scpetrule45

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REPUBLIC OF THE PHILIPPINES

SUPREME COURT

SECOND DIVISION

MANILA

BISHOP PEDRO DULAY ARIGO, CESAR N.

SARINO, DR. JOSE ANTONIO N. SOCRATES

PROF. H. HARRY L. ROQUE, JR.

Petitioners,

X__________________________________X

SC. G.R. No. 185941

For: PETITION FOR REVIEW ON

CERTIORARI UNDER RULE 45 (with

an Application for Writs of

Preliminary Mandatory and

Prohibitory Injunction and/or

Temporary Restraining Order)

-versus-

HON. EXECUTIVE SECRETARY EDUARDO R.

ERMITA, HON. ENERGY SECRETARY ANGELO

T. REYES, HON. FINANCE SECRETARY

MARGARITO B. TEVES, HON. BUDGET AND

MANAGEMENT SECRETARY ROLANDO D.

ANDAYA JR., HON. PALAWAN GOVERNOR

JOEL T. REYES, HON. REPRESENTATIVE

ANTONIO C. ALVAREZ, (1ST

DISTRICT), HON.

REPRESENTATIVE ABRAHAM MITRA, (2ND

DISTRICT), RAFAEL E. DEL PILAR,

PRESIDENT & CEO, PNOC EXPLORATION

CORPORATION,

Respondents.

X__________________________________X

PETITION

Petitioners, by counsel, and unto this Honorable Court, respectfully state, that:

PREFATORY STATEMENT

In this citizen’s suit, the issue of the “equitable share in the proceeds of the

utilization of the development of national wealth”1 of a local government unit, in this

1 From the language of the fundamental law of the land. See CONST. (1987), art X, sec. 7, which provides

that: “Local governments shall be entitled to an equitable share in the proceeds of the utilization and

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case, the Province of Palawan, by the special geographical circumstances involved, is

inextricably linked with the integrity of the national territory and the national patrimony;

the assailed presidential issuance, EO 683, crafted based on a grievously erroneous

construction by the Chief Executive of the constitutionally-defined national territorial

limits, is by itself, patently illegal and unconstitutional insofar as it violates the

provisions of the 1991 Local Government Code and the 1987 Constitution guaranteeing

an equitable share of the proceeds of the utilization of the development of the national

wealth of a local government unit.

The Court a quo has refused to take cognizance of the case primarily on the grounds

of prematurity and of judicial deference to joint efforts by the Executive and the

Legislative to define the country’s baselines. Petitioners contend that while it is true that

the questioned Executive Order is indeed premised on the eventual legislative

determination of the metes and bounds of the national territory pertaining to the country’s

baselines, particularly as it relates to the Kalayaan Island Group, popularly known as the

Spratlys, the very terms and conditions of EO 683 already present justiciable issues with

respect to the disbursement of public funds provided in the presidential issuance; on this

basis, the Courts cannot shirk from the duty to pass upon the relevant legal and

constitutional issues; moreover, Petitioners argue that it is as well the constitutional duty

of the Courts to examine what the 1987 Constitution itself establishes as the metes and

bounds of the national territory.

Finally, the Court a quo has faulted Petitioners for their supposed failure to provide it

with documents relevant to its adjudication of the Petition, pursuant to the provisions of

the Revised Rules of Court. A close examination of the issue however, will support

Petitioner’s claim that these documents are only tangential to the controversies at hand,

development of the national wealth within their respective areas, in the manner provided by law, including

sharing the same with the inhabitants by direct means.”

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not to mention that this Honorable Court itself has already determined that Petitioners are

not legally in a position to secure these documents because they are not parties to it.

A. PETITIONERS

1. Bishop Pedro Dulay Arigo current Bishop of the Archdiocese of Puerto

Princesa, Palawan, sues as a resident of Palawan, citizen and taxpayer of the Republic of

the Philippines.

2. Petitioner Cesar N. Sarino, a former secretary of the Department of the

Interior and Local Government (DILG), sues as a citizen and taxpayer of the Republic of

the Philippines.

3. Dr. Jose Antonio N. Socrates, a geologist and surgeon by training, sues as

a resident of Palawan, citizen and taxpayer of the Republic of the Philippines.

4. Petitioner Prof. H. Harry L. Roque, Jr., is a lawyer and professor of

constitutional law and international law at the University of the Philippines, sues as a

citizen, taxpayer, and as an officer of the court with a sworn duty to uphold the

Constitution and the laws of the Republic of the Philippines.

5. All the petitioners in this controversy may be served with court processes

through their counsel, the Roque and Butuyan Law Offices, with office address at Unit

1904, Antel 2000 Corporate Center, No. 121, Valero Street, Salcedo Village, Makati

City, 1227.

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B. RESPONDENTS

6. Respondent Hon. Eduardo Ermita is the incumbent Executive Secretary,

with office address at 2nd

Floor, Mabini Hall, Malacañang, J.P. Laurel St., San Miguel,

Manila, where he may be served with summons and other court processes.

7. Respondent Hon. Angelo T. Reyes is the incumbent Secretary of the

Department of Energy [hereinafter, DOE], with office address at Meritt Road, Fort

Bonifacio, Taguig, Metro Manila, where he may be served with summons and other court

processes.

8. Respondent Hon. Margarito B. Teves Jr. is the incumbent Secretary of

the Department of Finance [hereinafter, DOF], with office address at Roxas Blvd., corner

Vito Cruz St., Manila, where he may be served with summons and other court processes.

9. Respondent Hon. Rolando D. Andaya Jr. is the incumbent Secretary of

the Department of Budget and Management [hereinafter, DBM], with office address at

J.P Laurel St., corner Ayala St., City of Manila, where she may be served with summons

and other court processes.

10. Respondent Hon. Joel T. Reyes is the incumbent Governor of the

Province of Palawan, with office address at the Provincial Capitol, Puerto Princesa City,

Palawan, where he may be served with summons and other legal processes.

11. Respondent Hon. Antonio C. Alvarez is the incumbent Representative of

the First District of the Province of Palawan. He may be served with summons and other

legal processes at the House of Representatives, House of Representatives Complex,

Constitution Hills, Quezon City 1126.

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12. Respondent Hon. Abraham Mitra is the incumbent Representative of the

Second District of the Province of Palawan. He may be served with summons and other

legal processes at the House of Representatives, House of Representatives Complex,

Constitution Hills, Quezon City 1126.

13. Respondent Rafael E. Del Pilar is the incumbent President & CEO of the

PNOC Exploration Corporation. He may be served with summons and other legal

processes Building 1, Energy Center, Fort Bonifacio, Taguig City 1634.

STATEMENT OF MATERIAL FACTS

14. The Republic of the Philippines, through the Department of Energy

(DOE), entered into a service contract with Shell Philippines Exploration B.V. and

Occidental Philippines, Incorporated on December 11, 1990 for the exclusive contract of

petroleum operations in the area referred to as CAMAGO-MALAMPAYA. The

exploration led to the drilling of the Camago-Malampaya natural gas reservoir located

about eighty (80) kilometers from the coastline of Palawan, in the South China Sea.

15. The Camago-Malampaya project, which features extensive natural gas

and oil deposits, is said to be the largest single investment in the country, projected to

generate approximately 8 to 10 billion U.S. Dollars of revenue of the Philippine

government.

16. A dispute has arisen between the Provincial Government and the National

Government over the proportionate share of the proceeds of from the Camago-

Malampaya natural gas project.

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17. The Provincial Government of Palawan asserts its claim over a forty

percent (40%) share of the proceeds, according to the provisions of the 1991 Local

Government Code. Its claim for such a share is founded on its contention that the

Camago-Malampaya gas fields are located within the territorial jurisdiction of Palawan

and is thus entitled to the proceeds as provided for in the Local Government Code. For

this reason, the Provincial Government of Palawan has a pending claim in Court against

the National Government.2

18. The National Government however contends that the Camago-

Malampaya natural gas reservoir is approximately eighty (80) kilometers from the

coastline of Palawan and is thus outside its territorial jurisdiction. Hence, the Provincial

Government’s claim to entitlement to national wealth is unfounded.

19. There have been a number of negotiations between the two parties to end

the legal tussle between them over who has which rightful share over the proceeds of the

project, while the case is still pending in court.

20. The latest of such efforts to settle the controversy is the issuance by the

Office of the President on Dec. 1, 2007 of Executive Order No. 683 [hereinafter EO 683],

which authorizes the “use of fees, revenues and receipts from service contract no. 38 for

the implementation of development projects for the people of Palawan.”3

21. It was signed By Respondent Sec. Ermita on behalf of Mrs. Gloria

Macapagal-Arroyo.

