narra v. redmont

TodayisTuesday,June23,2015

NarraNickelMiningandDevelopmentCorp.v.RedmontConsolidatedMines,G.R.No.195580,21April2014Decision,Velasco[J]DissentingOpinion,Leonen[J]

RepublicofthePhilippinesSUPREMECOURT

BaguioCity

THIRDDIVISION

G.R.No.195580April21,2014

NARRA NICKEL MINING AND DEVELOPMENT CORP., TESORO MINING AND DEVELOPMENT, INC., andMCARTHURMINING,INC.,Petitioners,vs.REDMONTCONSOLIDATEDMINESCORP.,Respondent.

DECISION

VELASCO,JR.,J.:

Before this Court is a Petition for Review on Certiorari under Rule 45 filed by Narra Nickel and MiningDevelopment Corp. (Narra), Tesoro Mining and Development, Inc. (Tesoro), and McArthur Mining Inc.(McArthur),whichseekstoreversetheOctober1,2010Decision1andtheFebruary15,2011Resolutionof theCourtofAppeals(CA).

TheFacts

SometimeinDecember2006,respondentRedmontConsolidatedMinesCorp.(Redmont),adomesticcorporationorganizedandexistingunderPhilippinelaws,tookinterestinminingandexploringcertainareasoftheprovinceofPalawan.After inquiringwiththeDepartmentofEnvironmentandNaturalResources(DENR), it learnedthattheareas where it wanted to undertake exploration and mining activities where already covered by MineralProductionSharingAgreement(MPSA)applicationsofpetitionersNarra,TesoroandMcArthur.

PetitionerMcArthur,throughitspredecessorininterestSaraMarieMining,Inc.(SMMI),filedanapplicationforanMPSAandExplorationPermit(EP)with theMinesandGeoSciencesBureau(MGB),RegionIVB,Officeof theDepartmentofEnvironmentandNaturalResources(DENR).

Subsequently, SMMI was issued MPSAAMAIVB153 covering an area of over 1,782 hectares in BarangaySumbiling, Municipality of Bataraza, Province of Palawan and EPAIVB44 which includes an area of 3,720hectares in BarangayMalatagao, Bataraza, Palawan. TheMPSA andEPwere then transferred toMadridejosMiningCorporation(MMC)and,onNovember6,2006,assignedtopetitionerMcArthur.2

Petitioner Narra acquired its MPSA from Alpha Resources and Development Corporation and Patricia LouiseMining&DevelopmentCorporation (PLMDC)whichpreviously filed anapplication for anMPSAwith theMGB,RegionIVB,DENRonJanuary6,1992.Throughthesaidapplication,theDENRissuedMPSAIV112coveringanareaof3.277hectaresinbarangaysCalategasandSanIsidro,MunicipalityofNarra,Palawan.Subsequently,PLMDC conveyed, transferred and/or assigned its rights and interests over the MPSA application in favor ofNarra.

Another MPSA application of SMMI was filed with the DENR Region IVB, labeled as MPSAAMAIVB154(formerly EPAIVB47) over 3,402 hectares in BarangaysMalinao and Princesa Urduja, Municipality of Narra,ProvinceofPalawan.SMMIsubsequentlyconveyed,transferredandassigneditsrightsandinterestoverthesaidMPSAapplicationtoTesoro.

OnJanuary2,2007,RedmontfiledbeforethePanelofArbitrators(POA)oftheDENRthree(3)separatepetitionsforthedenialofpetitionersapplicationsforMPSAdesignatedasAMAIVB153,AMAIVB154andMPSAIV112.

Inthepetitions,Redmontallegedthatatleast60%ofthecapitalstockofMcArthur,TesoroandNarraareownedandcontrolledbyMBMIResources, Inc. (MBMI),a100%Canadiancorporation.Redmont reasoned that sinceMBMIisaconsiderablestockholderofpetitioners,itwasthedrivingforcebehindpetitionersfilingoftheMPSAsover the areas covered by applications since it knows that it can only participate in mining activities throughcorporationswhicharedeemedFilipinocitizens.RedmontarguedthatgiventhatpetitionerscapitalstocksweremostlyownedbyMBMI,theywerelikewisedisqualifiedfromengaginginminingactivitiesthroughMPSAs,whicharereservedonlyforFilipinocitizens.

In theirAnswers, petitioners averred that theywere qualified personsunderSection 3(aq) ofRepublicActNo.(RA)7942orthePhilippineMiningActof1995whichprovided:

Sec.3DefinitionofTerms.Asused inand forpurposesof thisAct, the following terms,whether insingularorplural,shallmean:

xxxx

(aq) "Qualified person" means any citizen of the Philippines with capacity to contract, or a corporation,partnership, association, or cooperative organized or authorized for the purpose of engaging in mining, withtechnicalandfinancialcapabilitytoundertakemineralresourcesdevelopmentanddulyregisteredinaccordancewithlawatleastsixtypercent(60%)ofthecapitalofwhichisownedbycitizensofthePhilippines:Provided,Thata legally organized foreignowned corporation shall be deemedaqualified person for purposesof grantinganexplorationpermit,financialortechnicalassistanceagreementormineralprocessingpermit.

Additionally,theystatedthattheirnationalityasapplicantsisimmaterialbecausetheyalsoappliedforFinancialorTechnicalAssistanceAgreements (FTAA)denominatedasAFTAIVB09 forMcArthur,AFTAIVB08 forTesoroandAFTAIVB07forNarra,whicharegrantedtoforeignownedcorporations.Nevertheless,theyclaimedthattheissueonnationalityshouldnotberaisedsinceMcArthur,TesoroandNarraareinfactPhilippineNationalsas60%oftheircapitalisownedbycitizensofthePhilippines.TheyassertedthatthoughMBMIowns40%ofthesharesofPLMC(whichowns5,997sharesofNarra),340%ofthesharesofMMC(whichowns5,997sharesofMcArthur)4and40%ofthesharesofSLMC(which,inturn,owns5,997sharesofTesoro),5thesharesofMBMIwillnotmakeit the owner of at least 60%of the capital stock of each of petitioners. They added that the best tool used indetermining thenationalityofacorporation is the "control test,"embodied inSec.3ofRA7042or theForeignInvestmentsActof1991.Theyalsoclaimed that thePOAofDENRdidnothave jurisdictionover the issues inRedmontspetitionsincetheyarenotenumeratedinSec.77ofRA7942.Finally,theystressedthatRedmonthasno personality to sue them because it has no pending claim or application over the areas applied for bypetitioners.

OnDecember14,2007,thePOAissuedaResolutiondisqualifyingpetitionersfromgainingMPSAs.Itheld:

[I]tisclearlyestablishedthatrespondentsarenotqualifiedapplicantstoengageinminingactivities.Ontheotherhand, [Redmont] having filed its own applications for an EPA over the areas earlier covered by the MPSAapplicationofrespondentsmaybeconsideredifandwhentheyarequalifiedunderthelaw.Theviolationoftherequirements for the issuance and/or grant of permits over mining areas is clearly established thus, there isreasontobelievethatthecancellationand/orrevocationofpermitsalreadyissuedunderthepremisesisinorderandopentheareascoveredtootherqualifiedapplicants.

xxxx

WHEREFORE, the Panel of Arbitrators finds the Respondents, McArthur Mining Inc., Tesoro Mining andDevelopment,Inc.,andNarraNickelMiningandDevelopmentCorp.as,DISQUALIFIEDforbeingconsideredasForeignCorporations.TheirMineralProductionSharingAgreement(MPSA)areherebyxxxDECLAREDNULLANDVOID.6

ThePOAconsideredpetitionersasforeigncorporationsbeing"effectivelycontrolled"byMBMI,a100%CanadiancompanyanddeclaredtheirMPSAsnullandvoid.InthesameResolution,itgaveduecoursetoRedmontsEPAs.Thereafter, on February 7, 2008, the POA issued an Order7 denying the Motion for Reconsideration filed bypetitioners.

Aggrieved by the Resolution and Order of the POA,McArthur and Tesoro filed a joint Notice of Appeal8 andMemorandum of Appeal9 with the Mines Adjudication Board (MAB) while Narra separately filed its Notice ofAppeal10andMemorandumofAppeal.11

In their respectivememorandum, petitioners emphasized that they are qualified persons under the law. Also,through a letter, they informed theMAB that they had their individualMPSAapplications converted to FTAAs.McArthurs FTAA was denominated as AFTAIVB0912 on May 2007, while Tesoros MPSA application wasconvertedtoAFTAIVB0813onMay28,2007,andNarrasFTAAwasconvertedtoAFTAIVB0714onMarch30,2006.

Pending the resolution of the appeal filed by petitioners with the MAB, Redmont filed a Complaint15 with theSecurities and Exchange Commission (SEC), seeking the revocation of the certificates for registration ofpetitionersonthegroundthattheyareforeignownedorcontrolledcorporationsengagedinmininginviolationofPhilippine laws. Thereafter, Redmont filed on September 1, 2008 a Manifestation and Motion to SuspendProceeding before theMAB praying for the suspension of the proceedings on the appeals filed byMcArthur,TesoroandNarra.

Subsequently,onSeptember8,2008,RedmontfiledbeforetheRegionalTrialCourtofQuezonCity,Branch92(RTC)aComplaint16forinjunctionwithapplicationforissuanceofatemporaryrestrainingorder(TRO)and/orwritof preliminary injunction, docketed as Civil Case No. 0863379. Redmont prayed for the deferral of the MABproceedingspendingtheresolutionoftheComplaintbeforetheSEC.

