SUBJECT: Constitutional Law 1

TOPIC: Patrimony – Citizenship Requirement for acquisition of alienable

agricultural land of the public domain
TITLE: Chavez v. PEA & Amari
CITATION: G.R. No. 133250, May 6, 2003

FACTS:
This case involves mainly the motions for reconsideration filed by herein
respondents and the Office of the Solicitor General from the Decision of
this Court dated 9 July 2002, which ruled, that "Clearly, the Amended
Joint Venture Agreement (JVA) violates glaringly Sections 2 and 3, Article
XII of the 1987 Constitution. Under Article 1409 of the Civil Code,
contracts whose 'object or purpose is contrary to law,' or whose 'object
is outside the commerce of men,' are 'inexistent and void from the
beginning.' The Court must perform its duty to defend and uphold the
Constitution, and therefore declares the amended JVA null and void ab
initio."
After thorough deliberation; the majority members of the Court voted to
deny the motions for reconsideration. And, it ruled that the prevailing
doctrine before, during and after the signing of the Amended JVA is that
private corporations cannot hold, except by lease, alienable lands of the
public, domain. This is one of the two main reasons why the decision
annulled the Amended JVA. The other main reason is that submerged
areas of Manila Bay, being part of the sea, are inalienable and beyond the
commerce of man, a doctrine that has remained immutable since the
Spanish Law on Waters of 1886. Clearly, the decision merely reiterated,
and did not overrule, any existing judicial doctrine. Even on the
characterization of foreshore lands reclaimed by the government, the
decision did not overrule existing law or doctrine. Since the adoption of
the Regalian doctrine in this jurisdiction, the sea and its foreshore areas
have always been part of the public domain. And since the enactment of
Act No. 1654 on May 18, 1907 until the effectivity of the 1973 Constitution,
statutory law never allowed foreshore lands reclaimed by the
government to be sold to private corporations. The 1973 and 1987
Constitutions enshrined and expanded the ban to include any alienable
land of the public domain.
There are, of course, decisions of the Court which, while recognizing a
violation of the law or Constitution, hold that the sale or transfer of the
land may no longer be invalidated because of "weighty considerations of
equity and social justice." The invalidation of the sale or transfer may also
be superfluous if the purpose of the statutory or constitutional ban has
been achieved. But none of these cases apply to Amari.
ISSUE:
Whether or not a private corporation, such as respondent AMARI, can
acquire reclaimed lands.
RULING:
No.
Under the 1935 Constitution, private corporations were allowed to
acquire alienable lands of the public domain. But since the effectivity of
the 1973 Constitution, private corporations were banned from holding,
except by lease, alienable lands of the public domain. The 1987
Constitution continued this constitutional prohibition. The prevailing law
before, during and after the signing of the Amended JVA is that private
corporations cannot hold, except by lease, alienable lands of the public
domain. The Decision has not annulled or in any way changed the law on
this matter. The Decision, whether made retroactive or not, does not
change the law since the Decision merely reiterates the law that
prevailed since the effectivity of the 1973 Constitution.
The Decision does not bar private corporations from participating in
reclamation projects and being paid for their services in reclaiming lands.
What the Decision prohibits, following the explicit constitutional
mandate, is for private corporations to acquire reclaimed lands of the
public domain. There is no prohibition on the directors, officers and
stockholders of private corporations, if they are Filipino citizens, from
acquiring at public auction reclaimed alienable lands of the public
domain. They can acquire not more than 12 hectares per individual, and
the land thus acquired becomes private land.
Despite the nullity of the Amended JVA, Amari is not precluded from
recovering from PEA in the proper proceedings, on a quantum meruit
basis, whatever Amari may have incurred in implementing the Amended
JVA prior to its declaration of nullity.