2The Provincial Government won a Petition for Declaratory Relief it filed with Branch 95 of the Regional Trial Court of Puerto Princesa, docketed as Special Civil Action Case No. 3779. Subsequently, the DOE,

then headed by Sec. Raphael Perpetuo Lotilla, brought the case before the Supreme Court, docketed as G.R

No. 170867, where it remains pending. 3 A copy of EO 683 is attached to this pleading as ANNEX A. It was attached to the Petition filed with the

Court a quo as ANNEX A as well.

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22. EO 683, among other things, provides that:

[T]he duly-authorized representatives of the National Government and the

Province of Palawan, with the conformity of the Representatives of the

Congressional Districts of Palawan, have agreed on a Provisional

Implementation Agreement (PIA) that would allow 50% of the disputed

40% if the Net Government Share in the proceeds of SC 38 to be utilized

for the immediate and effective implementation of the development

projects for the people of Palawan.

23. § 1 of EO 683 provides that under the PIA, the DBM is authorized to release

funds to the implementing agencies on the endorsement and submission by the DOE

and/or the PNOC Exploration Corporation of the following documents: a) directive by

the Office of the President or written request of the Province of Palawan, the Palawan

Congressional Districts or the Highly Urbanized City of Puerto Princesa, for the funding

of designated projects (§ 1.1); (b) a certification that the designated projects fall under the

investment program of the Province of Palawan, City of Puerto Princesa, and/or the

development projects identified in the development program of the National Government

or its agencies; (§1.2); and (c), Bureau of Treasury certification on the availability of

funds from the 50% of the 40% share being claimed by the Province of Palawan from the

Net Government Share under SC 38.

24. It states that “the DBM shall be subject to the actual collections deposited with the

National Treasury, and shall be in accordance with the Annual Fiscal Program of the

National Government.”

25. Another relevant provision is found in § 3 of EO 683, which provides that the

National government shall allow the Province of Palawan, the Congressional Districts of

Palawan and the City of Puerto Princesa to securitize their shares in the 50% of the

disputed 40% of the Net Government Share in the proceeds of SC 38 according to the

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PIA. The DOE, in consultation with the DOF, will be responsible for preparing the Net

Government Revenues for the period of to June 30, 1010 [sic].

26. “The amounts released pursuant to this EO shall be without prejudice to any on-

going discussions or final judicial resolution of the legal dispute regarding the National

Government’s territorial jurisdiction over the areas covered by SC 38 in relation to the

claim of the Province of Palawan under Sec. 290 of RA 7160,” according to § 4 of EO

683.

27. EO 684 was to take effect fifteen (15) days after its publication in a newspaper

of general circulation.

28. On Feb. 5, 2008, the Petitioners received a certified true copy of EO 683, signed

on Dec. 1, 2007 by the Respondent Sec. Ermita by the authority of Mrs. Gloria

Macapagal-Arroyo. The effectivity clause of EO 683 provides that it shall take effect 15

days after its publication in a general newspaper.

29. On Feb. 7, 2008 Petitioners filed with the Honorable Court of Appeals a special

civil action for certiorari under Rule 654 questioning the issuance of EO 683, with an

application for writs of preliminary mandatory and prohibitory injunction and/or

temporary restraining order. The case was docketed as CA-GR SP No. 102247.

30. On April 3,2008, Petitioners received notice of the Court a quo’s Resolution dated

March 18,2008 directing them to submit within five(5) days from notice copies of the

following : (1) petition for review on certiorari docketed as GR No. 170867(Republic of

the Philippineset al., v. the Provincial Government of Palawan) filed with this

Honorable Court; (2) the decision of the Regional Trial Court of Puerto Princesa,

Palawan, Branch 95 in Special Civil Action No. 3779; (3) Motion for Reconsideration of

4 A copy of the Petition with annexes is attached as ANNEX B.

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the aforesaid RTC decision; (4) Service Contract No. 38; and (5) the Provisional

Implementation Agreement (PIA), as required under Section 1, Rule 65, in relation to

Section 3, Rule 46 of the 1997 Rules of Civil Procedure.5

31. Petitioner sought an additional ten (10) days from April 8, 2008 or until April 18,

2008 to comply with the Resolution.

32. On April 18, 2008, Petitioners filed a Manifestation and Motion with the Court a

quo, informing the Court that they were unable to obtain a copy of the case records of GR

No. 1708657 in the dockets of this Honorable Court despite having made a formal

request for it and considering that they are not parties in the said case; They however

attached to the pleading certified true copies of the Decision of the Regional Trial Court

Branch 95 in Puerto Princesa, Palawan and the Motion for Reconsideration filed by the

National Government in the said case as well as a copy of Service Contract No. 38. They

further manifested the difficulty they encountered locating a copy of the PIA mentioned

in EO 386 and prayed of the Court to direct (1) the Hon. Secretary of Energy, a

Respondent in the case, to submit a copy of the Petition for Review in GR No. 1708657,

of which it was the lead Petitioner; (2) The Hon. Executive Secretary of the Philippines,

another Respondent, to submit before the Court a quo a certified true copy of SC No. 38

(3) any of the following Respondents, namely Hon. Joel T. Reyes, incumbent Governor

of Palawan, Hon. Antonio C. Alvarez, incumbent Representative of the First District of

the Province of Palawan and Hon. Abraham Mitra, incumbent Representative of the

Second District of the Province of Palawan, to submit to the Court a copy of the said PIA,

to which they were supposed to have been signatories.6

33. On May 29, 2008, the Former Twelfth Division of the Honorable Court of

Appeals rendered a resolution in CA GR NO.102247, the dispositive portion of which

5 A copy of the Resolution is attached as ANNEX C. 6 A copy of the Manifestation and Motion with annexes is attached as ANNEX D.

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read thus: “WHEREFORE, the petition is DENIED DUE COURSE and accordingly

DISMISSED.”7

34. On June 23, 2008, Petitioner filed a Motion praying that the Court a quo

reconsider its May 29, 2008:8

35. On August 8, 2008, Petitioners filed yet another Manifestation and Motion before

the Court a quo – a further submission on their failure to provide it with a copy of the

Petition in GR No. 170867 (Republic of the Philippines et al., v. Provincial Government

of Palawan), as a result of which the Court a quo, in its May 29,2008 resolution

dismissing the case, faulted the Petitioners, finding that Petitioners’ excuse for failing to

submit the said document “holds no water in light of the fact that the Supreme Court

requires pleadings, motions and other papers to be filed in no less than eighteen (18)

copies.”

36. In their second Manifestation and Motion, Petitioners informed the Court a quo

that on Aug. 5, 2008, they received a copy of a Resolution dated June 23, 2008 of the

Third Division of this Honorable Court, in which the High Court resolved to note thus:

“the letter dated 10 April 2008 of Romel Regalado Bagares of Roque and Butuyan Law

Offices and to DENY his request for certified true copies of documents enumerated

therein to be submitted in a related case pending before the Court of Appeals as the said

law office is not a counsel for any party.” The original duplicate copy of the said

Resolution was attached to the Manifestation and Motion. 9

37. On June 6, 2008, Petitioners received a copy of a Resolution of the Honorable

Court of Appeals dated December 16, 2008, denying their Motion for Reconsideration

7 A duplicate original copy of the Resolution dated May 29, 2008 is attached as ANNEX E. 8 A copy of the Motion for Reconsideration is attached as ANNEX F. 9 A copy of the second Manifestation and Motion with annexes is attached as ANNEX G.

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dated June 23,2008. The dispositive portion read thus: “WHEREFORE, premises

considered, petitioners’ motion for reconsideration is DENIED for lack of merit.”10

STATEMENT OF MATERIAL DATES

38. Under Rule 45, Petitioners have 15 days from notice of the assailed judgment or

order within which to file a Petition for Review on Certiorari. As Petitioner received the

said Resolution on January 7, 2009 they had until January 22, 2009 within which to file

the Petition.

39. However, on even date, Petitioners filed with this Honorable Court a motion

asking for an additional 30 days or until Feb. 21, 2009 to file the same. At the same time,

Petitioners paid the filing and other lawful docket fees in the amount of Four Thousand

Seven Hundred and Sixty Three Pesos (P4763.00), inclusive of the fee for a Writ of

Preliminary Injunction and/or a Temporary Restraining Order, through Postal Money

Orders issued in the name of the Hon. Clerk of Court of this Honorable Court.

40. Thus, Feb. 21, 2009 being a Saturday, Petitioner had until today, Feb. 23, 2009,

the next regular business day, within which to do the same.