ButbeforetheRTCcanresolveRedmontsComplaintandapplicationsfor injunctivereliefs, theMABissuedanOrderonSeptember10,2008,findingtheappealmeritorious.Itheld:

WHEREFORE, inviewof theforegoing, theMinesAdjudicationBoardherebyREVERSESandSETSASIDEtheResolutiondated14December2007ofthePanelofArbitratorsofRegionIVB(MIMAROPA)inPOADENRCaseNos. 200101, 200702 and 200703, and its Order dated 07 February 2008 denying the Motions forReconsiderationoftheAppellants.ThePetitionfiledbyRedmontConsolidatedMinesCorporationon02January2007isherebyorderedDISMISSED.17

Belatedly, onSeptember 16, 2008, theRTC issued anOrder18 grantingRedmonts application for a TROandsettingthecaseforhearingtheprayerfortheissuanceofawritofpreliminaryinjunctiononSeptember19,2008.

Meanwhile, onSeptember22, 2008,Redmont filedaMotion forReconsideration19 of theSeptember10, 2008OrderoftheMAB.Subsequently,itfiledaSupplementalMotionforReconsideration20onSeptember29,2008.

Before the MAB could resolve Redmonts Motion for Reconsideration and Supplemental Motion forReconsideration,RedmontfiledbeforetheRTCaSupplementalComplaint21inCivilCaseNo.0863379.

OnOctober6,2008,theRTCissuedanOrder22grantingtheissuanceofawritofpreliminaryinjunctionenjoiningthe MAB from finally disposing of the appeals of petitioners and from resolving Redmonts Motion forReconsiderationandSupplementMotionforReconsiderationoftheMABsSeptember10,2008Resolution.

OnJuly1,2009,however, theMABissuedasecondOrderdenyingRedmontsMotionforReconsiderationandSupplementalMotionforReconsiderationandresolvingtheappealsfiledbypetitioners.

Hence, the petition for review filed by Redmont before the CA, assailing the Orders issued by the MAB. OnOctober1,2010,theCArenderedaDecision,thedispositiveofwhichreads:

WHEREFORE,thePetitionisPARTIALLYGRANTED.TheassailedOrders,datedSeptember10,2008andJuly1,2009oftheMiningAdjudicationBoardarereversedandsetaside.ThefindingsofthePanelofArbitratorsof

theDepartmentofEnvironmentandNaturalResourcesthatrespondentsMcArthur,TesoroandNarraareforeigncorporations isupheldand, therefore, the rejectionof theirapplications forMineralProductSharingAgreementshouldberecommendedtotheSecretaryoftheDENR.

WithrespecttotheapplicationsofrespondentsMcArthur,TesoroandNarraforFinancialorTechnicalAssistanceAgreement(FTAA)orconversionoftheirMPSAapplicationstoFTAA,thematterforitsrejectionorapprovalisleftfordeterminationbytheSecretaryoftheDENRandthePresidentoftheRepublicofthePhilippines.

SOORDERED.23

InaResolutiondatedFebruary15,2011,theCAdeniedtheMotionforReconsiderationfiledbypetitioners.

Afteracarefulreviewoftherecords,theCAfoundthattherewasdoubtastothenationalityofpetitionerswhenitrealized that petitioners had a common major investor, MBMI, a corporation composed of 100% Canadians.Pursuant to the firstsentenceofparagraph7ofDepartmentofJustice(DOJ)OpinionNo.020,Seriesof2005,adoptingthe1967SECRuleswhichimplementedtherequirementoftheConstitutionandotherlawspertainingtotheexploitationofnaturalresources,theCAusedthe"grandfatherrule"todeterminethenationalityofpetitioners.Itprovided:

Sharesbelongingtocorporationsorpartnershipsatleast60%ofthecapitalofwhichisownedbyFilipinocitizensshallbeconsideredasofPhilippinenationality,but if thepercentageofFilipinoownership in thecorporationorpartnershipislessthan60%,onlythenumberofsharescorrespondingtosuchpercentageshallbecountedasofPhilippinenationality.Thus,if100,000sharesareregisteredinthenameofacorporationorpartnershipatleast60% of the capital stock or capital, respectively, of which belong to Filipino citizens, all of the shares shall berecordedasownedbyFilipinos.Butiflessthan60%,orsay,50%ofthecapitalstockorcapitalofthecorporationor partnership, respectively, belongs to Filipino citizens, only 50,000 shares shall be recorded as belonging toaliens.24(emphasissupplied)

Indeterminingthenationalityofpetitioners,theCAlookedintotheircorporatestructuresandtheircorrespondingcommonshareholders.Usingthegrandfatherrule,theCAdiscoveredthatMBMIineffectownedmajorityofthecommon stocks of the petitioners as well as at least 60% equity interest of other majority shareholders ofpetitionersthroughjointventureagreements.TheCAfoundthatthrougha"webofcorporatelayering,it isclearthatonecommoncontrollinginvestorinallminingcorporationsinvolvedxxxisMBMI."25Thus,itconcludedthatpetitionersMcArthur,TesoroandNarraarealsoinpartnershipwith,orpriviesininterestof,MBMI.

Furthermore, the CA viewed the conversion of the MPSA applications of petitioners into FTAA applicationssuspicious innatureand,asaconsequence, it recommendedtherejectionofpetitionersMPSAapplicationsbytheSecretaryoftheDENR.

With regard to the settlement of disputes over rights to mining areas, the CA pointed out that the POA hasjurisdictionoverthemandthatitalsohasthepowertodeterminetheofnationalityofpetitionersasaprerequisiteoftheConstitutionpriortheconferringofrightsto"coproduction,jointventureorproductionsharingagreements"ofthestatetominingrights.However,italsostatedthatthePOAsjurisdictionislimitedonlytotheresolutionofthedisputeandnotontheapprovalorrejectionoftheMPSAs.ItstipulatedthatonlytheSecretaryoftheDENRisvestedwiththepowertoapproveorrejectapplicationsforMPSA.

Finally,theCAupheldthefindingsofthePOAinitsDecember14,2007ResolutionwhichconsideredpetitionersMcArthur,TesoroandNarraasforeigncorporations.Nevertheless,theCAdeterminedthatthePOAsdeclarationthattheMPSAsofMcArthur,TesoroandNarraarevoidishighlyimproper.

WhilethepetitionwaspendingwiththeCA,RedmontfiledwiththeOfficeofthePresident(OP)apetitiondatedMay 7, 2010 seeking the cancellation of petitioners FTAAs. The OP rendered a Decision26 on April 6, 2011,wherein itcanceledandrevokedpetitionersFTAAsforviolatingandcircumventing the"Constitutionxxx[,] theSmallScaleMiningLawandEnvironmentalComplianceCertificateaswell asSections3and8of theForeignInvestmentActandE.O.584."27TheOP,inaffirmingthecancellationoftheissuedFTAAs,agreedwithRedmontstating that petitioners committed violationsagainst theabovementioned lawsand failed to submit evidence tonegate them. TheDecision further quoted theDecember 14, 2007Order of the POA focusing on the allegedmisrepresentation and claimsmade by petitioners of being domestic or Filipino corporations and the admittedcontinuedminingoperationofPMDCusingtheirlocallysecuredSmallScaleMiningPermitinsidetheareaearlierapplied for an MPSA application which was eventually transferred to Narra. It also agreed with the POAsestimationthatthefilingoftheFTAAapplicationsbypetitionersisaclearadmissionthattheyare"notcapableofconductingalargescaleminingoperationandthattheyneedthefinancialandtechnicalassistanceofaforeignentityintheiroperation,thatiswhytheysoughttheparticipationofMBMIResources,Inc."28TheDecisionfurtherquoted:

The filing of the FTAA application on June 15, 2007, during the pendency of the case only demonstrate theviolations and lack of qualification of the respondent corporations to engage inmining. The filing of the FTAAapplicationconversionwhich isallowedforeigncorporationof theearlierMPSAisanadmission that indeedtherespondentisnotFilipinobutratherofforeignnationalitywhoisdisqualifiedunderthelaws.Corporatedocumentsof MBMI Resources, Inc. furnished its stockholders in their head office in Canada suggest that they areconductingoperationonlythroughtheirlocalcounterparts.29

TheMotionforReconsiderationoftheDecisionwasfurtherdeniedbytheOPinaResolution30datedJuly6,2011.PetitionersthenfiledaPetitionforReviewonCertiorarioftheOPsDecisionandResolutionwiththeCA,docketedas CAG.R. SP No. 120409. In the CA Decision dated February 29, 2012, the CA affirmed the Decision andResolutionoftheOP.Thereafter,petitionersappealedthesameCAdecisiontothisCourtwhichisnowpendingwithadifferentdivision.

Thus, the instant petition for review against theOctober 1, 2010Decision of the CA. Petitioners put forth thefollowingerrorsoftheCA:

I.

TheCourtofAppealserredwhenitdidnotdismissthecaseformootnessdespitethefactthatthesubjectmatterofthecontroversy,theMPSAApplications,havealreadybeenconvertedintoFTAAapplicationsandthatthesamehavealreadybeengranted.

II.

TheCourt of Appeals erredwhen it did not dismiss the case for lack of jurisdiction considering that thePanelofArbitratorshasnojurisdictiontodeterminethenationalityofNarra,TesoroandMcArthur.

III.

The Court of Appeals erred when it did not dismiss the case on account of Redmonts willful forumshopping.

IV.

The Court of Appeals ruling that Narra, Tesoro and McArthur are foreign corporations based on the"GrandfatherRule" iscontrary to law,particularly theexpressmandateof theForeign InvestmentsActof1991,asamended,andtheFIARules.

V.

TheCourtofAppealserredwhenitappliedtheexceptionstotheresinteraliosactarule.

