Alexandria Condominium vs.
LLDA
G.R. No. 169228, 11 September 2009
FACTS:
Philippine Realty and Holdings, Inc. (PhilRealty) developed, established, and constructed Th
e Alexandra Condominium Corporation Complex from 1987 to 1993. In 1988, PhilRealty tran
sferred to petitioner The Alexandra Condominium Corporation (TACC) a parcel of land with a
n area of 9,786 sq. m. located at 29 Meralco Avenue, Pasig City as well as the common area
s of the project. The condominium project consists of 5 phases, namely, Clusters A, B, C, D,
and E. In 1987, the Human Settlements Regulatory Commission issued a Development Per
mit to PhilRealty to develop Cluster A of the project consisting of 3 Five Storey Buildings. Arc
hitect Walter Perez, then Building Official of Pasig City, reviewed the Site Development, Loc
ation Plan, and the Sanitary/Plumbing Plans and Specifications. Later, he issued a Building
Permit, as well as Sanitary/Plumbing Permit acknowledging the fixtures to be installed but wi
thout indicating the System of Disposal including a Waste Water Treatment Plan. In 1988, he
issued a Certificate of Final Inspection and Certificate of Occupancy for the Buildings. PhilRe
alty undertook the same process for the rest of the remaining Clusters.
In 1993, PhilRealty formally turned over the project to TACC but the former did not turn over
the as-built plans for the perimeter drainage layout, the foundation, and the electrical and plu
mbing layout of the project. In 1998, the Laguna Lake Development Authority (LLDA) advise
d TACC that its wastewater did not meet the government effluent standards provided in Secs.
68 and 69 of the 1978 National Pollution Control Commission (NPCC) Rules and Regulation
s as amended by the DENR Adm. Order No. 34. LLDA informed TACC that it must put up its
own Sewage Treatment Plant (STP) for its effluent discharge to meet government standards.
Since an STP would cost approximately Php15M to put up, TACC experimented with a prop
osed solution from Larutan Resources Devt. Corp., which treated the septic vault water with
biological enzymes. Still, TACC's water discharge failed to meet the government standards. I
n 1999, the LLDA's Environmental Division collected samples of TACC's wastewater and fou
nd two determinants namely, Chemical Oxygen Demand (COD) and Oil/Grease (OG). LLDA
found that TACC's samples failed to meet government standards of 150 for COD and 5 for O
G. LLDA issued a Notice of Violation directing TACC to submit corrective measures to abate
or control its water effluents discharged into the Laguna De Bay. LLDA imposed upon TACC
a daily fine of Php1,000.00 until full cessation of pollutive wastewater discharge.
TACC entered into an agreement with World Chem Marketing for the construction of the ST
P for Php7.5M which was completed in October 2001. In 2002, LLDA issued an Order statin
g the penalty imposed upon TACC and said that to condone the penalty would be tantamoun
t to tolerating the pollution of the river bodies and the Laguna De Bay which is contrary to LL
DA's mandate. In turn, TACC requested LLDA to dismiss the water pollution case against it.
In 2003, the LLDA issued an Order (assailed Order) requiring TACC to pay a fine of Php 1,0
62,000 representing the penalty from March 1999 to February 2002. TACC filed a petition for
certiorari before the CA with a prayer for issuance of TRO.
The CA dismissed the petition and sustained LLDA's contention that the petition was premat
urely filed. It ruled that TACC should have availed of all the means of administrative process
es afforded him and that the proper remedy should have been to resort to an administrative r
emedy before the DENR Secretary prior to judicial action due to the transfer of LLDA to the
DENR under Executive Order No. 149.
The CA likewise ruled that under Republic Act No. 4850 (An Act Creating the LLDA), as ame
nded by Presidential Decree No. 813, the LLDA shall be compensated for the damages to th
e water and aquatic resources of Laguna de Bay resulting from failure to meet established w
ater and effluent quality standards. It ruled that under Section 4 of Executive Order No. 927
(Defining Powers and Functions of LLDA), series of 1983, the LLDA is mandated to "make, a
lter or modify orders requiring the discontinuation of pollution specifying the conditions and th
e time within which such discontinuance must be accomplished." Further, the CA ruled that
Presidential Decree No. 984 (Pollution Control Law) provides for penalties for violation or no
n-compliance with any order, decision or regulation of the Commission for the control or abat
ement of pollution.
ISSUES:
(1) Whether or not the petition was filed prematurely.
(2) Whether or not the LLDA gravely abused its authority when it imposed the penalty upon
TACC despite the fact that it had already exhausted efforts and substantially spent to comply
with established effluent quality standards.
