Title
Atlas Consolidated Mining and Development Corp. vs. Court of Appeals
Case
G.R. No. 54305
Decision Date
Feb 14, 1990
ATLAS sought declaratory relief over mining claim assignments; SC ruled trial court lacked jurisdiction post-PD 1281, favoring Bureau of Mines' exclusive authority.
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Case Digest (G.R. No. 54305)

Facts:

  1. Operating Agreements:

    • On June 5, 1973, Atlas Consolidated Mining & Development Corporation (ATLAS) entered into an operating agreement with the heirs of Manuel Cuenco and Jose P. Velez (CUENCO-VELEZ) for the exploration, development, and operation of 12 mining claims in Toledo City, Cebu.
    • On June 17, 1973, ATLAS entered into a similar agreement with Biga Copper Mines Exploration Company (BIGA COPPER), a partnership composed of Pablo B. Gorosin, Francisco B. Gorosin, Pedro B. Gorosin, and Vicente T. Garaygay (BIGA PARTNERS), covering 31 mining claims in the same area.
  2. Overlapping Mining Claims:

    • Nine mining claims overlapped between the CUENCO-VELEZ and BIGA COPPER agreements. These overlapping claims were the subject of Mines Administrative Cases Nos. V-727 and V-750, resolved in favor of CUENCO-VELEZ by the Director of Mines on February 12, 1974. This decision was affirmed by the Secretary of Agriculture and Natural Resources on April 14, 1974, and later appealed to the Office of the President.
  3. Compromise Agreement:

    • During the appeal, CUENCO-VELEZ and BIGA COPPER entered into a compromise agreement, allowing BIGA COPPER to claim the nine overlapping mining claims.
  4. Third-Party Claims:

    • ATLAS received claims from third parties asserting rights to royalties based on assignments from BIGA COPPER and BIGA PARTNERS. ATLAS verified these claims and found that BIGA PARTNERS and BIGA COPPER had sold or assigned their interests in the mining claims to third parties before registering their Articles of Partnership.
  5. Assignment by CUENCO-VELEZ:

    • Alejandro T. Escano claimed to be an assignee of CUENCO-VELEZ for three mining claims retained under the compromise agreement. CUENCO-VELEZ later revoked the assignment due to Escano's failure to fulfill the conditions.
  6. Petition for Declaratory Relief:

    • ATLAS filed a petition for declaratory relief with the Court of First Instance of Cebu, seeking judicial interpretation of its obligations under the operating agreements and the validity of the assignments made by BIGA COPPER and CUENCO-VELEZ.
  7. Motion to Dismiss:

    • Respondents filed a motion to dismiss, arguing that the trial court lacked jurisdiction over the case, especially after the promulgation of Presidential Decree No. 1281, which vested exclusive jurisdiction over mining controversies in the Bureau of Mines.
  8. Trial Court's Ruling:

    • The trial court denied the motion to dismiss, ruling that the declaratory action was not a mining controversy and that the court retained jurisdiction.
  9. Court of Appeals Decision:

    • The Court of Appeals reversed the trial court's decision, holding that the declaratory action should have been dismissed because it involved questions of validity and enforcement of mining contracts, which fell under the exclusive jurisdiction of the Bureau of Mines.

Issue:

  1. Declaratory Relief by Non-Parties:

    • Can a person who is not a party to a contract file a petition for declaratory relief and seek a judicial interpretation of such contract?
  2. Jurisdiction of the Trial Court:

    • Can a trial court, which had already taken cognizance of an action involving a mining controversy, be divested of jurisdiction upon the promulgation of Presidential Decree No. 1281?

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Conclusion:

The Supreme Court affirmed the decision of the Court of Appeals, holding that the trial court had no jurisdiction to proceed with the declaratory action after the promulgation of Presidential Decree No. 1281. The summary judgment in favor of intervenor Efifanio A. Anoos was declared null and void, and the petition in intervention of CUENCO-VELEZ was dismissed for lack of merit.


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