VI.

TheCourt of Appeals erredwhen it concluded that the conversion of theMPSAApplications into FTAAApplicationswereof"suspiciousnature"asthesameisbasedonmereconjecturesandsurmiseswithoutanyshredofevidencetoshowthesame.31

Wefindthepetitiontobewithoutmerit.

Thiscasenotmootandacademic

TheclaimofpetitionersthattheCAerredinnotrenderingtheinstantcaseasmootiswithoutmerit.

Basically,acaseissaidtobemootand/oracademicwhenit"ceasestopresentajusticiablecontroversybyvirtueofsuperveningevents,so thatadeclaration thereonwouldbeofnopracticaluseorvalue."32Thus, thecourts"generallydeclinejurisdictionoverthecaseordismissitonthegroundofmootness."33

The "mootness" principle, however, does accept certain exceptions and the mere raising of an issue of"mootness" will not deter the courts from trying a case when there is a valid reason to do so. In David v.MacapagalArroyo(David), theCourtprovidedfour instanceswherecourtscandecideanotherwisemootcase,thus:

1.)ThereisagraveviolationoftheConstitution

2.)Theexceptionalcharacterofthesituationandparamountpublicinterestisinvolved

3.)Whenconstitutional issue raised requires formulationof controllingprinciples toguide thebench, thebar,andthepublicand

4.)Thecaseiscapableofrepetitionyetevadingreview.34

Alloftheexceptionsstatedabovearepresentintheinstantcase.WeofthisCourtnotethatagraveviolationoftheConstitution,specificallySection2ofArticleXII, isbeingcommittedbya foreigncorporationrightunderourcountrys nose through a myriad of corporate layering under different, allegedly, Filipino corporations. Theintricate corporate layering utilized by theCanadian company,MBMI, is of exceptional character and involvesparamount public interest since it undeniably affects the exploitation of our Countrys natural resources. Thecorrespondingactionsofpetitionersduringthelifetimeandexistenceoftheinstantcaseraisequestionsaswhatprincipleistobeappliedtocaseswithsimilarissues.NodefiniterulingonsuchprinciplehasbeenpronouncedbytheCourthence,thedispositionoftheissuesorerrorsintheinstantcasewillserveasaguide"tothebench,thebar and the public."35 Finally, the instant case is capable of repetition yet evading review, since theCanadiancompany, MBMI, can keep on utilizing dummy Filipino corporations through various schemes of corporatelayeringandconversionofapplications toskirt theconstitutionalprohibitionagainst foreignmining inPhilippinesoil.

ConversionofMPSAapplicationstoFTAAapplications

WeshalldiscussthefirsterrorinconjunctionwiththesixtherrorpresentedbypetitionerssincebothinvolvetheconversionofMPSAapplications toFTAAapplications.Petitionerspropound that theCAerred in rulingagainstthemsincethequestionedMPSAapplicationswerealreadyconvertedintoFTAAapplicationsthus,theissueontheprohibitionrelating toMPSAapplicationsof foreignminingcorporations isacademic.Also,petitionerswouldwantustocorrecttheCAsfindingwhichdeemedtheaforementionedconversionsofapplicationsassuspiciousinnature,sinceitisbasedonmereconjecturesandsurmisesandnotsupportedwithevidence.

Wedisagree.

TheCAsanalysisof theactionsofpetitionersafter thecasewas filedagainst themby respondent isonpoint.Thechangingofapplicationsbypetitionersfromonetypetoanotherjustbecauseacasewasfiledagainstthem,in truth, would raise not a few sceptics eyebrows. What is the reason for such conversion? Did the saidconversionnotstemfromthecasechallengingtheircitizenshipandtohavethecasedismissedagainstthemforbeing"moot"?Itisquiteobviousthatitispetitionersstrategytohavethecasedismissedagainstthemforbeing"moot."

Considerthehistoryofthiscaseandhowpetitionersrespondedtoeveryactiondonebythecourtorappropriategovernment agency: on January 2, 2007, Redmont filed three separate petitions for denial of the MPSAapplications of petitioners before the POA. On June 15, 2007, petitioners filed a conversion of their MPSAapplications to FTAAs. The POA, in its December 14, 2007 Resolution, observed this suspect change ofapplicationswhilethecasewaspendingbeforeitandheld:

The filing of the Financial or Technical Assistance Agreement application is a clear admission that the

respondentsarenotcapableofconductinga largescaleminingoperationand that theyneed the financialandtechnical assistance of a foreign entity in their operation that is why they sought the participation of MBMIResources,Inc.TheparticipationofMBMIinthecorporationonlyprovesthefactthatitistheCanadiancompanythatwillprovidethefinancesandtheresourcestooperatetheminingareasforthegreaterbenefitandinterestofthesameandnottheFilipinostockholderswhoonlyhavealesssubstantialfinancialstakeinthecorporation.

xxxx

xxxThefilingoftheFTAAapplicationonJune15,2007,duringthependencyofthecaseonlydemonstratetheviolations and lack of qualification of the respondent corporations to engage inmining. The filing of the FTAAapplicationconversionwhich isallowedforeigncorporationof theearlierMPSAisanadmission that indeedtherespondentisnotFilipinobutratherofforeignnationalitywhoisdisqualifiedunderthelaws.Corporatedocumentsof MBMI Resources, Inc. furnished its stockholders in their head office in Canada suggest that they areconductingoperationonlythroughtheirlocalcounterparts.36

OnOctober1,2010,theCArenderedaDecisionwhichpartiallygrantedthepetition,reversingandsettingasidetheSeptember10,2008andJuly1,2009OrdersoftheMAB.InthesaidDecision,theCAupheldthefindingsofthePOAof theDENRthat thehereinpetitionersare in fact foreigncorporations thusa recommendationof therejectionoftheirMPSAapplicationswererecommendedtotheSecretaryoftheDENR.WithrespecttotheFTAAapplicationsorconversionoftheMPSAapplicationstoFTAAs,theCAdeferredthematterforthedeterminationoftheSecretaryoftheDENRandthePresidentoftheRepublicofthePhilippines.37

In theirMotion forReconsiderationdatedOctober26,2010,petitionersprayed for thedismissalof thepetitionasserting thatonApril5,2010, thenPresidentGloriaMacapagalArroyosignedand issued in their favorFTAANo. 052010IVB, which rendered the petition moot and academic. However, the CA, in a Resolution datedFebruary15,2011deniedtheirmotionforbeingamere"rehashoftheirclaimsanddefenses."38Standingfirmonits Decision, the CA affirmed the ruling that petitioners are, in fact, foreign corporations. On April 5, 2011,petitionerselevatedthecasetousviaaPetitionforReviewonCertiorariunderRule45,questioningtheDecisionoftheCA.Interestingly,theOPrenderedaDecisiondatedApril6,2011,adayafterthispetitionforreviewwasfiled, cancellingand revoking theFTAAs,quoting theOrderof thePOAandstating thatpetitionersare foreigncorporations since they needed the financial strength of MBMI, Inc. in order to conduct large scale miningoperations.TheOPDecisionalsobasedthecancellationonthemisrepresentationoffactsandtheviolationofthe"SmallScaleMiningLawandEnvironmentalComplianceCertificateaswellasSections3and8of theForeignInvestment Act and E.O. 584."39 On July 6, 2011, the OP issued a Resolution, denying the Motion forReconsiderationfiledbythepetitioners.

RespondentRedmont, in itsCommentdatedOctober10,2011,madeknown to theCourt the factof theOPsDecisionandResolution.IntheirReply,petitionerschosetoignoretheOPDecisionandcontinuedtoreusetheirold arguments claiming that they were granted FTAAs and, thus, the case was moot. Petitioners filed aManifestationandSubmissiondatedOctober19,2012,40whereintheyassertedthatthepresentpetitionismootsince, in a remarkable turn of events, MBMI was able to sell/assign all its shares/interest in the "holdingcompanies" to DMCIMining Corporation (DMCI), a Filipino corporation and, in effect, making their respectivecorporationsfullyFilipinoowned.

Again,itisquiteevidentthatpetitionershavebeentryingtohavethiscasedismissedforbeing"moot."Theirfinalact, wherein MBMI was able to allegedly sell/assign all its shares and interest in the petitioner "holdingcompanies" to DMCI, only proves that they were in fact not Filipino corporations from the start. The recentdivestingof interestbyMBMIwillnotchangethestandofthisCourtwithrespecttothenationalityofpetitionersprior the suspicious change in their corporate structures. The new documents filed by petitioners are factualevidencethatthisCourthasnopowertoverify.

Theonly thingclearandproved in thisCourt is the fact that theOPdeclared thatpetitionercorporationshaveviolated severalmining laws andmademisrepresentations and falsehood in their applications for FTAAwhichleadtotherevocationofthesaidFTAAs,demonstratingthatpetitionersarenotbeyondgoingagainstoraroundthelawusingshiftyactionsandstrategies.Thus,inthisinstance,wecansaythattheirclaimofmootnessismootinitselfbecausetheirdefenseofconversionofMPSAstoFTAAshasbeendiscreditedbytheOPDecision.

Grandfathertest

Themainissueinthiscaseiscenteredontheissueofpetitionersnationality,whetherFilipinoorforeign.Intheirpreviouspetitions, theyhadbeenadamant in insisting that theywereFilipinocorporations,until theysubmittedtheirManifestationandSubmissiondatedOctober19,2012where theystated theallegedchangeofcorporateownership to reflect their Filipino ownership. Thus, there is a need to determine the nationality of petitionercorporations.