RULING:
(1) YES. The doctrine of non-exhaustion of administrative remedies requires that resort be fir
st made with the administrative authorities in the resolution of a controversy falling under thei
r jurisdiction before the controversy may be elevated to a court of justice for review. A prema
ture invocation of a court's intervention renders the complaint without cause of action and dis
missible.
EO 149 transferred LLDA from the Office of the President to the DENR for policy and progra
m coordination and/or administrative supervision. Under EO 149, DENR only has administrat
ive power over LLDA. Administrative power is concerned with the work of applying policies a
nd enforcing orders as determined by proper governmental organs.
However, EO 192, which reorganized the DENR, mandates the DENR to "promulgate rules
and regulations for the control of water, air and land pollution" and to "promulgate ambient a
nd effluent standards for water and air quality including the allowable levels of other pollutant
s and radiations." EO 192 created the Pollution Adjudication Board under the Office of the D
ENR Secretary which assumed the powers and functions of the NPCC with respect to the ad
judication of pollution cases, including NPCC's function to “serve as arbitrator for the determi
nation of reparation, or restitution of the damages and losses resulting from pollution." Henc
e, TACC has an administrative recourse before the DENR Secretary which it should ha
ve first pursued before filing a petition for certiorari before the Court of Appeals. At m
ost, TACC should have filed a Motion for Reconsideration of the assailed Order.
(2) NO. RA 4850 specifically mandates LLDA to carry out and make effective the declared n
ational policy of promoting and accelerating the development and balanced growth of the La
guna Lake area and the surrounding provinces of Rizal and Laguna and the cities of San Pa
blo, Manila, Pasay, Quezon and Caloocan with due regard and adequate provisions for envir
onmental management and control, preservation of the quality of human life and ecological s
ystems, and the prevention of undue ecological disturbances, deterioration and pollution. LL
DA, by virtue of its special charter, has the responsibility to protect the inhabitants of the Lag
una Lake region from the deleterious effects of pollutants emanating from the discharge of w
astes from the surrounding areas.
Under Section 4-A of RA 4850, as amended, LLDA is entitled to compensation for damages
resulting from failure to meet established water and effluent quality standards:
Sec. 4-A. Compensation for damages to the water and aquatic resources of Laguna de Bay
and its tributaries resulting from failure to meet established water and effluent quality standar
ds and from such other wrongful act or omission of a person, private or public, juridical or oth
erwise, punishable under the law shall be awarded to the Authority to be earmarked for wate
r quality control and management.
In the present case, TACC does not challenge LLDA's authority to impose the fine. However,
TACC argues that since it had already exhausted efforts and substantially spent to comply w
ith established effluent quality standards, the daily penalty imposed by the LLDA is an unwar
ranted financial burden to its unit owners and should thus be condoned. TACC further argue
s that the non-compliance with government standards was due to the omission and fault of P
hilRealty.
TACC's arguments have no merit. PhilRealty formally turned over the project to TACC in 1
993. Thereafter, TACC managed the project. It was almost five years after, or in 1998, when
LLDA advised TACC that its wastewater did not meet government effluent standards. It is cle
ar that the responsibility to comply with government standards lies with TACC. If, as claimed
by TACC, the non-compliance was due to the omission and fault of PhilRealty, TACC's reco
urse is to file an action, if warranted, against PhilRealty in a proper court. TACC cannot esca
pe its liability to LLDA by shifting the blame to PhilRealty. Hence, the LLDA did not abuse its
discretion in issuing its Order.