41. Petitioners therefore are filing the instant action within the reglamentary period

provided for under Rule 45.

10 A certified true copy of the Resolution is attached as ANNEX H.

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NATURE OF THE CASE

42. This Petition is an Appeal by Certiorari before the Supreme Court under Rule 45

of the Revised Rules of Court, questioning the resolution of the Court a quo that

dismissed the special civil action for certiorari under Rule 65 filed against the

Respondents in the instant case. On account of the nature of this petition and the causes

of action involved, Petitioners respectfully ask of this Honorable Court that the bond for

a writ of preliminary mandatory and prohibitory injunction and/or temporary restraining

order be waived.

STATEMENT OF THE ISSUES

I. WHETHER OR NOT THE HONORABLE COURT A QUO GRAVELY ERRED UNDER LAW

WHEN IT HELD THAT THERE IS NO ACTUAL CASE AND CONTROVERSY IN THE

PROCEEDING A QUO.

II. WHETHER OR NOT THE HONORABLE COURT A QUO GRAVELY ERRED UNDER LAW IN

DISMISSING THE PETITION ON THE GROUND OF PREMATURITY AND DEFERRING TO ON-

GOING JOINT EFFORTS OF THE BOTH THE LEGISLATURE AND THE EXECUTIVE TO

REDEFINE THE COUNTRY’S BASELINES.

III. WHETHER OR NOT THE HONORABLE COURT A QUO GRAVELY ERRED UNDER LAW IN

DISMISSING THE PETITION FOR THE ALLEGED FAILURE OF PETITIONERS TO PROVIDE IT

WITH A COPY OF THE PROVISIONAL INTERIM AGREEMENT (PIA) THAT GAVE RISE TO

THE ISSUANCE OF EO 683, PURSUANT TO RULE 65 § 1 IN RELATION TO RULE 46 § 3

OF THE REVISED RULES OF COURT.

IV. WHETHER OR NOT THE HONORABLE COURT A QUO ERRED UNDER LAW IN

DISMISSING THE PETITION FOR THE ALLEGED FAILURE OF PETITIONERS TO PROVIDE IT

WITH CERTAIN DOCUMENTS PERTAINING TO GR NO. 170867, PURSUANT TO RULE 65 § 1

IN RELATION TO RULE 46 § 3 OF THE REVISED RULES OF COURT.

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SUBMISSIONS

I. THE HONORABLE COURT A QUO GRAVELY ERRED UNDER LAW WHEN IT HELD THAT

THERE IS NO ACTUAL CASE AND CONTROVERSY IN THE PROCEEDING A QUO,

CONSIDERING THAT THE ISSUANCE OF QUESTIONED EXECUTIVE ORDER (EO) 683

ALREADY INVOLVES STATUTORY CONSTITUTIONAL AND JURISPRUDENTIAL QUESTIONS

THAT ARE RIPE FOR ADJUDICATION, NAMELY, THE DIBURSEMENT OF PUBLIC FUNDS IN

VIOLATION OF THE CONSTITUTIONAL PROVISION ON REALIGNMENT OF PUBLIC FUNDS,

THE PROVISIONS OF THE 1991 LOCAL GOVERNMENT CODE ON THE EQUITABLE SHARING

OF THE INTERNAL REVENUE ALLOTMENT (IRA) BETWEEN THE NATIONAL

GOVERNMENT AND THE LOCAL GOVERNMENT UNITS, AND THE UNLAWFUL WITHOLDING

OF THE SAID ALLOTMENT , ALL OF WHICH THE COURTS HAVE A CONSTITUTIONAL DUTY

TO RESOLVE.

II. THE HONORABLE COURT A QUO GRAVELY ERRED UNDER LAW IN DISMISSING THE

PETITION ON THE GROUND OF PREMATURITY AND OF JUDICIAL DEFERENCE TO CO-

EQUAL BRANCHES OF GOVERNMENT NOW DELIBERATING ON THE COUNTRY’S

BASELINES, CONSIDERING THAT (1) THE HONORABLE COURT A QUO HAS A

CONSTITUTIONAL DUTY TO INTERPRET THE CONSTITUTIONAL PROVISIONS DEFINING

THE NATIONAL TERRITORY AND (2) INDEPENDENT OF THE FINAL ADJUDICATION OF THE

DISPUTE BETWEEN THE PROVINCE OF PALAWAN AND THE NATIONAL GOVERNMENT

PENDING BEFORE THE THIRD DIVISION OF THIS HONORABLE COURT IN GR NO. 170867

(REPUBLIC OF THE PHILIPPINES ETAL., V. THE PROVINCIAL GOVERNMENT OF PALAWAN),

THE TERMS AND CONDITIONS OF E.O. 683 ARE INDUBITABLY ALREADY A VIOLATION OF

CONSTITUTION, STATUTE AND JURISPRUDENCE.

III. THE HONORABLE COURT A QUO GRAVELY ERRED UNDER LAW IN DISMISSING THE

PETITION FOR THE ALLEGED FAILURE OF PETITIONERS TO PROVIDE IT WITH A COPY OF

THE PROVISIONAL INTERIM AGREEMENT (PIA), CONSIDERING THAT THE TERMS AND

PROVISIONS OF EO 683 EMBODY ALL THE TERMS AND PROVISIONS OF THE ASSAILED

PIA. THUS WHAT IS BEING CHALLENGED IS THE QUESTIONED ORDER, WHICH WAS

DRAFTED AND ISSUED TO EXPRESS IN OFFICIAL TERMS AND TO PUT INTO LEGAL EFFECT

THE PIA’S OWN TERMS AND CONDITIONS; REQUIRING PETITIONERS TO SUBMIT A COPY

OF THE PIA, DRAFTED AND SIGNED IN THE FIRST PLACE UNDER CONDITIONS OF

SECRECY, WOULD SIMPLY BE SUPERFLOUS, ACCORDING TO THE RULES COURT.

IV. THE HONORABLE COURT A QUO ERRED UNDER LAW IN DISMISSING THE PETITION

FOR THE ALLEGED FAILURE OF PETITIONERS TO PROVIDE IT WITH CERTAIN

DOCUMENTS PERTAINING TO GR NO. 170867, CONSIDERING THAT UNDER THE RULES

OF COURT THESE ARE NOT REALLY NECESSARY - AS THEY ARE ONLY TANGENTIAL –

TO THE RESOLUTION OF THE CASE BY THE COURT A QUO, NOT TO MENTION THAT

PETITIONERS ARE NOT EVEN PARTIES TO THE CASE OF WHICH THE SAME DOCUMENTS

ARE PART, AS THIS HONORABLE COURT ITSELF HAS ALREADY DETERMINED.

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DISCUSSION

I.

THE HONORABLE COURT A QUO

GRAVELY ERRED UNDER LAW

WHEN IT HELD THAT THERE IS NO

ACTUAL CASE AND CONTROVERSY

IN THE PROCEEDING A QUO,

CONSIDERING THAT THE ISSUANCE

OF QUESTIONED EXECUTIVE

ORDER (EO) 683 ALREADY

INVOLVES STATUTORY

CONSTITUTIONAL AND

JURISPRUDENTIAL QUESTIONS

THAT ARE RIPE FOR

ADJUDICATION, NAMELY, THE

DIBURSEMENT OF PUBLIC FUNDS

IN VIOLATION OF THE

CONSTITUTIONAL PROVISION ON

REALIGNMENT OF PUBLIC FUNDS,

THE PROVISIONS OF THE 1991

LOCAL GOVERNMENT CODE ON

THE EQUITABLE SHARING OF THE

INTERNAL REVENUE ALLOTMENT

(IRA) BETWEEN THE NATIONAL

GOVERNMENT AND THE LOCAL

GOVERNMENT UNITS, AND THE

UNLAWFUL WITHOLDING OF THE

SAID ALLOTMENT , ALL OF WHICH

THE COURTS HAVE A

CONSTITUTIONAL DUTY TO

RESOLVE.

43. Contrary to the Court a quo’s contention, the instant Petition has not been

prematurely filed and that the issues presented before it are not yet ripe for adjudication.

While it may well be true that the interim undertaking between the National Government

and the Province of Palawan is contingent on the final adjudication of G.R. No. 170867,

it is undeniable that in the meanwhile that no such adjudication has happened

disbursements of public funds will ensue or are already taking place in violation of

Statute, Constitution and jurisprudence.

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A. Violations of the 1991 Local Government Code

44. The Court a quo should have considered that EO 683, among other

things, provides that:

[T]he duly-authorized representatives of the National Government and the

Province of Palawan, with the conformity of the Representatives of the

Congressional Districts of Palawan, have agreed on a Provisional

Implementation Agreement (PIA) that would allow 50% of the disputed

40% if the Net Government Share in the proceeds of SC 38 to be utilized

for the immediate and effective implementation of the development

projects for the people of Palawan.