Basically,therearetwoacknowledgedtestsindeterminingthenationalityofacorporation:thecontroltestandthegrandfather rule. Paragraph 7 of DOJOpinion No. 020, Series of 2005, adopting the 1967 SEC Rules whichimplemented the requirement of the Constitution and other laws pertaining to the controlling interests inenterprisesengagedintheexploitationofnaturalresourcesownedbyFilipinocitizens,provides:

Sharesbelongingtocorporationsorpartnershipsatleast60%ofthecapitalofwhichisownedbyFilipinocitizensshallbeconsideredasofPhilippinenationality,but if thepercentageofFilipinoownership in thecorporationorpartnershipislessthan60%,onlythenumberofsharescorrespondingtosuchpercentageshallbecountedasofPhilippinenationality.Thus,if100,000sharesareregisteredinthenameofacorporationorpartnershipatleast60% of the capital stock or capital, respectively, of which belong to Filipino citizens, all of the shares shall berecordedasownedbyFilipinos.Butiflessthan60%,orsay,50%ofthecapitalstockorcapitalofthecorporationor partnership, respectively, belongs to Filipino citizens, only 50,000 shares shall be counted as owned byFilipinosandtheother50,000shallberecordedasbelongingtoaliens.

Thefirstpartofparagraph7,DOJOpinionNo.020,stating"sharesbelongingtocorporationsorpartnershipsatleast 60%of the capital ofwhich is ownedbyFilipino citizens shall be consideredas ofPhilippine nationality,"pertains to the control test or the liberal rule. On the other hand, the second part of the DOJOpinion whichprovides,"ifthepercentageoftheFilipinoownershipinthecorporationorpartnershipislessthan60%,onlythenumberofsharescorresponding tosuchpercentageshallbecountedasPhilippinenationality,"pertains to thestricter,morestringentgrandfatherrule.

Priortothisrecentchangeofevents,petitionerswereconstantinadvocatingtheapplicationofthe"controltest"

underRA7042,asamendedbyRA8179,otherwise knownas theForeign InvestmentsAct (FIA), rather thanusingthestrictergrandfatherrule.ThepertinentprovisionunderSec.3oftheFIAprovides:

SECTION3.Definitions.AsusedinthisAct:

a.)ThetermPhilippinenationalshallmeanacitizenofthePhilippinesoradomesticpartnershiporassociationwhollyownedbythecitizensofthePhilippinesacorporationorganizedunderthelawsofthePhilippinesofwhichatleastsixtypercent(60%)ofthecapitalstockoutstandingandentitledtovoteiswhollyownedbyFilipinosoratrusteeoffundsforpensionorotheremployeeretirementorseparationbenefits,wherethetrusteeisaPhilippinenationalandat leastsixtypercent (60%)of the fundwillaccrue to thebenefitofPhilippinenationals:Provided,ThatwereacorporationanditsnonFilipinostockholdersownstocksinaSecuritiesandExchangeCommission(SEC) registeredenterprise,at leastsixtypercent (60%)of thecapitalstockoutstandingandentitled tovoteofeachofbothcorporationsmustbeownedandheldbycitizensofthePhilippinesandatleastsixtypercent(60%)ofthemembersoftheBoardofDirectors,inorderthatthecorporationshallbeconsideredaPhilippinenational.(emphasissupplied)

Thegrandfather rule, petitioners reasoned,hasno leg to standon in the instant casesince thedefinitionofa"PhilippineNational"underSec.3oftheFIAdoesnotprovideforit.Theyfurtherclaimthatthegrandfatherrule"hasbeenabandonedandisnolongertheapplicablerule."41TheyalsoopinedthatthelastportionofSec.3oftheFIAadmits theapplicationofa "corporate layering"schemeofcorporations.Petitionersclaim that theclearandunambiguouswordings of the statute preclude the court fromconstruing it andprevent the courts useofdiscretioninapplyingthelaw.Theysaidthattheplain,literalmeaningofthestatutemeanttheapplicationofthecontroltestisobligatory.

Wedisagree."Corporatelayering"isadmittedlyallowedbytheFIAbutifitisusedtocircumventtheConstitutionandpertinent laws, then itbecomes illegal.Further, thepronouncementofpetitioners that thegrandfather rulehasalreadybeenabandonedmustbediscreditedforlackofbasis.

Art.XII,Sec.2oftheConstitutionprovides:

Sec. 2. All lands of the public domain, waters, minerals, coal, petroleum and other mineral oils, all forces ofpotentialenergy,fisheries,forestsortimber,wildlife,floraandfauna,andothernaturalresourcesareownedbythe State. With the exception of agricultural lands, all other natural resources shall not be alienated. Theexploration,development,andutilizationofnaturalresourcesshallbeunderthefullcontrolandsupervisionoftheState. The State may directly undertake such activities, or it may enter into coproduction, joint venture orproductionsharingagreementswithFilipinocitizens,orcorporationsorassociationsat leastsixtypercentumofwhosecapitalisownedbysuchcitizens.Suchagreementsmaybeforaperiodnotexceedingtwentyfiveyears,renewablefornotmorethantwentyfiveyears,andundersuchtermsandconditionsasmaybeprovidedbylaw.

xxxx

ThePresidentmayenterintoagreementswithForeignownedcorporationsinvolvingeithertechnicalorfinancialassistanceforlargescaleexploration,development,andutilizationofminerals,petroleum,andothermineraloilsaccording to the general terms and conditions provided by law, based on real contributions to the economicgrowthandgeneralwelfareofthecountry.Insuchagreements,theStateshallpromotethedevelopmentanduseoflocalscientificandtechnicalresources.(emphasissupplied)

TheemphasizedportionofSec.2whichfocusesontheStateenteringintodifferenttypesofagreementsfortheexploration, development, and utilization of natural resourceswith entitieswho are deemed Filipino due to 60percent ownership of capital is pertinent to this case, since the issues are centered on the utilization of ourcountrysnaturalresourcesorspecifically,mining.Thus,thereisaneedtoascertainthenationalityofpetitionerssince,astheConstitutionsoprovides,suchagreementsareonlyallowedcorporationsorassociations"atleast60percentof suchcapital isownedbysuchcitizens."Thedeliberations in theRecordsof the1986ConstitutionalCommissionshedlightonhowacitizenshipofacorporationwillbedetermined:

Mr. BENNAGEN: Did I hear right that the Chairmans interpretation of an independent national economy isfreedomfromundueforeigncontrol?Whatisthemeaningofundueforeigncontrol?

MR.VILLEGAS:Undueforeigncontrol isforeigncontrolwhichsacrificesnationalsovereigntyandthewelfareoftheFilipinointheeconomicsphere.

MR. BENNAGEN:Why does it have to be qualified still with theword "undue"?Why not simply freedom fromforeigncontrol?Ithinkthatisthemeaningofindependence,becauseasphrased,itstillallowsforforeigncontrol.

MR.VILLEGAS:Itwillnowdependontheinterpretationbecauseif,forexample,weretainthe60/40possibilityinthecultivationofnaturalresources,40percentinvolvessomecontrolnottotalcontrol,butsomecontrol.

MR.BENNAGEN:Inanycase,Ithinkinduetimewewillproposesomeamendments.

MR.VILLEGAS:Yes.Butwewillbeopentoimprovementofthephraseology.

Mr.BENNAGEN:Yes.

Thankyou,Mr.VicePresident.

xxxx

MR.NOLLEDO:InSections3,9and15,theCommitteestatedlocalorFilipinoequityandforeignequitynamely,6040inSection3,6040inSection9,and2/31/3inSection15.

MR.VILLEGAS:Thatisright.

MR. NOLLEDO: In teaching law, we are always faced with the question: Where do we base the equityrequirement,isitontheauthorizedcapitalstock,onthesubscribedcapitalstock,oronthepaidupcapitalstockofacorporation?WilltheCommitteepleaseenlightenmeonthis?

MR.VILLEGAS:WehavejusthadalongdiscussionwiththemembersoftheteamfromtheUPLawCenterwhoprovideduswithadraft.ThephrasethatiscontainedherewhichweadoptedfromtheUPdraftis60percentof

thevotingstock.

MR.NOLLEDO:Thatmustbebasedonthesubscribedcapitalstock,becauseunlessdeclareddelinquent,unpaidcapitalstockshallbeentitledtovote.

MR.VILLEGAS:Thatisright.

MR.NOLLEDO:Thankyou.

Withrespect toan investmentbyonecorporation inanothercorporation,say,acorporationwith6040percentequityinvestsinanothercorporationwhichispermittedbytheCorporationCode,doestheCommitteeadoptthegrandfatherrule?

MR.VILLEGAS:Yes,thatistheunderstandingoftheCommittee.

MR.NOLLEDO:Therefore,weneedadditionalFilipinocapital?

MR.VILLEGAS:Yes.42(emphasissupplied)

ItisapparentthatitistheintentionoftheframersoftheConstitutiontoapplythegrandfatherruleincaseswherecorporatelayeringispresent.

Elementary in statutory construction is when there is conflict between the Constitution and a statute, theConstitutionwillprevail.Inthisinstance,specificallypertainingtotheprovisionsunderArt.XIIoftheConstitutionon National Economy and Patrimony, Sec. 3 of the FIA will have no place of application. As decreed by thehonorableframersofourConstitution,thegrandfatherruleprevailsandmustbeapplied.

Likewise,paragraph7,DOJOpinionNo.020,Seriesof2005provides:

The abovequoted SEC Rules provide for the manner of calculating the Filipino interest in a corporation forpurposes, among others, of determining compliancewith nationality requirements (the InvesteeCorporation).Suchmannerofcomputation isnecessarysincetheshares in the InvesteeCorporationmaybeownedbothbyindividual stockholders (Investing Individuals) and by corporations and partnerships (Investing Corporation).The said rules thus provide for the determination of nationality depending on the ownership of the InvesteeCorporationand,incertaininstances,theInvestingCorporation.