NOTES:
RA 9275 (Clean Water Act of 2004) SEC. 19. Lead Agency. - The DENR shall be the prim
ary government agency responsible for the implementation and enforcement of this Act unle
ss otherwise provided herein. As such, it shall have the following functions, powers and resp
onsibilities:
(f) Review and set effluent standards every five (5) years from the effectivity of this Act or so
oner as determined by the Department
MMDA vs. Concerned Residents of Manila Bay
G.R. Nos. 171947
Feb, 15, 2011
PETITIONERS: METROPOLITAN MANILA DEVELOPMENT AUTHORITY, DEPARTMENT
OF ENVIRONMENT AND NATURAL RESOURCES, DEPARTMENT OF EDUCATION, CUL
TURE AND SPORTS, DEPARTMENT OF HEALTH, DEPARTMENT OF AGRICULTURE, D
EPARTMENT OF PUBLIC WORKS AND HIGHWAYS, DEPARTMENT OF BUDGET AND M
ANAGEMENT, PHILIPPINE COAST GUARD, PHILIPPINE NATIONAL POLICE MARITIME
GROUP, and DEPARTMENT OF THE INTERIOR AND LOCAL GOVERNMENT
FACTS:
This case started when, on January 29,1999, respondents Concerned Residents of
Manila Bay filed a complaint before the RTC of Imus, Cavite, against several government ag
encies, among them, the petitioners, for the cleanup, rehabilitation, and protection of the Ma
nila Bay. The Complaint alleged that the water quality of the Manila Bay had fallen way belo
w the allowable standards set by law, specifically PD 1152 or the Philippine Environment Co
de. In their individual causes of action, respondents alleged that the continued neglect of peti
tioners in abating the pollution of the Manila Bay constitutes a violation of respondents’ const
itutional right to life, health and a balanced ecology, the Environment Code, the Pollution Co
ntrol Law, the Water Code and Sanitation Code, among others. Respondents prayed that pet
itioners be ordered to clean the Manila Bay and submit to the RTC a concerted concrete pla
n of action for the purpose. The RTC rendered ordering the defendant-government agencies,
jointly and solidarily, to clean up and rehabilitate Manila Bay and restore its waters to SB (Cl
ass B sea waters per Water Classification Tables) classification to make it fit for swimming, s
kin-diving and other forms of contact recreation. To attain this, defendant-agencies, with defe
ndant DENR as the lead agency, are directed, within six (6) months from receipt hereof, to a
ct and perform their respective duties by devising a consolidated, coordinated and concerted
scheme of action for the rehabilitation and restoration of the bay.
Section 17 of the Environment Code provides for the upgrading of water qualit
y, that where the quality of water has deteriorated to a degree where its state will adversely
affect its best usage, the government agencies concerned shall take such measures as may
be necessary to upgrade the quality of such water to meet the prescribed water quality stand
ards. Section 20 of the same Code provides for the Clean-up Operations stating that it s
hall be the responsibility of the polluter to contain, remove and clean-up water pollution incid
ents at his own expense. In case of his failure to do so, the government agencies concerned
shall undertake containment, removal and clean-up operations and expenses incurred in sai
d operations shall be charged against the persons and/or entities responsible for such polluti
on.
Petitioners, before the CA, were one in arguing in the main that the pertinent pr
ovisions of the Environment Code (PD 1152) relate only to the cleaning of specific poll
ution incidents and do not cover cleaning in general. And apart from raising concerns
about the lack of funds appropriated for cleaning purposes, petitioners also asserted t
hat the cleaning of the Manila Bay is not a ministerial act which can be compelled by
mandamus.
ISSUE:
Do Sections 17 and 20 of PD 1152 under the headings, Upgrading of Water Quality a
nd Clean-up Operations, envisage a cleanup in general or are they limited only to the cleanu
p of specific pollution incidents.
HELD:
Secs. 17 and 20 of the Environment Code Include Cleaning in General. When th
e Clean Water Act (RA 9275) took effect, its Sec. 16 on the subject, o, amended the counter
part provision (Sec. 20) of the Environment Code (PD 1152). Sec. 17 of PD 1152 continues,
however, to be operational. The amendatory Sec. 16 of RA 9275 reads:
SEC. 16. Cleanup Operations.––Notwithstanding the provisions of Sections 15 and 2
6 hereof, any person who causes pollution in or pollutes water bodies in excess of th
e applicable and prevailing standards shall be responsible to contain, remove and cle
an up any pollution incident at his own expense to the extent that the same water bod
ies have been rendered unfit for utilization and beneficial use: Provided, That in the
event emergency cleanup operations are necessary and the polluter fails to im
mediately undertake the same, the DENR in coordination with other governmen
t agencies concerned, shall undertake containment, removal and cleanup oper
ations. Expenses incurred in said operations shall be reimbursed by the persons fou
nd to have caused such pollution under proper administrative determination. Reimbur
sements of the cost incurred shall be made to the Water Quality Management Fund o
r to such other funds where said disbursements were sourced.
Petitioners maintain that the application of said Sec. 20 is limited only to "water polluti
on incidents," which are situations that presuppose the occurrence of specific, isolated polluti
on events requiring the corresponding containment, removal, and cleaning operations. Pushi
ng the point further, they argue that "cleanup operations" to restore the body of water to pre-
spill condition, which means that there must have been a specific incident of either intentiona
l or accidental spillage of oil or other hazardous substances.
The Supreme Court ruled that Sec. 17 does not in any way state that the government
agencies concerned ought to confine themselves to the containment, removal, and cleaning
operations when a specific pollution incident occurs. On the contrary, Sec. 17 requires them
to act even in the absence of a specific pollution incident, as long as water quality "has deteri
orated to a degree where its state will adversely affect its best usage." This section, to stress,
commands concerned government agencies, when appropriate, "to take such measures as
may be necessary to meet the prescribed water quality standards." In fine, the underlying du
ty to upgrade the quality of water is not conditional on the occurrence of any pollution inciden
t.