45. Thus, even if the case is pending, both parties have agreed that they will

nevertheless allow the disbursement of public funds according to an agreed formula.

Moreover, such disbursement will proceed independent of and regardless of what the

outcome will be of the Supreme Court’s adjudication of their respective territorial claims

over the Malampaya gas and oil wells. It is for this reason that Petitioners contend that

the certiorari proceeding a quo could have been given due course independent of the

Supreme Court’s adjudication of such territorial conflict between the National

Government and the Province of Palawan.

46. § 1 of EO 683 provides that under the PIA, the DBM is authorized to release

funds to the implementing agencies on the endorsement and submission by the DOE

and/or the PNOC Exploration Corporation of the following documents: a) directive by

the Office of the President or written request of the Province of Palawan, the Palawan

Congressional Districts or the Highly Urbanized City of Puerto Princesa, for the funding

of designated projects (§ 1.1); (b) a certification that the designated projects fall under the

investment program of the Province of Palawan, City of Puerto Princesa, and/or the

development projects identified in the development program of the National Government

or its agencies; (§1.2); and (c), Bureau of Treasury certification on the availability of

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funds from the 50% of the 40% share being claimed by the Province of Palawan from the

Net Government Share under SC 38.

47. It states that “the DBM shall be subject to the actual collections deposited with the

National Treasury, and shall be in accordance with the Annual Fiscal Program of the

National Government.”

48. Further § 3 of EO 683, provides that the National government shall allow the

Province of Palawan, the Congressional Districts of Palawan and the City of Puerto

Princesa to securitize their shares in the 50% of the disputed 40% of the Net Government

Share in the proceeds of SC 38 according to the PIA. The DOE, in consultation with the

DOF, will be responsible for preparing the Net Government Revenues for the period of to

June 30, 1010 [sic].

49. “The amounts released pursuant to this EO shall be without prejudice to any on-

going discussions or final judicial resolution of the legal dispute regarding the National

Government’s territorial jurisdiction over the areas covered by SC 38 in relation to the

claim of the Province of Palawan under Sec. 290 of RA 7160,” according to § 4 of EO

683.

50. Undeniably, EO 683 is now in effect, having already been published in a

newspaper of general circulation a long time ago, notwithstanding the fact that requisites

embodied in constitution, statute and jurisprudence in respect of disbursements arising

from the share of the local government unit in the proceeds of the utilization of its natural

resources have not been met.

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51. Obviously, these requisites were not observed in the case of Palawan, as it was

not in Pimentel v. Aguirre – a clear showing of a grave abuse of discretion amounting to

an excess of jurisdiction.

52. For the provisions of the law cannot be bargained away by the PIA as embodied

in EO 683; to do so would not only violate the Local Government Code, but above all,

the Constitution, which provisions on the equitable sharing of resources between the

National Government and the Local Government Unit it is also giving flesh to.

53. First of all, neither Respondent Reyes nor Respondents Alvarez and Mitra

have the authority to sign on behalf of the other Local Government Units of Palawan –

the mayors, as well as the barangay captains. In fact the cities, municipalities, and

barangays have a bigger share than the Provincial Government in the allocation of

revenues, as § 292 of the Local Government Code says. (The city/municipality gets 45 %

and the barangay gets 35% or a combined share of 80 percent as against the Province’s

share of only 20 percent). They cannot sign the PIA as if they are the sole recipients of

the proceeds of the utilization of the Malampaya Oil and Gas Reserves.

54. In fact, the PIA removes from the picture the other LGUs who have a

rightful stake in such proceeds because here the Province of Palawan claims for itself a

much-reduced share of 50 percent of the 40 percent share mandated by the law as

belonging to the LGUs, granting the other half to the National Government.

55. Secondly, the PIA violates § 290 of the 1991 Local Government Code.

The interim agreement only talks of “net proceeds” supposedly of the utilization of the

Malampaya oil and gas resources while the law provides that the share of the LGU is

based on “gross collection.” Hence the interim agreement reduces the rightful share of the

LGUs in two ways: one, by making “net proceeds” as the basis of the sharing, and two,

by cutting down the equitable share of the LGUs in such proceeds by half, which share is

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now to be claimed exclusively by the Province of Palawan, without due consideration for

the cities, municipalities and barangays concerned.

56. This is patently illegal, and in contravention of the 1991 Local

Government Code. In the first place this provision of the law is not subject to

compromise. This interim agreement is an unequivocal violation of the intention of the

1991 Local Government Code to provide the local government with greater power over

its natural resources.

57. Thirdly, it should be remembered that § 286 of the Local Government

Code is followed by a clause that says: “Nothing in this Chapter shall be understood to

diminish the share of local government units under existing laws.” Now this provision is

important because it goes against all the promises the national government is making

through the PIA. Under the law, the proceeds of the utilization of natural resources is to

be directly released to each local government unit, without need of any further action.

58. The problem is that the PIA makes it clear that any fund allocation for

any project must first be approved by the Department of Energy and/or the PNOC

Exploration Corporation as provided for in § 1 of EO 683. Moreover, these projects are

made “subject to the actual collections deposited with the National Treasury.”

59. Fourthly, the PIA provides that only those projects identified by the

Office of the President, or the Province of Palawan, or the Palawan Congressional

Districts, or the Highly Urbanized City of Puerto Princesa may be funded. Now, this goes

against the intent of the 1991 Local Government Code to grant LGUs autonomy and to

decentralize power. How the money from its equitable share in the utilization of its

natural resources is to be spent is a prerogative of the LGUs and the national government

has no business fiddling with it, subject only to the terms and conditions found in § 294

of the 1991 Local Government Code.

19

60. Fifthly, the PIA allows the securitization of the shares of the LGUs and

the National Government in the utilization of the Malampaya Oil and Gas resources. The

National Government cannot securitize what it does not own legally. Neither can the

Province of Palawan securitize what it does not fully own. Securitization also brings with

it a host of complex issues, considering that it will necessarily draw the participation of

other parties – corporations primarily.

B. Violations of applicable jurisprudence on the International Revenue Allotment (IRA)

61. The most recent jurisprudence upholds their right under law to the

proceeds of the utilization of national wealth within their boundaries. In Pimentel v.

Aguirre, this Honorable Court ruled that the shares of the local government unit from

national wealth in the national internal revenue shall be automatically released. The High

Court said that by this provision in the Local Government Code providing for such

release, it uses the word “shall” and as a rule, it is a word of command that must be given

a “compulsory meaning.”11

The ponente, Justice Panganiban, thus said:

The Constitution vests the President with the power of supervision,

not control, over local government units (LGUs). Such power

enables him to see to it that LGUs and their officials execute their

tasks in accordance with law. While he may issue advisories and

seek their cooperation in solving economic difficulties, he cannot

prevent them from performing their tasks and using available

resources to achieve their goals. He may not withhold or alter any

authority or power given them by the law. Thus, the withholding of

a portion of internal revenue allotments legally due them cannot be

directed by administrative fiat.12

62. In the same case, the Supreme Court said that if at all there arises a

situation where the national government must, of necessity, reduce the share of local

11G.R. No. 132988. July 19, 2000. 12 Id.

20

government units, the law itself sets certain procedures and limits that must be followed.

Citing from the Code13

itself, the ponente thus said:

There are therefore several requisites before the President may

interfere in local fiscal matters: (1) an unmanageable public sector

deficit of the national government; (2) consultations with the

presiding officers of the Senate and the House of Representatives

and the presidents of the various local leagues; and (3) the

corresponding recommendation of the secretaries of the

Department of Finance, Interior and Local Government, and

Budget and Management. Furthermore, any adjustment in the

allotment shall in no case be less than thirty percent (30%) of the

collection of national internal revenue taxes of the third fiscal year

preceding the current one.

C. Violations of the Constitution itself

63. That there is an actual case and controversy in this case is established by the fact

that Respondent Sec. Ermita clearly overstepped constitutional bounds when he issued

the EO 683 – a grave abuse of discretion amounting to a lack of jurisdiction – considering

that such issuance is a violation of the Constitutional Provision on the equitable sharing

of resources between the National Government and the Local Government Unit.

