Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. L-30829 August 28, 1929

THE GOVERNMENT OF THE PHILIPPINE ISLANDS, applicant-appellant,

vs.
COLEGIO DE SAN JOSE, ET AL., claimants.
COLEGIO DE SAN JOSE, appellee.

Attorney-General Jaranilla for appellant.

Vicente O. Romualdez for appellee.

VILLA-REAL, J.:

This is an appeal taken by the Government of the Philippine Islands from a decision of the
Court of First Instance of Laguna, rendered in cadastral case No. 30, G. L. R. O. Record No.
359 of the municipality of San Pedro, Province of Laguna, ordering the registration of the two
parcels of land known as lots 1 and 2 described in the application, in favor of the Colegio de
San Jose in accordance with the provisions of law, without special pronouncement as to the
costs, it being understood, however, that the lease of said lands executed by the aforesaid
Colegio de San Jose in favor of Carlos Young y Baldwin is valid and subsists under the terms
and conditions set forth in the instruments, Exhibits Y-1 and Y-2, and providing for the
issuance of the proper decree once said decision becomes final.

In support of the appeal, the appellant assigns the following alleged errors as committed by
the court below in its judgment, to wit:

1. The lower court erred in not holding that the parcels of land in question are part of
the bed of Laguna Lake and, therefore, belong to the public domain.

2. The lower court erred in finding that said lands are included in the title of the
appellee and in finding that the appellee has been in the possession and occupation
of the same.

3. The lower court erred in qualifying as extraordinary inundations the fact that the
lands in dispute are under water during the rainy season.

4. The lower court erred in decreeing the registration of the lands in dispute to the
appellee and in denying the appellant's motion for a new trial.

The pertinent facts necessary to decide the questions of fact and of law raised in the instant
appeal, are as follows:

During the months of September, October and November every year, the waters of Laguna
de Bay cover a long strip of land along the eastern border of the two parcels of land in
question, the width of which strip varies from 50 to 70 meters according to the evidence of
the Colegio de San Jose and up to the eastern border of the pass claimed by the
municipality of San Pedro Tunasan, according to some witnesses for the Insular
Government; and, according to other witnesses for the Insular Government, the flooded strip
includes the aforementioned pass itself, which is usually completely covered with water, so
that the people can fish in said flooded strip.

The claimant Colegio de San Jose contends, and its evidence tends to prove, that the
above-named parcels of land are a part of the Hacienda de San Pedro Tunasan belonging to
said claimant, which has been in possession thereof since time immemorial by means of its
tenants or lessees and farmers.

On the other hand, the Government of the Philippine Islands contends that the said two
parcels of land belong to the public domain, and its evidence tends to prove that they have
always been known as the shores of Laguna de Bay, and they are situated alongside the
highway running parallel to said shore; that the water of the lake has receded a great
distance on that side; that said parcels of land had been under water formerly; that at
present, during the rainy season, the water of the lake reaches the highway, and that when
the water recedes the people of the place occupy and cultivate said lands during the dry
season.

The only question to be decided in the present appeal is whether the two aforesaid parcels
of land in controversy belong to the Hacienda de San Pedro Tunasan and are owned by the
claimant Colegio de San Jose, or whether they belong to the public domain as a part of the
bed of Laguna de Bay.

It is of primary importance to determine whether the body of water called Laguna de Bay is
naturally and legally a lake or a lagoon.

The Enciclopedia Juridica Espanola, volume XXI, pages 124 and 125, defines "lake" and
"lagoon" as follows:

LAKE. A body of water formed in depressions of the earth. Ordinarily fresh water,
coming from rivers, brooks, or springs, and connected with the sea by them.

LAGOON. A small lake, the hollow bed of which is bounded by elevations of land.

Laguna de Bay is a body of water formed in depressions of the earth; it contains fresh water
coming from rivers and brooks or springs, and is connected with Manila Bay by the Pasig
River. According to the definition just quoted, Laguna de Bay is a lake.

Inasmuch as Laguna de Bay is a lake, we must resort to the legal provisions governing the
ownership and use of lakes and their beds and shores, in order to determine the character
and ownership of the parcels of land in question.

Article 407 of the Civil Code says the following in its pertinent part:

ART. 407. The following are of public ownership:

xxx xxx xxx

4. Lakes and ponds formed by nature on public lands, and their channels.
 xxx xxx xxx

And article 44 of the Law of Waters of August 3, 1866, provides as follows:

ART. 44. Natural ponds and lakes existing upon public lands and fed by public
waters, belong to the public domain.

xxx xxx xxx

It is beyond discussion that Laguna de Bay belongs to the public domain, being a natural
lake existing upon public lands, and fed by public waters from rivers, brooks and springs.

Now then, what is the bed of Laguna de Bay?

Article 74 of the Law of Waters cited above defines the bed of lake as follows:

ART. 74. The natural bed or basin of lakes, ponds, or pools, is the ground covered by
their waters when at their highest ordinary depth.

This definition raises the question: Which is the natural bed or basin of Laguna de Bay?

The evidence shows tat during the dry season, that is, during the months of December,
January, February, March, April, May, June, July and August, the water of the lake at its
highest depth reaches no farther that the line forming the northeastern boundary of the two
parcels of land in controversy, and that it is only during the wet season, that is, during the
months of September, October, and November, that said water rises to the highway,
completely covering said parcels of land. Therefore, the waters of Laguna de Bay have two
different levels during the year:

One during the dry season, which obtains during nine months, and the other during the wet
season, which continues for three months. Which of these two heights marks the land limit of
the waters of Laguna de Bay, that is, which of them forms its natural bed or basin? The law
says, the highest ordinary depth. Now then, which of the two aforesaid depths of the waters
of Laguna de Bay is the ordinary one? The word "ordinary" is defined in the Dictionary of the
Spanish Academy as follows:

ORDINARY. Not exceeding the average; common, natural, occurring always or most
of the time; not going beyond what happens or takes place.

The word extraordinary is defined in the same dictionary as follows:

EXTRAORDINARY. Uncommon, transcending the general rule, order or measure;

exceeding, surpassing, or going beyond that which is ordinary, commonly met with,
current, settled, or admitted by the majority.

According to the foregoing definitions of the words "ordinary" and "extraordinary," the highest
depth of the waters of Laguna de Bay during the dry season is the ordinary one, and the
highest depth they attain during the rainy season is the extraordinary one; inasmuch as the
former is the one which is regular, common, natural, which occurs always or most of the time
during the year, while the latter is uncommon, transcends the general rule, order of measure,
and goes beyond that which is the ordinary depth. If, according to the definition given by
article 74 of the Law of Waters quoted above, the natural bed or basin of the lakes is the
ground covered by their waters when at their highest ordinary depth, the natural bed or basin
of Laguna de Bay is the ground covered by its waters when at their highest depth during the
dry season, that is, up to the northeastern boundary of the two parcels of land in question.

Inasmuch as, according to article 407 of the Civil Code, cited above, lakes and their beds
belong to the public domain, and inasmuch as, according to article 74 of the Law of Waters
cited above, the bed of lake is the ground covered by its waters at their highest ordinary
depth; whereas the waters of Laguna de Bay at their highest depth reach no farther than the
northeastern boundary of the two parcels of land in question, said parcels are outside said
bed and, consequently, do not belong to the public domain.

The Government of the Philippine Islands also contends that as the waters of Laguna de Bay
have receded very much, as a result of which the two parcels of land under discussion,
which had been under water before, were left uncovered, the claimant Colegio de San Jose
which owned the estate bordering upon said Laguna de Bay, did not acquire said two parcels
of land, in accordance with the provisions of article 367 of the Civil Code, as follows:

ART. 367. The owners of estates bordering on ponds or lagoons, do not acquire the
land left dry by the natural decrease of the waters, nor lose those inundated by them
in extraordinary floods.

As may be seen, the legal provision quoted above, cited by the appellant in support of its
contention, refers to ponds and lagoons, and has therefore no application to the case at bar,
which refers to a lake, a lagoon being legally distinct in character from a lake.

Having pointed out that the inundations of the two parcels of land in question during the
months of September, October and November, is extraordinary, the legal provision applicable
to the case is that contained in article 77 of the aforesaid Law of Waters, which reads:

ART. 77. Lands accidentally inundated by the waters of lakes, or by creeks, rivers,
and other streams, shall continue to be the property of their respective owners.

If, as we have seen, the two parcels of land in litigation form no part of the bed of Laguna de
Bay, and consequently, do not belong to the public domain, they must belong to the claimant
Colegio de San Jose as a part of the Hacienda de San Pedro Tunasan, owned by it, the
northeastern part of which borders on said lake, and in accordance with the legal provision
just quoted, the fact that they are inundated by its waters during extraordinary risings, which
take place during the months of September, October and November, does not deprive said
claimant of the ownership thereof.

Article 84 of the said Law of Waters further provides:

ART 84. Accretions deposited gradually upon lands contiguous to creeks, streams,
rivers, and lakes, by accessions or sediments from the waters thereof, belong to the
owners of such lands.

xxx xxx xxx

Even if, therefore, the two parcels of land in litigation were considered as accretions
gradually deposited by accessions or sediments from the waters of Laguna de Bay, they
would still, according to the legal provision just quoted, belong to the claimant Colegio de
San Jose as owner of the lands bordering on said Laguna de Bay.

The appellant also contends that the two parcels of land form a part of the shores of Laguna
de Bay and are therefore of public ownership, citing paragraph 3 of article 1 of the Law of
Waters, which says:

ART. 1. The following are part of the national domain open to public use:

xxx xxx xxx

3. The shores. By the shore is understood that space covered and uncovered by
the movement of the tide. Its interior or terrestrial is the line reached by the highest
equinoctial tides. Where the tides are not appreciable, the shore begins on the land
side at the line reached by the sea during ordinary storms or tempests.

As the court below correctly held, this legal provision refers to the waters of the sea, being
included under Title I, which treats of the ownership and use of said waters of the sea. Lake
waters, being terrestrial waters, their ownership and use are governed by Title II of said Law
of Waters. In the same manner as the shore of the sea is that space covered and uncovered
by the waters during the tides, its interior or terrestrial limit being the line reached by its
highest ordinary depth. In the instant case, the interior or terrestrial limit of the Laguna de
Bay is the ground covered by its waters in its highest ordinary depth, that is, up to the
northeastern boundary of the two parcels of land in question.

Summarizing, we find: (1) That the natural bed or basin of Laguna de Bay is the ground
covered by its waters at their highest ordinary depth during the dry season, that is, during the
months of December, January, February, March, April, May, June, July and August; (2) that
the highest depth reached by said waters during the rainy season, or during the months of
September, October and November, is extraordinary; (3) that the two parcels of land in
litigation form an integral part of the Hacienda de San Pedro Tunasan belonging to the
claimant Colegio de San Jose; (4) that said two parcels of land, being accidentally inundated
by the waters of Laguna de Bay continue to be the property of the claimant Colegio de San
Jose (art. 77, Law of Waters of August 3, 1866); (5) that even supposing that the said two
parcels of land have been formed by accession or deposits of sediment by the waters of said
Laguna de Bay, they still belong to the said claimant Colegio de San Jose, as owner of the
land of the Hacienda de San Pedro Tunasan, bordering on said Laguna de Bay (art. 84, Law
of Waters of August 3, 18660; (6) that the provisions of the Law of Waters regulating the
ownership and use of the waters of the sea are not applicable to the ownership and use of
lakes, which are governed by special provisions.

In the view of the foregoing considerations, we are of the opinion and so hold, that the
judgment appealed from should be affirmed, without special pronouncements as to costs. So
ordered.

G.R. No. L-60219 June 29, 1984

BIENVENIDO AMISTOSO, petitioner,

vs.
SENECIO ONG, EPIFANIA NERI & HON. PRESIDING JUDGE, ESTEBAN M. LISING OF
THE COURT OF FIRST INSTANCE OF CAMARINES SUR, BRANCH VI, respondents.
Resales and Associates Law Office for petitioner.

Gil P. Pacamarra for respondents.

CUEVAS, J.:

This is a Petition for Review on certiorari of the Order of the defunct Court of First Instance of
Camarines Sur, Branch VI dated January 14, 1981, dismissing its Civil Case No. P-153, for
lack of jurisdiction.

The pertinent antecedents are as follows:

On July 27, 1981, petitioner as plaintiff, filed before the then Court of First Instance of
Camarines Sur, a conplaint for Recognition of Basement with Preliminary Injunction and
Damages. The complaint which was docketed in the a resaid Court as Civil Case No. P-153
among others alleged, that plaintiff (now petitioner) and defendant Epifania Neri, (one of the
herein private respondents) are the owners of adjoining parcels of agricultural land situated
in Cauayanan, Tinambac, Camarines Sur; that an irrigation canal traverses the land of
defendant Neri through which irrigation water from the Silmod River passes and flows to the
land of the petitioner for the latter's beneficial use and that respondent Neri, owner of the
land on which said irrigatrion canal exists and Senecio Ong, the cultivator of the said
property, despite repeated demands refused to recognize the rights and title of the petitioner
to the beneficial use of the water passing through the aforesaid irrigation canal and to have
petitioner's rights and/or claims annotated on the Certificate of Title of respondent Neri . . . .
Hence, the filing of the said complaint.

In their Answer, private respondents denied the existence of any right on the part of the
petitioner to the use of the canal mentioned in the complaint nor any contract, much less any
deed or encumbrance on their property and assert that they have not performed any act
prejudicial to the petitioner that will warrant the filing of the complaint against them. By way of
affirmative and special defenses, private respondents alleged that petitioner's complaint
states no cause of action and that the Court has no jurisdiction over the same.

Issues having been joined, trial was held. After petitioner has rested his case by a formal
offer of his testimonial and documentary evidences, private respondents instead of
presenting their evidence, filed a motion to dismiss. In the said motion, respondents contedn
that the instant case, involving as it does development, exploitation, conservation and
utilization of water resources falls within the exclusive jursidiction of the National Water
Resources Council pursuant to P.D. NO. 424, Section 2(b) and Section 88 thereof. Acting on
private respondent's motion, respondent Judge dismissed petitioner's complaint for lack of
jurisdiction in an Order dated January 14, 1981. The pertinent portion of that Order reads as
follows:

... The basis of the motion to dismiss are the provisions of Presidential
Decree No. 424 and the Water Code known as Presidential Decree No.
1067. In opposing the motion to dismiss, plaintiff contends that the present
action does not involve water dispute and that since the present action was
filed before the court prior to the effectivity of the Presidential Decree No.
424, it is the old law on the matter that should be applied. These contentions
of the plaintiff are without merit. The complaint belies the plaintiff's contention.
 Allegations in the complaint are explicit regarding the claim of the right of
plaintiff over the water passing through his land. The right over irrigation
water not having been shown as established or vested or that said vested
right, if any, has not been alleged to be registered in accordance with the
water code, the provisions of Presidential Decrees 424 and 1067 shall
govern. As stated by the Supreme Court in the case of Abe-Abe vs.
Manta, No. L-4827, May 31, 1979, 90 SCRA 523, to wit: 4

It is incontestable that the petitioner's immediate recourse is

to ventilate their grievance with the National Water Resources
Council which, as already noted, is the administrative agency
exclusively vested with original jurisdiction to settle water
rights disputes under the water code under Presidential
Decree No. 4 24.

The code assumes that it is more expeditious and pragmatic

to entrust to an administrative agency the settlement of water
rights disputes rather than require the claimants to go directly
to the court where the proceedings are subject to unavoidable
delays which are detrimental to the parties ...

That jurisdiction of the Council under Section 2(b) of

Presidential Decree No. 424 is reaffirmed in Sec. 88 of the
Water Code and in Section 3rd thereof which provides that
'the utilization, exploitation, development, conservation and
protection of water resources shall be subject to the control
and regulation of the government through Council.

