La Bugal-B’Laan v. Ramos
G.R. No. 127882 | December 01, 2004
FACTS:
The Petition for Prohibition and Mandamus before the Court challenges the
constitutionality of Republic Act No. 7942 and its Implementing Rules and Regulations
and as well as the FTAA executed by the government with Western Mining Corporation
(Philippines), Inc. (WMCP). On January 27, 2004, the Court en banc promulgated its
Decision granting the Petition and declaring the unconstitutionality of certain provisions
of RA 7942 and its IRR as well as of the entire FTAA executed between the government
and WMCP, mainly on the finding that FTAAs are service contracts prohibited by the 1987
Constitution. On 2001, WMCP sold its whole stake in Sagittarius Mines which is 60%
owned by Filipinos while 40% is owned by Indophil Resources – Australian company.
According to the January 2004 Decision, the 1987 Constitution (Section 2 of Article XII)
effectively banned such service contracts like FTAA. Subsequently, respondents filed
separate Motions for Reconsideration. In a Resolution dated March 9, 2004, the Court
required petitioners to comment thereon. In the Resolution of June 8, 2004, it set the case
for Oral Argument on June 29, 2004.
ISSUE/S:
Whether the Philippine Mining Act is unconstitutional as held on Supreme Court
decision on January 2004?
DECISION:
The Supreme Court, en banc reversed and set aside the Court’s January 27, 2004
decision and dismissed the petition for prohibition and mandamus. The Court ruled that
the phrase “Agreements involving either technical or financial assistance” in paragraph 4
of Section 2, Article XII of the Constitution includes service contracts and allows foreignowned corporations to participate not only by providing technical or financial aid but also
by exercising management authority over large-scale mining operations, subject to full
control of the State. The “full control and supervision” doesn’t equate to day-to-day
management or chore but rather approval for work programs, budgets and compliance
such as compliances they need to adhere and prescribes sanctions or possible
termination of contracts upon breach of contract. Therefore, the Court upheld the
constitutionality of the Republic Act 9472