Under the abovequoted SEC Rules, there are two cases in determining the nationality of the InvesteeCorporation.The first case is the liberal rule, later coinedby theSECas theControlTest in its30May1990Opinion,andpertainstotheportioninsaidParagraph7ofthe1967SECRuleswhichstates,(s)haresbelongingto corporations or partnerships at least 60% of the capital of which is owned by Filipino citizens shall beconsidered as of Philippine nationality. Under the liberal Control Test, there is no need to further trace theownershipofthe60%(ormore)FilipinostockholdingsoftheInvestingCorporationsinceacorporationwhichisatleast60%FilipinoownedisconsideredasFilipino.

ThesecondcaseistheStrictRuleortheGrandfatherRuleProperandpertainstotheportioninsaidParagraph7ofthe1967SECRuleswhichstates,"butifthepercentageofFilipinoownershipinthecorporationorpartnershipislessthan60%,onlythenumberofsharescorrespondingtosuchpercentageshallbecountedasofPhilippinenationality."Under theStrictRuleorGrandfatherRuleProper, thecombined totals in the InvestingCorporationandtheInvesteeCorporationmustbetraced(i.e.,"grandfathered")todeterminethetotalpercentageofFilipinoownership.

Moreover, the ultimate Filipino ownership of the shares must first be traced to the level of the InvestingCorporationandaddedtothesharesdirectlyownedintheInvesteeCorporationxxx.

xxxx

Inotherwords,basedon thesaidSECRuleandDOJOpinion, theGrandfatherRuleor thesecondpartof theSECRuleappliesonlywhenthe6040Filipinoforeignequityownershipisindoubt(i.e.,incaseswherethejointventure corporation with Filipino and foreign stockholders with less than 60% Filipino stockholdings [or 59%]invests in other joint venture corporationwhich is either 6040%Filipinoalien or the 59% lessFilipino).Stateddifferently,wherethe6040Filipinoforeignequityownershipisnotindoubt,theGrandfatherRulewillnotapply.(emphasissupplied)

After a scrutiny of the evidenceextant on record, theCourt finds that this case calls for the application of thegrandfatherrulesince,asruledbythePOAandaffirmedbytheOP,doubtprevailsandpersistsinthecorporateownership of petitioners. Also, as found by theCA, doubt is present in the 6040 Filipino equity ownership ofpetitionersNarra,McArthurandTesoro,since theircommon investor, the100%CanadiancorporationMBMI,funded them.However,petitionersalsoclaim that there is "doubt"onlywhen thestockholdingsofFilipinosarelessthan60%.43

Theassertionofpetitioners that "doubt"onlyexistswhen thestockholdingsare less than60%fails toconvincethisCourt.DOJOpinionNo.20,whichpetitionersquotedintheirpetition,onlymadeanexampleofaninstancewhere "doubt"as to theownershipof thecorporationexists. Itwouldbe ludicrous to limit theapplicationof thesaidwordonly to the instanceswhere thestockholdingsofnonFilipinostockholdersaremore than40%of thetotalstockholdingsinacorporation.Thecorporationsinterestedincircumventingourlawswouldclearlystrivetohave "60%FilipinoOwnership" at face value. Itwouldbe senseless for theseapplying corporations to state intheirrespectivearticlesofincorporationthattheyhavelessthan60%Filipinostockholderssincetheapplicationswillbedeniedinstantly.Thus,variouscorporateschemesandlayeringsareutilizedtocircumventtheapplicationoftheConstitution.

Obviously,theinstantcasepresentsasituationwhichexhibitsaschemeemployedbystockholderstocircumventthelaw,creatingacloudofdoubtintheCourtsmind.Todetermine,therefore,theactualparticipation,directorindirect,ofMBMI,thegrandfatherrulemustbeused.

McArthurMining,Inc.

To establish the actual ownership, interest or participation ofMBMI in each of petitioners corporate structure,theyhavetobe"grandfathered."

Aspreviouslydiscussed,McArthuracquireditsMPSAapplicationfromMMC,whichacquireditsapplicationfromSMMI.McArthurhasacapitalstockoftenmillionpesos(PhP10,000,000)dividedinto10,000commonsharesatonethousandpesos(PhP1,000)pershare,subscribedtobythefollowing:44

Name Nationality NumberofShares

AmountSubscribed

AmountPaid

MadridejosMiningCorporation

Filipino 5,997 PhP5,997,000.00

PhP825,000.00

MBMIResources,Inc.

Canadian 3,998 PhP3,998,000.0 PhP1,878,174.60

LauroL.Salazar Filipino 1 PhP1,000.00 PhP1,000.00

FernandoB.Esguerra

Filipino 1 PhP1,000.00 PhP1,000.00

ManuelA.Agcaoili Filipino 1 PhP1,000.00 PhP1,000.00

MichaelT.Mason American 1 PhP1,000.00 PhP1,000.00

KennethCawkell Canadian 1 PhP1,000.00 PhP1,000.00

Total 10,000 PhP10,000,000.00

PhP2,708,174.60(emphasissupplied)

Interestingly, looking at the corporate structure of MMC, we take note that it has a similar structure andcompositionasMcArthur. In fact, itwouldseem thatMBMI isalsoamajor investorand "controls"45MBMI andalso, similar nominal shareholders were present, i.e. Fernando B. Esguerra (Esguerra), Lauro L. Salazar(Salazar),MichaelT.Mason(Mason)andKennethCawkell(Cawkell):

MadridejosMiningCorporation


AmountSubscribed

AmountPaid

OlympicMines&

Development

Corp.

Filipino 6,663 PhP6,663,000.00 PhP0

MBMIResources,

Inc.

Canadian 3,331 PhP3,331,000.00 PhP2,803,900.00

AmantiLimson Filipino 1 PhP1,000.00 PhP1,000.00

FernandoB.

Esguerra


LauroSalazar Filipino 1 PhP1,000.00 PhP1,000.00

EmmanuelG.

Hernando


MichaelT.Mason

American 1 PhP1,000.00 PhP1,000.00

KennethCawkell

Canadian 1 PhP1,000.00 PhP1,000.00

Total 10,000 PhP10,000,000.00

PhP2,809,900.00

(emphasissupplied)

Noticeably, OlympicMines & Development Corporation (Olympic) did not pay any amount with respect to thenumber of shares they subscribed to in the corporation, which is quite absurd since Olympic is the majorstockholder in MMC. MBMIs 2006 Annual Report sheds light on why Olympic failed to pay any amount withrespecttothenumberofsharesitsubscribedto.ItstatesthatOlympicenteredintojointventureagreementswithseveralPhilippinecompanies,whereinitholdsdirectlyandindirectlya60%effectiveequityinterestintheOlympicProperties.46QuotingthesaidAnnualreport:

OnSeptember9,2004,theCompanyandOlympicMines&DevelopmentCorporation("Olympic")enteredintoaseriesofagreementsincludingaPropertyPurchaseandDevelopmentAgreement(theTransactionDocuments)withrespecttothreenickellateritepropertiesinPalawan,Philippines(the"OlympicProperties").TheTransactionDocumentseffectivelyestablishajointventurebetweentheCompanyandOlympicforpurposesofdevelopingtheOlympicProperties.TheCompanyholdsdirectlyand indirectlyan initial60%interest in the jointventure.Undercertain circumstances and upon achieving certainmilestones, the Companymay earn up to a 100% interest,subjecttoa2.5%netrevenueroyalty.47(emphasissupplied)

Thus, as demonstrated in this first corporation, McArthur, when it is "grandfathered," company layering wasutilized byMBMI to gain control overMcArthur. It is apparent thatMBMI hasmore than 60% ormore equityinterestinMcArthur,makingthelatteraforeigncorporation.

TesoroMiningandDevelopment,Inc.

Tesoro, which acquired its MPSA application from SMMI, has a capital stock of ten million pesos (PhP10,000,000)dividedintotenthousand(10,000)commonsharesatPhP1,000pershare,asdemonstratedbelow:

[[reference=http://sc.judiciary.gov.ph/pdf/web/viewer.html?file=/jurisprudence/2014/april2014/195580.pdf]]

Name Nationality Numberof

Shares

Amount

Subscribed

AmountPaid

SaraMarie

Mining,Inc.

Filipino 5,997 PhP5,997,000.00

PhP825,000.00

MBMI

Resources,Inc.

Canadian 3,998 PhP3,998,000.00

PhP1,878,174.60


FernandoB.

Esguerra


ManuelA.

Agcaoili




Total 10,000 PhP10,000,000.00

PhP2,708,174.60

(emphasissupplied)

Exceptforthename"SaraMarieMining,Inc.,"thetableaboveshowsexactlythesamefiguresasthecorporatestructure of petitioner McArthur, down to the last centavo. All the other shareholders are the same: MBMI,Salazar,Esguerra,Agcaoili,MasonandCawkell.The figuresunder "Nationality," "NumberofShares," "AmountSubscribed,"and"AmountPaid"areexactlythesame.Delvingdeeper,wescrutinizeSMMIscorporatestructure:

SaraMarieMining,Inc.



Shares

Amount

Subscribed

AmountPaid

OlympicMines&

Development

Corp.

Filipino 6,663 PhP6,663,000.00

PhP0

MBMIResources,

Inc.

Canadian 3,331 PhP3,331,000.00

PhP2,794,000.00

AmantiLimson Filipino 1 PhP1,000.00 PhP1,000.00

FernandoB.

Esguerra


LauroSalazar Filipino 1 PhP1,000.00 PhP1,000.00

EmmanuelG.