For another, a perusal of Sec. 20 of the Environment Code, as couched, indicates th
at it is properly applicable to a specific situation in which the pollution is caused by polluters
who fail to clean up the mess they left behind. In such instance, the concerned government a
gencies shall undertake the cleanup work for the polluters’ account. Petitioners’ assertion, th
at they have to perform cleanup operations in the Manila Bay only when there is a water poll
ution incident and the erring polluters do not undertake the containment, removal, and clean
up operations, is quite off mark. As earlier discussed, the complementary Sec. 17 of the Envi
ronment Code comes into play and the specific duties of the agencies to clean up come in e
ven if there are no pollution incidents staring at them. Petitioners, thus, cannot plausibly invo
ke and hide behind Sec. 20 of PD 1152 or Sec. 16 of RA 9275 on the pretext that their clean
up mandate depends on the happening of a specific pollution incident. In this regard, what th
e CA said with respect to the impasse over Secs. 17 and 20 of PD 1152 is at once valid as it
is practical. The appellate court wrote: "PD 1152 aims to introduce a comprehensive progra
m of environmental protection and management. This is better served by making Secs. 17 &
20 of general application rather than limiting them to specific pollution incidents."
CASE: SHELL PHILIPPINES EXPLORATION B.V. v. EFREN JALOS, [Link]. (G.R.
No. 179918)
DATE: 8 September 2010
PONENTE: J. Abad
FACTS
On 11 December 1990, Shell Philippines Exploration B.V. (Shell) and the
Republic of the Philippines entered into Service Contract 38 for the
exploration and extraction of petroleum in northwestern Palawan.
Two years later, Shell discovered natural gas in the Camago-Malampaya area
and pursued its development of the well under the Malampaya Natural Gas
Project.
The Project entailed the construction and installation of a pipeline from Shell’s
production platform to its gas processing plant in Batangas. The pipeline
spanned 504 kilometers and crossed the Oriental Mindoro Sea.
On 5 May 2013, respondent Efren Jalos, [Link]., fishermen from Bansud,
Oriental Mindoro, filed a complaint for damages against Shell before the RTC
Pinamalayan, Oriental Mindoro claiming that their livelihood was adversely
affected by the construction and operation of Shell’s natural gas pipeline
which greatly affected biogenically hard-structured communities and led to
stress the marine life in Mindoro Sea. From Php 4,848.00 per month, their
average net income fell to only Php 573.00.
Shell moved to dismiss the complaint alleging the following:
- It is a pollution case; thus, the trial court had no jurisdiction but the
Pollution Adjudication Board (PAB).
- It serves as an agent of the Philippine government. It cannot therefore be
sued under the doctrine of state immunity without the consent of the State.
- The complaint failed to state a cause of action since it did not specify any
actionable wrong or particular act or omission that could have caused the
alleged injury.
On 24 March 2004, the RTC dismissed the complaint ruling that the action
was actually pollution-related.
Jalos, [Link]. filed a petition for certiorari before the CA.
CA reversed the RTC decision, ruling that:
- Shell was not being sued for committing pollution, but for constructing and
operating a natural gas pipeline that caused fish decline and considerable
reduction in the fishermen’s income. The claim for damages was thus
based on a quasi-delict over which the regular courts have jurisdiction.
- The doctrine of state immunity is inapplicable. The State was not even
impleaded as party defendant. Besides, the State should be deemed to
have given its consent to be sued when it entered into contract with Shell.
- The complaint sufficiently alleged an actionable wrong. Jalos, [Link].
invoked their right to fish the sea and earn a living, which Shell had the
correlative obligation to respect. Failure to do so resulted in a violation of
the fishermen’s right and thus gave rise to a cause of action for damages.
Shell moved to reconsider the CA decision but the same was denied. Hence,
the present petition for review under Rule 45.
ISSUES
1. WON the complaint is a pollution case that falls within the primary jurisdiction
of the PAB
2. WON the complaint sufficiently alleges a cause of action against Shell
3. WON the suit is actually against the State and is barred under the doctrine of
state immunity
RULING
1. Yes. Section 2(a) of P.D. 984 entitled, “Providing for the Revision of Republic Act
No. 3931, commonly known as the Pollution Control Law, and for Other
Purposes” defines pollution in this wise:
(a) "Pollution" means any alteration of the physical, chemical
and biological properties of any water, air and/or land resources
of the Philippines, or any discharge thereto of any liquid, gaseous or
solid wastes as will or is likely to create or to render such water, air
and land resources harmful, detrimental or injurious to public health,
safety or welfare or which will adversely affect their utilization for
domestic, commercial, industrial, agricultural, recreational or other
legitimate purposes. (Emphasis supplied)
It is clear from the definition that the stress to marine life claimed by Jalos,
[Link]. is caused by some kind of pollution emanating from Shell’s natural gas
pipeline. The pipeline, they said, greatly affected or altered the natural habitat of
fish and affected the coastal water’s natural function as fishing grounds.