Failing to obtain a favorable reconsideration of the Order of dismissal, petitioner now comes
before Us through the instant petition contending:

(1) That the case at bar is not to settle any water dispute between the parties
but a complaint which calls purely for a determination of the right of the
plaintiff to have an established right amounting to an easement annotated on
the certificate of title of the defendant, hence the question is judicial which
may be taken cognizance of by the respondent court;

(2) That since the case was filed on July 26, 1972. Which was before the
effectivity of PD NO. 424, therefore, even if defendant's contention is correct
that the case involved water rights dispute the old law on water applies
and not the present water code otherwise the Court shall lose jurisdiction
contrary to the well-settled rule that once be lost;

(3) That the herein defendant can no longer raise the question of plaintiff's
right to the beneficial use of irrigation water since the right to use had already
been determined, decided and laid to rest when the Department of Public
Works, Transportation and Communications awarded petitioner Water Rights
Grant after complying with all the legal requirements such as publication,
payment of fees, survey, investigation, etc.; and

(4) That the issue in the case at bar which was erroneously overlooked by the
respondent Judge does not involve a determination of the right of the parties
 to the utilizatio conservation and protection of the parties' respective water
rights, hence it does not fan within the competence nor jurisdiction of the
National Water Resources Council.

In a Resolution promulgated on August 11, 1982, we required the respondents to comment

on the petition. Private respondents' COMMENT was filed on March 2, 1984. Petitioner's
REPLY thereto on the other hand was filed on May 10, 1984.

We considered the COMMENT as an Answer and gave due course to the petition.

Private respondents contend that the assailed order of dismissal was in order since a mere
cursory reading of the complaint shows that petitioner claims for the right to use water
coming from the Silmod River and prays that his right to the utilization thereof be respected
and not be disturbed and/or obstructed by the respondents. On its face then, the dispute is
on the use, conservation and protection of the right to water either by the petitioner or by the
private respondents. The annotation of the alleged encumbrance on the title of the private
respondent is merely the relief prayed for on the basis of the claim to the use and protection
of water passing through the land of the respondents. And since the controversy hinges on
the right to use and protect the water from the Silmod River that passes on the land of the
private respondents to the petitioner's property, the proper authority to determine such a
controversy is the National Water Resources Council which is vested with exclusive
jurisdiction over such question pursuant to P.D. NOS. 424 and 1067.

We find the petition impressed with merit.

Private respondents' insistence that what is involved in the instant case is the right to use,
exploit and convey water is controverted by the "STIPULATION OF FACTS" entered into
between them and the petitioner in the court below which was approved in an Order dated
February 20, 1975, the pertinent portion of which reads as follows:

1. That there exists an irrigation canal for the use of the defendants diverting
water coming from the Silmod River, Tinambac, Camarines Sur, passing on
the ricelands of the latter to the plaintiff's land irrigating the land of the latter,
although plaintiff claims it existed since 1952 up to the present, but disputed
by the defendants.

2. That the plaintiff has an approved water rights Grant issued by the
Department of Public Works, Transportation and Communications, which
plaintiff claims it for beneficial use to irrigate their land from the Silmod River
and defendants dispute said claim

3. That as of now, defendants have no approved Water Rights Grant issued

by the proper authorities for the use of the water for irrigation purposes from
the Silmod River. However, defendants have a pending application for Water
Rights, the water of which shall pass thru a different irrigation canal.

4. That one of the defendants' predecessors-in-interest, Abundio Barallas had

a written contract with the plaintiff, which defendants claim easement of
aqueduct Defendants are questioning the legality, enforceability and validity
of such contract.
 xxx xxx xxx

6. That defendants refused to surrender their Transfer Certificate of Title of

her land for purposes of annotation of the contract, allegedly an easement of
aqueduct on the ground that she questions the validity, enforceability, legality
and therefore they are not bound by the same.

From the foregoing stipulations, private respondents admit that petitioner, then plaintiff, has
an approved Water Rights Grant issued by the Department of Public Works, Transportation
and Communications. Private respondents, however, contend that the said grant does not
pertain to the beneficial use of irrigation water from Silmod River. The records, however, do
not show any other irrigation water going to petitioner's property passing thru respondents'
lot aside from that coming from the Silmod River. Respondents' controversion of petitioner's
right to irrigation water specifically from Silmod River is undoubtedly a lame denial.

Aside from this admission, the record clearly discloses an approved Water Rights Grant in
favor of petitioner. Dr. Bienvenido V. Amistoso, which was approved on November 13, the
Acting Secretary of Public Works and Commission David M. Consunji. (Exh. 1) The grant
was made three (3) years before the promulgation of P.D. 1067 on December 31, 1976,
known as the Water Code of the Philippines, which revised and consolidated the laws
governing ownership, appropriation, option exploitation, development, conservation and
protection of water resources thereby repealing among others, the provisions of the Spanish
Law of Water of August 3, 1866, the Civil Code of Spain of 1889, and the Civil Code of the
Philippines on ownership of water, easement relating to water and of public water and
acquisitive prescription on the use of water which are inconsistent with the provisions of said
Code (Art. 10, P.D. 1067).lwphl@it

The water rights grant partakes the nature of a document known as a water
permit recognized under Article 13 of P.D. 1067, which provides:

Article 13. Except as otherwise herein provided, no person, including

Government instrumentalities or government-owned or controlled
corporations, shall appropriate water without a water right, which shall be
evidenced by a document known as a water permit.

Water right is the 7 granted by the government to appropriate and use water.

As to the validity of the WATER RIGHTS GRANT of Amistoso upon the promulgation of P.D.
1067 on December 31, 1976, the governing provision of law is found in the Transitory and
Final Provisions of P.D. 1067. It fans under "acts and contracts under the regime of old laws".
Article 97 provides, thus:

Article 97. Acts and contracts under the regime of old laws, ff they are valid in
accordance therewith, shag be respected, subject to the stations established
in this Code. Any modification or extension of these acts and contracts after
the promulgation of this Code, shall be subject to the provisions hereof.

It may be observed that the WATER RIGHTS GRANT of Amistoso does not fall under "claims
for a right to use water existing on or before December 31, 1974" which under P.D. 1067 are
required to be registered with the National Water Resources Council within two (2) years
from promulgation of P.D. 1067, otherwise it is deemed waived and the use thereof deemed
abandoned. It is no longer a mere "claim" inasmuch as there was already a GRANT by the
Secretary of Public Works, Transportation and Communications (the official then authorized
to issue said grant) on November 13, 1973 after complying with all the requirements then
prescribed by law for such grant.

The grant contradicts the erroneous findings of the respondent Judge, and incontrovertibly
entitles petitioner to the beneficial use of water from Silmod River. That right is now a. vested
one and may no longer be litigated as to bring petitioner's case within the jurisdiction of the
National Water Resources Council. To resurrect that issue right to the use of invistigation
water from Silmod River will be violative of the rule on res judicata which also applies with
equal vigor and effect to quasi judicial tribunal (Brillantes vs. Castro, 99 Phils. 497, Ipekdjian
Merchandising, Inc. vs. Court of Tax Appeals, 9 SCRA 72, September 30,1963).

As correctly postulated by the petitioner, the court a quo is not being asked to grant petitioner
the right to use but to compel private respondents to recognize that right and have the same
annotated on respondent Neri's Torrens Certificate of Title. Resort to judicial intervention
becomes necessary because of the closure made by the respondents of the irrigation canal
thus depriving the petitioner to continue enjoying irrigation water coming from Silmod River
through respondents' property. The interruption of the free flow of water caused by the
refusal to re-open the closed irrigation canal constituted petitioner's cause of action in the
court below, which decidedly do not fall within the domain of the authority of the National
Water Resources Council

Respondents, however, rely very heavily on the dictum laid down in the Abe-Abe vs.
Manta, No. L-4827, May 31, 1979, 90 SCRA 524, wherein it was held that

It is incontestable that the petitioner's immediate recourse is to ventilate their

grievance with the National Water Resources Council which, as already
noted, is the administrative agency exclusively vested with original
jurisdiction to settle water rights disputes under the water code and under
Presidential Decree No. 424.

The Code assumes that it is more expeditious and pragmatic to entrust to an

administrative agency the settlement of water rights disputes rather than
require the claimants to go directly to the court where the proceedings are
subject to unavoidable delays which are detrimental to the parties ...

That jurisdiction of the Council under Section 2(b) of Presidential Decree No.
424 is reaffirmed in Section 88 of the Water Code and in Section 3rd thereof
which provides that 'the utlization exploitation, development, conservation
and protection of water resources shall be subject to the control and
regulation of the government through the Council

The said pronouncement, however, finds no application to the instant case for in there, both
petitioners and respondent have no established right emanating from any grant by any
governmental agency to the use, appropriation and exploitation of water. In the case at bar,
however, a grant indubitably exists in favor of the petitioner. It is the enjoyment of the right
emanating from that grant that is in litigation. Violation of the grantee's right, who in this case
is the petitioner, by the closure of the irrigation canal, does not bring the case anew within
the jurisdiction of the National Water Resources Council.

WHEREFORE, the Order of the Honorable respondent Judge of January 14, 1981, is hereby
SET ASIDE. Private respondents are hereby ordered to RECOGNIZE petitioner's
BASEMENT of water and to surrender to the Register of Deeds of Camarines Sur the
owner's duplicate Transfer Certificate of Title No. 14216 covering respondent Epifania Neri's
property so that petitioner's right to the beneficial use of said irrigation canal and water
passing through the same may be annotated thereon.

SO ORDERED.

DASMARIAS WATER G.R. No. 175550

DISTRICT,
Petitioner,
Present:

PUNO, C.J., Chairperson,

CORONA,
- v e r s u s - CARPIO MORALES,*
AZCUNA and
LEONARDO-DE CASTRO, JJ.

MONTEREY FOODS
CORPORATION,**
Respondent. Promulgated:
September 17, 2008

x---------------------------------------------------x

R E S O LUTIO N
CORONA, J.:

This is a petition for review on certiorari [1] of the May 26, 2006
decision[2] and November 21, 2006 resolution[3] of the Court of Appeals (CA)
in CA-G.R. SP No. 90855.

Respondent Monterey Foods Corporation is a domestic corporation

primarily engaged in the livestock and agriculture business. It was issued
water permit nos. 17779 and 17780 by the National Water Resources Board
(NWRB)[4] for its two deep wells located at Barangay Langcaan, Dasmarias,
Cavite. The water drawn from the wells was used solely for respondents
business and not for the purpose of selling it to third persons for profit.

Petitioner Dasmarias Water District is a government-owned corporation

organized by the Sangguniang Bayan of Dasmarias in accordance with the
provisions of PD 198 (otherwise known as the Provincial Water Utilities Act
of 1973).[5]

On March 30, 2004, petitioner filed a complaint for payment of production

assessment against respondent in the Regional Trial Court (RTC) of Imus,
Cavite, Branch 90, docketed as Civil Case No. 0113-04. Invoking Sec. 39 of
PD 198, it prayed that respondent be ordered to pay the following: (1)
monthly production assessment for the two deep wells in the amount
of P55,112.46 from the date of demand; (2) actual expenses of at
least P50,000 and (3) attorneys fees and costs of suit.[6]

On June 8, 2004, respondent filed a motion to dismiss on the ground that the
RTC had no jurisdiction to hear the case because, under PD 1067 (otherwise
known as the Water Code of the Philippines),[7] it was the NWRB that had
jurisdiction.[8]

On April 28, 2005, the RTC issued an order denying the motion to
dismiss.[9] It ruled that it had jurisdiction over the subject matter of the case
because it referred to the right of petitioner to collect production
assessments. It denied reconsideration in an order dated June 8, 2005.[10]

Aggrieved, respondent filed a petition for certiorari [11] in the CA under

Rule 65 of the Rules of Court docketed as CA-G.R. SP No. 90855 assailing
the April 28, 2005 and June 8, 2005 RTC orders. Aside from the issue of
jurisdiction, it likewise raised the issue of whether petitioner had the
authority to impose a production assessment under Sec. 39 of PD 198.

In a decision promulgated on May 26, 2006, the CA granted herein

respondents petition and dismissed petitioners complaint.[12] It held that since
the complaint involved a dispute relating to the appropriation, utilization,
exploitation, development, control, conservation and protection of waters,
the NWRB had original jurisdiction over it under Art. 88 of PD 1067. It also
ruled that under PD 1067, petitioner had no authority to impose the
assessment without the prior approval of the NWRB.[13]

Hence this petition. The sole issue is whether it is the RTC or the NWRB
which has jurisdiction over the collection of water production assessments.

The CA ruled that the NWRB had original jurisdiction over the
complaint under Arts. 3 (d), 88 and 89 of PD 1067 and that the regular courts
exercised only appellate jurisdiction:

ART. 3. The underlying principles of this Code are:

xxx xxx xxx

d. The utilization, exploitation, development, conservation

and protection of water resources shall be subject to the control
and regulation of the government through the [NWRB].

xxx xxx xxx

ART. 88. The [NWRB] shall have original jurisdiction over

all disputes relating to appropriation, utilization, exploitation,
development, control, conservation and protection of waters
within the meaning and context of the provision of this Code.
 xxx xxx xxx

ART. 89. The decisions of the [NWRB] on water rights

controversies may be appealed to the [RTC] [14] of the province
where the subject matter of the controversy is situated within
fifteen (15) days from the date the party appealing receives a copy
of the decision, on any of the following grounds: (1) grave abuse
of discretion; (2) question of law; and (3) questions of fact and
law.

Petitioner argues that the issue in its complaint was the determination
of its right as a water district under Sec. 39 of PD 198 to impose production
assessments on respondent:
Sec. 39. Production Assessment. - In the event the board
of a district finds, after notice and hearing, that production of
ground water by other entities within the district for commercial
or industrial uses is injuring or reducing the districts financial
condition, the board may adopt and levy a ground water
production assessment to compensate for such loss. In
connection therewith, the district may require necessary reports by
the operator of any commercial or industrial well. Failure to pay
said assessment shall constitute an invasion of the waters of the
district and shall entitle this district to an injunction and damages
pursuant to Section 32[15] of this Title. (Emphasis supplied)

Thus, it avers that the regular courts had jurisdiction over the subject matter
thereof. It asserts that since it was not questioning the validity of the water
permits issued by the NWRB to respondent, it was not a water rights dispute
over which the NWRB had original jurisdiction.[16]

The petition has merit.

 It is axiomatic that jurisdiction is determined by the allegations in the
complaint.[17] Petitioner alleged the following:

1. That [petitioner] is a government owned agency duly

organized by the Sangguniang Bayan of the Municipality of
Dasmarias pursuant to the express provisions of [PD. 198], as
amended, particularly Secs. 5, 6, 7, Chapter 1, Title 2, thereof and
with principal office at Camerino Avenue, Dasmarias, Cavite;

xxx xxx xxx

3. That under the provisions of [PD 198], specifically Sec.

47 thereof, [petitioner] is the exclusive franchise holder in the
maintenance and operation of water supply and in the distribution
thereof for domestic, industrial uses, and that no franchise shall be
granted to any other person, agency or corporation for domestic,
industrial or commercial water service within its district without
the consent of [petitioner] and subject only to the review by the
Local Water Utilities Administration;

4. That [respondent] is engaged in farm business, in the

operation of which [respondent] has installed two (2) deepwells,
namely Well No. 1 and Well No. 2, with the following description
and capacity:
WELL No. HP CAPACITY
1 30 300 gpm
2 7.5 75 gpm
5. That under the provision of [PD 198], particularly Sec.
39 Chapter VIII, Title II thereof, if the district ([petitioner] herein)
thru its board of directors, finds, after notice and hearing, that
production of ground water by other entities, including
[respondent] herein, within the district for commercial or
industrial uses is injuring or reducing the districts financial
condition, the Board may adopt and levy a ground-water
assessment to compensate for such loss;
6. Since the operation of [respondents] business, together
with other companies or entities within the district, [petitioner]
has found that [respondents] operation of its two (2) deepwells has
adversely affected [petitioners] financial condition;
 7. That [petitioner] therefore invited [respondents]
representative or representatives to discuss the matter of
production assessment on the basis of the volume of water
consumption extracted from [respondents] two (2) deepwells and
its adverse effect on [petitioners] financial condition, as shown by
[petitioners] letters dated 24 March 1998 and 31 August 2002 and
others, xerox copies of said letters dated 24 March 1998 and 31
August 2002 are hereto attached and marked as Annexes A and B
hereof;
8. That [petitioner] thru its authorized inspectors, conducted
inspection of [respondents] deepwells Nos. 1 and 2 and submitted
their own findings of the daily and monthly average consumption
of [respondents] subject deepwells, and on the basis of
[petitioners] duly approved resolution regarding charge rate
of P2.00 per cubic meter, petitioner came up with the following
production assessment charge:

Well HP Capacity Hrs. of Charge AverageConsumption Actual Charge

Operation Rate Daily Monthly Average
Peso/m3 Daily Monthly
peso/m3peso/m3

1 30 300 12 P2.00 816.48 2,449.42 1,632.9648,988.85

2 7.5 75 6 P2.00 102.06 3,061.80 204.12 6.123.61

P55,112.46

xerox copies of said finding and computation is hereto marked as

Annex C hereof;

9. That despite demands made upon [respondent], the latter failed

and refused and continues to fail and refuse to pay [petitioners]
fair and just demands, to the damage and prejudice of [petitioner].
[18]

It is clear from the allegations that the complaint involved the determination
and enforcement of petitioners right under PD 198 to impose production
assessments, not the appropriation and use of water and the adjudication of
the parties respective water rights.[19] It was admitted that petitioner was a
duly constituted water district. Respondent, on the other hand, obtained
water permits from the NWRB. Both thus had respective rights to the use of
the water. But petitioner was not challenging the water permits acquired by
respondent. As we held in Atis v. CA:[20]

The case at bar does not involve any dispute relating to

appropriation or use of waters. "Appropriation" as used in the
Water Code means the "acquisition of rights over the use of
waters or the taking or diverting of waters from a natural source"
(Art. 9); while "use of water for fisheries is the utilization of water
for the propagation and culture of fish as a commercial
enterprise." In fact, Petitioner is the holder of [two water permits].
The issuance of said permits served to grant petitioner water rights
or the privilege to appropriate and use water (Art. 13, [PD] 1067)
from the San Pedro Creek and sea water from Dapitan Bay for his
fishpond.

