Case Digest (G.R. No. 244063)
Facts:
The Lone Congressional District of Benguet Province, represented by Hon. Ronald M. Cosalan, G.R. No. 244063, and the Republic of the Philippines, represented by the Mines and Geosciences Bureau of the Department of Environment and Natural Resources (MGB‑DENR), G.R. No. 244216, v. Lepanto Consolidated Mining Company and Far Southeast Gold Resources, Inc., EN BANC, June 21, 2022, Inting, J., writing for the Court.The dispute arises from MPSA No. 001‑90 executed on March 3, 1990 by the Republic, through the DENR, authorizing Lepanto Consolidated Mining Company and Far Southeast Gold Resources, Inc. (collectively, respondents) to conduct mining in Mankayan, Benguet — an area that overlaps part of the ancestral domains of the Mankayan Indigenous Cultural Communities/Indigenous Peoples (ICCs/IPs). Section 3.1 of the MPSA provided for an initial 25‑year term, renewable for another 25 years “upon such terms and conditions as may be mutually agreed upon by the parties or as may be provided by law.” Section 14.2 of the MPSA provided that more favorable terms under later laws would inure to the contractors.
After enactment of the Philippine Mining Act (RA 7942, 1995) and the Indigenous Peoples’ Rights Act (RA 8371, IPRA, 1997) with its FPIC and NCIP certification precondition (Section 59), respondents sought renewal. On May 22, 2014 respondents wrote MGB‑CAR to express intent to renew; MGB‑CAR found substantial compliance but advised endorsement to NCIP for certification and FPIC. Respondents maintained the renewal clause and RA 7942 entitled them to renewal under original terms and challenged the NCIP endorsement as impairing vested contractual rights. They served a Demand for Arbitration on the Republic (Feb. 18, 2015) invoking Section XII (Arbitration) of the MPSA and obtained a writ of preliminary injunction (Branch 149, RTC, Sp. Proc. No. M‑7767, Mar. 18, 2015) restraining government interference with mining operations.
The issues submitted to the Ad Hoc Arbitral Tribunal included (A) whether the controversy is within original/exclusive jurisdiction of the courts, (B) whether the dispute is arbitrable, and (C) whether FPIC/NCIP certification may validly be imposed as a renewal requirement. On November 27, 2015 the Arbitral Tribunal issued a Final Award finding the dispute arbitrable, holding the FPIC/NCIP certification an “unfavorable future legislation requirement” that could not be imposed to bar renewal, concluding respondents had a vested right to renewal under the MPSA and ordering reimbursement of certain advances.
The Republic filed a petition to vacate the award before Branch 141, RTC, Makati (Sp. Proc. No. M‑7932). In a Resolution dated May 6, 2016, RTC Branch 141 vacated the Arbitral Award, holding the tribunal exceeded its authority and that the award violated law and public policy — particularly the IPRA’s protection of ICCs/IPs — and relied on Special ADR Rules Rule 19.10 to entertain public policy as a ground for vacatur. The RTC denied reconsideration (Order, July 5, 2016). Respondents elevated the case to the Court of Appeals (CA) under the Special ADR Rules. Meanwhile, the Lone Congressional District of Benguet filed a Motion for Leave to Intervene (Aug. 31, 2017).
In a Decision dated April 30, 2018 (CA‑G.R. SP No. 146806) and Resolution of Jan. 14, 2019, the CA set aside the RTC Resolution, reinstated the Arbitral Award, and denied the District of Benguet’s motion to intervene. The CA held the dispute concerned interpretation and enforceability of the MPSA’s renewal clause and was thus arbitrable, that the Arbitral Tribunal could interpret ...(Pro-only)
Issues:
- Did the Court of Appeals err in denying the Lone Congressional District of Benguet’s motion for leave to intervene in the appeal from the RTC’s vacation of the Arbitral Award?
- Should the Court of Appeals’ affirmation of the Arbitral Tribunal’s Final Award be sustained, or must the award be vacated (noting issues of arbitrability, public policy, and whether respondents ...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
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Doctrine:
- (Pro-only)