64. In fact, the money supposedly coming from the Net Share of the National

Government for disbursement according to EO 683 came from the 40-percent share of

the province of Palawan from the proceeds of the Camago-Malampaya oil and gas field,

which is a realignment of funds not allowed by the 1987 Charter;

65. Moreover, the Respondent Sec. Ermita committed a grave abuse of discretion

amounting to a lack of jurisdiction when he authorized the Secretary of DOE and/or the

PNOC Exploration Corporation to determine to which implementing agencies funds may

13 “. . . [I]n the event the national government incurs an unmanaged public sector deficit, the President of

the Philippines is hereby authorized, upon the recommendation of [the] Secretary of Finance, Secretary of the Interior and Local Government and Secretary of Budget and Management, and subject to consultation

with the presiding officers of both Houses of Congress and the presidents of the liga, to make the necessary

adjustments in the internal revenue allotment of local government units but in no case shall the allotment be

less than thirty percent (30%) of the collection of national internal revenue taxes of the third fiscal year

preceding the current fiscal year . . .” See also Rep. Act. No. 7160 (1991) Sec. 284.

21

be released under the PIA. For in usual budgeting procedures of Congress, the share

from the National Wealth is included in the appropriation for “Allocation to Local

Government Units” which is classified as a mandatory obligation of the National

Government to the LGU in accordance with Section 290 of Republic Act No. 7160,

otherwise known as the Local Government Code.

66. Thus EO 683 is nothing more than a realignment of funds carried out in violation

of the Constitution. 14

For in usual budgeting procedures of Congress, the share from the

National Wealth is included in the appropriation for “Allocation to Local Government

Units” which is classified as a mandatory obligation of the National Government to

the LGU and automatically released to the LGU in accordance with Section 290 of

Republic Act No. 7160, otherwise known as the Local Government Code.15

67. What is particularly onerous and illegal about the PIA is that it practically grants

the Representatives from Palawan’s two congressional districts a huge pork barrel fund –

one that is arguably even larger than the total allocation of pork barrel for all members of

the House of Congress appropriations, who each receive around P65 million a year under

the annual Congressional Priority Development Assistance Fund (PDAF).

68. Under the terms of EO 683, the money will be coursed through the DBM, upon

the recommendation of the DOE and/or the PNOC Exploration Corporation, which is a

violation of the Constitutional Provision on the equitable sharing of resources between

the National Government and the Local Government Unit.

69. The Constitution makes it mandatory for the government to remit the equitable

share of the LGU in the utilization of natural resources. As discussed above, it is made

through the appropriation for “Allocation to Local Government Units” by Congress.

14

See 1987 CONST Art.VI § 5. 15 See 1987 CONST, Art. X, § 6,

22

Here, by virtue of a mere Executive Order, funds are realigned, in violation of the

Constitution, and of the principle of separation of powers. Only Congress has that power.

Not the Executive Secretary, not the DOE, not the DOF, not the DBM, much less, the

PNOC Exploration Corporation. The issues presented by Petitioners in the instant case

are clearly ripe for judicial adjudication.

70. It is clear that these terms and provisions of EO 683 may be adjudicated upon by

this Honorable Court without reference to the conflicting territorial claims made by the

National Government and the Province of Palawan. In fact, Petitioners’ intent in making

reference to the pending case before the Supreme Court between the two entities is

merely to provide a historical backdrop to the issuance of the questioned Executive

Order.

71. It is for this reason that in the instant Petition, when it was filed, only had a

certified true copy of EO 386 as an attachment.

72. This Honorable Court’s power of judicial review involves the power to declare as

unconstitutional not only a treaty, international or executive agreement, presidential

decree, proclamation, order, instruction, ordinance or regulation but also the “application,

or operation of presidential decrees, proclamations, orders, instructions, ordinances, and

other regulations.”16

73. The presidential issuance in question clearly involves constitutional issues that

are within the power of this Honorable Court to adjudicate.

74. Moreover, it is already law, thus giving rise to the presumption that its terms and

conditions providing for the questioned disbursement of public funds are already being

16 See 1987 CONST Art VIII, § 4 (2).

23

implemented, as such terms and conditions clearly provide for their immediate

implementation.

75. For which reason, it would not be specious to say that this governmental act

being challenged – EO 683 – in fact, already had a direct adverse effect on Petitioners

who are suing as citizens exercising a public right under the constitution. As held in

Pascual v. Executive Secretary, “there are many decisions nullifying, at the instance of

taxpayers, laws providing for the disbursement of public funds, upon the theory that the

‘expenditure of public funds, by an officer of the State for the purpose of administering

an unconstitutional act constitutes a misapplication of such funds,’ which may be

enjoined at the request of the taxpayer.” 17

17 Mabanag v. Lopez-Vito, 78 Phil. 1(1947).

24

II.

THE HONORABLE COURT A QUO

GRAVELY ERRED UNDER LAW IN

DISMISSING THE PETITION ON THE

GROUND OF PREMATURITY AND OF

JUDICIAL DEFERENCE TO CO-

EQUAL BRANCHES OF

GOVERNMENT NOW

DELIBERATING ON THE

COUNTRY’S BASELINES,

CONSIDERING THAT (1) THE

HONORABLE COURT A QUO HAS A

CONSTITUTIONAL DUTY TO

INTERPRET THE CONSTITUTIONAL

PROVISIONS DEFINING THE

NATIONAL TERRITORY AND (2)

INDEPENDENT OF THE FINAL

ADJUDICATION OF THE DISPUTE

BETWEEN THE PROVINCE OF

PALAWAN AND THE NATIONAL

GOVERNMENT PENDING BEFORE

THE THIRD DIVISION OF THIS

HONORABLE COURT IN GR NO.

170867 (REPUBLIC OF THE

PHILIPPINES ETAL., V. THE

PROVINCIAL GOVERNMENT OF

PALAWAN), THE TERMS AND

CONDITIONS OF E.O. 683 ARE

INDUBITABLY ALREADY A

VIOLATION OF CONSTITUTION,

STATUTE AND JURISPRUDENCE.

76. The Court a quo, in dismissing the case, took judicial notice of “the on-going

efforts of both the legislative and executive departments to arrive at a common position in

redefining the country’s baseline.”18

It therefore deferred to the legislative-executive

rapproachment on the baseline issue, claiming that it concerns “policy determination”

that cannot be made subject to “collateral adjudication.”19

18Resolution dated May 29, 2008, at 6. 19 Id.

25

77. Yet the Court a quo itself acknowledges that in fact, there is an existing law

defining the country’s baseline, namely, Republic Act No. 3046, as amended by Republic

Act No. 5446.20

78. That law defining the country’s baselines still stands as law, until revoked or

amended. The on-going efforts of both legislative and executive departments to refine or

otherwise revise that law remain nothing more than that – efforts, but not law.

79. With due respect, Petitioners direct to the attention of this Honorable Court the

fact that Article 1 the 1987 Constitution itself defines what the metes and bounds of the

national territory are:

The national territory comprises the Philippine archipelago, with all the

islands and waters embraced therein, and all other territories over

which the Philippines has sovereignty or jurisdiction, consisting of its

terrestrial, fluvial and aerial domains, including its territorial sea, the

seabed, the subsoil, the insular shelves, and other submarine areas. The

waters around, between, and connecting the islands of the archipelago,

regardless of their breadth and dimensions, form part of the

internal waters of the Philippines.

80. For this reason, it would be in disregard of this duty under the Constitution if this

Honorable Court shirks from the issues presented by herein Petitioners before it merely

on the ground that the legislature and the executive are as yet trying to redefine the

country’s baselines, considering that such efforts have not yet been translated into law so

that the country’s existing law on baselines remain good law, not to mention that in the

first place, the Constitution itself defines the extent of the national territory.

81. There is one very important issue at the heart of this argument, and it is the fact

that the issuance of EO 683 manifests a serious lack of understanding on the part of the

20 Id., at fn. 14.

26

Executive Secretary of its implications on Philippines claims both to the nature and the

expanse of the national territory under the UNCLOS III regime.21

82. This is because the province of Palawan is the strong and secure anchor on which

the Philippine claim to an Extended Continental Shelf (hereinafter, ECS) under the

regime of the Law of the Sea stands. Ultimately, such a policy dismembers the national

territory because it cuts away the Philippine claim to an ECS as defined under the United

Nation Conference on the Law of the Sea. The Conference, after a series of meetings in

1958, 1960, and 1973, adopted in 1982 what is now known as UNCLOS III, which

entered into force on November 16, 1994. The Philippines is party to the treaty.22

83. UNCLOS III entitles coastal States like the Philippines to claim a continental

shelf of up to 200 nautical miles (n.m.) from its baselines. As Art. 76 (1) of UNCLOS III

provides:

The continental shelf of a coastal State comprises the seabed and

subsoil of the submarine areas that extend beyond its territorial

sea throughout the natural prolongation of its land territory to

the outer edge of the continental margin, or to a distance of 200

nautical miles from the baselines from which the breadth of the

territorial sea is measured where the outer edge of the continental

margin does not extend up to that distance. [emphasis supplied].