Private Respondents/Intervenors do not dispute the water

rights petitioner had acquired by reason of those permits xxxx

xxx no dispute lies relative to the use or appropriation by

Petitioner of water from the San Pedro Creek and sea water from
the Dapitan Bay. The case does not involve a determination of the
parties' respective water rights, which would otherwise be within
the competence and original jurisdiction of the [NWRB]. Rather,
the issue is whether or not the construction of the dike, obstructed
the natural water course or the free flow or water from Petitioner's
higher estate to Intervenors' lower estate thereby causing injury to
petitioner's rights and impairing the use of his fishpond. [21]

Also, in Amistoso v. Ong, et al.,[22] we explained:

As correctly postulated by the petitioner, the court a quo is

not being asked to grant petitioner the right to use but to compel
private respondents to recognize that right and have the same
 annotated on respondent Neri's Torrens Certificate of Title. Resort
to judicial intervention becomes necessary because of the closure
made by the respondents of the irrigation canal thus depriving the
petitioner to continue enjoying irrigation water coming from
Silmod River through respondents' property. The interruption of
the free flow of water caused by the refusal to re-open the closed
irrigation canal constituted petitioner's cause of action in the court
below, which decidedly do not fall within the domain of the
authority of the [NWRB].

Respondents, however, rely very heavily on the dictum laid

down in the Abe-Abe vs. Manta[23] xxxx

xxx xxx xxx

The said pronouncement, however, finds no application to

the instant case for in there, both petitioners and respondent have
no established right emanating from any grant by any
governmental agency to the use, appropriation and exploitation of
water. In the case at bar, however, a grant indubitably exists in
favor of the petitioner. It is the enjoyment of the right emanating
from that grant that is in litigation. Violation of the grantee's right,
who in this case is the petitioner, by the closure of the irrigation
canal, does not bring the case anew within the jurisdiction of the
[NWRB].[24]

Clearly at issue in this case is whether, under the factual allegations of

petitioner, it had the right under PD 198 to impose production assessments
on respondent. It did and it was a judicial question properly addressed to the
courts.

A judicial question is raised when the determination of the question

involves the exercise of a judicial function, that is, it involves the
determination of what the law is and what the legal rights of the parties are
with respect to the matter in controversy.[25]
 Aside from the aforequoted cases, we ruled in the following that
judicial questions were raised and were thus properly cognizable by the
regular courts:

(1) in Metro Iloilo Water District v. CA,[26] the issue was whether the
extraction and sale of ground water within petitioners service area violated
petitioners rights as a water district, justifying the issuance of an injunction.

(2) the action in Bulao v. CA[27] was for damages predicated on a

quasi-delict. Private respondent alleged that petitioner maliciously
constructed a dam and diverted the flow of water, causing the interruption of
water passing through petitioners land towards that of private respondent
and resulting in the loss of harvest of rice and loss of income.[28]

In the same vein, the claim under Sec. 39 related to a prejudice or

damage to petitioners finances as a water district which gave it the right to
levy a production assessment to compensate for the loss. Under the
provision, the water district was also entitled to injunction and damages in
case there was failure to pay. Obviously, this was a judicial issue which fell
under the jurisdiction of the regular courts. Since this involved a judicial
question, it followed that the doctrine of primary jurisdiction did not apply
because the technical expertise of the NWRB was not required.

Specifically, the action was within the exclusive jurisdiction of the

RTC because it was incapable of pecuniary estimation as provided in Sec. 19
(1) of BP 129,[29] as amended by RA 7691.[30] The basic issue was petitioners
entitlement to the right provided under Sec. 39 of PD 198. Although there
was a claim for a sum of money, it was purely incidental to, or a
consequence of, the principal relief sought.[31]

We note that the CA already ruled on the issue of whether petitioner

had the authority to impose production assessments. Petitioner did not raise
this issue in its petition before us. Did this amount to a waiver of the
issue? No, it did not. In its motion to dismiss in the RTC, respondent raised
the sole issue of lack of jurisdiction. Accordingly, the RTC in its April 28,
2005 and June 8, 2005 orders dealt only with this issue. However,
respondent, in its petition for certiorari in the CA, raised the additional
question of petitioners authority to impose the production assessments. This
was obviously premature because it already went into the merits of the case
and the RTC had not yet had the opportunity to resolve the
issue. Furthermore, points of law, theories, issues and arguments not brought
to the attention of the trial court ought not to be considered by a reviewing
court as these cannot be raised for the first time on appeal. [32] Therefore, it
was an error for the CA to rule on this issue.

Finally, respondent challenged the constitutionality of Sec. 39 of PD

198 in its memorandum. It contended that said provision was an undue
delegation of legislative power.[33] A collateral attack on a presumably valid
law is not allowed.

We have ruled time and again that the constitutionality or

validity of laws, orders, or such other rules with the force of law
cannot be attacked collaterally. There is a legal presumption of
validity of these laws and rules. Unless a law or rule is annulled in
a direct proceeding, the legal presumption of its validity stands. [34]
 Besides,

[a] law is deemed valid unless declared null and void by a

competent court; more so when the issue has not been duly
pleaded in the trial court. The question of constitutionality must
be raised at the earliest opportunity. xxx The settled rule is that
courts will not anticipate a question of constitutional law in
advance of the necessity of deciding it. [35]

WHEREFORE, the petition is hereby GRANTED. The decision and

resolution of the Court of Appeals dated May 26, 2006 and November 21,
2006, respectively, are REVERSED and SET ASIDE. The case
is REMANDED to Branch 90 of the Regional Trial Court of Imus, Cavite
for further proceedings.

SO ORDERED.

METRO ILOILO WATER DISTRICT, petitioner, vs. HON. COURT

OF APPEALS, Former SECOND DIVISION, Manila, HON.
SEVERINO C. AGUILAR, Presiding Judge, Branch 35, RTC,
Iloilo, EMMA NAVA, RUFINO SITACA, JR., REXES URSUA,
CARMEN PANGANTIHON, BENITO GO, REBECCA BERLIN,
and / or CHIT BERLIN, LUIS CARREON, CHARLES KANA-
AN and GERRY LUZURIAGA, respondents.

DECISION
TINGA, J.:

Before this Court is a Petition[1] dated November 9, 1995 filed by the

Metro Iloilo Water District assailing the Decision[2] of the Court of
appeals dated June 19, 1995 which affirmed the trial
courts Order[3] dismissing the petitions for injunction filed by petitioner
against private respondents.
Petitioner is a water district organized under the provisions of
Presidential Decree No. 198 (P.D. 198), as amended. It was granted by
the Local Water Utilities Administration Conditional Certificate of
Conformance No. 71[4] on January 12, 1979. Its service areas
encompass the entire territorial areas of Iloilo City and the Municipalities
of Ma-asin, Cabanatuan, Santa Barbara and Pavia.
Sometime between April and May of 1993, petitioner filed nine (9)
individual yet identical petitions for injunction with prayer for preliminary
injunction and / or temporary restraining order [5] against herein private
respondents the pertinent portions of which read:

4.Thatpursuanttotheprovisionsofsection31(a)ofP.D.198,asamended,the
petitionerasaWaterDistrictwasauthorizedtoadoptlawsandregulations
governingthedrilling,maintenanceandoperationofwellswithinits
boundariesforpurposesotherthansinglefamilydomesticuseonoverlying
land,withthenprovisionthatanywelloperatedinviolationofsuchregulations
shallbedeemedaninterferencewiththewatersofthedistrict;

5.Thatbyvirtueofsaidauthorization,theBoardofDirectorsforthepetitioner
promulgateditsRulesGoverningGroundWaterPumpingandspring
DevelopmentWithintheTerritorialJurisdictionoftheMetroIloiloWater
District,Section3ofwhichprovidesasfollows:

GroundWaterPumpingandSpringDevelopment.Exceptwhentheuseof
waterisforsinglefamilydomesticuse,noperson,naturalorjuridicalshall
abstractorwithdrawgroundwaterandappropriatethewatersfromsprings
withinthejurisdictionoftheDistrictwithoutfirstsecuringawaterpermitfrom
theCouncilandnopersonshallengageinthebusinessofdrillingwellseither
astestwellsorproductionwellsforthepurposeofabstractingorwithdrawing
groundwaterwithoutfirstregisteringaswellasdrillerwiththeCouncil;
Provided,thatthepersondrillinghisownwellorthroughtheservicesofa
qualifiedwelldrillershallcomplywiththestandardsandrequirements
establishedhereininadditiontothoseestablishedbytheCouncilforthe
exploitationofgroundwaterresources.

6.Thattherespondenthasabstractedorwithdrawngroundwaterwithinthe
territorialjurisdictionofthepetitionerat_________________________Iloilo
City,withoutfirstsecuringaWaterPermitfromtheNationalWaterResources
Councilnorhaditswelldrillerregisteredassuchwithsaidcouncil,andsold
saidwatersoextractedtocommercialandotherconsumersinIloiloCity,
withinpetitionersservicearea;
7.Thattheunauthorizedextractionorwithdrawalofgroundwaterbythe
respondentwithoutthenecessarypermitthereforeisinviolationoftherules
andregulationsprescribedbytheBoardofDirectorsofthepetitionerasabove
mentioneddulyapprovedbytheNationalWaterResourcesCounciland
constitutesinterferencewithordeteriorationofwaterqualityorthenatural
flowofsurfaceorgroundwatersupplywhichmaybeusedorusefulforany
purposeofthepetitionerforwhichthepetitionerasaWaterDistrictmay
commence,maintain,intervenein,defendandcompromiseactionsor
proceedingsunderSection31(a)ofP.D.198,asamended;

8.Thattheactoftherespondentincontinuingtoextractorwithdrawground
waterwithoutaWaterPermittherefor,isinviolationofArt.XIIIofP.D.1067
oftheWaterCodeofthePhilippines,andunlesssuchactisrestrained,will
definitelycausegreatlossuponthepetitionerasaWaterDistrict. [6]

In their respective answers, private respondents uniformly invoked

the lack of jurisdiction of the trial court, contending that the cases were
within the original and exclusive jurisdiction of the National Water
Resources Council (Water Council) under Presidential Decree No.
1067, otherwise known as the Water Code of the Philippines (Water
Code). In addition, private respondents Emma Nava[7] and Rebecca
Berlin[8] denied having extracted or withdrawn water from the ground,
much less sold the same.[9] Private respondent Carmen Pangantihon
likewise denied having constructed any waterworks system in her area
but admitted that she had constructed her own deep well, unaware that
she needed to get a permit to do the same. [10]Private respondent Rufino
Sitaca maintained the petitioners source of water are reservoirs from
rivers and are thus not affected by his well. Moreover, he claimed that
his water permit application was deemed approved, and thus he is
entitled to use the water from his well.[11]
Private respondent Benito Go admitted that he extracted water from
the ground, which he claimed to be his private property, and used the
water for his lumberyard and domestic purposes.[12] Additionally, he
alleged the petitioners rules and regulations were not published in the
Official Gazette and hence petitioner had no cause of action. [13] Private
respondent Charles Kana-an asserted that he had complied with the
requirements for the approval of his water permit application. He
claimed that he was extracting and selling water with petitioners
knowledge, and without damage and injury to the latter. [14] Meanwhile,
private respondent Gerry Luzuriaga claimed that he was not the real
party in interest, but Shoemart, Inc. which has the control and
possession of the property where the alleged withdrawal of ground
water was taking place.[15]
The trial court dismissed the petitions in its Order [16] dated March 17,
1994, ruling that the controversy was within the original jurisdiction of
the Water Council, involving, as it did, the appropriation, exploitation,
and utilization of water, and factual issues which were within the Water
Councils competence. In addition, the trial court held that petitioner
failed to exhaust administrative remedies under the doctrine of primary
administrative jurisdiction. Petitioners Motion for Reconsideration[17] was
thereafter denied on April 29, 1994.[18]
A petition[19] dated May 27, 1994 seeking a review of the trial courts
order of dismissal was filed before this Court but the same was referred
to the Court of Appeals for consideration and adjudication on the merits
in the Resolution[20] dated July 11, 1994.
Petitioner sought the review of the order of the trial court dismissing
the petitions and denying its motion for reconsideration, on the ground
that the trial court failed to adhere to this Courts rulings in Amistoso v.
Ong[21] and Santos v. Court of Appeals,[22] which upheld the regular
courts jurisdiction over disputes which involve not the settlement of
water rights but the enjoyment of the right to water use for which a
permit had already been granted.
The Court of Appeals denied the petition, holding that the trial court
did not err in dismissing the case for want of jurisdiction as it was the
Water Council which had jurisdiction over the case. The appellate court
ratiocinated:

ThecontroversyinthiscasearosefromthefactthatthepetitionerIloiloWater
DistrictwasgrantedwaterrightsinIloiloCityandtherespondentsalso
extractedorwithdrewgroundwaterwithinthesamejurisdiction.

Whileatfirstimpressionthiscaseinvolvesaviolationofthepetitioners
enjoymentofarighttowateruse,thefactisthatitactuallyinvolvesalsoa
disputeovertheappropriation,utilization,exploitationdevelopment,control,
conversationandprotectionofwatersbecausetherespondentshaveallegedly
engagedintheextractionorwithdrawalofgroundwaterwithoutapermitfrom
theNWRCwithintheterritorialjurisdictionofthepetitioner.Therefore,Art.88
ofP.D.No.1067givingtheNWRCoriginaljurisdictionoverthecasesis
applicable.
TheNWRChasjurisdictiontohearanddecidedisputesrelatingto
appropriation,utilizationandcontrolofwaterwhiletheRegionalTrialCourt
onlyhasappellatejurisdictionoverthecase.Thiswastherulingofthe
SupremeCourtinAbeabevs.Manta,90SCRA524whichwasreiterated
inTanjayWaterDistrictvs.Gabanton,172SCRA253.

