Chavez vs PEA Case Digest

Chavez vs PEA and Amari Coastal Bay Development Corporation G.R. No. 133250. July 9, 2002 Facts: Public Estates Authority (PEA) is a wholly government-owned and –controlled corporation which is the primary implementing agency of the National Government to reclaim foreshore and submerged lands of the public domain. By virtue of a Special Patent issued by President Corazon Aquino, the Register of Deeds of the Paranaque, in April 1988, issued certificates of title, in the name of PEA, covering three reclaimed islands known as the Freedom Islands located at the southern portion of the Manila-Cavite Coastal Road, Paranaque City. The Freedom Islands have a total land area of 157.841 hectares. In April 1995, PEA entered into a Joint Venture Agreement (JVA) with AMARI, a private corporation, to develop the Freedom Islands. The JVA also required the reclamation of an additional 250 hectares of submerged areas surrounding these islands to complete the configuration in the Master Development Plan of the Southern Reclamation Project-Manila Cavite Coastal Road Reclamation Project. The JVA was later amended giving AMARI an option to reclaim an additional 350 hectares of submerged area. Part of the consideration for AMARI’s work is the conveyance of 70% of the total net usable reclaimed area – equivalent to 367.5 hectares, title of which will be in AMARI’s name. Issue: Whether or not AMARI, a private corporation, can acquire and own under the Amended JVA 367.5 hectares of reclaimed foreshore and submerged areas in Manila Bay Held: No. AMARI as a private corporation cannot acquire the reclaimed Freedom Islands, though alienable lands of the public domain, except by lease, as provided under Section 3, Article XII of the Constitution. The still submerged areas (i.e., the more or less additional 250 and 350 hectares of submerged areas) in Manila Bay are inalienable lands of the public domain; as such, they are beyond the commerce of man, as provided under Section 2, Article XII of the Constitution. The reclaimed Freedom Islands: The assignment to PEA of the ownership and administration of the reclaimed areas in Manila Bay, coupled with President Aquino’s actual issuance of a special patent covering the Freedom Islands, is equivalent to an official proclamation classifying the Freedom Islands as alienable or disposable lands of the public domain. They also constitute a declaration that the Freedom Islands are no longer needed for public service. The Freedom Islands are thus alienable or disposable lands of the public domain, open to disposition or concession to qualified parties. The submerged areas: The mere reclamation of foreshore and submerged areas by PEA does not convert these inalienable natural resources of the State into alienable or disposable lands of the public domain. There must be a law or presidential proclamation officially classifying these reclaimed lands as alienable or disposable and open to disposition or concession. Moreover, these reclaimed lands cannot be

classified as alienable or disposable if the law has reserved them for some public or quasi-public use. PEA’s authority to sell: In order for PEA to sell its reclaimed foreshore and submerged alienable lands of the public domain, there must be legislative authority empowering PEA to sell these lands, in view of the requirement under CA No. 141. Without such legislative authority, PEA could not sell but only lease its reclaimed foreshore and submerged alienable lands of the public domain. PEA’s Charter grants it such express legislative authority to sell its lands, whether patrimonial or alienable lands of the public domain. Nevertheless, any legislative authority granted to PEA to sell its reclaimed alienable lands of the public domain would be subject to the constitutional ban on private corporations from acquiring alienable lands of the public domain. Hence, such legislative authority could only benefit private individuals. Registration of alienable lands of the public domain: Registration of land under Act No. 496 or PD No. 1529 does not vest in the registrant private or public ownership of the land. Registration is not a mode of acquiring ownership but is merely evidence of ownership previously conferred by any of the recognized modes of acquiring ownership. Registration does not give the registrant a better right than what the registrant had prior to the registration. The registration of lands of the public domain under the Torrens system, by itself, cannot convert public lands into private lands. Jurisprudence holding that upon the grant of the patent or issuance of the certificate of title the alienable land of the public domain automatically becomes private land cannot apply to government units and entities like PEA. Lands registered under Act No. 496 or PD No. 1529 are not exclusively private or patrimonial lands. Lands of the public domain may also be registered pursuant to existing laws. Several laws authorize lands of the public domain to be registered under the Torrens System or Act No. 496, now PD No. 1529, without losing their character as public lands. For instance, -

Under the Revised Administrative Code of 1987, private property purchased by the National Government for expansion of an airport may be titled in the name of the government agency tasked to administer the airport. Private property donated to a municipality for use as a town plaza or public school site may likewise be titled in the name of the municipality. All these properties become properties of the public domain, and if already registered under Act No. 496 or PD No. 1529, remain registered land. There is no requirement or provision in any existing law for the de-registration of land from the Torrens System.

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Private lands taken by the Government for public use under its power of eminent domain become unquestionably part of the public domain. Nevertheless, Section 85 of PD No. 1529 authorizes the Register of Deeds to issue in the name of the National Government new certificates of title covering such expropriated lands.