84. This 200 n.m offshore defines the Exclusive Economic Zone [hereinafter EEZ]

of the coastal state. In some cases and under certain conditions however, UNCLOS

entitles a coastal state up to 350 n.m. of EEZ, or an additional 150 n.m. more, which

obtains where the continental shelf or a portion of it is beyond the 200 n.m. limit, subject

to the delimitation of the neighboring states’ claim to a similar continental shelf regime.23

21 The full text of the multi-lateral treaty may be accessed at the official website found at

<http://www.un.org/Depts/los/convention_agreements/texts/unclos/UNCLOS-TOC.htm> last visited, June

10, 2004. Under the Revised Rules on Evidence, mandatory judicial notice is given to the “law of

nations.” See RULE OF COURT, Rule 129, § 1, 1997 Revised Rules of Court. 22The Philippines ratified the treaty on May 8, 1984; for information on the status of the treaty as to the

various ratifications made, see <http://www.un.org/Depts/los/reference_files/status2003.pdf> last visited,

June 10, 2004. 23 The relevant provisions of Art. 76, para. 4, et seq., provides thus:

27

85. Clearly, the Camago-Malampaya oil and has fields, from the UNCLOS III

definition, fall within the area of the continental shelf of Palawan as the “natural

prolongation of its land territory.” It must be stressed that, contrary to the contention of

the Chief Executive and her agents, the oil and gas in the area are not found in the

waters off Palawan but in the continental shelf of Palawan.

86. In other words, these mineral resources are drawn up by pipes from the deep

bowels – the subsoil, that is – of the continental shelf. To any scientist or lawyer well-

4. (a) For the purposes of this Convention, the coastal State shall establish the outer edge

of the continental margin wherever the margin extends beyond 200 nautical miles from

the baselines from which the breadth of the territorial sea is measured, by either:

(i) a line delineated in accordance with paragraph 7 by reference to the

outermost fixed points at each of which the thickness of sedimentary

rocks is at least 1 per cent of the shortest distance from such point to

the foot of the continental slope; or

(ii) a line delineated in accordance with paragraph 7 by reference to fixed

points not more than 60 nautical miles from the foot of the continental

slope.

(b) In the absence of evidence to the contrary, the foot of the continental slope shall be

determined as the point of maximum change in the gradient at its base.

5. The fixed points comprising the line of the outer limits of the continental shelf on the

seabed, drawn in accordance with paragraph 4 (a)(i) and (ii), either shall not exceed

350 nautical miles from the baselines from which the breadth of the territorial sea is

measured or shall not exceed 100 nautical miles from the 2,500 metre isobath, which is a line connecting the depth of 2,500 metres.

6. Notwithstanding the provisions of paragraph 5, on submarine ridges, the outer limit of

the continental shelf shall not exceed 350 nautical miles from the baselines from which

the breadth of the territorial sea is measured. This paragraph does not apply to submarine

elevations that are natural components of the continental margin, such as its plateaux,

rises, caps, banks and spurs.

7. The coastal State shall delineate the outer limits of its continental shelf, where that

shelf extends beyond 200 nautical miles from the baselines from which the breadth of the

territorial sea is measured, by straight lines not exceeding 60 nautical miles in length, connecting fixed points, defined by coordinates of latitude and longitude.

8. Information on the limits of the continental shelf beyond 200 nautical miles from the

baselines from which the breadth of the territorial sea is measured shall be submitted by

the coastal State to the Commission on the Limits of the Continental Shelf set up under

Annex II on the basis of equitable geographical representation. The Commission shall

make recommendations to coastal States on matters related to the establishment of the

outer limits of their continental shelf. The limits of the shelf established by a coastal State

on the basis of these recommendations shall be final and binding.

9. The coastal State shall deposit with the Secretary-General of the United Nations charts

and relevant information, including geodetic data, permanently describing the outer limits of its continental shelf. The Secretary-General shall give due publicity thereto.

10. The provisions of this article are without prejudice to the question of delimitation of

the continental shelf between States with opposite or adjacent coasts.

28

versed in the language of UNCLOS III, it is simply preposterous to say that the Camago-

Malampaya fields are outside Palawan, or that the oil and gas reserves are drawn from

waters 80 kilometers off its shores. The mineral resources, in fact, are mined from the

“subsoil of the submarine areas that extend beyond its territorial sea throughout the

natural prolongation of its land territory…,” to borrow in part from Art. 76(1) of

UNCLOS III.

87. Indeed, UNCLOS III acknowledges the inherent right of every coastal state to its

Continental Shelf but requires that a clear delimitation of the limits of such right in cases

where other states make a similar claim;24

this delimitation is also important to the

determination of where the international sea-bed, which is considered the “common

heritage of mankind,” starts.

88. The deadline for the submission of the limits of the continental shelf has been set

on or before May 13, 2009, or ten years after the Scientific and Technical Guidelines of

the Commission on the Limits of the Continental Shelf (CLCS) has been adopted.

89. The delineation of the limits of its continental shelf will assure the country’s

sovereign rights over the petroleum, natural gas and other resources found in the area. In

other words, an ECS– which extends up to 350 nautical miles from the baselines – means

a much expanded claim to rich natural resources in the region and a greater access to

these resources. A textbook by two noted experts on the Law of the Sea regime explains

just how important the issue of delimitating a coastal state’s continental shelf is:

Physically, the seabed adjacent to a physical coast is usually considered to

consist of three separate sections…First, the section that slopes down

gradually from the low-water mark to the depth, averaging about 130

24Art. 83 of the UNCLOS III provides that delimitation between opposite and adjacent states “shall be

effected by agreement on the basis of international law…in order to achieve an equitable solution.” See

also the ICJ ruling in the 1982 Tunisia/Libya Continental Shelf Case, where the international tribunal ruled

that under customary international law, “the satisfaction of equitable principles is, in the delimitation

process, of cardinal importance.” 1982 ICJ Rep. 18.

29

metres, at which the angle of declination increases markedly: this is the

continental shelf proper. Second, the section bordering the shelf and

having the steeper slope, going down to around 1,200 to 2,500 metres: this

is known as the continental slope. Third, there is in many locations an area

beyond the slope where the sea bed falls away more gradually and is

composed mainly of sediments washed down from the continents. This is

called the continental rise, and typically descends to a depth of around

3,500 to 5,500 metres. Together these three sections from the continental

margin, which constitutes about one-fifth of the sea floor.

In many places, the continental margin – and especially the

continental shelf – is rich in natural resources. Most important are

the extensive oil and gas reserves, which represent something like

ninety percent of the total value of minerals taken from the sea

bed. Offshore exploitation of oil and gas on a commercial scale did

not begin shortly before the Second World War, but it expanded

rapidly as a result of developments in technology and increasing

demand. By the mid1990s offshore oil and gas production

accounted for around one-third of the total world production; and

some estimated that around 70 percent of the world’s undiscovered

reserves lie offshore. It is expected that by 2005 there will be

around 4, 100 offshore oil and gas fields on stream, and almost

9,000 offshore platforms associated with them. The main

concentrations of production facilities lie in four areas: north-west

Europe, West Africa, south-east Asia and north America…There

has also been interest in ‘placer’ deposits of heavy minerals

containing metals such as tin, titanium, chromium and zirconium.

…As well as mineral resources, there are also important fisheries

on the continental shelf for sedentary species, such as oysters and

clams, and lobsters and crabs (although the classification of the

two latter organisms as ‘sedentary’ is controversial)…The

existence of such a rich diversity of valuable resources makes the

legal status of the continental shelf an important practical

question.25

90. Worth noting is the fact that for several years now, a joint project on the

Delimitation of the Outer Limits of the Philippine Continental Shelf has been doing just

that: fortifying the Philippine claim to an extended continental shelf. The project aims to

gather, generate, process, and assess bathymetrical, geophysical, and geological data as

well as prepare the legal and political arguments necessary to make the Philippine’s claim

to such an extended continental shelf before the United Nations. Spearheaded by the UP

Law Center Institute of International Legal Studies (UPLAW-IILS), it has for participants

the UP National Institute of Geological Sciences (UP-NIGS), the Coast and Geodetic

Survey Division of the National Mapping Resource Information Agency (NAMRIA) of

25 RR CHURCHILL & A.V. LOWE, THE LAW OF THE SEA 141-142 (3rd ed., 1999). [British spelling has been

retained in the passage quoted].