ThecasesofSantosv.CourtofAppeals,214SCRA170andAmistosovs.
Ong,130SCRA288arenotapplicabletothecaseatbarforhere,whatis
involvedisnotonlytheallegedviolationofthegranteesrightbutaquestionof
whetherornottherespondentshaveequalrighttotheappropriation,utilization
andexploitationofwaterrights.[23]

The Court of Appeals denied petitioners Motion for

Reconsideration dated July 11, 1995 in its Resolution of September
[24]

29, 1995.[25]
Petitioner now contends that the extraction or withdrawal of ground
water as well as the sale thereof within its territorial jurisdiction is a
violation of its rights as a water district. [26] Being a violation thereof, the
regular courts have jurisdiction over the dispute. On the other hand,
private respondents unanimously maintain that it is the Water Council
which has jurisdiction over the subject matter of this case. Thus, the
sole issue in this petition, as presented by petitioner, is:

DIDTHEREGIONALTRIALCOURTOFILOILOHAVEJURISDICTION
OVERTHESUBJECTMATTEROFTHEPETITIONS?[27]

Petitioner anchors its claim on Section 31 (now 32) of PD 198, as

amended, which reads:

Sec.32.ProtectionofwatersandFacilitiesofDistrict.Adistrictshallhavethe
rightto:

(a)Commence,maintain,intervenein,defendandcompromiseactionsor
proceedingstopreventinterferencewithordeteriorationofwaterquality
orthenaturalflowofanysurface,streamorgroundwatersupplywhichmay
beusedorusefulforanypurposeofthedistrictorbeacommonbenefittothe
landsoritsinhabitants.Thegroundwaterwithinadistrictisnecessarytothe
performanceofthedistrictspowersandsuchdistrictsherebyauthorizedto
adoptrulesandregulationssubjecttotheapprovaloftheNationalWater
ResourcesCouncilgoverningthedrilling,maintenanceandoperationofwells
withinitsboundariesforpurposesotherthanasingledfamilydomesticuseon
overlyingland.Anywelloperatedonviolationofsuchregulationsshallbe
deemedininterferencewiththewatersofthedistrict.

(c)Prohibitanyperson,firmorcorporationfromvending,selling,orotherwise
disposingofwaterforpublicpurposeswithintheserviceareaofthedistrict
wheredistrictfacilitiesareavailabletoprovidesuchservice,orfixtermsand
conditionsbypermitforsuchsaleordispositionofwater.

By virtue of the above provisions, petitioner states that as a water

district, it has the right to prevent interference with the water of the
district; and to enforce such right, it is given remedies of commencing,
maintaining, or intervening in, defending or entering into appropriate
actions or proceedings.
In asserting the jurisdiction of the regular courts over its petitions
and the propriety of its filing of the petitions before the trial court,
petitioner invokes the ruling of the Court in Amistoso v. Ong,[28] as
reiterated in Santos v. Court of Appeals,[29] that where the issue involved
is not the settlement of a water rights dispute, but the enjoyment of a
right to water use for which a permit was already granted, the regular
court has jurisdiction and not the Water Council.
Petitioner insists that there is no occasion to invoke the original
jurisdiction of the Water Council in this case since there is no question
of appropriation, exploitation, utilization, development, control,
conservation, and protection of water. The only dispute, according to
petitioner, pertains to the act of private respondents in extracting ground
water from the territory of petitioner as a water district and selling the
same within its service area, or more succinctly, private respondents
interference with the granted right of petitioner over ground water within
its territorial jurisdiction.[30]
Private respondents, for their part, staunchly invoke Article 88 of the
Water Code, which grants original jurisdiction over all disputes relating
to the appropriation, utilization, exploitation, development, control,
conservation and protection of waters to the Water Council.[31]
Relying on the cases of Abe-abe v. Manta[32] and Tanjay Water
District v. Gabaton,[33] private respondents maintain that the Water
Council is exclusively vested with original jurisdiction to settle water
disputes under the Water Code. They claim that
the Amistoso and Santos cases do not apply to the instant case since
in Amistoso, the issue was the prevention of the flow of water through
an irrigation canal, and in Santos, the issue referred to the prevention of
the enjoyment of a water right. In contrast, the issue in the instant case
is the right to appropriate water which petitioner and some of the private
respondents profess to have.
We find merit in the petition.
The petitions file before the trial court were for the issuance of an
injunction order for respondents to cease and desist from extracting or
withdrawing water from petitioners well and from selling the same within
its service areas.[34] The petitions contained factual allegations in support
of the prayer for injunction, to wit:
1. the grant to petitioner of a Conditional Certificate of Conformance by the
Local Water Utilities Administration over areas from which water was
allegedly extracted or withdrawn by private respondents, by virtue of which
its Board of Directors promulgated rules governing ground water pumping
within its service areas;
2. abstraction or withdrawal of water within the territorial jurisdiction of petitioner
by private respondents without first securing a permit from the Water
Council, or registering their well drillers, and sale of said water so extracted
to commercial and other consumers within petitioners service areas;
3. that the unauthorized extraction or withdrawal of ground water by private
respondents without the necessary permit was in violation of petitioners
prescribed rules, and constitutes interference for which petitioner may
commence, maintain, intervene in, defend and compromise actions or
proceedings under Sec. 31 of P.D. No. 198;
4. that the extraction or withdrawal of ground water without the corresponding
permit was a violation of Art. 13 of the Water Code; and
5. that great damage and prejudice will be suffered by petitioner if private
respondents extraction and withdrawal of ground water, as well as the selling
thereof be allowed to continue.

In essence, the petitions focus on the violations incurred by private

respondents by virtue of their alleged unauthorized extraction and
withdrawal of ground water within petitioners service area, visa-a-
vis petitioners vested rights as a water district. At issue is whether or not
private respondents extraction and sale of ground water within
petitioners service area violated petitioners rights as a water district. It is
at once obvious that the petitions raise a judicial question.
A judicial question is raised when the determination of the questions
involves the exercise of a judicial function, i.e., the question involves the
determination of what the law is and what the legal rights of the parties
are with respect to the matter in controversy. As opposed to a moot
question or one properly decided by the executive or legislative branch,
a judicial question is properly addressed to the courts.[35]
The instant case certainly calls for the application and interpretation
of pertinent laws and jurisprudence in order to determine whether
private respondents actions violate petitioners rights as a water district
and justify an injunction. This issue does not so much provide occasion
to invoke the special knowledge and expertise of the Water Council as it
necessitates judicial intervention. While initially it may appear that there
is a dimension to the petitions which pertains to the sphere of the Water
Council, i.e., the appropriation of water which the Water Code defines
as the acquisition of rights over the use of waters or the taking or
diverting of waters from a natural source in the manner and for any
purpose allowed by law, in reality the matter is at most merely collateral
to the main thrust of the petitions.
The petitions having raised a judicial question, it follows that the
doctrine of exhaustion of administrative remedies, on the basis of which
the petitions were dismissed by the trial court and the Court of Appeals,
does not even come to play.[36]
Notably too, private respondents themselves do not dispute
petitioners rights as a water district. The cases of Abe-Abe v.
Manta[37] and Tanjay Water District v. Gabaton[38] invoked by private
respondents are thus inapplicable. In Abe-Abe v. Manta, both petitioners
and respondent had no established right emanating from any grant by
any governmental agency to the use, appropriation and exploitation of
water, while in Tanjay Water District v. Gabaton, petitioner Tanjay sought
to enjoin the Municipality of Pamplona and its officials from interfering in
the management of the Tanjay Waterworks System.
On the other hand, in the analogous case of Amistoso v. Ong[39],
petitioner had an approved Water Rights Grant from the Department of
Public Works, Transportation and Communications. The trial court was
not asked to grant petitioner the right to use but to compel private
respondents to recognize that right. Thus, we declared that the trial
courts jurisdiction must be upheld where the issue involved is not the
settlement of a water rights dispute, but the enjoyment of a right to
water use for which a permit was already granted.[40]
In like manner, the present petition calls for the issuance of an
injunction order to prevent private respondents from extracting and
selling ground water within petitioners service area in violation of the
latters water permit. There is no dispute regarding petitioners right to
ground water within its service area. It is petitioners enjoyment of its
rights as a water district which it seeks to assert against private
respondents.
WHEREFORE, the Decision of the Court of Appeals dated June 19,
1995 is SET ASIDE and the case is ordered REMANDED to the trial
court for further proceedings, with costs against respondents.
SO ORDERED.

G.R. No. L-37986 March 1, 1934

EUFEMIA MERCADO, plaintiff-appellant,

vs.
THE MUNICIPAL PRESIDENT OF MACABEBE, PAMPANGA, and THE SECRETARY OF
COMMERCE AND COMMUNICATIONS, defendants-appellee.

Eusebio Orense and Nicolas Belmonte for appellant.

Provincial Fiscal Daza for appellees.

DIAZ, J.:

This is an appeal taken by Eufemia Mercado from a judgment rendered by the Court of First
Instance of Pampanga dismissing her appeal from an order of the Secretary of Commerce
and Communications wherein said official directed Romulo Mercado, the appellant's
predecessor in interest, to remove the two dikes which he had constructed at both ends of
the creek named Batasan-Limasan or Pinac Bugalun, which traverses part of the hacienda
described in certificate of Title No. 329 of the registry of deeds of Pampanga, and formerly
belonging to said Romulo Mercado, but which now belongs to the appellant by virtue of a
formal donation made to her by said Romulo Mercado, after the institution of this action.

After due trial, the court a quo held that the creek in question is property of the public
domain.

The contention of the appellant's predecessor in interest in the record of the investigation
conducted by the Secretary of Commerce and Communications, through his agents, and that
of the appellant, both in the court a quoand in this court, is that the said Batasan-Limasan or
Pinac Bugalun creek is not a natural but an artificial creek which had been developed on
his hacienda by means of excavations made by his men on two different occasions, the
former before the revolution or during the Spanish regime, and the latter after the revolution.

The appellees, in turn, contend that the creek in question is a natural navigable creek which
already existed on the said hacienda of the appellant not only long before the revolution but
also from the time immemorial.

The evidence presented by the appellant shows that formerly when her so-
called hacienda still belonged to her grandfather Mariano Mercado, the portion of the said
creek, indicated on the plan Exhibit 2 by two parallel lines in black ink drawn from the point
marked 3 towards the center until it turns northwards, was but a recess or arm then called
Bugalun, of the Nasi River, which arm was lost in the hacienda. It extended close to a small
creek called Batasan-Limasan which derived its waters, particularly during high tide, from the
large creek called Limasan indicated on the aforesaid plan.

Mariano Mercado, the original owner of the hacienda, in order to facilitate the cutting and
transportation of firewood and other products, produced on the said hacienda, towards the
Nasi River on the east or towards Limasan creek on the west, connected the two recesses or
bodies of water in question by means of excavations and, after having so connected them,
made other excavations at both ends towards the said river and creek, thus constructing a
sort of canal directly connecting both bodies of water, and which later became known as the
Batasan-Limasan or Pinac Bugalun creek.

The said Batasan-Limasan or Pinac Bugalun creek or canal already existed at the time of
the institution of the registration proceedings wherein judgment was rendered resulting in the
issuance of certificate of title No. 329 in favor of Romulo Mercado. On the plan of the land,
which was presented in the said case, the aforesaid creek appears; and at the time the case
was tried as well as when the certificate of title was issued in favor of the applicant Romulo
Mercado, none of the herein defendants nor the Insular Government filed opposition or
objection thereto.

Once the said Batasan-Limasan or Pinac Bugalun creek or canal was opened from the Nasi
River to Limasan creek, not only the residents of the hacienda and those who visited it but
also some of the residents of the nearby barrios and municipalities began to use it as a
means of communication in attending to their needs, sometimes with the permission of the
owners of the hacienda, and at other times without even the latter's knowledge. It was then
that Romulo Mercado, the appellant's predecessor in interest, decided to convert the said
creek into a fish pond and with that object in view, in 1928 he closed the two opening thereof
towards the Nasi River on one side and Limasan creek on the other side.

The appellant's witnesses, Romulo Mercado, Maximo dela Pea and Andres Limin testified
that the creek in question became navigable only from the time Mariano Mercado had
excavated both ends and the junction of the former two recesses from which said creek had
been formed; that the former owners of the hacienda had employed about 60 men for a
period of two weeks in order to perform such task, and that during the revolution and for
about ten years, in view of the fact that many people entered the hacienda to cut or carry
away firewood without permission, Romulo Mercado ordered the creek closed in order to
prevent the entrance into and passage of strangers through it.

On the other hand, the appellee's tried to prove by means of their witnesses Castor
Quiambao, Maximino Guintu and Lorenzo Magat, that the creek in question has existed on
the appellant's hacienda from time immemorial, and that they had been passing through and
fishing in it, as others had done, as often as they wished, long before the revolution until it
was closed by the appellant's predecessor in interest in 1928. To that effect, they presented
resolution No. 6 of the municipal council of Macabebe, Pampanga, placing at public auction
the privilege of fishing in the Batasan-Limasan creek (Exhibit 6), among other rivers and
creeks. However, they failed to establish that anybody had ever obtained such privilege, for
which reason said evidence cannot be given any weight, there being no doubt, as there can
be no doubt, that a mere notice, as Exhibit 6, does not constitute sufficient evidence that the
creek in question is the property of the public domain.1vvphi1.ne+

The testimony of the said witnesses for the appellees seems insufficient to overcome that of
the witnesses for the appellant on the ground that Castor Quiambao is relatively young and
he himself admitted that in his youth, as he remembered, he used to pass through the creek
in question only once or twice a month. The other witnesses, not being residents of the
place, were in no better position to know what the appellant's witnesses knew as to the true
nature, conditions and changes which the said creek had undergone, inasmuch as the latter
witnesses had lived and worked in that same place for many years.

However, considering that the evidence of both parties is equiponderant, could not the
question be decided by taking into consideration only, or mainly, the undisputed fact that the
creek in question, both during the first years of its existence, when it was but a small creek
formed by the channels or recesses called Batasan-Limasan and Bugalun by some
witnesses, and after it had been converted into said creek, whether naturally or artificially,
that it, by means of man's labor, with openings toward the Nasi River and toward the
Limasan creek, derived its waters from the aforesaid river and creek, which unquestionably
belong to the public domain?

The lower court, invoking the provisions of articles 339, 407 and 408 of the Civil Code,
decided the question mainly by taking said fact into consideration.

The pertinent parts of the aforesaid three articles provide as follows:

Property of public ownership is

1. That devoted to public use, such as roads, canals, rivers, torrents, ports and
bridges constructed by the State, riverbanks, shores, roadsteads, and that of a
similar character. (Art. 339.)

The following are of public ownership:

1. Rivers and their natural channels;

2. Continuous or intermittent waters from springs or brooks running in their natural

channels and the channels themselves;

3. Waters rising continuously or intermittently on lands of public ownership;

xxx xxx xxx

8. Waters which flow continuous or intermittently from lands belonging to private

parties, to the State, to provinces, or to towns, from the moment they leave such
lands. (Art. 407.)

The following are of private ownership:

1. Waters, either continuous or intermittent rising on private estates, while they run
through them;

2. Lakes and ponds and their beds when formed by nature on said estates;

3. Subterranean waters found on the same;

4. Rain waters falling thereon as long as they remain within their boundaries;
 5. The channels of flowing streams, continuous or intermittent, formed by rain water,
and those of brooks crossing estates which are not of public ownership.

The water, bed, banks, and floodgates of a ditch or aqueduct are deemed to be an
integral part of the estate or building for which the waters are intended. The owners
of estates through or along the boundaries of which the aqueduct passes can assert
no ownership over it, nor any right to make use of its beds or banks, unless they
base their claim on title deeds which specify the right or the ownership claimed. (Art,
408.)

It will be noted that the appellant cannot invoke in her favor the article last quoted on the
ground that although it is true that the Batasan-Limasan or Pinac Bugalun creek passes
through her hacienda, it is none the less true that it is not included in any of the kinds of
private property therein enumerated. The appellant and her predecessors in interest, in
closing the two openings of the said creek and converting it into a fish pond, not only
appropriated for themselves the channel of the said creek but also the creek itself; and a
creek is not a brook because the latter is but a short, almost continuous stream of water
(Diccionario de la Real Academia Espaola), while the former is a recess or arm extending
from a river, which participates in the ebb and flow of the sea. (15 Enciclopedia Juridica
Espaola, 216.)

