SR Metals v. Reyes
REITERATIONFacts
1. The Antecedents: Petitioners SR Metals, Inc., SAN R Mining and Construction Corp., and Galeo Equipment and Mining Co., Inc. were granted two-year Small-Scale Mining Permits (SSMPs) to extract Nickel and Cobalt (Ni-Co) ore. These permits were issued after the Department of Environment and Natural Resources (DENR) granted them Environmental Compliance Certificates (ECCs). The ECCs contained a restriction, pursuant to Presidential Decree (PD) No. 1899, limiting annual extraction to 50,000 metric tons (MT) of ore. Subsequently, the Provincial Governor questioned the quantity of ore mined and shipped, leading to an investigation. The Mines and Geosciences Bureau (MGB) inspection indicated that the mining corporations had exceeded the 150,000 MT combined production limit, with a stockpile inventory of 177,297 dry metric tons (DMT). 2. Procedural History: The DENR Secretary issued a Cease and Desist Order (CDO) suspending the mining corporations' operations due to alleged violations, including exceeding annual production limits and issues with their ECCs and SSMPs. The mining corporations challenged this CDO before the Court of Appeals (CA) via a Petition for Certiorari, arguing grave abuse of discretion. They relied on a Department of Justice (DOJ) opinion suggesting that PD 1899's 50,000 MT limit was impliedly repealed by Republic Act (RA) No. 7076, and that 'ore' should only refer to the valuable Ni-Co component. The CA denied their petition, finding the ECCs moot due to expiration and upholding the DENR's authority to issue the CDO. The CA agreed with the Office of the Solicitor General (OSG) that the 50,000 MT limit applied to unprocessed ore and that the DOJ opinion was not binding. 3. The Petition: The mining corporations filed a Petition for Review on Certiorari with this Court, assailing the CA's decision. They argue that Section 1 of PD 1899, which imposes the 50,000 MT annual production limit on small-scale mining, violates the equal protection clause by creating an unjustified distinction between miners under PD 1899 and those under RA 7076. They also contend that RA 7076 impliedly repealed PD 1899's production limit and that their ECCs specifically allowed for 50,000 MTs of Ni-Co ore, meaning only the Ni-Co component, excluding gangue, should be measured. The core of their argument is that the 50,000 MT limit is either unconstitutional, repealed, or should be interpreted to exclude non-valuable materials from the measurement.
Issue(s)
Whether Section 1 of PD 1899, imposing a 50,000-MT annual production limit on small-scale mining, violates the equal protection clause. Whether RA 7076 impliedly repealed Section 1 of PD 1899. Whether the 50,000-MT limit refers to Ni-Co ore only, excluding gangue, or to 'run-of-mine ore' from which only water is deductible.
Ruling
The Petition is DENIED. The July 4, 2007 Decision and September 14, 2007 Resolution of the Court of Appeals in CA-G.R. SP No. 97127 are AFFIRMED in toto.
Ratio Decidendi
On the applicability of PD 1899, RA 7076, and the equal protection clause: The Court held that PD 1899 and RA 7076 co-exist, with PD 1899 applying to individuals, partnerships, and corporations, and RA 7076 applying to cooperatives. The argument that RA 7076 impliedly repealed PD 1899 was rejected because the DENR's DMC 2007-07 imposed the 50,000 DMTs limit to both SSMPs under PD 1899 and SSMCs under RA 7076, harmonizing the laws and rendering the equal protection issue moot. On whether RA 7076 impliedly repealed Section 1 of PD 1899: The initial contention that RA 7076 impliedly repealed PD 1899 due to the omission of an annual production limit in the former was rejected. The Court noted that both laws delegated to the DENR the power to promulgate implementing rules and regulations (IRRs). On the interpretation of the 50,000-MT limit and 'ore': The Court affirmed the DENR's interpretation of the 50,000-MT limit, specifying 'run-of-mine ore' as the ore as it emerges from the mine before treatment, congruent with RA 7942. For metallic minerals like Ni-Co, this measurement is conservative and crucial for environmental protection, preventing irreversible degradation of natural resources. The mining corporations' contention that their ECCs specified '50,000 MTs of Ni-Co ore' was interpreted to mean they were to mine Ni-Co, not that the measurement should be based solely on the purest form of Ni-Co, excluding all gangue.
Main Doctrine
The 50,000 metric ton annual production limit for small-scale mining under Presidential Decree No. 1899 applies to all small-scale miners, regardless of whether they operate under PD 1899 or Republic Act No. 7076, as harmonized by the Department of Environment and Natural Resources (DENR). The term 'ore' in this context refers to 'run-of-mine ore,' which includes soil and other materials, with only the weight of water being deductible, to prevent environmental degradation and ensure equitable regulation.