Hernando




Total 10,000 PhP10,000,000.00

PhP2,809,900.00

(emphasissupplied)

After subsequently studyingSMMIs corporate structure, it is not farfetched for us to spot the glaring similaritybetweenSMMIandMMCscorporatestructure.Again, thepresenceof identicalstockholders,namely:Olympic,

MBMI, Amanti Limson (Limson), Esguerra, Salazar, Hernando, Mason and Cawkell. The figures under theheadings "Nationality," "Number of Shares," "Amount Subscribed," and "Amount Paid" are exactly the sameexcept for the amount paid byMBMIwhich now reflects the amount of twomillion seven hundred ninety fourthousand pesos (PhP 2,794,000). Oddly, the total value of the amount paid is twomillion eight hundred ninethousandninehundredpesos(PhP2,809,900).

Accordingly,after"grandfathering"petitionerTesoroandfactoringinOlympicsparticipationinSMMIscorporatestructure,itisclearthatMBMIisincontrolofTesoroandowns60%ormoreequityinterestinTesoro.ThismakespetitionerTesoroa nonFilipino corporationand, thus, disqualifies it to participate in theexploitation, utilizationanddevelopmentofournaturalresources.

NarraNickelMiningandDevelopmentCorporation

Moving on to the last petitioner, Narra, which is the transferee and assignee of PLMDCs MPSA application,whosecorporatestructuresarrangementissimilartothatofthefirsttwopetitionersdiscussed.ThecapitalstockofNarra is tenmillionpesos (PhP10,000,000),which isdivided into ten thousandcommonshares (10,000)atonethousandpesos(PhP1,000)pershare,shownasfollows:



Shares

Amount

Subscribed

AmountPaid

PatriciaLouise

Mining&

Development

Corp.

Filipino 5,997 PhP5,997,000.00

PhP1,677,000.00

MBMI

Resources,Inc.

Canadian 3,998 PhP3,996,000.00

PhP1,116,000.00

HiginioC.

Mendoza,Jr.


HenryE.

Fernandez


ManuelA.

Agcaoili


Ma.ElenaA.

Bocalan


BayaniH.Agabin Filipino 1 PhP1,000.00 PhP1,000.00

RobertL.

McCurdy

American 1 PhP1,000.00 PhP1,000.00


Total 10,000 PhP10,000,000.00


Again, MBMI, along with other nominal stockholders, i.e., Mason, Agcaoili and Esguerra, is present in thiscorporatestructure.

PatriciaLouiseMining&DevelopmentCorporation

Usingthegrandfathermethod,wefurtherlookandexaminePLMDCscorporatestructure:


AmountSubscribed

AmountPaid

PalawanAlphaSouthResourcesDevelopmentCorporation

Filipino 6,596 PhP6,596,000.00

PhP0

MBMIResources,

Inc.

Canadian 3,396 PhP3,396,000.00

PhP2,796,000.00

HiginioC.Mendoza,Jr. Filipino 1 PhP1,000.00 PhP1,000.00

FernandoB.Esguerra Filipino 1 PhP1,000.00 PhP1,000.00

HenryE.Fernandez Filipino 1 PhP1,000.00 PhP1,000.00


ManuelA.Agcaoili Filipino 1 PhP1,000.00 PhP1,000.00

BayaniH.Agabin Filipino 1 PhP1,000.00 PhP1,000.00



Total 10,000 PhP10,000,000.00


Yetagain,theusualplayersinpetitionerscorporatestructuresarepresent.Similarly,theamountofmoneypaidby the 2nd tier majority stock holder, in this case, Palawan Alpha South Resources and Development Corp.(PASRDC),iszero.

StudyingMBMIsSummaryofSignificantAccountingPoliciesdatedOctober31,2005explainsthereasonbehindtheintricatecorporatelayeringthatMBMIimmerseditselfin:

JOINTVENTURESTheCompanys ownership interests in variousmining ventures engaged in the acquisition,explorationanddevelopmentofmineralpropertiesinthePhilippinesisdescribedasfollows:

(a)OlympicGroup

ThePhilippinecompaniesholdingtheOlympicProperty,andtheownershipandintereststherein,areasfollows:

OlympicPhilippines(the"OlympicGroup")

SaraMarieMiningPropertiesLtd.("SaraMarie")33.3%

TesoroMining&Development,Inc.(Tesoro)60.0%

Pursuant to theOlympic joint venture agreement theCompany holds directly and indirectly an effective equityinterest intheOlympicPropertyof60.0%.Pursuant toashareholdersagreement, theCompanyexercises jointcontroloverthecompaniesintheOlympicGroup.

(b)AlphaGroup

ThePhilippinecompaniesholdingtheAlphaProperty,andtheownershipintereststherein,areasfollows:

AlphaPhilippines(the"AlphaGroup")

PatriciaLouiseMiningDevelopmentInc.("Patricia")34.0%

NarraNickelMining&DevelopmentCorporation(Narra)60.4%

UnderajointventureagreementtheCompanyholdsdirectlyandindirectlyaneffectiveequityinterestintheAlphaProperty of 60.4%. Pursuant to a shareholders agreement, the Company exercises joint control over thecompaniesintheAlphaGroup.48(emphasissupplied)

Concludingfromtheabovestatedfacts,itisquitesafetosaythatpetitionersMcArthur,TesoroandNarraarenotFilipinosinceMBMI,a100%Canadiancorporation,owns60%ormoreoftheirequityinterests.Suchconclusionisderived fromgrandfatheringpetitionerscorporateowners,namely:MMI,SMMIandPLMDC.Going furtherandadding to the picture, MBMIs Summary of Significant Accounting Policies statement regarding the "jointventure"agreementsthatitenteredintowiththe"Olympic"and"Alpha"groupsinvolvesSMMI,Tesoro,PLMDCandNarra.Noticeably,theownershipofthe"layered"corporationsboilsdowntoMBMI,Olympicorcorporationsunderthe"Alpha"groupwhereinMBMIhasjointventureagreementswith,practicallyexercisingmajoritycontroloverthecorporationsmentioned.Ineffect,whetherlookingatthecapitalstructureortheunderlyingrelationshipsbetween and among the corporations, petitioners are NOT Filipino nationals and must be considered foreignsince60%ormoreoftheircapitalstocksorequityinterestsareownedbyMBMI.

Applicationoftheresinteraliosactarule

Petitionersquestion theCAsuseof theexceptionof theres interaliosactaor the"admissionbycopartneroragent" rule and "admission by privies" under the Rules of Court in the instant case, by pointing out thatstatementsmadebyMBMIshouldnotbeadmittedinthiscasesinceitisnotapartytothecaseandthatitisnota"partner"ofpetitioners.

Secs.29and31,Rule130oftheRevisedRulesofCourtprovide:

Sec.29.Admissionbycopartneroragent.Theactordeclarationofapartneroragentof thepartywithin thescopeofhisauthorityandduringtheexistenceof thepartnershiporagency,maybegiven inevidenceagainstsuchpartyafter thepartnershipor agency is shownbyevidenceother thansuchact or declaration itself. Thesameruleappliestotheactordeclarationofajointowner,jointdebtor,orotherpersonjointlyinterestedwiththeparty.

Sec.31.Admissionbyprivies.Whereonederivestitletopropertyfromanother,theact,declaration,oromissionofthelatter,whileholdingthetitle,inrelationtotheproperty,isevidenceagainsttheformer.

PetitionersclaimthatbeforetheabovementionedRulecanbeappliedtoacase,"thepartnershiprelationmustbe shown, and that proof of the fact must be made by evidence other than the admission itself."49 Thus,petitioners assert that the CA erred in finding that a partnership relationship exists between them and MBMIbecause,infact,nosuchpartnershipexists.

Partnershipsvs.jointventureagreements

PetitionersclaimthattheCAerredinapplyingSec.29,Rule130oftheRulesbystatingthat"byenteringintoajointventure,MBMIhaveajointinterest"withNarra,TesoroandMcArthur.TheychallengedtheconclusionoftheCAwhichpertainstotheclosecharacteristicsof

"partnerships"and"jointventureagreements."Further, theyasserted thatbefore thisparticularpartnershipcanbe formed, it should have been formally reduced into writing since the capital involved is more than threethousandpesos(PhP3,000).BeingthatthereisnoevidenceofwrittenagreementtoformapartnershipbetweenpetitionersandMBMI,nopartnershipwascreated.

Wedisagree.

Apartnershipisdefinedastwoormorepersonswhobindthemselvestocontributemoney,property,orindustrytoacommonfundwiththeintentionofdividingtheprofitsamongthemselves.50Ontheotherhand,jointventureshave been deemed to be "akin" to partnerships since it is difficult to distinguish between joint ventures andpartnerships.Thus:

[T]herelationsofthepartiestoajointventureandthenatureoftheirassociationaresosimilarandcloselyakintoapartnership that it isordinarilyheld that their rights,duties,and liabilitiesare tobe testedby ruleswhicharecloselyanalogoustoandsubstantially thesame, ifnotexactly thesame,as thosewhichgovernpartnership. Infact,ithasbeensaidthatthetrendinthelawhasbeentoblurthedistinctionsbetweenapartnershipandajointventure,verylittlelawbeingfoundapplicabletoonethatdoesnotapplytotheother.51

Thoughsomeclaimthatpartnershipsandjointventuresaretotallydifferentanimals,thereareveryfewrulesthatdifferentiateonefromtheotherthus,jointventuresaredeemed"akin"orsimilartoapartnership.Infact,injointventureagreements,rulesandlegalincidentsgoverningpartnershipsareapplied.52

Accordingly,culledfromtheincidentsandrecordsofthiscase,itcanbeassumedthattherelationshipsenteredbetweenandamongpetitionersandMBMIarenosimple"jointventureagreements."Asarule,corporationsareprohibited from entering into partnership agreements consequently, corporations enter into joint ventureagreements with other corporations or partnerships for certain transactions in order to form "pseudopartnerships."