On the other hand, the aforecited article 339 provides that canals, rivers,
torrents, . . . and those of a similar character are property of public ownership, and the
similarity between rivers, canals, and creeks is undoubtedly obvious on the ground that, as
has been stated, a creek is no other than an arm extending from a river. Furthermore, under
article 407, the Batasan-Limasan or Pinac Bugalun creek may be considered as belonging
to the class of property enumerated in paragraph 8 thereof. And, in addition to the foregoing,
the Contentious Court of Spain (Tribunal Contencioso de Espaa) in a decision dated June
25, 1890, laid down the doctrine that creeks are property of the public domain
(15 Enciclopedia Juridica Espaola, 216).

And even granting that the Batasan-Limasan creek acquired the proportions which it had,
before it was closed, as a result of excavations made by laborers of the appellant's
predecessor in interest, it being a fact that, since the time it was opened as a water route
between the Nasi River and Limasan creek, the owners thereof as well as strangers, that is,
both the residents of the hacienda and those of other nearby barrios and municipalities, had
been using it not only for their bancas to pass through but also for fishing purposes, and it
being also a fact that such was the condition of the creek at least since 1906 until it was
closed in 1928, if the appellant and her predecessors in interest had acquired any right to the
creek in question by virtue of excavations which they had made thereon, they had lost such
right through prescription inasmuch as they failed to obtain, and in fact they have not
obtained, the necessary authorization to devote it to their own use to the exclusion of all
others. The use and enjoyment of a creek, as any other property susceptible of
appropriation, may be acquired or lost through prescription, and the appellant and her
predecessors in interest certainly lost such right through the said cause, and they cannot
now claim it exclusively for themselves after the general public had been openly using the
same from 1906 to 1928. When two different interests, one being private and the other
public, are in conflict with one another, the former should yield to the latter.

It is useless for the appellant now to allege that she has obtained certificate of title No. 396 in
her favor because the said certificate does not confer upon her any right to the creek in
question, inasmuch as the creek, being of the public domain, is included among the various
exceptions enumerated in section 39 of Act No. 496 to which the said certificate is subject by
express provision of the law, and furthermore, because it so appears in the certificate itself.

The doctrine laid down in the case of the Government of the Philippine Islands vs.
Santos (G. R. No. 27202, promulgated September 2, 1927, not reported), which the
appellant invokes in her favor, is not applicable herein because the subject matter in that
case is not of the same nature as the Batasan-Limasan or Pinac Bugalun creek. The thing
involved therein was simply a date or, in the words of the trial court, a low depression on the
defendant's land where there was a waterway passable by bancas at high tide, but which
completely dried up at low tide and during the dry season. From what has been hereinbefore
stated, it may be inferred that the Batasan-Limasan creek is perfectly navigable
by bancas throughout the year, inasmuch as at the time it was measured in November by
employees and agents of the Bureau of Lands, it was more than two meters deep at its
mouth and around a meter and a half deep at its shallow parts. Furthermore, in the case of
Urbano Santos, the creek in question was closed a few years after excavations had been
made in the land under consideration.

Wherefore, the judgment appealed from is hereby affirmed, with costs against the appellant.
So ordered.

[G.R. No. 15700. September 18, 1920. ]

CRISPULO SIDECO, Plaintiff-Appellant, v. LEOCADIO SARENAS and RUFINO

SARENAS, Defendants-Appellees.

Araneta & Zaragoza for Appellant.

C. Ledesma for Appellees.

SYLLABUS

1. PROPERTY; WATERS; IRRIGATION; PHILIPPINE LAW ANALYZED. The Philippine Law on the
subject of waters has both a constitutional and a statutory basis and has both a civil law and a
common law origin.

2. ID.; ID.; ID.; ID. The Philippine Bill, the Act of Congress of July 1, 1902, authorizes the
Government of the Philippine Islands to make rules and regulations for the use of waters.

3. ID.; ID.; ID.; ID. Local statutory law relating to irrigation is made up of the Spanish Law of
Waters of August 3, 1866, various provisions of the Spanish Civil Code, and the Irrigation Act, Act
No. 2152 of the Philippine Legislature as amended by Act No. 2652.

4. ID.; ID.; ID.; ID.; ACCRUED RIGHTS. Both the Organic Law and the Irrigation Act explicitly
provide that they shall not work to the detriment of accrued rights.

5. ID.; ID.; ID.; ID.; PRIORITY OF APPROPRIATION. Priority of appropriation gives the better
right as between two or more persons using the public waters.

6. ID.; ID.; ID.; ID.; ID. The precise point of time when the right attempted to be asserted
began is regarded as commencing when the claimant started to construct his dam, ditch, flume, or
other appliance, by means of which his appropriation is effected, provided he prosecutes his
enterprise to success and with reasonable diligence.

7. ID.; ID.; ID.; ID.; ADMINISTRATIVE CONCESSION; PRESCRIPTION. The Civil Code and the
Spanish Law of Waters, which must be looked to in order to determine rights which had vested prior
to the enactment of the Irrigation Act, provide that the use waters is acquired either by
administrative concession or by prescription of twenty years.
 8. ID.; ID.; ID.; ID.; ID.; ID. --To found a prescriptive water right on adverse possession, the
enjoyment of it must have been continuous during the full prescriptive period, under a claim of right
hostile and adverse to those who were injured by such use so as to exclude them from a similar use
of the water.

9. ID.; ID.; ID.; ID.; BENEFICIAL USE. Beneficial use is the basis, the measure, and the limit of
all rights to water in the Philippine Islands.

10. ID.; ID.; ID.; ID.; ADMINISTRATIVE DECISIONS. Administrative machinery for the
settlement of disputes as to the use of waters is provided by the Irrigation Act, as amended.

11. ID.; ID.; ID.; ID.; ID. The statute, in placing discretion over the making of appropriations of
waters with the Director of Public Works, and the Secretary of Commerce and Communications, is
not unconstitutional as conferring on them judicial powers, since their determination is at most
quasi-judicial only and since the right of direct appeal to the courts is expressly allowed.

12. ID.; ID.; ID.; ID.; ID. The Director of Public Works and the Secretary of Commerce and
Communications are authorized to adjudicate on priorities and grant permits. Such officers act
merely in an administrative capacity. However, their decisions, when not appealed from, are
conclusive.

13. ID.; ID.; ID.; ID.; ID.; DECISION OF DIRECTOR OF PUBLIC WORKS AS PART OF JUDICIAL
RECORD. The decision of the Director of Public Works, affirmed by the Secretary of Commerce
and Communications, containing as it does the technical findings of officers especially qualified in
irrigation engineering, should invariably be made a part of the judicial record because (1) the
determination of these officials would be most useful to the courts, and (2) the exact date of the
decision is of moment since it decides whether the appeal was taken in time.

14. ID.; ID.; ID.; ID.; PRESUMPTION OF LAW. Where Ss predecessors constructed a dam in
1885 but no administrative concession is proved, there arises a presumption that the law has been
obeyed.

15. ID.; ID.; ID.; ID.; INSTANT CASE. Held: That Ss has demonstrated priority of appropriation
as to the waters flowing through the estero [estuary] Bangad, Province of Nueva Ecija, and has,
therefore, the preferential right to the use of these waters for irrigation purposes.

DECISION

MALCOLM, J. :

This appeal requires an interpretation and an application of the various provisions of Philippine law
which concern the subject of irrigation.

The rubric of the case is brief. Two parties, Crispulo Sideco on the one hand, and Leocadio Sarenas
and Rufino Sarenas on the other hand, claim the exclusive right to the use of the waters flowing
through the estero [estuary] Bangad, Province of Nueva Ecija, for irrigation purposes. The claim of
Sideco goes back to 1885 when the predecessor in interest of his father constructed a dam in these
waters; the use of the dam was afterwards interrupted by outside causes such as imprisonment and
war, but again re-asserted in 1911, 1915, and 1916. Exactly what the two Sarenas contention is, is
not quite clear on the facts before us. However, it appears that they made application to the
Director of Public Works, only to meet with the opposition of Sideco, and that the Director of Public
Works, with the approval of the Secretary of Commerce and Communications, granted the two
Sarenas the right, in preference to all other persons, to use the waters of the estero Bangad. Sideco
then took the proceedings to the Court of First Instance of Nueva Ecija. After trial, judgment was
entered, dismissing the complaint and the appeal of Sideco and confirming the decision of the
administrative authorities, with the costs against the plaintiff.

The further appeal of Sideco to this court, while conceding the correctness of the findings of the trial
court, squarely challenges its judgment.
The Philippine law on the subject of waters has both a constitutional and a statutory basis and has
both a civil law and a common law origin. The Philippine Bill authorized the Government of the
Philippine Islands to make rules and regulations for the use of waters.Beneficial use," reads this
portion of the Organic Law, "shall be the basis, the measure, and the limit of all rights to water in
said islands." Priority of possession, rights to the use of water which had vested and accrued and
which were recognized and acknowledged by the local customs, laws, and the decisions of the
courts, were to be respected. The possessors and owners of such vested rights were to be
maintained and protected in the same. (Act of Congress of July 1, 1902, sections 19, 50; 32 Stat. at
L., 691.)

Local statutory law relating to irrigation is made up of the Spanish Law of Waters of August 3, 1866,
various provisions of the Spanish Civil Code, and the Irrigation Act, Act No. 2152 of the Philippine
Legislature as amended by Act No. 2652. The Law of Waters was held as in force in the Islands in a
decision of the Supreme Court of the Philippine Islands affirmed by the Supreme Court of the United
States; and Act No. 2152 continued this law and the provisions of the Civil Code in the matter of
waters, and all other existing laws dealing with waters and irrigation systems in force in so far as
they are not incompatible with the provisions of the Act. (Ker & Co. v. Cauden [1906], 6 Phil., 732;
[1912], 223 U. S., 268; Act No. 2152, sec. 51.) The Irrigation Act, like the Organic Law, explicitly
provides that it shall not work to the detriment of rights acquired prior to its passage. (Secs. 1, 50.)
Like too the Organic Law, the doctrine of beneficial use is recognized. Priority of appropriation gives
the better right as between two or more persons using the public waters. (Sec. 3.) The Civil Code
and the Spanish Law of Waters, which must be looked to in order to determine rights which had
vested prior to the enactment of the Irrigation Act, provide that the use of waters is acquired either
by administrative concession or by prescription of twenty years. (Civil Code, art. 409, and various
provisions of the Spanish Law of Waters.)

Administrative machinery for the settlement of disputes a8 to the use of waters is provided by the
Irrigation Act, as amended. Controversies must be submitted to the Secretary of Commerce and
Communications through the Director of Public Works. The "decision" of the Secretary thereon is
final "unless appeal therefrom be taken to the proper court within thirty days after the date of the
notification of the parties of said decision. In case of such appeal the court having jurisdiction shall
try the controversy de novo." (Sec. 4.) A more extensive method is also provided, somewhat akin
to our cadastral system, which makes it the duty of the Director of Public Works to make a technical
examination of streams and to prepare a list of priorities. In the performance of this work, the
Director of Public Works or any official especially authorized by him, may examine witnesses under
oath, and can issue for this purpose subpoenas and subpoenas duces tecum. (Secs. 8, 41.)
Certificates signed by the Secretary of Commerce and Communications are then granted each
appropriator. (Secs. 9, 18.) "Appeal" lies from the "decision" of the Director of Public Works, as
approved by the Secretary of Commerce and Communications, to the Court of First Instance of the
province in which the property is situated. Such action must be brought within ninety days of the
date of the publication of the approved list of priorities. (Sec. 10.)

The provisions of Philippine Irrigation Law have been gone into somewhat more extensively than is
absolutely essential for the disposition of the instant appeal, for the very good reason that the
procedure to be followed in such cases does not seem to be well-known. Narrowing some what our
inquiry, there next logically follows a discussion of the principles which concern priority of
appropriation, Spanish grants, and prescription.

The doctrine of prior appropriation, as we have said, is here recognized as the fundamental principle
which must primarily determine the vital industrial question of what constitutes a valid appropriation
of waters for irrigation purposes. As we have also stated. there must be in there must be in this
jurisdiction an intention to use the waters for a beneficial purpose. The precise point of time when
the right attempted to be asserted began is regarded as commencing when the claimant started to
construct his dam, ditch, flume, or other appliance, by means of which his appropriation is effected,
provided he prosecutes his enterprise to success and with reasonable diligence. (Nevada Ditch Co.
v. Bennett [1896], 30 Ore., 59.)

The decisive question in this case thus reduces itself still further to the determination of which of
the two rival claimants has shown priority of use of the waters of the estero Bangad, and this
question must be determined herein in conformity with the civil law, since this was a right which for
all practical purposes accrued prior to the enactment of the Irrigation Act.
As to plaintiffs case, it is admitted that Sidecos predecessor constructed a dam in this estero in
1885. But no administrative concession with this end in view is proved. (See Civil Code, art. 409;
Spanish Law of Waters, arts. 234, 235.) Counsel, however, contends, with some slight degree of
effectiveness, that there is here a presumption, uncontradicted by other evidence, that the law has
been obeyed. (Code of Civil Procedure, sec. 334, No. 31.) He also claims title by prescription of
twenty years. (Civil Code, art. 459; Spanish Law of Waters, secs. 39, 42.) To found a prescriptive
water right on adverse possession, the enjoyment of it must have been continuous during the full
prescriptive period, under a claim of right hostile and adverse to those who were injured by such
use so as to exclude them from a similar use of the water. On the facts found by the trial judge,
plaintiff gains some standing for his claim because of the adverse character of his use, interrupted
by forces over which he had no control, and the various attempts he has made to consummate the
construction of an irrigation dam.

As to the case made for the defendants, little can be said. The facts which seem to have convinced
the Director of Public Works and the Secretary of Commerce and Communications of the better
rights of the defendants are not before us. The defense in the lower court was merely a general
denial and an attempt to overcome plaintiffs pretensions, while not effectively making an
affirmative showing.

The facts of record are far from satisfactory and fall short of that certainty which is always desirable
in judicial trials. This leads us to say something further regarding the decisions of administrative
officers in irrigation controversies and the procedure which should be followed when the matter is
brought before the courts.

In many of the states of the American Union which have adopted irrigation codes, notably in the
State of Wyoming, general authority over the making of appropriations is given to the state
engineer. The statutes placing discretion in these matters with the state engineer are not
unconstitutional as conferring on him judicial powers, since his determination is at most quasi-
judicial only and since the right of direct appeal to the courts is expressly allowed. (Boise etc. Co. v.
Stewart [1904], 10 Idaho, 38; Farm Inv. Co. v. Carpenter [1900], 9 Wyo., 110.) The engineer is
authorized to adjudicate on priorities and grant permits. Proceedings in court are a continuation of
ex parte proceedings before an executive official. Such officers act merely in an administrative
capacity. However, the decisions of these administrative officers, when not appealed from in time,
are conclusive. (See Wiel, Water Rights in the Western States, Part I, Chapter VIII; Part IV, Chapter
II- Waha Lewiston & Water Co. v. Lewiston-Sweetwater Irrigation Co. Ltd. [1907], 158 Fed., 137.)

Parenthetically, it may be remarked that the decision of the Director of Public Works, affirmed by
the Secretary of Commerce and Communications, containing as it does the technical findings of
officers especially qualified in irrigation engineering, should invariably be made a part of the judicial
record because, (1) the determination of these officials would be most helpful to the courts, and (2)
the exact date of the decision is of moment since it decides whether the appeal was taken in time.
The courts, without doubt, would entertain great respect for the decisions of these administrative
officers Trial courts should require that such decisions be made a part of the complaint before
proceeding with the action.

Another thought brought forth by the facts before us is, that since the prime question will usually
concern priority of appropriation, the defendant as well as the plaintiff must present affirmative
proof if he expects t win his case. Merely attempting to undermine plaintiffs proof is not sufficient,
for the plaintiff, having once shown the date of his appropriation, if the defendant cannot show an
anterior use, obviously the plaintiff must win.