Inevitably, in resolving the claim for damages of Jalos, [Link]., the proper
tribunal must determine whether or not the operation of the pipeline adversely
altered the coastal water’s properties and negatively affected its life sustaining
function. The power and expertise needed to determine such issues lies with the
PAB.
Executive Order 192 transferred to the PAB the powers and functions of the
National Pollution and Control Commission provided under R.A. 3931, as
amended by P.D. 984. These empowered the PAB to determine the location,
magnitude, extent, severity, causes and effects of water pollution.
Among its functions is to serve as arbitrator for the determination of
reparation, or restitution of the damages and losses resulting from pollution. In
this regard, the PAB has the power to conduct hearings, impose penalties for
violation of P.D. 984, and issue writs of execution to enforce its orders and
decisions. The PAB’s final decisions may be reviewed by the CA under Rule 43
of the Rules of Court.
Therefore, Jalos, [Link]. had administrative recourse before filing their
complaint with the regular courts. The definition of the term pollution itself
connotes the need for specialized knowledge and skills, technical and scientific,
in determining the presence, the cause, and the effects of pollution. These
knowledge and skills are not within the competence of ordinary courts.
Consequently, resort must first be made to PAB, which is the agency possessed
of expertise in determining pollution-related matters.
2. Yes. A cause of action is the wrongful act or omission committed by the
defendant in violation of the primary rights of the plaintiff. Its elements consist of:
(1) a right existing in favour of the plaintiff; (2) a duty on the part of the defendant
to respect the plaintiff’s right; and (3) an act or omission of the defendant in
violation of such right.
To sustain a motion to dismiss for lack of cause of action, however, the
complaint must show that the claim for relief does not exist and not only that the
claim was defectively stated or is ambiguous, indefinite or uncertain.
Here, all the elements of a cause of action are present:
a. Jalos, [Link]. undoubtedly had the right to the preferential use of marine and
fishing resources which is guaranteed by no less than the Constitution;
b. Shell had the correlative duty to refrain from acts or omissions that could
impair Jalos, [Link].’s use and enjoyment of the bounties of the seas; and
c. Shell’s construction and operation of the pipeline, which is an act of
physical intrusion into the marine environment, is said to have disrupted
and impaired the natural habitat of fish and resulted in considerable
reduction of fish catch and income for Jalos, [Link].
Thus, the construction and operation of the pipeline may, in itself, be a
wrongful act that could be the basis of Jalos, [Link].’s cause of action. The rules do
not require that the complaint establish in detail the causal link between the
construction and operation of the pipeline, on the one hand, and the fish decline
and loss of income, on the other hand, it being sufficient that the complaint
alleges facts which, if true would justify the relief demanded.
3. No. Shell’s main undertaking under Service Contract 38 is to perform all
petroleum operations and provide all necessary technology and finance as well
as other connected services to the Philippine government. As defined under the
contract, petroleum operation means the searching for and obtaining Petroleum
within the Philippines, including the transportation, storage, handling and sale of
petroleum whether for export or domestic consumption. Shell’s primary obligation
under the contract is not to represent the Philippine government for the purpose
of transacting business with third persons. Rather, its contractual commitment is
to develop and manage petroleum operations on behalf of the State.
Consequently, Shell is not an agent of the Philippine government, but a
provider of services, technology and financing for the Malampaya Natural Gas
Project. It is not immune from suit and may be sued for claim even without the
State’s consent.
Notably, Article II, paragraph 8, Annex B of Service Contract 38 states that
legal expenses, including judgments obtained against the Parties or any of them
on account of the Petroleum Operations, can be recovered by Shell as part of
operating expenses to be deducted from gross proceeds. Article II, paragraph 9B
of the same document allows a similar recovery for all actual expenditures
incurred and paid by CONTRACTOR (Shell) in settlement of any and all losses,
claims, damages, judgments, and any other expenses not covered by insurance,
including legal services. This signifies that the State itself acknowledged the
suability of Shell. Since payment of claims and damages pursuant to a judgment
against Shell can be deducted from gross proceeds, the State will not be required
to perform any additional affirmative act to satisfy such a judgment.