G.R. No. 122213 - CDCP Mining Corp. vs. Commissioner of Internal Revenue

Case Digest (G.R. No. 122213)
Expanded Legal Reasoning Model

Facts:

Background and Parties Involved

Petitioners include Cordillera Global Network, Cordillera Peoples Alliance, Cordillera Indigenous Peoples Legal Center, Cordillera Ecological Pine Tree Center, various concerned residents of Baguio City, and other individuals represented by their respective guardians.
Respondents include Secretary Ramon J.P. Paje (DENR Secretary), Attorney Juan Miguel T. Cuna (Director of the Environmental Management Bureau - EMB), SM Investments Corporation, Secretary Rogelio Singson (Department of Public Works and Highways), and other public and private officials and entities.

The SM Pines Resort Project and Expansion

On September 13, 2001, the Department of Environment and Natural Resources (DENR) issued Environmental Compliance Certificate (ECC) CAR0106-047-120 to SM Investments Corporation for its SM Pines Resort Project, an 8.5-hectare eco-tourism mixed-use development including a shopping mall (SM City Baguio), hotel, service apartments, and entertainment center.
Construction of SM City Baguio was completed in November 2003. Subsequently, SM City Baguio proposed an Expansion Project to increase parking and commercial spaces on Luneta Hill.

Permit Applications and Government Actions

On December 29, 2010, SM Investments Corporation submitted an Environmental Performance Report and Management Plan to EMB-CAR for the amendment of its ECC to cover the Expansion Project.
EMB-CAR requested additional information, particularly an inventory of affected trees; SM submitted a revised report by April 25, 2011.
On September 22, 2011, DENR granted the amendment of the ECC.
On October 27, 2011, DENR-CAR, clearance from Secretary Paje, issued a permit allowing SM Investments Corporation to cut and earth-ball Benguet pine, Alnus trees, and saplings affected by the Expansion Project, subject to conditions including public consultations and securing an ECC.
Baguio City’s City Planning and Development Office issued locational clearance for the Expansion Project on December 19, 2011.

Legal Proceedings

On February 27, 2012, Cordillera Global Network filed a complaint (Civil Case No. 7595-R) praying for a temporary environmental protection order to enjoin cutting or earth-balling of 182 Benguet pine and Alnus trees on Luneta Hill.
SM continued earth-balling operations beginning April 9, 2012, but ceased upon issuance of a temporary environmental protection order effective April 11, 2012.
Additional motions, including a motion to extend the temporary order and a contempt petition for alleged violations, were filed.
Judy Lyn Adajar and 75 other residents filed a second complaint (Civil Case No. 7629-R) also assailing the Expansion Project permits.
The two environmental cases and the contempt petition were consolidated for trial.

Trial Court Findings and Decision (December 3, 2012)

The Regional Trial Court (RTC) acknowledged petitioners’ standing under the principle of transcendental importance but dismissed the cases for failure to exhaust administrative remedies.
The RTC found petitioners’ expert testimony lacking scientific basis and that the removal of trees would not cause irreparable environmental damage, giving credence to SM’s mitigation measures and tree replacement program.
The court dismissed claims of irregularity in the issuance of permits and ECC, also rejecting opposition witnesses as lacking proper expertise.
The Temporary Environmental Protection Order was lifted and complaints dismissed.

Court of Appeals Decision (December 12, 2014)

The Court of Appeals (CA) affirmed the RTC’s ruling, ruling that petitioners failed to prove patently illegal acts or lack of jurisdiction and failed to exhaust administrative remedies which required resort to appropriate agencies first.
The CA upheld the presumption of regularity of official acts and the validity of the permits and ECC.

Supreme Court Proceedings

On March 6, 2015, petitioners filed a Petition for Review on Certiorari before the Supreme Court with a prayer for Temporary Restraining Order (TRO) and Writ of Preliminary Injunction.
The Court issued a TRO on March 24, 2015, enjoining the expansion project and tree cutting/earth-balling operations.
Various motions, comments, and memoranda were filed by both private and public respondents opposing the petition and seeking dissolution of TRO.
The Court eventually modified the TRO on April 19, 2016.

Contentions of the Petitioners and Respondents

Petitioners contend the Expansion Project is essentially a new project exceeding the parameters of a mere expansion, violating zoning ordinances (including maximum building height) and lacking proper environmental assessment and public consultations.
They assert the failure to conduct a separate environmental impact assessment (EIA) or secure a separate ECC for the tree cutting and earth-balling activities is illegal.
Petitioners rely on rulings such as Boracay Foundation, Inc. v. Aklan to argue they were not required to exhaust administrative remedies as non-parties to the ECC application.
Respondents argue questions of fact are inappropriate on certiorari review, that petitioner verification was defective, permits have expired (mootness), and that administrative remedies must be exhausted.
Public respondents maintain the amended ECC was valid, a separate ECC for tree cutting was unnecessary because those activities were covered within the amended ECC, and that public consultations, as required, were undertaken.

Zoning and Land Use Ordinance

Baguio City’s Comprehensive Zoning Ordinance divides the city into zones (e.g., Low-Density Commercial Zone C-1, Medium-Density C-2, High-Density C-3) with differing permitted uses and building standards.
C-1 is principally for Central Business District trade and services. C-3 is for regional shopping centers and high-rise buildings.
SM City Baguio was certified as located in C-1, complying with the zoning requirements and locational clearance issued by the City Planning and Development Office.
Petitioners failed to show the locational clearances were improperly issued and should have availed administrative appeal before the Housing and Land Use Regulatory Board for zoning disputes.

Environmental Regulations and Executive Orders

Executive Order No. 23 (2011) declared moratorium on cutting and harvesting of timber in natural and residual forests. Indigenous trees are specially protected.
The initial ECC issued in 2001 allowed removal of 112 trees with specific mitigation conditions.
The amended ECC in 2011 for the Expansion Project covered additional structures but did not specifically authorize cutting of an additional 182 trees.
DENR issued a tree-cutting and earth-balling permit in 2011 subject to conditions including securing an ECC before such operations.
The failure to observe these procedural requirements and to differentiate indigenous from planted trees was noted as grave.

Supreme Court Observations

The Supreme Court heavily emphasized the State’s constitutional mandate to protect the environment (Art. II, Sec. 16, 1987 Constitution).
It was noted that lower courts erred in upholding the amended ECC without proper consideration of Executive Order No. 23 and environmental implications.
The importance of following procedures ensuring minimal environmental impact over expedient development was underscored.

Issues:

Whether the Petition should be dismissed due to defective verification and certification against forum shopping.
Whether the Petition improperly raises questions of fact, which are disallowed under Rule 45 of the Rules of Court.
Whether the Petition is barred for failure to exhaust administrative remedies and due to the doctrine of primary jurisdiction.
Whether the ECC, tree-cutting and earth-balling permits, and related locational clearances were validly and regularly issued.
Whether a separate Environmental Compliance Certificate was required for the cutting and earth-balling of the additional 182 trees affected by the Expansion Project.
Whether the Expansion Project violated Baguio City's comprehensive zoning ordinance, including building height and land use regulations.

Ruling:

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Case Digest (G.R. No. 122213) Core Legal Reasoning Model Expanded

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Case Digest (G.R. No. 122213) Expanded Legal Reasoning Model

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Case Digest (G.R. No. 122213)
Core Legal Reasoning Model

Expanded

Case Digest (G.R. No. 122213)
Expanded Legal Reasoning Model