On the facts before us, the court has come to the conclusion that plaintiff has demonstrated priority
of appropriation. The result, consequently, must be, to reverse the judgment appealed from, to
declare that the plaintiff has the preferential right to the waters of the estero Bangad for the
irrigation of his land, and to order that this decision be registered with the register of deeds of the
Province of Nueva Ecija. The costs of both instances shall be taxed against the defendants. So
ordered.

G.R. No. L-11627 August 10, 1918

THE MUNICIPALITY OF MANGALDAN, plaintiff-appellee,
vs.
THE MUNICIPALITY OF MANAOAG, defendant-appellant.

Sison & Moran for appellant.

Rafael Monserrat for appellee.

TORRES, J.:

On May 23, 1914, counsel for the municipality of Mangaldan filed a complaint in the Court of
First Instance of Pangasinan against the municipality of Manaoag, alleging that from time
immemorial it has been enjoying and using one-half of the water of the Tagumising River,
that is, all the volume of water carried by the so-called Tolon River, a continuation of the
former, which passes through the municipality of Manaoag; that, under as easement that for
more than 30 years had existed in favor of the plaintiff, certain residents of Mangaldan have
been enjoying the use of the water from the said Tagumising and Tolon Rivers for the
purpose of irrigating their lands, but that, two years prior to the date above-mentioned, they
were deprived of the use and enjoyment of the water of said rivers, by reason of the
defendant's having obstructed the channel by means of a strong dam built at the confluence
of the two rivers at a place between the localities of Tagumising and Tolon, thus obstructing
the flow of the water; wherefore, the plaintiff municipality prayed the court to hold that is was
entitled to use and enjoy the water carried by the so-called Tolon River, and further, that the
court oblige the defendant to tear down the dam that it had constructed at t he confluence of
the Tagumising and the so-called Tolon Rivers, and to pay the costs.

The demurrer to the aforementioned complaint having been overruled by an order of July 22,
1914, to which the defendant excepted, the latter, in his answer, recognized the personality
of the plaintiff and admitted that the channel of the Tagumising River lay partly within the
municipality of Manaoag; and denied each and all of the allegations contained in the
complaint. As a special defense he alleged that, even granting that the plaintiff had at any
time a right to the water that flows through the Tagumising River, such right had already
totally prescribed; and the defendant, therefore, prayed that the municipality of Manaoag be
absolved from the complaint, with the costs against the plaintiff.

After the trial was held and the evidence adduced by both parties, the court, on the morning
of May 2, 1915, attended by counsel for the litigants, by the municipal presidents of said
municipalities and by the clerk of court, repaired to the vicinity of said river for the purpose of
making an ocular inspection thereof and of the dam in the sitioof Amorboran. Said inspection
disclosed that near and in front of the said dam there was a piece of land covered with an
overgrowth of weeds which prevented the water of the river from reaching it, and, on its
being carefully examined, some bamboo stakes were found there; these had some plant
growth in their lower part, while their upper and front parts appeared to be covered with earth
and sand overlaid with considerable under brush and a number of small trees; that at a
distance of about 50 steps from the dam, there was a small pool of water and back of it the
bed of the river was completely dry and had been filed with earth and sand; and that in the
part of the river between the dam and the water there was a fill that was higher than the river
bed. During the inspection, counsel for the plaintiff called attention to the fact that, as the bed
of the irrigation ditch named Canon was of the same width as that of the Tagumising River,
and that, as there was a current in the ditch, this latter took all the water of the river. It was
also observed that the bamboo stake was quite new, and had not rotted notwithstanding that
it had been under water. Counsel for the defendant called the court's attention to the alleged
fact that a little farther down here was laundering place, which indicated that there was water
there; but when the place was examined, it was found out that the river bed was dry and
there was neither any water nor a laundering place. This same counsel also noted that the
earth on the dam was a deposit left there by the river current, as likewise the embankment
behind the dam, earth, sand and driftwood, having accumulated there during a period of
about 30 years, and that the part of the Tagumising River where there was a running water
was lower than the dry part of the same river back of the dam, so that, even though the earth
and sand deposit on the dam had been removed, it would have been difficult for the water to
rise up to the level of the dry bed of the river.

In view of the foregoing, on August 2, 1914, judgment was rendered, whereby the
municipality of Manaoag was ordered to remove the dam designated under letter A, in the
condition in which it was then, and likewise the deposits of earth and sand that were in front
of and behind said dam. The defendant was further ordered to construct in the same place a
new dam, with branches of trees only, so that the surplus water might pass and be used by
the inhabitants of Mangaldan, as it had been used by them for many years past. The
defendant was also ordered to pay the costs. To this judgment, the defendant excepted and
moved for a new trial. This motion was overruled, and the petitioner, after taking exception,
filed the proper bill of exceptions, which was transmitted to the clerk of this court.

In this action, it is incumbent upon us to determine whether the water that flows through the
river known by the names of Tagumising River and Tolon, and whether this river itself having
two names, belong to the public domain, and whether the people of the municipality of
Mangaldan have, by prescription, the right to use and enjoy the water of that part of the said
river known by the name of Tagumising , when it passes through the municipality of
Manaoag, and of the part thereof known by the name of Tolon, where it crosses the
municipality of Mangaldan.

The very witnesses presented by the counsel for the defendant municipality of Manaoag
testified to the fact, which was proven, that the people of the municipality of Mangaldan had,
for more than twenty years past, been using and enjoying the water that passed through the
Tolon section of the river coming from the Tagumising section which crossed the municipality
of Manaoag, although according to two of plaintiff's witnesses, Ulpiano de Vera and Jose
Lopez Serafica, that water taken for use, only during the rainy season from May of one year
until January of the next.

Article 407 of the Civil Code provides that the following are of the public ownership: 1. Rivers
and their natural beds, etc.

Article 409 of the same Code provides:

The use of public waters is acquired

1. By administrative concession.

2. By prescription of twenty years.

The limits of the rights and obligations of these uses shall be those appearing, in the first
case, from the terms of the concession; and, in the second, from the manner and form of
which the water have been used.
 Article 411 provides: The right to make use of public waters is extinguished by the
forfeiture of the concession, and the non-user for twenty years.

From these legal provisions it is concluded that the Tagumising River, as well as the water
that flows through it and then passes through the Tolon River, which is a continuation of the
Tagumising River, are of the public domain. This is confirmed by article 33 of the Law of
Waters of August 3, 1866, in force in these Islands. Therefore, the inhabitants of both
Manaoag and Mangaldan have the same right to enjoy the use of this water, and the
defendant municipality may not, to the prejudice of the inhabitants of Mangaldan, alter,
modify, or reduce the water bed of the said river in the part thereof where it passes through
the town of Manaoag; neither may the inhabitants of Manaoag impede the flow of the water
of the Tagumising section of the river, so as to prevent its coming into the Tolon section of the
stream, thus absolutely depriving the people of Mangaldan of said water.

The record does not contain even any circumstantial evidence that the Tagumising River had
its source within the territory of the town of Manaoag, and it is to be believed that the water of
the so-called Tagumising River came from places outside of Manaoag and from lands of
higher altitude than those where the town of Manaoag stands, so that the people of
Manaoag and those of Mangaldan only have the right to use and enjoy the water of the said
river, which as well as the river itself, is of the public domain, as already stated. Neither of
these two municipalities has a right to monopolize the water of said river, especially that of
Manaoag which is on a higher elevation, so that the water runs from the boundary of the
municipality of Manaoag, eastward, toward the town of Mangaldan situated, westward at a
lower altitude.

Coming now to the errors assigned from the judgment appealed, we shall begin by stating
that the municipality of Mangaldan was created and established in accordance with law, and
is therefore vested with the character of a juridical entity entitled to bring suits and file
complaints for the purpose of recovering any damages, losses, and injuries that may be
caused to the community which it represents. A municipality is an association or corporation
of public interest, endowed with a personality to acquire and possess all kinds of property to
contract obligations and bring civil and criminal actions in accordance with its governing
organization. All the inhabitants of Mangaldan have been deprived of the use of the water
that, coming from the Tagumising section of the river, flows through the Tolon section of the
same, and it is natural that this municipality of Mangaldan should come out in their defense
as being the true representative of the community and should exercise a legitimate
conducive to the removal of the obstacles that impede the flow of the water of said river, and
thus avoid greater damages to its inhabitants.

With respect to the jurisdiction of the Court of First Instance of Pangasinan, it will suffice the
purposes of this decision to state that this case does not concern the appropriation of public
waters, and the maintenance and operation of an irrigation system, or any of the other
purposes referred to in Act 2152, nor the controversies referred to in section 3 of said Act, so
that its section 4 can not be strictly applied. But the present case concerns the use and
enjoyment of water of a river of the public domain, and also the rights acquired by the
plaintiff, which rights must be respected by the defendant; hence, the orders overruling the
demurrer is not erroneous.

If the water of the rivers called by the names of the Tagumising and Tolon belong to the
public domain, it is unquestionable that, while it passes through the section of the stream
which crosses the town of Mangaldan, it may be used publicly by the inhabitants of this
municipality, and the latter is by law entitled to defend the community comprising its
inhabitants by compelling the recognition and respect of their rights, through the institution of
such actions as may correspond to it as a legitimate representative of said community.

In the Ruling Case Law (vol. 19, sec. 345) the following doctrine is laid down: "A municipal
corporation is the proper representative of the equitable rights of its inhabitants to the use of
the public square, and is authorized to file a bill in equity to prevent the erection of a
nuisance therein." If a municipality has the power to petition the courts for the abatement and
removal of any nuisance in a public square, why can it not do the same when the nuisance is
erected in a river whose water is of the public domain, and when such a nuisance obstructs
or hinders the public use of the water, inasmuch as both the public squares and public
waters come under the same classification of property for public use?

By the oral evidence and the plan, Exhibit A, it was only proven that dams had been erected,
within both the municipalities of Manaoag and Mangaldan and in the river called by the
double name of Tagumising and Tolon which crosses these municipalities from east to west;
that for more than twenty years, the inhabitants of the town of Mangaldan had been enjoying
the use of the water of said river in the part thereof called Tolon, and that they had been
deprived of its use few years before when the interstices or small openings of the Manaoag
dam were closed with earth and stones thus totally preventing the passage of the water. It
further appears that the river bed beyond the Manaoag dam and just before the stream
enters the territory of Mangaldan, had been raised, and that the water of the Tagumising
section of the river, now diverted, passes through the irrigation ditch named Canon, as
shown by the record of the ocular inspection made on May 2, 1915.

Notwithstanding the allegation made by counsel for the municipality of Manaoag, the herein
appellant, that the court erred in recognizing and holding that the municipality of Mangaldan
is entitled to use the water of the Tolon section of the Tagumising River, the records contains
decisive oral evidence that both prior and subsequent to the year 1870, and until but a few
years ago, the town of Mangaldan had been using such water from the Tagumising section of
the river as was allowed to pass the Manaoag dam and continue its course through the Tolon
section of said river, for, in the judgment rendered by the Court of First Instance of
Pangasinan, on September 3, 1870 (record, p. 8), it was ordered that the residents of
Mangaldan be restored to the enjoyment of the surplus water that escaped from the
Manaoag dams in its course down river. It also appears from said judgment that the
Manaoag dams were constructed of branches of trees and allowed the passage of a
considerable volume of water which was used by the inhabitants of Mangaldan, and that the
interruption of the flow of the water to and through the Tolon section of the river was due to
the construction of a dam in sitio of Mitura, for the reason that this dam was built in 1900 and
the interruption in the flow of the water took place only in 1911, and was caused by the
openings in the dam being filled with earth, sand, and brush.

Furthermore, the record contains no evidence whatever that the inhabitants of the town of
Mangaldan had, for more than twenty years, ceased to use the waster coming from the
Tagumising River, for the interruption in the flow of that water began only seven years ago;
so that, in accordance with the provisions of articles 409 and 411 of the Civil Code, the right
acquired by them, through prescription has not been extinguished.

Although the record does not satisfactorily show that the municipality of Manaoag filled in the
bed of the Tagumising River in the vicinity of the dam constructed in said river, and although
it is probable that the accumulation of earth in the river and in the dam was due to the force
of the current of the water of the river itself, yet this would not relieve the defendant from its
obligation to remove all the obstacles that obstruct the flow of the water, thus restoring the
dam to its original state so that it may allow the water of the river to pass through its fissures
and small openings, to the end that the people of Mangaldan may enjoy the use of this
water, to which they have a right by reason of the fact that the Tagumising section of the river
and the water which flows over its bed belong to the public domain, and no one has a right to
monopolize them for his exclusive benefit and to the prejudice of others who have the same
right. The existence of the dam or dams in the Tagumising River which benefit the
inhabitants of the town of Manaoag by their enjoyment of the water of public use, implies the
obligation to maintain and preserve the said dam or dams in proper condition so that any
alteration or change may not cause injury to the resident of other towns.

For the foregoing reasons, whereby the errors assigned from the judgment appealed have
been refuted, and, said judgment being in accordance with law and in conformity with the
evidence of record, should be, as it hereby is, affirmed, with the costs against the appellant.
So ordered.

[G.R. No. 132209. April 29, 2005]

CARLOS C. BUENDIA, petitioner, vs. CITY OF

ILIGAN, respondent.

DECISION
CHICO-NAZARIO, J.:

Before Us is a Petition for Review on Certiorari assailing the

Decision[1] of the Regional Trial Court (RTC) of Lanao del Norte, Branch
2, which set aside the Order[2] of the National Water Resources Board
(NWRB), the dispositive portion of which reads:

WHEREFORE,thewritofcertiorariprayedforisherebygrantedandthe
question(sic)NWRBorderofMarch10,1994,isherebysetasideandrendered
ofnoeffectforbeingissuedingraveabuseofdiscretion. [3]

THE FACTS

On 05 October 1992, petitioner Buendia filed with the NWRB an

application for the appropriation of water from a spring located within his
property in Ditucalan, Iligan City. Said application was docketed as
Application No. 11913 (for commercial purposes) and No. 11917 (for
domestic water supply).[4]
 In the absence of protests to the applications being timely filed, the
NWRB, after evaluating petitioners applications, issued on 25 June
1993, Water Permits No. 13842 and No. 13827[5]in his favor.
On 17 November 1993, almost five (5) months after petitioners
Water Permits were issued, respondent City of Iligan filed with the
NWRB an Opposition and/or Appeal[6] contesting the issuance of said
water permits to petitioner. The Opposition and/or Appeal sought to
serve as both a protest against petitioners water permit applications, as
well as an appeal to the NWRBs grant of the water permits to petitioner.
On 10 March 1994, the NWRB issued an Order [7] dismissing
respondents Opposition and/or Appeal. The Opposition part was
dismissed for being filed out of time, while the Appeal part was
dismissed as a consequence of the denial of the opposition to the
application, i.e., in the absence of a verified protest having been
seasonably filed, no water rights controversy arose; hence, there was
no decision from which respondent may appeal from.
Respondent City of Iligan did not move for a reconsideration of said
order, nor did it appeal to the appropriate Executive Department,[8] but
instead filed on 09 September 1994, with the RTC of Lanao del Norte,
Branch 2, a Petition for Certiorari assailing the legality of the NWRB
Order for being issued in excess of its jurisdiction and/or with grave
abuse of discretion amounting to lack of jurisdiction.
Respondent sought to annul the NWRB Order on the following
specific grounds:
1. The NWRB did not notify the City of Iligan of Buendias Water Permit
Application No. 11913 and No. 11917. Neither did the NWRB give the City of
Iligan an opportunity to be heard with respect to the applications because no
public hearing was conducted; and
2. The NWRBs March 10, 1994 Order was issued without due process, the
NWRB having arbitrarily and despotically denied the City of Iligans
Opposition and/or Appeal notwithstanding the fact that the latter was not
furnished a copy (sic) of Buendias Water Permits.[9]

In his Answer, petitioner prayed for the dismissal of the petition

claiming inter-alia that: (a) the petition was not filed within a reasonable
period, as it was filed more than five (5) months after petitioner received
a copy of the order it seeks to annul; (b) the petition lacks cause of
action for failure of the City of Iligan to file a Motion for Reconsideration
which is a prerequisite to the filing of a petition for certiorari; (c) the City
of Iligan did not exhaust all administrative remedies, since it did not avail
itself of its right to appeal as provided under the Administrative Code of
1987; and (d) the NWRB appropriately dismissed the Opposition and/or
Appeal.[10]
After all the issues were joined with the filing of the last pleading, the
case was set for pre-trial. As reflected in the pre-trial order of 28 June
1996 which was amended on 02 July 1996, the parties specifically
agreed to limit the issue of the case to whether or not the NWRB Order
dated March 10, 1994 was rendered by the NWRB with grave abuse of
discretion or contrary to law.[11]
On 15 August 1997, the trial court rendered the assailed decision.
Although the court a quo upheld the dismissal of the Opposition and/or
Appeal on procedural grounds, it nonetheless annulled the NWRB
Order, to wit:

Fromtheaforesaidestablishedfacts,itcouldbesafelydeducedthatasearlyas
October22,1992oreightmonthspriortotheissuanceofrespondentBuendias
waterpermitsonJune23,1993,petitionerCityofIliganwasalreadyawareof
respondentBuendiaswaterpermitapplicationandhadalltheopportunityto
protestoropposethesame.

