Administrative Law

Arellano University School of Law

aiza ebina/2015

CHAVEZ vs NATIONAL HOUSING AUTHORITY

530 SCRA 235
Scope of Powers of Administrative Agencies
Express and Implied Powers
FACTS: Petitioner Francisco Chavez in his capacity as taxpayer seeks to declare null and void the Joint
Venture Agreement between the NHA and R-II Builders, Inc (RBI) for being unconstitutional and invalid,
and to enjoin respondents particularly respondent NHA from implementing and/or enforcing the said
project and other agreements related thereto. On March 1, 1988, then President Corazon C. Aquino issued
Memorandum Order No. 161 approving and directing the implementation of the Comprehensive and
Integrated Metropolitan Manila Waste Management Plan. Specifically, respondent NHA was ordered to
conduct feasibility studies and develop low-cost housing projects at the dumpsite and absorb scavengers
in NHA resettlement/low-cost housing projects.
Pursuant to MO 161-A, NHA prepared the feasibility studies which resulted in the formulation of the
Smokey Mountain Development Plan and Reclamation of the Area Across R-10 or the Smokey Mountain
Development and Reclamation Project. SMDRP aimed to convert the Smokey Mountain dumpsite into a
habitable housing project, inclusive of the reclamation of the area across R-10, adjacent to the Smokey
Mountain as the enabling component of the project. Once finalized, the plan was submitted to President
Aquino for her approval.
On January 17, 1992, President Aquino proclaimed MO 415, approving and directing the implementation of
the SMDRP through a private sector joint venture. Said MO stipulated that the land area covered by the
Smokey Mountain dumpsite is conveyed to the NHA as well as the area to be reclaimed across R-10. In the
same MO 415, President Aquino created an Executive Committee to oversee the implementation of the
plan and an inter-agency Technical Committee was created composed of the technical representatives of
the EXECOM. Based on the evaluation of the pre-qualification documents, the EXECOM declared the New
San Jose Builders, Inc. and RBI as top two contractors. Thereafter, TECHCOM submitted its
recommendation to the EXECOM to approve the RBI proposal which garnered the highest score.
On October 7, 1992, President Ramos authorized NHA to enter into a JVA with RBI. Afterwards, President
Ramos issued Proclamation No. 465 increasing the proposed area for reclamation across R-10 from 40
hectares to 79 hectares. On September 1, 1994, pursuant to Proclamation No. 39, the DENR issued Special
Patent No. 3591 conveying in favor of NHA an area of 211,975 square meters covering the Smokey
Mountain Dumpsite. The land reclamation was completed in August 1996. Sometime later in 1996,
pursuant likewise to Proclamation No. 39, the DENR issued Special Patent No. 3598 conveying in favor of
NHA an additional 390,000 square meter area. After some time, the JVA was terminated. RBI demanded the
payment of just compensation for all accomplishments and costs incurred in developing the SMDRP plus a
reasonable rate of return. In a Memorandum of Agreement (MOA) executed by NHA and RBI, both parties
agreed to terminate the JVA and other subsequent agreements, which stipulated, among others, that
unpaid balance may be paid in cash, bonds or through the conveyance of properties or any combination
thereof.
On August 5, 2004, former Solicitor General Francisco I. Chavez filed this Petition for Prohibition and
Mandamus seeking to declare null and void the Joint Venture Agreement and the Smokey Mountain
Development and Reclamation Project, and all other agreements in relation thereto, for being
Unconstitutional and Invalid. The petitioner challenges the authority of NHA to reclaim lands. He claims
that the power to reclaim lands of public domain is vested exclusively with the Public Estates Authority. He
also contends that NHA and RBI were not given the power and authority by DENR to reclaim foreshore and
submerged lands, as required and that there was no proclamation officially classifying the reclaimed lands
as alienable and disposable.
ISSUE: Whether or not the NHA has the authority to reclaim lands
RULING: Yes. While the authority of NHA to reclaim lands is challenged by petitioner, we find that the NHA
had more than enough authority to do so under existing laws. While PD 757, the charter of NHA, does not
explicitly mention reclamation in any of the listed powers of the agency, we rule that the NHA has an
implied power to reclaim land as this is vital or incidental to effectively, logically, and successfully
implement an urban land reform and housing program enunciated in Sec. 9 of Article XIII of the 1987
Constitution.
Basic in administrative law is the doctrine that a government agency or office has express and implied
powers based on its charter and other pertinent statutes. Express powers are those powers granted,
allocated, and delegated to a government agency or office by express provisions of law. On the other
hand, implied powers are those that can be inferred or are implicit in the wordings of the law or conferred

by necessary or fair implication in the enabling act. When a general grant of power is conferred or duty
enjoined, every particular power necessary for the exercise of the one or the performance of the other is
also conferred by necessary implication. when the statute does not specify the particular method to be
followed or used by a government agency in the exercise of the power vested in it by law, said agency has
the authority to adopt any reasonable method to carry out its functions.
The power to reclaim on the part of the NHA is implicit from PD 757, RA 7279, MO 415, RA 6957, and PD 3A. Land reclamation is an integral part of the development of resources for some of the housing
requirements of the NHA. Private participation in housing projects may also take the form of land
reclamation.
RATIO: Express and implied powers. - The jurisdiction and powers of administrative agencies are
measured and limited by the Constitution or law creating them or granting their powers, to those
conferred expressly or by necessary or fair implication.
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