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    11 Miners Association of The Philippines v. Factoran, 240 SCRA 100, January 16, 1995

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    mae ann rodolfo
    The Miners Association of the Philippines filed a petition challenging the validity and constitutionality of DENR Administrative Order Nos. 57 and 82. Administrative Order No. 57 provided for the conversion of existing mining leases into production sharing agreements within one year, while Administrative Order No. 82 outlined procedures for awarding new production sharing agreements. The Supreme Court ruled that the administrative orders were constitutional and valid. They did not automatically terminate contracts in violation of the Constitution, but rather allowed for negotiated conversion or new agreements to further the goals of sustainable mining and public interest under the Constitution.

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    11 Miners Association of The Philippines v. Factoran, 240 SCRA 100, January 16, 1995

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    mae ann rodolfo
    28 views3 pages
    The Miners Association of the Philippines filed a petition challenging the validity and constitutionality of DENR Administrative Order Nos. 57 and 82. Administrative Order No. 57 provided for the conversion of existing mining leases into production sharing agreements within one year, while Administrative Order No. 82 outlined procedures for awarding new production sharing agreements. The Supreme Court ruled that the administrative orders were constitutional and valid. They did not automatically terminate contracts in violation of the Constitution, but rather allowed for negotiated conversion or new agreements to further the goals of sustainable mining and public interest under the Constitution.

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    11 Miners Association of the Philippines v. Factoran, 240 SCRA 100, January 16, 1995

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    The Miners Association of the Philippines filed a petition challenging the validity and constitutionality of DENR Administrative Order Nos. 57 and 82. Administrative Order No. 57 provided for the conversion of existing mining leases into production sharing agreements within one year, while Administrative Order No. 82 outlined procedures for awarding new production sharing agreements. The Supreme Court ruled that the administrative orders were constitutional and valid. They did not automatically terminate contracts in violation of the Constitution, but rather allowed for negotiated conversion or new agreements to further the goals of sustainable mining and public interest under the Constitution.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    28 views3 pages

    11 Miners Association of The Philippines v. Factoran, 240 SCRA 100, January 16, 1995

    Uploaded by

    mae ann rodolfo
    The Miners Association of the Philippines filed a petition challenging the validity and constitutionality of DENR Administrative Order Nos. 57 and 82. Administrative Order No. 57 provided for the conversion of existing mining leases into production sharing agreements within one year, while Administrative Order No. 82 outlined procedures for awarding new production sharing agreements. The Supreme Court ruled that the administrative orders were constitutional and valid. They did not automatically terminate contracts in violation of the Constitution, but rather allowed for negotiated conversion or new agreements to further the goals of sustainable mining and public interest under the Constitution.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    G.R. No.

    98332   January 16, 1995

    MINERS ASSOCIATION OF THE PHILIPPINES, INC., petitioner,

    vs.

    HON. FULGENCIO S. FACTORAN, JR., Secretary of Environment and Natural


    Resources, and JOEL D. MUYCO, Director of Mines and Geosciences Bureau,
    respondents.

    FACTS:

    Pursuant to Section 6 of Executive Order No. 279, authorizing the DENR Secretary to
    negotiate and conclude joint venture, co-production, or production-sharing agreements
    for the exploration, development and utilization of mineral resources, and prescribing
    the guidelines for such agreements and those agreements involving technical or
    financial assistance by foreign-owned corporations for large-scale exploration,
    development, and utilization of minerals, the DENR Secretary issued DENR
    Administrative Order No. 57, series of 1989, entitled "Guidelines on Mineral Production
    Sharing Agreement under Executive Order No. 279." Under the transitory provision of
    said DENR Administrative Order No. 57, embodied in its Article 9, all existing mining
    leases or agreements which were granted after the effectivity of the 1987 Constitution
    pursuant to Executive Order No. 211, except small scale mining leases and those
    pertaining to sand and gravel and quarry resources covering an area of twenty (20)
    hectares or less, shall be converted into production-sharing agreements within one (1)
    year from the effectivity of these guidelines.

    The Secretary of the DENR then further issued DENR Administrative Order No. 82,
    series of 1990, laying down the "Procedural Guidelines on the Award of Mineral
    Production Sharing Agreement (MPSA) through Negotiation."

