G.R. No. L-49731 - Sering vs. Plazo

Philex Mining Corporation initiated a complaint on September 1, 1978, against Twin Peaks Mining Association and its four partners before the Court of First Instance of Rizal, Pasig Branch II.
The complaint sought a judicial declaration on the validity and binding effect of two mining agreements entered into on May 22, 1970, and June 25, 1971 for the exploration, operation, and exploitation of two hundred ninety lode mineral claims located at Tuba, Benguet.

The two agreements were executed with the late Andres K. Espiritu, who purportedly presented himself as the general manager of Twin Peaks.
Philex aimed to enforce the contracts against Twin Peaks to avail of rights and privileges under Presidential Decree No. 463.
Philex’s complaint included allegations that the mining claims were subject to the disputed mining contracts, despite refusals by the claimowner to abide by their terms.

They denied that Espiritu was duly authorized by the partnership to execute the contracts, asserting that he was not, in fact, the general manager nor a partner of Twin Peaks.
They filed a motion to dismiss the complaint on the grounds of lack of jurisdiction and absence of a valid cause of action.

Twin Peaks contended that the nature of the dispute—the enforcement of mining contracts—fell exclusively within the jurisdiction of the Bureau of Mines pursuant to section 7(c) of Presidential Decree No. 1281.
The trial court, however, denied the motion to dismiss, maintaining that the validity of the mining contracts was a justiciable matter and that the complaint sufficiently stated a cause of action.

Vicente M. Conlu, officer-in-charge of the legal division of the Bureau of Mines, appeared as amicus curiae supporting the petitioners’ (Twin Peaks’) position.
The Bureau of Mines argued that not only was the dispute within its exclusive jurisdiction, but the case had also become moot after the Assistant Director of Mines had rejected Philex’s applications for rights under PD No. 463, citing:

That Espiritu was not authorized to bind Twin Peaks.
That Philex failed to comply with the Bureau’s requirements regarding Espiritu’s authority.

The rejection of Philex’s applications underscored an implied admission of the Bureau of Mines’ exclusive jurisdiction over such disputes.

After filing a verified answer wherein Twin Peaks denied the execution of the agreements, the petitioners sought special civil actions of certiorari and prohibition challenging the trial court’s order denying their motion to dismiss.
The petition was duly given due course, prompting the higher court to reexamine the jurisdictional propriety of the lower court’s actions.

Does the trial court have jurisdiction over disputes involving the enforcement of mining contracts?
Can a judicial court entertain a dispute that, under Presidential Decree No. 1281 (section 7(c)), is designated to the exclusive jurisdiction of the Bureau of Mines?

Is the question of the validity of the mining contracts a justiciable issue appropriate for judicial intervention?
Can the form of action (a complaint for declaratory relief and damages) circumvent the exclusive administrative remedy provided by the Bureau of Mines for enforcing mining contracts?

Given the rejection by the Assistant Director of Mines of Philex’s applications for availment of rights, has the dispute become moot and academic in nature?
Does the failure of Philex to appeal the administrative order render the lower court's action inappropriate?