Inthisparticularcase,asemphaticallystressedinrespondentBuendias
memorandum,itisnotdisputedthatnoverifiedprotestoroppositionwasfiled
duringallthetime,respondentBuendiasapplicationswerebeingprocessedby
respondentNWRB.Hence,undertheprevailingcircumstances,itbeing
uncontested,nowaterrightscontroversyaroseandrespondentNWRBdirectly
evaluatedthetechnicalaspectoftheapplicationspursuanttotheImplementing
RulesandRegulationsasexplainedabove.Infact,onMarch1112,1993,
respondentNWRB,hadconductedthephysicalinvestigationofthespring,
whichisthesubjectmatteroftheapplication.

Accordingly,basedonlyupontheforegoingconsiderations,itwouldappear
thatrespondentNWRBwascorrectindismissingpetitionersOppositionand/or
Appealbecausethereisnothingwhichcanbethesubjectofanappealasthere
isnothingforrespondentNWRBtodecideconsideringtheabsenceofwater
rightscontroversy.

Considering,however,thattheinstantcaseisaclashbetweenanindividualor
privaterightasagainstanassertionforthepublicwelfare,involving,asa
matteroffact,thewatersupplyfortheCityofIligan,thisCourthastoexamine
morecloselythefactsandthelawintheirbroadestperspective.Amorecareful
scrutinyoftherecordsaswellasthestipulationsoffactsandadmissionsbythe
parties,ashereinabovespecified,revealmaterialandsubstantialaspectsof
thecase,nottakenintoconsiderationbytherespondentNWRB,whichentirely
changesthecomplexionofthecase.[12][Emphasesours]

According to the lower court, the appropriation by the Iligan City

Waterworks Sewerage System (ICWSS) and its predecessors-in-
interest of the water source at Ditucalan spring was from 1927 up to the
present, as shown by the following:
1. That the Iligan Waterworks Sewerage System has been existing as early as
1927 and the same was taken over by the NAWASA on April 1, 1956;
2. That in 1971, R. A. No. 6234 was passed and by virtue of the same, the
MWSS took over the NAWASA, and on August 19, 1973, a Memorandum of
Agreement (MOA) was issued between the MWSS and the City Mayor of
Iligan, transferring the power of the MWSS to Iligan City.[13]

Thus, following the rule on acquisitive prescription that the right to

the use of public water may be acquired through prescription for twenty
(20) years, the court a quo ruled that the ICWSS had already acquired
by acquisitive prescription the right to appropriate water from the
Ditucalan spring prior to Buendias application for water rights before the
NWRB and that the Board no longer had any jurisdiction to issue any
water right over the same water source.
Thereafter, on 30 September 1997, petitioner filed a Motion for
Reconsideration, which was subsequently denied by the trial court in an
Order[14] dated 05 January 1998.
Raising purely questions of law, petitioner filed the present petition.

ISSUES

In this Petition for Certiorari, petitioner raises the following issues:

1.Whetherthecourtaquowentbeyondtheissuesitwasempoweredto
adjudicate,asdelineatedinthePreTrialOrder,andthusdepartedfromthe
acceptedandusualcourseofjudicialproceedings,aswellasdeprived
petitionerofhisrighttopresentevidencetosupportthecase;

2.Assumingthatthecourtaquomayvalidlypassupontheissueofwhohas
thebetterrighttoappropriatewaterfrompetitionersproperty,whetherit
decidedthisquestionofsubstanceinaccordwithlaworwiththeapplicable
decisionsoftheSupremeCourt;

3.Whetherthecourtaquocorrectlyruledthatsincerespondenthadalready
acquiredbyacquisitiveprescriptiontherighttoappropriatewaterfromthe
DitucalanspringthentheNWRBnolongerhadanyjurisdictiontoissueany
waterrightoverthesamewatersource;and

4.Whetherthecourtaquocorrectlyruledthatrespondenthastherightto
appropriatewaterunderitscharter,RepublicActNo.525.

RULING OF THE COURT

In order to properly settle the issues raised in the instant case, a

perusal of the NWRB Order of 10 March 1994 is of utmost importance
since, as determined by the parties during pre-trial and recognized by
the trial court in its decision, the pivotal issue of the case is the legality
of the NWRB Order dismissing respondents Opposition and/or Appeal.
It bears stressing that respondents Opposition and/or Appeal was
dismissed by the NWRB solely on procedural grounds, the opposition
being filed out of time. According to the NWRB:

Asagainstthisgratuitousclaimbytheoppositors,however,therecordis
repletewithevidencethatIliganCity,wasinpointoffactandinlaw,very
muchawareoftheseapplicationsasearlyasOctober22,1992,yetnoverified
protestnoroppositionwasfiledbyIliganCityduringallthetimethatthese
applicationswerebeingprocessed,investigatedandevaluatedanddespite
havingampleopportunitytodoso

Ontheotherpointraisedwhichpertainstotheappealissue,acareful
examinationofthesearticlesalludedto(Art.88and89,P.D.1067)shows
beyonddoubtthatthesereferstodecisionsoftheCouncil(nowBoard)on
waterrightscontroversiesordisputes,whichinthisparticularcasedoesnot
exist.Inthecaseatbar,therewasNOdecisionofawaterrightcontroversyin
thepreissuanceofsubjectwaterpermitswhichmaybethesubjectofan
appeal.ConsideringfurtherthattherewasNOverifiedprotestseasonablyfiled
againstsaidapplications,logicallytherefore,thereisnocontroversytospeakof
.
Inessence,theOppositionand/orAppealfiledbyIliganCity,hasnolegto
standon,becauseitwasfiledOUTOFTIMEandsecondly,becauseofwantof
legalandfactualbasis.[15][Italicsours]

Clearly, therefore, the only question which the court a quo should
have resolved is whether or not the NWRB had correctly dismissed the
Opposition and/or Appeal for being filed out of time. To said issue, the
trial court opined:

Inthisparticularcase,asemphaticallystressedinrespondentBuendias
memorandum,itisnotdisputedthatnoverifiedprotestoroppositionwasfiled
duringallthetime,respondentBuendiasapplicationswerebeingprocessedby
respondentNWRB.Hence,undertheprevailingcircumstances,itbeing
uncontested,nowaterrightscontroversyarose

Accordingly,basedonlyupontheforegoingconsiderations,itwouldappear
thatrespondentNWRBwascorrectindismissingpetitionersOppositionand/or
Appealbecausethereisnothingwhichcanbethesubjectofanappealasthere
isnothingforrespondentNWRBtodecideconsideringtheabsenceofwater
rightscontroversy.[16][EmphasisOurs]

Respondents penchant for disregarding the rules of procedure is

evident from the facts of the case. Both the NWRB and the trial court
deduced that as early as 22 October 1992 or eight (8) months prior to
the issuance of petitioners water permits, respondent City of Iligan was
already aware of Buendias applications and had all the opportunity to
protest the same but failed to do so and instead, filed its opposition
and/or appeal almost five months after the permits have been issued.
Further, from receipt of the NWRB order denying its opposition and/or
appeal, respondent did not file a Motion for Reconsideration but
proceeded to file a Petition for Certiorari with the RTC after almost six
(6) months from the issuance of said order. Certainly, filing said petition
almost six (6) months later does not fall within what this Court considers
as a reasonable period to institute a petition for certiorari. Although the
applicable rules on special civil action for certiorari, at the time of the
filing of the petition, did not provide for a definite time frame within which
to file the petition,[17] this Court has ruled, as early as 20 January 1992 in
a Resolution in PHILEC Workers Union v. Hon. Romeo A. Young,[18] that
the special civil action for certiorari under Rule 65 of the Rules of Court
must be filed within a reasonable period of only three (3) months.[19]
 The failure to file the certiorari petition within a reasonable time
renders the petitioner [respondent in this case] susceptible to the
adverse legal consequences of laches.[20] The essence of laches is the
failure, or neglect, for an unreasonable and unexplained length of time
to do that which, by exercising due diligence, could or should have been
done earlier; it is the negligence or omission to assert a right within a
reasonable time, warranting a presumption that the party entitled to
assert it either has abandoned it or declined to assert it.[21]
Notwithstanding the conclusion that the dismissal of said opposition
and/or appeal was in accordance with law, the court a quo proceeded to
resolve the question of as to who between the City of Iligan and Carlos
Buendia has the better right to the water source, certainly going beyond
the issue delineated in the pre-trial. The RTC reasoned:

Considering,however,thattheinstantcaseisaclashbetweenanindividualor
privaterightasagainstanassertionforthepublicwelfare,involving,asa
matteroffact,thewatersupplyfortheCityofIligan,thisCourthastoexamine
morecloselythefactsandthelawintheirbroadestperspective.Amorecareful
scrutinyoftherecordsaswellasthestipulationsoffactsandadmissionsbythe
parties,ashereinabovespecified,revealmaterialandsubstantialaspectsofthe
case,nottakenintoconsiderationbytherespondentNWRB,whichentirely
changesthecomplexionofthecase.[22]

Absent a discussion by the NWRB of the substantial issues raised in

the Opposition and/or Appeal, the trial court should not have decided
said questions especially since they were not passed upon by the Board
which exercises original jurisdiction over issues involving water rights
controversies.[23]
Time and again, this Court has upheld the doctrine of primary
jurisdiction in deference to the specialized expertise of administrative
agencies to act on certain matters. As held by the Court in the case
of Industrial Enterprises, Inc. v. Court of Appeals:[24]

...[I]fthecaseissuchthatitsdeterminationrequirestheexpertise,specialized
skillsandknowledgeoftheproperadministrativebodiesbecausetechnical
mattersorintricatequestionsoffactsareinvolved,thenreliefmustfirstbe
obtainedinanadministrativeproceedingbeforearemedywillbesuppliedby
thecourtseventhoughthematteriswithintheproperjurisdictionofacourt.
 Therefore, the question of as to who between the City of Iligan and
Carlos Buendia has the better right to the water source should have
been left to the determination of the NWRB via a timely protest filed
during the pendency of the water permit applications. However, said
issue could not have been adjudicated upon by the NWRB since the
application was never properly contested. Hence, in the absence of a
timely protest filed before the NWRB, no water rights controversy arose
wherein the NWRB can properly discuss the substantial issues raised
by respondent.
Furthermore, Articles 16 and 17 of the Water Code of the Philippines
provide:

Art.16.Anypersonwhodesirestoobtainawaterpermitshallfilean
applicationwiththeCouncil[nowBoard]whoshallmakeknownsaid
applicationtothepublicforanyprotests.

Indeterminingwhethertograntordenyanapplication,theCouncil[now
Board]shallconsiderthefollowing:protestsfiled,ifany;priorpermits
granted;theavailabilityofwater;thewatersupplyneededforbeneficialuse;
possibleadverseeffects;landuseeconomics;andotherrelevantfactors.

Uponapprovalofanapplication,awaterpermitshallbeissuedandrecorded.

Art.17.Therighttotheuseofwaterisdeemedacquiredasofthedateoffiling
oftheapplicationforawaterpermitincaseofapprovedpermits,orasofthe
dateofactualuseinacasewherenopermitisrequired.[Emphasesours]

From a reading of the above provisions, it is evident that after an

application to obtain a water permit has been made known to the public,
any interested party must file his protest thereto, in order that the
application may be properly evaluated. Otherwise, after the application
for a water permit has been approved, the grantee of the permit now
acquires an exclusive right to use the water source, reckoned from the
date of the filing of the applications. Thus, after petitioners right to the
water permit has been properly adjudicated, respondent may no longer
belatedly question said grant. By virtue of respondents failure to lodge a
timely protest, petitioner has already acquired the right to appropriate
the water from the spring inside the latters property.
In conclusion, the failure of respondent City of Iligan to timely
oppose the water permit applications, and later on to file the Petition
for Certiorari within a reasonable time has the effect of rendering the
grant of the water permits to petitioner Buendia final and executory.
As to the issue of acquisitive prescription, the Court cannot now
accept hook, line, and sinker the lower courts findings on the issue
based on two reasons. First, said determination was not passed upon
by the agency that exercises original jurisdiction to settle said question
of fact, which brings us to the conclusion that the court a quo should
have declined to decide on the matter. Second, such determination is
contradicted by the allegations made by the City of Iligan in a previous
case that has become final involving the same parties. It has been
established in the decision[25] of the RTC of Lanao del Norte, Branch 1,
entitled, Buendia v. City of Iligan, and affirmed by the Court of Appeals,
[26]
that respondent entered petitioners property only in 1974 and
constructed an in-take dam thereon for purposes of appropriating water
from the spring only in 1978. According to the said decision:

Ontheotherhand,thedefendantCityofIligansallegationsthatitsentryand
clearingovertheareain1974wasacteduponingoodfaithasallowedbythe
administratrixoftheestateofplaintiffsfatherinthepersonofAureaBuendiais
right.Butitsfailurelaterontoobtaintheconsentandknowledgeofthetrue
ownerwhenitconstructedtheintakedamoverthelandin1978constitutebad
faith[27]

Therefore, based on respondents previous allegations, the ICWSS

cannot be said to have acquired a right to the use of the water source
by acquisitive prescription, since it only entered the premises two (2)
years before the enactment of the Water Code of the Philippines and
only eighteen (18) years before petitioner applied with the NWRB for
water permits. Furthermore, respondents alleged exercise of its right to
appropriate the water source since 1927 is negated by its belated
application with the NWRB for water permits. If indeed the City of Iligan
has the right to appropriate water from the spring located inside
petitioners property, then respondent would not have filed said
application after the water permits over said water source have already
been issued to petitioner.
As to the fourth issue of whether or not respondent has the right to
appropriate water under its charter, suffice it to say that a perusal of the
charter of the City of Iligan (Rep. Act No. 525) shows no grant of the
power to appropriate water resources. Section 15 of the charter merely
provides for the power to provide for the maintenance of waterworks for
supplying water to the inhabitants of the city.
WHEREFORE, premises considered, the petition is hereby
GRANTED and the Decision of the Regional Trial Court of Lanao del
Norte, Branch 2, dated 15 August 1997, is hereby SET ASIDE. The
Order of the National Water Resources Board dated 10 March 1994 is
AFFIRMED. No costs.
SO ORDERED.

G.R. No. L-20928 March 31, 1966

NATIONAL WATERWORKS AND SEWERAGE AUTHORITY, plaintiff-appellee,

vs.
SECRETARY OF PUBLIC WORKS AND COMMUNICATIONS, defendant-appellant.

Office of the Solicitor General for the respondent-appellant.

Tomas P. Matic, Jr. for the plaintiff-appellee.

REYES, J.B.L., J.:

Direct appeal from a judgment of the Court of First Instance of Manila, Branch XII, rendered
in its Civil Case No. 43729, annulling and setting aside an administrative decision of the
Secretary of Public Works and Communications, appealed to said court pursuant to the
provisions of the Irrigation Law (Act 2152).