30

the Department of the Environment and Natural Resources (DENR), Mines and

Geosciences Bureau of the DENR, and the Energy Resource Development Bureau of the

Department of Energy (DoE). The project, estimated to cost close to P1.9 billion over a

five year-period (1993-1997), has identified three areas where the possible extended

continental shelf exists: (i) the KIG; (ii) the Benham Rise and (iii) the Scarborough Shoal

Area.

91. Filipino experts however, look at the KIG as the “most promising”26

with respect

to petroleum and natural gas. That hydrocarbon deposits abound in the area is indicated

by seven drill holes in the Reed Bank and other drill holes in Western Palawan, including

the discovery wells in Nido, Malampaya, and Cadlao, although no drill holes have yet to

be made at the KIG itself.27

The main argument is that the KIG is a continuation of the

Palawan landmass, or a “natural prolongation” of the Palawan continental shelf. The

geology underneath Palawan, the studies so far show, are identical to that found

underneath the KIG.28

92. Indeed, this is not only a legal argument but also a scientific one, because

Filipino experts who have studied the area argue that the best way to claim an ECS in the

area is to consider the Malampaya fields and the Kalayaan Island Group (otherwise

popularly known as the Spratlys) as a unified extension of the continental shelf of

Palawan.

93. Hence, the Philippine claim to sovereignty to the entire KIG region, as well as to

the Camago-Malampaya fields, cannot stand on any solid footing without acknowledging

26 Dr. Teodoro M. Santos, A Strategy for Delineating the Philippine Continental Shelf: An Abstract, edited

version of a paper presented at a round table discussion on the Delineation of the Extended Philippine

Continental Shelf, August 30, 2001 at the UPLC-IILS, at 3. Dr. Santos is a senior geologist at the UP-

NIGS. Dr. Santos is one of the scientific experts working on the inter-disciplinary, inter-agency

delimitation project and the leading proponent of the campaign for an ECS. 27 Id., at 6. 28Dr. Santos, supra note 1, at 3. Dr. Santos, in the same paper, also reports : “One of the most important

documents that tend to indicate that the KIG and Palawan are an integral part of the same fragment of

continental crust was the geologic map of the South China Sea made by a French group of geologists. This

map, in proper scale and detail, and supported by direct geomorphical evidence, can be used to support the

Philippines’ claim to an extended continental shelf in the area…” id., at 9-10.

31

the existence of the Continental Shelf of Palawan, and without advancing it before the

proper UN body, the Commission on the Limits of the Continental Shelf.

94. The case may well be understood through this syllogism: to say that the Camago-

Malampaya fields are not part of Palawan is to say that the Philippines does not have

any claim to an ECS, or much less, to an “inner” continental shelf that is all of 200 n.m.

extending seaward. It is in effect, to deny the existence of a continental shelf appurtenant

to the Province of Palawan; But this is also a surrender of Philippine claims to sovereign

rights over a large region that Filipinos have long considered as belonging to Philippine

national territory, including the KIG. The pursuit of such a policy also undermines the

Philippine claim to the KIG.

95. This is because one basis for the Philippine claim to the KIG is that they

constitute a natural prolongation of the continental shelf of the province of Palawan.29

96. To deny that Palawan possesses a Continental Shelf and that the Camago-

Malampaya fields are a natural prolongation of Palawan’s landmass is to bargain away

the Filipino people’s rightful claim to the rich marine resources in the region – in

contravention of our national interest in the integrity of the national territory as well as

the people’s right – indeed, the herein petitioners’ right – to enjoy the benefits of the

natural resources of the country.

97. It is therefore, a violation of the fundamental law of the land, which declares

thus:

The State shall protect the nation’s marine wealth in its

archipelagic waters, territorial sea, and exclusive economic zone,

and reserve its use and enjoyment exclusively to Filipino citizens.30

29 See also Gerardo M.C. Valero, The Dispute Over the Spratly Archipelago: Is the Question of Sovereignty

Still Relevant? Proceedings of a Round Table Discussion sponsored by the UP Institute of International

Legal Studies,1-69 (1993) and H. Harry Roque, Jr., China’s Claim to the Spratlys: A Critical Analysis,

JOURN. OF EN, & NAT. RES. LAW (1007).

32

98. What are covered by the continental shelf provisions? These are (a) the

sovereign right to explore and exploit its natural resources31

which “do not depend on

occupation, effective or notional, or any express proclamation”32

and “are exclusive in

the sense that if the coastal state does not explore the continental shelf or exploit its

natural resources, no one may undertake these activities without the express consent of

the coastal state”33

; (b) exclusive rights to: construct, operate and use of artificial islands,

installations and structures on the continental shelf34

; authorize and regulate drilling on

the continental shelf for all purposes; and exploit the subsoil by means of tunneling,

irrespective of the depth of the water above the subsoil.35

99. Needless to say, these involve special and important constitutional issues

requiring this Honorable Court’s intervention.

100. Moreover, assuming that the better part of judicial discretion is exercised

in favor of deference to the legislature on the issue of territorial delimitation, there are

other issues presented before the Court a quo already discussed above that it has the duty

to resolve under the Constitution and that it cannot avoid if it is to faithfully perform such

duty. For these issues involve the disbursement of public funds in violation of law,

jurisprudence and the constitution and Petitioners, as do the public, stand to suffer

irreparable injury if these acts are not restrained.

30 CONST. (1987). Art. XII, Sec. 2 (2). For an excellent background on this article, see A. Suzette V.

Suarez, Note: Revisiting the Provision on Protection of Marine Wealth and Reservation of its Use for the

Exclusive Enjoyment of Filipino Citizens in the 1987 Constitution, 4 OCEAN LAW AND POLICY

SERIES, 125-136 (2000). 31Art. 77 (1), UNCLOS III. 32 Art. 56(3), UNCLOS III. 33 Art. 77(1) UNCLOS III. 34 Art. 80, UNCLOS III. 35 Art. 85, UNCLOS III.

33

III.

THE HONORABLE COURT A QUO

GRAVELY ERRED UNDER LAW IN

DISMISSING THE CASE FOR THE

ALLEGED FAILURE OF

PETITIONERS TO PROVIDE IT WITH

A COPY OF THE PROVISIONAL

INTERIM AGREEMENT (PIA),

CONSIDERING THAT THE TERMS

AND PROVISIONS OF EO 683

EMBODY ALL THE TERMS AND

PROVISIONS OF THE ASSAILED

PIA. THUS WHAT IS BEING

CHALLENGED IS THE QUESTIONED

ORDER, WHICH WAS DRAFTED

AND ISSUED TO EXPRESS IN

OFFICIAL TERMS AND TO PUT INTO

LEGAL EFFECT THE PIA’S OWN

TERMS AND CONDITIONS;

REQUIRING PETITIONERS TO

SUBMIT A COPY OF THE PIA,

DRAFTED AND SIGNED IN THE

FIRST PLACE UNDER CONDITIONS

OF SECRECY, WOULD SIMPLY BE

SUPERFLOUS, ACCORDING TO THE

RULES COURT.

101. The most cursory reading of EO 683 shows that it in fact embodies all the

relevant provisions of the PIA; in fact, it can be said to be a mere re-statement of the PIA.

102. According to EO 683, the main intent of the PIA is to forge an agreement

between the National Government and the Province of Palawan, with the conformity of

its Representations, which would allow:

…50% of the disputed 40% of the Net Government Share in the proceeds

of SC 38 to be utilized for the immediate and effective implementation of

the development projects for the people of Palawan.

34

103. Along this line, § 1 of EO 683 provides that under the PIA, the DBM is

authorized to release funds to the implementing agencies on the endorsement and

submission by the DOE and/or the PNOC Exploration Corporation of the following

documents: a) directive by the Office of the President or written request of the Province

of Palawan, the Palawan Congressional Districts or the Highly Urbanized City of Puerto

Princesa, for the funding of designated projects (§ 1.1); (b) a certification that the

designated projects fall under the investment program of the Province of Palawan, City of

Puerto Princesa, and/or the development projects identified in the development program

of the National Government or its agencies; (§1.2); and (c), Bureau of Treasury

certification on the availability of funds from the 50% of the 40% share being claimed by

the Province of Palawan from the Net Government Share under SC 38.

104. It states that “the DBM shall be subject to the actual collections deposited

with the National Treasury, and shall be in accordance with the Annual Fiscal Program of

the National Government.”

105. Moreover, § 3 of EO 683, which provides that the National government

shall allow the Province of Palawan, the Congressional Districts of Palawan and the City

of Puerto Princesa to securitize their shares in the 50% of the disputed 40% of the Net

Government Share in the proceeds of SC 38 according to the PIA. The DOE, in

consultation with the DOF, will be responsible for preparing the Net Government

Revenues for the period of to June 30, 1010 [sic].

