertaking, the State being thenceforth legally required to follow a course of conduct consistent with the declaration.  It can be gathered from the ruling of ICJ that public statements of a state representative may be construed as a unilateral declaration only when the following conditions are present: the statements were clearly addressed to the international community, the state intended to be bound to that community by its statements, and that not to give legal effect to those statements would be detrimental to the security of international intercourse. Plainly, unilateral declarations arise only in peculiar circumstances.

In this case, the Philippine panel did not draft the same with the clear intention of being bound thereby to the international community as a whole or to any State, but only to the MILF. While there were States and international organizations involved, one way or another, in the negotiation and projected signing of the MOA-AD, they participated merely as witnesses or, in the case of Malaysia, as facilitator. As held in the Lomé Accord case, the mere fact that in addition to the parties to the conflict, the peace settlement is signed by representatives of states and international organizations does not mean that the agreement is internationalized so as to create obligations in international law. Since the commitments in the MOA-AD were not addressed to States, not to give legal effect to such commitments would not be detrimental to the security of international intercourse - to the trust and confidence essential in the relations among States. That the Philippine panel did not enter into such a formal agreement suggests that it had no intention to be bound to the international community. On that ground, the MOA-AD may not be considered a unilateral declaration under international law.

Hence, the MOA-AD is not binding as an international agreement

 

8. No, the Executive Branch does not have the authority to so bind the Government of the Republic of the Philippines with BJE.

The court ruled that the President's power to conduct peace negotiations is implicitly included in her powers as Chief Executive and Commander-in-Chief. The President may not, of course, unilaterally implement the solutions that she considers viable, but she may not be prevented from submitting them as recommendations to Congress, which could then, if it is minded, act upon them pursuant to the legal procedures for constitutional amendment and revision. The President - in the course of conducting peace negotiations - may validly consider implementing even those policies that require changes to the Constitution, but she may not unilaterally implement them without the intervention of Congress, or act in any way as if the assent of that body were assumed as a certainty.

In this case the "suspensive clause" in the MOA-AD viewed in light of the above-discussed standards. Given the limited nature of the President's authority to propose constitutional amendments, she cannot guarantee to any third party that the required amendments will eventually be put in place, nor even be submitted to a plebiscite. The most she could do is submit these proposals as recommendations either to Congress or the people, in whom constituent powers are vested. Plainly, stipulation-paragraph 7 on GOVERNANCE is inconsistent with the limits of the President's authority to propose constitutional amendments, it being a virtual guarantee that the Constitution and the laws of the Republic of the Philippines will certainly be adjusted to conform to all the "consensus points" found in the MOA-AD. Hence, it must be struck down as unconstitutional.

Hence, the Executive Branch does not have the authority to so bind the Government of the Republic of the Philippines with BJE.