Obviously,asthe intricatewebof"ventures"entered intobyandamongpetitionersandMBMIwasexecutedtocircumvent the legal prohibition against corporations entering into partnerships, then the relationship createdshould be deemed as "partnerships," and the laws on partnership should be applied. Thus, a joint ventureagreement between and among corporations may be seen as similar to partnerships since the elements ofpartnershiparepresent.

Consideringthat therelationshipsfoundbetweenpetitionersandMBMIareconsideredtobepartnerships, thentheCAisjustifiedinapplyingSec.29,Rule130oftheRulesbystatingthat"byenteringintoajointventure,MBMIhaveajointinterest"withNarra,TesoroandMcArthur.

PanelofArbitratorsjurisdiction

We affirm the ruling of theCA in declaring that the POA has jurisdiction over the instant case. The POA hasjurisdiction to settle disputesover rights tominingareaswhichdefinitely involve thepetitions filedbyRedmontagainstpetitionersNarra,McArthurandTesoro.Redmont,byfilingitspetitionagainstpetitioners,isassertingtheright of Filipinos overmining areas in thePhilippines against alleged foreignownedmining corporations.Suchclaimconstitutesa"dispute"foundinSec.77ofRA7942:

Within thirty (30) days, after the submission of the case by the parties for the decision, the panel shall haveexclusiveandoriginaljurisdictiontohearanddecidethefollowing:

(a)Disputesinvolvingrightstominingareas

(b)Disputesinvolvingmineralagreementsorpermits

WeheldinCelestialNickelMiningExplorationCorporationv.MacroasiaCorp.:53

Thephrase "disputes involving rights tominingareas" refers toanyadverseclaim,protest,oropposition toanapplicationformineralagreement.ThePOAthereforehasthejurisdictiontoresolveanyadverseclaim,protest,or opposition to apendingapplication for amineral agreement filedwith the concernedRegionalOfficeof theMGB.ThisisclearfromSecs.38and41oftheDENRAO9640,whichprovide:

Sec.38.

xxxx

Within thirty (30) calendar days from the last date of publication/posting/radio announcements, the authorizedofficer(s)of theconcernedoffice(s)shall issueacertification(s)thatthepublication/posting/radioannouncementhavebeencompliedwith.Anyadverseclaim,protest,oppositionshallbefileddirectly,withinthirty(30)calendardaysfromthelastdateofpublication/posting/radioannouncement,withtheconcernedRegionalOfficeorthroughanyconcernedPENROorCENROforfilingintheconcernedRegionalOfficeforpurposesofitsresolutionbythePanel ofArbitratorspursuant to theprovisionsof thisAct and these implementing rulesand regulations.Uponfinal resolution of any adverse claim, protest or opposition, the Panel of Arbitrators shall likewise issue acertificationtothateffectwithinfive(5)workingdaysfromthedateoffinalityofresolutionthereof.Wherethereisnoadverseclaim,protestoropposition, thePanelofArbitratorsshall likewise issueaCertification to thateffectwithinfiveworkingdaystherefrom.

xxxx

NoMineralAgreementshallbeapprovedunlesstherequirementsunderthisSectionarefullycompliedwithandanyadverseclaim/protest/oppositionisfinallyresolvedbythePanelofArbitrators.

Sec.41.

xxxx

Withinfifteen(15)workingdaysformthereceiptoftheCertificationissuedbythePanelofArbitratorsasprovidedinSection38hereof,theconcernedRegionalDirectorshallinitiallyevaluatetheMineralAgreementapplicationsinareas outsideMineral reservations. He/She shall thereafter endorse his/her findings to the Bureau for furtherevaluationbytheDirectorwithinfifteen(15)workingdaysfromreceiptofforwardeddocuments.Thereafter, theDirector shall endorse the same to the secretary for consideration/approval within fifteen working days fromreceiptofsuchendorsement.

In caseofMineralAgreement applications in areaswithMineralReservations,within fifteen (15)workingdaysfromreceiptoftheCertificationissuedbythePanelofArbitratorsasprovidedforinSection38hereof,thesameshallbeevaluatedandendorsedby theDirector to theSecretary for consideration/approvalwithin fifteendaysfromreceiptofsuchendorsement.(emphasissupplied)

Ithasbeenmadeclear fromtheaforecitedprovisions that the"disputes involvingrights tominingareas"underSec. 77(a) specifically refer only to those disputes relative to the applications for a mineral agreement orconfermentofminingrights.

The jurisdiction of thePOAover adverse claims, protest, or oppositions to amining right application is furtherelucidatedbySecs.219and43ofDENRAO95936,whichread:

Sec.219.FilingofAdverseClaims/Conflicts/Oppositions.NotwithstandingtheprovisionsofSections28,43and57above,anyadverseclaim,protestoroppositionspecified insaidsectionsmayalsobe fileddirectlywith thePanelofArbitratorswithin theconcernedperiods for filingsuchclaim,protestoroppositionasspecified insaidSections.

Sec.43.Publication/PostingofMineralAgreement.

xxxx

The Regional Director or concerned Regional Director shall also cause the posting of the application on thebulletin boards of the Bureau, concerned Regional office(s) and in the concerned province(s) andmunicipality(ies),copyfurnishedthebarangayswheretheproposedcontractareaislocatedonceaweekfortwo(2)consecutiveweeks ina languagegenerallyunderstood in the locality.After fortyfive(45)daysfromthe lastdateofpublication/postinghasbeenmadeandnoadverseclaim,protestoroppositionwasfiledwithinthesaidfortyfive(45)days, theconcernedofficesshall issueacertificationthatpublication/postinghasbeenmadeandthatnoadverseclaim,protestoroppositionofwhatevernaturehasbeenfiled.Ontheotherhand,iftherebeanyadverse claim, protest or opposition, the same shall be filed within fortyfive (45) days from the last date ofpublication/posting,with theRegionalOfficesconcerned,or through theDepartmentsCommunityEnvironmentandNaturalResourcesOfficers(CENRO)orProvincialEnvironmentandNaturalResourcesOfficers(PENRO),tobefiledat theRegionalOffice for resolutionof thePanelofArbitrators.Howeverpreviouslypublishedvalidandsubsistingminingclaimsareexemptedfromposted/postingrequiredunderthisSection.

Nomineralagreementshallbeapprovedunlesstherequirementsunderthissectionarefullycompliedwithandany opposition/adverse claim is dealt with in writing by the Director and resolved by the Panel of Arbitrators.(Emphasissupplied.)

Ithasbeenmadeclear fromtheaforecitedprovisions that the"disputes involvingrights tominingareas"underSec. 77(a) specifically refer only to those disputes relative to the applications for a mineral agreement orconfermentofminingrights.

The jurisdiction of thePOAover adverse claims, protest, or oppositions to amining right application is furtherelucidatedbySecs.219and43ofDENROAO95936,whichreads:

Sec.219.FilingofAdverseClaims/Conflicts/Oppositions.NotwithstandingtheprovisionsofSections28,43and57above,anyadverseclaim,protestoroppositionspecified insaidsectionsmayalsobe fileddirectlywith thePanelofArbitratorswithin theconcernedperiods for filingsuchclaim,protestoroppositionasspecified insaidSections.

Sec.43.Publication/PostingofMineralAgreementApplication.

xxxx

The Regional Director or concerned Regional Director shall also cause the posting of the application on thebulletin boards of the Bureau, concerned Regional office(s) and in the concerned province(s) andmunicipality(ies),copyfurnishedthebarangayswheretheproposedcontractareaislocatedonceaweekfortwo(2)consecutiveweeks ina languagegenerallyunderstood in the locality.After fortyfive(45)daysfromthe lastdateofpublication/postinghasbeenmadeandnoadverseclaim,protestoroppositionwasfiledwithinthesaidfortyfive(45)days, theconcernedofficesshall issueacertificationthatpublication/postinghasbeenmadeandthatnoadverseclaim,protestoroppositionofwhatevernaturehasbeenfiled.Ontheotherhand,iftherebeanyadverse claim, protest or opposition, the same shall be filed within fortyfive (45) days from the last date ofpublication/posting,with theRegional offices concerned, or through theDepartmentsCommunityEnvironmentandNaturalResourcesOfficers(CENRO)orProvincialEnvironmentandNaturalResourcesOfficers(PENRO),tobefiledattheRegionalOfficeforresolutionofthePanelofArbitrators.However,previouslypublishedvalidandsubsistingminingclaimsareexemptedfromposted/postingrequiredunderthisSection.

Nomineralagreementshallbeapprovedunlesstherequirementsunderthissectionarefullycompliedwithandany opposition/adverse claim is dealt with in writing by the Director and resolved by the Panel of Arbitrators.(Emphasissupplied.)

These provisions lead us to conclude that the power of the POA to resolve any adverse claim, opposition, orprotest relative tomining rights underSec. 77(a) ofRA7942 is confined only to adverse claims, conflicts andoppositionsrelatingtoapplicationsforthegrantofmineralrights.