106. “The amounts released pursuant to this EO shall be without prejudice to

any on-going discussions or final judicial resolution of the legal dispute regarding the

National Government’s territorial jurisdiction over the areas covered by SC 38 in

relation to the claim of the Province of Palawan under Sec. 290 of RA 7160,” according

to § 4 of EO 683.

35

107. It is clear from the terms and provisions of EO 683 that these in fact only

re-state in official terms the terms and provisions of the PIA. The signatories to the PIA

have also been duly identified in the questioned Executive Order.

108. In fact, from the tenor of EO 683, it can be reasonably said that there is

nothing significant in the PIA that has not been reproduced or repeated in the questioned

Executive Order.

109. Thus it should be stressed that what is being assailed is EO 683 itself,

which puts into official legal terms the provisions of the PIA; EO 683 is the legal act

putting into legal effect the provisions of the PIA that is subject to the special civil action

of certiorari under Rule 65 in the Court a quo.

110. The relevant portion of § 1 of Rule 65 only requires that the petition “be

accompanied by a certified true copy of the judgment, order or resolution subject thereof,

copies of all pleadings and documents relevant and pertinent thereto….”

111. The pleadings and documents required are only those “relevant and

pertinent” to the resolution of the case. At issue here is really the unconstitutional and

illegal issuance of EO 683, which has been made subject to the special civil action of

certiorari under Rule 65. The PIA would not be subject to such a challenge precisely

because it would have a different legal effect by itself, in the absence of an enabling or

implementing law. A different remedy would be appropriate and not such a special civil

action – a complaint for the annulment of a contract, and filed with a different court and

not the Court a quo, in particular the Regional Trial Court, which has subject matter

jurisdiction over such an action.

36

112. Having said this, it must also be noted that the PIA has been kept under

wraps and away from the eyes of the people of Palawan by the signatories. It was entered

into with utmost secrecy. The signatories to the PIA did not disclose it to the people of

Palawan. Hence it came as a big surprise to the Petitioners when the EO 683 was issued;

as they had earlier manifested, they only came to know about the PIA because of the

Executive Order in question. After EO 683 came to light, Petitioners decided to bring the

matter to Court because of its patent illegality and unconstitutionality.

113. If anything, there is an issue here of the people’s constitutional right to

information on matters that affect public life.36

It is incumbent upon the Court to ask the

parties to the PIA who are respondents to the special civil action for certiorari under Rule

65 before the Court a quo to produce the questioned agreement in the proceedings before

it.

36

CONST.(1987) Art.III § 7: “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.”

37

IV.

THE HONORABLE COURT A QUO

ERRED UNDER LAW IN DISMISSING

THE CASE FOR THE ALLEGED

FAILURE OF PETITIONERS TO

PROVIDE IT WITH CERTAIN

DOCUMENTS PERTAINING TO GR

NO. 170867, CONSIDERING THAT

UNDER THE RULES OF COURT

THESE ARE NOT REALLY

NECESSARY - AS THEY ARE ONLY

TANGENTIAL – TO THE

RESOLUTION OF THE CASE BY THE

COURT A QUO, NOT TO MENTION

THAT PETITIONERS ARE NOT EVEN

PARTIES TO THE CASES OF WHICH

THE SAME DOCUMENTS ARE PART,

AS THIS HONORABLE COURT

ITSELF HAS ALREADY

DETERMINED.

114. As already noted above, Petitioners received a copy of a Resolution dated

June 23, 2008 of the Third Division of this Honorable Court, in which the High Court

resolved to note thus: “the letter dated 10 April 2008 of Romel Regalado Bagares of

Roque and Butuyan Law Offices and to DENY his request for certified true copies of

documents enumerated therein to be submitted in a related case pending before the Court

of Appeals as the said law office is not a counsel for any party.”

115. Despite the best efforts exerted by undersigned counsel on behalf of the

Petitioners, they could not obtain a copy of the Petition filed in GR No. 170867 pending

before the Third Division of this Honorable Court because, as already noted by the same

Court, undersigned counsel is not a counsel for any party in the said case.

38

116. However, some of the Respondents in the case before the Court a quo are

parties to the case in GR No. 170867; they are therefore, the most logical sources of the

Petition as well as related documents, including SC 98.

117. In any case, GR No.170867 and its records are now a matter of judicial

notice to this Honorable Court.

118. Besides, and as already discussed above, the relevant portion of § 1 of

Rule 65 only requires that the petition “be accompanied by a certified true copy of the

judgment, order or resolution subject thereof, copies of all pleadings and documents

relevant and pertinent thereto….”

119. The Rules state that the pleadings and documents required are only those

“relevant and pertinent” to the resolution of the case. What is at issue here? It is the

unconstitutional and illegal issuance of EO 683, which has been made subject to the

special civil action of certiorari under Rule 65.

120. Moreover, as Petitioners argue above, the provision to the Court a quo of a

copy of the Petition and of SC 98 is not necessary for it to adjudicate on the issues

presented in this case, inasmuch as the terms and provisions of EO 683 may be

adjudicated upon by the Court without direct reference to the conflicting territorial claims

made by the National Government and the Province of Palawan.

121. The issue of whether the gas wells of Malampaya fall properly within the

Palawan provincial territory is distinct and separate from whether or not the

disbursements that EO 683 allow to be made are in violation of both the 1987 Charter and

the relevant provisions in the 1991 Local Government Code on the equitable share of the

local government unit in the distribution of the proceeds of the national wealth within its

39

jurisdiction as well as of the jurisprudence on the immediate release of the International

Revenue Allotment.

PRAYER

WHEREFORE, premises considered, Petitioners respectfully pray that this Honorable

Court issue a Resolution

(1) giving due course to the Petition;

(2) annulling the Court a quo’s Resolutions dated May 29, 2008 and June 6, 2008;

and

(3) declaring the questioned EO 386 both illegal and unconstitutional on the grounds

discussed above.

Other relief just and equitable are also prayed for.

Makati City for the City of Manila, February 17, 2009.

By the Counsel for Petitioners:

ROQUE & BUTUYAN LAW OFFICES

Unit 1904 Antel 2000 Corporate Center

121 Valero St., Salcedo Village

Makati City 1200

Tel No. 750-3847 to 48

Email: [email protected]

Fax No: 887-3893

40

By:

H. HARRY L. ROQUE, JR. PTR NO. 0008545/JAN. 8, 2009/MAKATI CITY

IBP NO. 499912/LIFETIME/MAKATI CITY

ROLL NO. 36976

MCLE EXEMPTION NO. II-002169

JOEL RUIZ BUTUYAN

PTR NO. 0008546/JAN. 8, 2009/MAKATI CITY

IBP NO. 500459/ LIFETIME/MAKATI CITY

ROLL NO. 36911

MCLE COMPLIANCE NO. 0000571

ROMEL REGALADO BAGARES PTR NO. 0016687/JAN 14, 2009/MAKATI CITY

IBP NO. 775414/JAN 12, 2009/SOCSARGEN

ROLL NO. 49518

MCLE COMPLIANCE NO.II-0015132 JAN. 5, 2009

COPY FURNISHED:

Office of the Solicitor General

134 Amorsolo St.,Legaspi Village

1229 Makati City

Hon. Eduardo Ermita

Secretary

Office of the Executive Secretary

Malacanang, Manila

Hon. Rolando D. Andaya Jr.

Secretary

Department of Budget and Management

JP Laurel St., corner Ayala St. Manila

Hon. Angelo T. Reyes

Secretary

Department of Energy

Meritt Road, Fort Bonifacio

Taguig, Metro Manila

Hon. Margarito B. Teves

Secretary

Department of Finance

Roxas Blvd., corner Vito Cruz St.,

Manila

41

Hon. Joel T. Reyes

Governor

Provincial Capitol

Puerto Princesa City

Palawan

Hon. Antonio C. Alvarez

Representative, 1st District, Palawan

House of Representatives Complex

Constitutional Hills, Quezon City 1126

Hon. Baham Mitra

Representative, 2nd

District, Palawan

House of Representatives Complex

Constitution Hills, Quezon City 1126.

Rafael E. Del Pilar

President & CEO

PNOC Exploration Corporation

Building 1, Energy Center

Fort Bonifacio

Taguig City 1634

EXPLANATION

Due to the shortage of messengerial services and lack of time this Petition is being

served to the other parties by registered mail in accordance with Section 11, Rule 13 of

the Revised Rules of Court.

ROMEL REGALADO BAGARES