    The issuance and the impending implementation by the DENR of Administrative Order
    Nos. 57 and 82 after their respective effectivity dates compelled the Miners Association
    of the Philippines, Inc. to file the instant petition assailing their validity and
    constitutionality before this Court.

    Petitioner Miners Association of the Philippines, Inc., mainly contends that the
    administrative orders do not conform with Executive Order Nos. 211 and 279, petitioner
    contends that both orders violate the non-impairment of contract provision under Article
    III, Section 10 of the 1987 Constitution on the ground that Administrative Order No. 57
    unduly pre-terminates existing mining leases and other mining agreements and
    automatically converts them into production-sharing agreements within one (1) year
    from its effectivity date.  On the other hand, Administrative Order No. 82 declares that
    failure to submit Letters of Intent and Mineral Production-Sharing Agreements within two
    (2) years from the date of effectivity of said guideline or on July 17, 1991 shall cause the
    abandonment of their mining, quarry and sand gravel permits.
    Petitioner argued that Executive Order No. 279 does not contemplate automatic
    conversion of mining lease agreements into mining production-sharing agreement as
    provided under Article 9, Administrative Order No. 57 and/or the consequent
    abandonment of mining claims for failure to submit LOIs and MPSAs under Section 3,
    Administrative Order No. 82 because Section 1 of said Executive Order No. 279
    empowers the DENR Secretary to negotiate and enter into voluntary agreements which
    must set forth the minimum terms and conditions provided under Section 2 thereof. 
    Moreover, petitioner contends that the power to regulate and enter into mining
    agreements does not include the power to preterminate existing mining lease
    agreements.

    ISSUE:

    Whether or not DENR Administrative Order Nos. 57 and 82 issued by the DENR
    Secretary are unconstitutional.

    HELD:

    NO. DENR Administrative Order Nos. 57 and 82 are not unconstitutional.

    The questioned administrative orders are reasonably directed to the accomplishment of


    the purposes of the law under which they were issued and were intended to secure the
    paramount interest of the public, their economic growth and welfare.  The validity and
    constitutionality of Administrative Order Nos. 57 and 82 must be sustained, and their
    force and effect upheld.

    Administrative Order No. 57 applies only to all existing mining leases or agreements
    which were granted after the effectivity of the 1987 Constitution pursuant to Executive
    Order No. 211.  It bears mention that under the text of Executive Order No. 211, there is
    a reservation clause which provides that the privileges as well as the terms and
    conditions of all existing mining leases or agreements granted after the effectivity of the
    1987 Constitution, pursuant to Executive Order No. 211, shall be subject to any and all
    modifications or alterations which Congress may adopt pursuant to Article XII, Section 2
    of the 1987 Constitution.  Hence, the strictures of the non-impairment of contract clause
    under Article III, Section 10 of the 1987 Constitution do not apply to the aforesaid mining
    leases or agreements granted after the effectivity of the 1987 Constitution, pursuant to
    Executive Order No. 211.  They can be amended, modified or altered by a statute
    passed by Congress to achieve the purposes of Article XII, Section 2 of the 1987
    Constitution.

    Moreover, nowhere in Administrative Order No. 57 is there any provision which would
    lead us to conclude that the questioned order authorizes the automatic conversion of
    mining leases and agreements granted after the effectivity of the 1987 Constitution,
    pursuant to Executive Order No. 211, to production-sharing agreements.  The provision
    in Article 9 of Administrative Order No. 57 that "all such leases or agreements shall be
    converted into production sharing agreements within one (1) year from the effectivity of
    these guidelines" could not possibly contemplate a unilateral declaration on the part of
    the Government that all existing mining leases and agreements are automatically
    converted into production-sharing agreements.  On the contrary, the use of the term
    "production-sharing agreement" in the same provision implies negotiation between the
    Government and the applicants, if they are so minded.  Negotiation negates compulsion
    or automatic conversion as suggested by petitioner in the instant petition.  A mineral
    production-sharing agreement (MPSA) requires a meeting of the minds of the parties
    after negotiations arrived at in good faith and in accordance with the procedure laid
    down in the subsequent Administrative Order No. 82.

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