POAs jurisdiction isconfinedonly toresolutionsofsuchadverseclaims,conflictsandoppositionsand ithasnoauthority to approve or reject said applications. Such power is vested in the DENR Secretary uponrecommendationoftheMGBDirector.Clearly,POAsjurisdictionover"disputesinvolvingrightstominingareas"hasnothingtodowiththecancellationofexistingmineralagreements.(emphasisours)

Accordingly, as we enunciated in Celestial, the POA unquestionably has jurisdiction to resolve disputes overMPSAapplicationssubjectofRedmontspetitions.However,saidjurisdictiondoesnotincludeeithertheapprovalorrejectionoftheMPSAapplications,whichisvestedonlyupontheSecretaryoftheDENR.Thus,thefindingofthePOA,withrespecttotherejectionofpetitionersMPSAapplicationsbeingthattheyareforeigncorporation,isvalid.

JusticeMarvicMarioVictorF.Leonen, inhisDissent,assertsthat it istheregularcourts,notthePOA,thathasjurisdictionovertheMPSAapplicationsofpetitioners.

Thispostulationisincorrect.

Itisbasicthatthejurisdictionofthecourtisdeterminedbythestatuteinforceatthetimeofthecommencementoftheaction.54

Sec.19,BatasPambansaBlg.129or"TheJudiciaryReorganization

Actof1980"reads:

Sec.19.JurisdictioninCivilCases.RegionalTrialCourtsshallexerciseexclusiveoriginaljurisdiction:

1.Inallcivilactionsinwhichthesubjectofthelitigationisincapableofpecuniaryestimation.

Ontheotherhand,thejurisdictionofPOAisunequivocalfromSec.77ofRA7942:

Section77.PanelofArbitrators.

xxxWithinthirty(30)days,afterthesubmissionofthecasebythepartiesforthedecision,thepanelshallhaveexclusiveandoriginaljurisdictiontohearanddecidethefollowing:

(c)Disputesinvolvingrightstominingareas

(d)Disputesinvolvingmineralagreementsorpermits

It is clear that POA has exclusive and original jurisdiction over any and all disputes involving rights tominingareas. One such dispute is an MPSA application to which an adverse claim, protest or opposition is filed byanotherinterestedapplicant.1 w p h i1 Inthecaseatbar, thedisputearoseororiginatedfromMPSAapplicationswherepetitioners are asserting their rights to mining areas subject of their respective MPSA applications. Sincerespondent filed 3 separate petitions for the denial of said applications, then a controversy has developedbetweenthepartiesanditisPOAsjurisdictiontoresolvesaiddisputes.

Moreover, the jurisdiction of theRTC involves civil actionswhilewhat petitioners filedwith theDENRRegionalOfficeoranyconcernedDENREorCENROareMPSAapplications.ThusPOAhasjurisdiction.

Furthermore,thePOAhasjurisdictionovertheMPSAapplicationsunderthedoctrineofprimaryjurisdiction.EuromedLaboratoriesv.ProvinceofBatangas55elucidates:

The doctrine of primary jurisdiction holds that if a case is such that its determination requires the expertise,specialized training and knowledge of an administrative body, reliefmust first be obtained in an administrativeproceedingbeforeresorttothecourtsishadevenifthemattermaywellbewithintheirproperjurisdiction.

WhatevermaybethedecisionofthePOAwilleventuallyreachthecourtsystemviaaresorttotheCAandtothisCourtasalastrecourse.

SellingofMBMIssharestoDMCI

Asstatedbefore,petitionersManifestationandSubmissiondatedOctober19,2012wouldwantustodeclaretheinstantpetitionmootandacademicduetothetransferandconveyanceofalltheshareholdingsandinterestsofMBMI toDMCI,acorporationdulyorganizedandexistingunderPhilippine lawsand isat least60%Philippineowned.56Petitionersreasonedthattheynowcannotbeconsideredasforeignownedthetransferoftheirsharessupposedlycuredthe"defect"oftheirpreviousnationality.TheyclaimedthattheircurrentFTAAcontractwiththeState should stand since "even whollyowned foreign corporations can enter into an FTAA with the State."57Petitionersstress that thereshouldno longerbeany issue leftas regards theirqualification toenter intoFTAAcontractssincetheyarequalifiedtoengageinminingactivitiesinthePhilippines.Thus,whetherthe"grandfatherrule"orthe"controltest"isused,thenationalitiesofpetitionerscannotbedoubtedsinceitwouldpassbothtests.

ThesaleoftheMBMIshareholdingstoDMCIdoesnothaveanybearingintheinstantcaseandsaidfactshouldbedisregarded.ThemanifestationcannolongerbeconsideredbyussinceitisbeingtackledinG.R.No.202877pendingbefore thisCourt.1 w p h i1Thus, thequestionofwhetherpetitioners,allegedlyaPhilippineownedcorporationduetothesaleofMBMI'sshareholdingstoDMCI,areallowedtoenterintoFTAAswiththeStateisanonissueinthiscase.

Inending, the "control test" isstill theprevailingmodeofdeterminingwhetherornotacorporation isaFilipinocorporation, within the ambit of Sec. 2, Art. II of the 1987 Constitution, entitled to undertake the exploration,developmentandutilizationof thenatural resourcesof thePhilippines.When in themindof theCourt there isdoubt,basedontheattendantfactsandcircumstancesofthecase,inthe6040Filipinoequityownershipinthecorporation,thenitmayapplythe"grandfatherrule."

WHEREFORE, premises considered, the instant petition is DENIED. The assailed Court of Appeals DecisiondatedOctober1,2010andResolutiondatedFebruary15,2011areherebyAFFIRMED.

SOORDERED.

PRESBITEROJ.VELASCO,JR.AssociateJustice

WECONCUR:

DIOSDADOM.PERALTAAssociateJustice

ROBERTOA.ABADAssociateJustice

JOSECATRALMENDOZAAssociateJustice

Idissent.SeeSeparateOpinionMARVICMARIOVICTORF.LEONEN

AssociateJustice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the case wasassignedtothewriteroftheopinionoftheCourt'sDivision.

PRESBITEROJ.VELASCO,JR.AssociateJusticeChairperson

CERTIFICATION

PursuanttoSection13,ArticleVIIIoftheConstitutionandtheDivisionChairperson'sAttestation,IcertifythattheconclusionsintheaboveDecisionhadbeenreachedinconsultationbeforethecasewasassignedtothewriteroftheopinionoftheCourt'sDivision.

MARIALOURDESP.A.SERENOChiefJustice

Footnotes1PennedbyAssociateJusticeRubenC.AysonandconcurredinbyAssociateJusticesAmelitaG.TolentinoandNorrnandieB.Pizzaro.2Rollo,p.573.3Id.at86.4Id.at82.5Id.at84.6Id.at139140.7Id.at379.8Id.at378.9Id.at390.10Id.at411.11Id.at414.12Id.at353.13Id.at367,seeapplicationonp.368.14Id.at334337.15Id.at438.16Id.at460.17Id.at202.18Id.at473.19Id.at486.20Id.at522.21Id.at623.22Id.at629.23Id.at9596.24DepartmentofJusticeOpinionNo.020,Seriesof2005,adoptingthe1967SECRules.25Rollo,p.89.26Id.at573590,O.P.CaseNo.10E229,pennedbyExecutiveSecretaryPaquitoN.Ochoa,Jr.

27Id.at587.28Id.29Id.at588.30Id.at591594.31Id.at2021.32Davidv.MacapagalArroyo,G.R.No.171396,etc.,May3,2006,489SCRA160.33Id.34Id.35Id.36Rollo,pp.138139.37Id.at9596.38Id.at101.39Id.at587.40Id.at679689.41Id.at33.42 "Proposed Resolution No. 533 Resolution to Incorporate in the Article on National Economy andPatrimonyaProvisiononAncestralLands," IIIRecord,CONSTITUTIONALCOMMISSION,R.C.C.No.55(August13,1986).43Rollo,p.44,quotingDOJOpinionNo.20.44Id.at82.45Id.46Id.at83.47Id.48Id.at8788.49Id.at48.50CIVILCODE,Art.1767.514,46AmJur2d,pp.2425.52 30, 46 Am Jur 2d "law relating to dissolution and termination of partnerships is applicable to jointventures" 17, 46 Am Jur 2d "In other words, an agreement to combine money, effort, skill, andknowledge,andtopurchaselandforthepurposeofresellingordealingwithitataprofit, isapartnershipagreement,orajointventurehavingingeneralthelegalincidentsofapartnership"50,46AmJur2d"Therelationshipbetweenjointventurers, likethatexistingbetweenpartners, isfiduciaryincharacterandimposesuponalltheparticipantstheobligationofloyaltytothejointconcernandoftheutmostgoodfaith,fairness,andhonestyintheirdealingswitheachotherwithrespecttomatterspertainingtotheenterprise"57"Ithasalreadybeenpointedoutthattherights,duties,andliabilitiesofjointventurersaregoverned,ingeneral,byruleswhicharesimilaroranalogoustothosewhichgovernthecorrespondingrights,duties,andliabilitiesofpartners,exceptastheyarelimitedbythefactthatthescopeofajointventureisnarrowerthanthatoftheordinarypartnership.Asinthecaseofpartners,jointventurersmaybejointlyandseverallyliable to third parties for thedebts of the venture" 58, 46AmJur 2d "It hasalso beenheld that theliabilityfortortsofpartiestoajointventureagreementisgovernedbythelawapplicabletopartnerships."53G.R.Nos.169080,172936,176226&176319,December19,2007,541SCRA166.54Lee,etal. v.PresidingJusge,etal.,G.R.No.68789,November10,1986Peoplev.Paderna,No.L28518,January29,1968.55G.R.No.148106,July17,2006.56Rollo,p.684.57Id.at687.

TheLawphilProjectArellanoLawFoundation

narra v. redmont

Documents

tesoro mining

mcarthur mining

nickel mining

municipality of narra

narra nickel

development corporation

assignedtop narra

mpsa application of