The controversy started from a letter complaint, dated January 7, 1959, of the Project
Engineer of the Angat River Irrigation System to the Director of Public Works, asking that
representations be made to the National Waterworks and Sewerage Authority (NAWASA for
short) to secure the release of enough water from the Ipo Dam to avert a crop failure in the
Province of Bulacan, and from the refusal of the NAWASA to grant the request because of
the low water level in its reservoirs. After a series of indorsements, the Acting Undersecretary
of Public Works and Communications, acting for the Secretary, rendered an administrative
decision recognizing that Executive Proclamation Nos. 48 (dated November 10, 1922) and
72 (dated December 27, 1950) reserved 3600 and 40,000 liters per second of water from the
Angat River for the Metropolitan Water District (predecessor of the NAWASA) and the Angat
River Irrigation, System, respectively, but declaring that NAWASA is not entitled to priority in
the use of the water of the Angat River, and ordering the said entity to apply for water rights
with the Bureau of Public Works, pursuant to section 14 of Act 2152 (Irrigation Law). In
effect, the Secretary's decision declares that the NAWASA has no right to use the waters of
the Angat River.

Its attempts to secure reconsideration of the Department's ruling having proved futile,
NAWASA appealed to the court, as provided by section 4 of the Irrigation Act, that allows
such appeal within 30 days from notice of the administrative decision. This was done by
forwarding a complaint by registered mail on the last (or 30th) day of the period allowed by
law.
The defendant Secretary of Public Works and Communications answered, interposing the
defenses that: (1) the complaint was filed out of time; (2) the plaintiff NAWASA had not
exhausted all available administrative remedies; and (3) that plaintiff has not acquired the
right to use and enjoy the water from the Angat River by administrative concession or
prescription.1wph1.t

The court below found the defenses interposed to be untenable, and reversed the
Secretary's decision. Whereupon, this appeal was duly taken and the case elevated to this
Court, where defendant-appellant assigns the following errors:

1. The trial court erred in holding that the appeal to the court made by plaintiff from
the decision of the Secretary of Public Works was filed within the reglementary
period.

2. The trial court erred in holding that plaintiff has acquired the right to use the waters
of the Angat River by prescription.

3. The trial court erred in not dismissing the petition.

In its first assignment of error, the defendant Secretary contends that, admitting that the
NAWASA's complaint in appeal was sent by registered mail on the last of the 30 days
allowed by the Irrigation Act for appealing the administrative decision to the court of
competent jurisdiction, still the complaint may not be deemed to have been filed on the same
day, for the reason that there is no showing that the filing fees were simultaneously paid.

The appellant's argument, however, fails to take into account that, in appealed cases, failure
to pay the docketing fees does not automatically result in the dismissal of the appeal; the
dismissal is discretionary in the appellate court. Rule 141, section 3, speaking of the fees of
the clerk of the Court of Appeals or of the Supreme Court, provides that:

If the fees are not paid, the court may refuse to proceed with the action until they are
paid and may dismiss the appeal or the action or proceeding.

The rule quoted is applicable by analogy to the Court of First Instance of Manila in the instant
case, since the Court was exercising appellate jurisdiction conferred upon it by law to review
administrative decisions under the Irrigation Act. For the rest, it is well to remember that the
discretion of inferior courts is not to be interferred with in the absence of plain abuse thereof.

Considering that under the Rules of Court the date of mailing (by registered mail) is
considered the date of filing of any petition, or pleading, the appellant's first assignment of
error must be overruled.

The appellant's second assignment of error goes to the merits of the case.

It is undisputed that, by Proclamation No. 5 of July 10, 1913, as amended by Proclamation

No. 48 of November 10, 1922, the then Governor-General of the Philippine Islands, General
Leonard Wood, expressly declared that, pursuant to Act No. 2152

I hereby, for reasons of public policy designate as exempt from appropriation and
reserve for the use of the Metropolitan Water District of Manila, Philippine Islands,
3500 liters per second of time, or so much thereof as may be needed for domestic
 purposes, of the water of the Angat River, Province of Bulacan, Philippine Islands . . .
.

The terms "exempt from appropriation and reserve for the use of the Metropolitan Water
District" necessarily imply that the District was granted authority to withdraw and make
exclusive use of the aforesaid amount of water; otherwise, the reservation and exemption
from appropriation of such water would lose all significance. The proclamation, in effect,
amount to an administrative concession in favor of the Metropolitan Water District
(predecessor of the NAWASA), and is entitled to priority over the similar reservation in favor
of the Angat River Irrigation System made by Proclamation No. 72, Series of 1950, since that
of the Water District was made twenty-eight years earlier, at the very least; and in addition,
the amount of water thus reserved was "excluded from appropriation", obviously by anyone
else other than the grantee.

The stand taken by the respondent Secretary of Public Works is that while the Governor-
General's Proclamations constituted valid reservations of water in favor of the Water District,
yet to validly appropriate such water the District must first apply to the Director of Public
Works. This ruling does not appear reasonable. As heretofore noted, the proclamation
already "excluded from appropriation" the water reserved for the Metropolitan Water District.
In view of the executive control that the American
Governor-General exercised (under the Organic Laws in force in 1922) over the offices
under him, it is difficult to conceive that the Secretary or the Director of Public Works could
refuse the Metropolitan Water District the right to use the water reserved for its use by the
Chief Executive, since it would, in effect, amend the latter's proclamations. And if the Director
could not refuse, but had necessarily to confirm the grant, then an application to his office for
such concession became a useless ceremony and a total superfluity.

We are thus led to no other conclusion but that the Proclamations in favor of the Metropolitan
Water District constituted valid and operative administrative concessions in favor of
appellee's predecessor, and it admittedly made use of the water thus granted, without
objection from any party until 1959. Actually, one of defendant's predecessors was even
chairman of the plaintiff's Board of Directors when the Ipo Dam was built (Rec. on App., p.
41) to divert the water of the Angat River into the plaintiff's aqueducts.

The incontestable fact is that from 1913 to 1959, i.e., for 46 years, the NAWASA and its
predecessors in interest had openly, publicly, and exclusively appropriated water from the
Angat River without protest from anyone; but appellant Secretary seeks to neutralize this
long acquiesced-in user by arguing that under the Irrigation Act, Act 2152 as amended,
acquisition by prescription of the use of public waters is not recognized, because under
section 14 of said Act,

Any person hereafter desiring to appropriate any public water shall previously make
an application to the Secretary of Public Works and Communications through the
Director of Public Works.

It is worthy of note that, as observed by the court a quo, both the Civil Code of 1889 (Art.
409) and the Law of Waters of 1866 (Art. 194) recognized two different ways of acquiring the
right to the use of public waters: (1) by administrative concession and (2) by prescription for
20 years. Since the Irrigation law nowhere provides that the procedure provided in its section
14 shall be exclusive, and implied repeals are not favored, we see no reason to disturb the
lower court's conclusion that even if the Irrigation law did modify the old legislation procedure
in obtaining administrative concession of public waters, still it has not invalidated prescription
of a mode of acquiring title thereto, specially considering that the Civil Code of 1950, Article
504, reiterates the dual juridical source of title to the use of public water, and even reduces
the prescriptive period from twenty to ten years. In fact, the Attorney General of the
Philippines had heretofore recognized that the Irrigation law (Art. 2152) has not affected
either Article 409 of the Civil Code of 1889 or Articles 39 and 194 of the Law of Waters of
1866 (7 op. Atty. Gen. 570, 576-579; Francisco, Philippine Law of Waters and Water Rights,
p. 147).

More conclusive still is the pronouncement of this Supreme Court in Serrano vs. De la Cruz,
67 Phil. 348, wherein as late as 1939, twenty-seven years after the enactment of the original
Irrigation Act No. 2152, this High Tribunal recognized the existence of title to the use of public
water by prescription, saying (cas. cit. p. 350):

Neither had the petitioner acquired a right of of public waters, through prescription,
by continuous enjoyment thereof for only ten years. Prescription of twenty years is
necessary to that effect. (Art. 409, Civil, Code; Art. 39, Law of Waters of August 3,
1866; Magno vs. Castro, 30 Phil. 585; Sideco vs. Sareas and Sareas, 41 Phil. 80.)

Appellant argues finally that the use of the waters of the Angat River by NAWASA and its
predecessors could not ripen into a valid right because it was not exercised adversely
against the Government. The answer to this contention was given since 1933 in our decision
in Government of the Philippine Islands vs. Franco, 57 Phil. 780, 784, where this Court ruled:

It is axiomatic that prescription can not be asserted against the sovereign, and it is
therefore futile for any claimant of real property to claim adverse possession against
the Government. It results that it is never necessary, in order to acquire title by
adverse possession against an individual owner, that the person asserting adverse
possession should have held adversely to the Government. The decisions bearing
upon this point will be found collated in the note to Boe vs. Arnold (20 Am. & Eng.
Ann. Cases, 533), as well as in 2 C.J., pp. 130, 131, and it is unnecessary to extend
the discussion.

Hence, that the Metropolitan Water District and the NAWASA did not hold adversely against
the Government does not mean that their possession and use of the Angat River Waters was
not adverse to that of the Angat River Irrigation System, which is its adversary in the present
proceedings. The NAWASA and its predecessors had no need of holding adversely against
the National Government since the latter had expressly granted it the prior use of the water
in question by the two proclamations previously referred to. The defendant Secretary
appears to have overlooked that in prosecuting the present case the NAWASA is not
asserting a right against the Government itself but merely appealing from the Secretary's
decision.

Appellant's third assignment of error, being a mere consequence of the preceding ones,
requires no separate discussion.

We conclude that the court below correctly reversed the administrative decision of appellant
Secretary of Public Works and Communications for not being in consonance with the
applicable law.

Wherefore, the decision appealed from is hereby affirmed. Without costs.

 [G.R. No. 28491. September 29, 1928.]

TOMAS MONTEVERDE, Plaintiff-Appellant, v. SEBASTIAN T. GENEROSO, Provincial

Governor of Davao, ET AL., Defendants-Appellees.

Jose Poblete, Rafael S. Castillo, Leon A. Garcia, Jose V. Diaz and Abad Santos, Camus,
Delgado & Recto for Appellant.

Attorney-General Jaranilla for Appellees.

SYLLABUS

1. NUISANCES; CLASSES. Nuisances are of two classes: Nuisances per se and nuisances per
accidens.

2. ID.; ID.; ABATEMENT. As to nuisanees per se, since they affect the immediate safety of
persons and property, they may be summarily abated under the undefined law of necessity. As to
nuisances per accidens, even the municipal authorities, under their power to declare and abate
nuisances, would not have the right to compel the abatement of a particular thing or act as a
nuisance without reasonable notice to the person alleged to be maintaining or doing the same of the
time and place of hearing before a tribunal authorized to decide whether such a thing or act does in
law constitute a nuisance.

3. ID.; ID.; ID.; DESTRUCTION OF DAMS AND FISHPONDS IN NAVIGABLE STREAMS NUISANCES.
A provincial governor, a district engineer, or a district health officer is not authorized to destroy
private property consisting of dams and fishponds summarily and without any judicial proceedings
whatever under the pretense that such private property constitutes a nuisance.

4. ID.; ID.; ID.; ID. A dam or a fishery constructed in a navigable stream is not a nuisance per
se. A dam or a fishpond may be a nuisance per accidens where it endangers or impairs the health or
depreciates property by causing water to become stagnant.

5. ID.; ID.; ID.; ID.; DUE PROCESS OF LAW. The public health may be conserved but conserved
only in a legal manner. Due process of law must be observed before the citizens property or
personal rights or liberty can be interfered with. Conceding without deciding that article 24 of the
Law of Waters is in force, it can only be made use of by conforming to the provisions of the organic
law.

6. ID.; ID.; ID.; ID.; ID.; WHETHER SUMMARY ABATEMENT OR JUDICIAL PROCEEDINGS
NECESSARY. It is not easy to draw the line between cases where the property illegally used may
be destroyed summarily and where judicial proceedings are necessary for its condemnation. One
criterion is the value of the property, whether of great value or trifling value. (Lawton v. Steele
[1894], 152 U.S., 133.)

DECISION

MALCOLM, J.:

This is a case the determination of which could easily be made difficult by the injection of numerous
controversial questions of fact and law, but which as we view it can readily be decided on a basic
legal point arising from the undisputed facts and on a concession without decision of all disputed
facts in favor of the Government. On this basis, the ultimate and decisive question is this: Is a
provincial governor, a district engineer, or a district health officer authorized to destroy private
property consisting of dams and fishponds summarily and without any judicial proceedings whatever
under the pretense that such private property constitutes a nuisance?

The undisputed facts are these: Tomas Monteverde is the owner of a parcel of land situated in the
barrio of Santa Ana, municipality of Davao, Province of Davao. He possesses a Torrens title to the
land obtained in 1921. The parcel of land is bounded on the northwest by the Agdao River. The
Tambongon Creek is a branch of the Agdao River and runs through Monteverdes land. For fishpond
purposes, Monteverde constructed two dams across the Agdao River and five dams across the
Tambongon Creek. The two dams in the Agdao River were destroyed by order of the district
engineer of Davao. The provincial governor of Davao also threatened to destroy the other dams in
the Tambongon Creek. The motive behind the destruction of the dams in the Agdao River and the
proposed destruction of the dams in the Tambongon Creek was to safeguard the public health. To
prevent the contemplated action with reference to the Tambongon Creek, Monteverde sought in the
Court of First Instance of Davao to obtain an order of injunction in restraint of the provincial
governor, the district engineer, and the district health officer, but in this attempt Monteverde was
unsuccessful in the lower court.

To the undisputed facts, there may be added for the purposes of the decision without necessarily
having to resolve them the following: The fishponds were constructed in 1921 and 1922 and did not
exist as the result of a concession in Spanish times. The Tambongon Creek running through
Monteverdes property is navigable and as such is of public ownership. (See in this connection the
cases of Samson v. Dionisio and Fabian [1908], 11 Phil., 538, and Bautista v. Alarcon [1912], 23
Phil., 631.)

The reason for the contemplated action by the provincial governor and the legal authority on which
he relied are disclosed by the communication from the provincial governor to the plaintiff reading as
follows:

"Mr. TOMAS MONTEVERDE

"Sta. Ana, Davao

"SIR: There have been referred to this office several complaints against you for having closed some
of the branches of the Agdao River for fishpond purposes without previous authorization from
competent authorities, thus obstructing the flow of water and causing the development of stagnant
water which serves as suitable breeding places for mosquitos.

"For the good of public sanitation, and by virtue of the authority conferred me by section 24 of the
Water Law, you are hereby ordered, upon receipt hereof, to open all the ditches by destroying the
dams so constructed therein as obstruction of the water flow, the construction of same not being in
accordance with the law.

"Prompt compliance to this order is enjoined, otherwise, the district engineer will be ordered to
effect the work at your costs.

"Very respectfully,

(Sgd.) "S. T. GENEROSO

"Provincial Governor"

Again emphasizing that the facts for the purposes of the appeal may be conceded to be as
contended by the Government, we then must determine if any existing law authorizes the provincial
governor and the other provincial officials to remove without a hearing or legal process any private
construction on a navigable stream.

The law is found in many places. There have been cited sections 938, 941, 978, 980, 995, 2592,
2594, 2604, and 2625 of the Administrative Code; section 39 of the Land Registration Act; articles
339, 344, 407, 412, and 490 of the Civil Code; and article 24 of the Spanish Law of Waters of 1866.
With reference to this varied assortment of law, the flat statement is advanced without fear of
contradiction that with the possible exception of article 24 of the Law of Waters no law expressly
empowers the provincial governor to order the removal of obstructions and the destruction of
nuisances in a navigable stream. On the contrary, the law specifically grants to the municipal
council the power by ordinance or resolution "to declare, prevent, and abate nuisances." (Sec. 2625
[aa], Administrative Code; Bernardino and Zaplan v. Governor and Provincial Board of Cavite
[1910], 17 Phil., 176.) As to article 24 of the Spanish Law of Waters of 1866, it provides:jgc:chanrobles.com.ph
"Any person may, upon his own private property, construct artificial ponds of sea water, having
communication with the sea, for use as bathing places or vivaries, or for any other commercial or
recreative purpose, notice thereof being given to the governor of the province. During two months,
the governor shall have power to order the suspension of the work if, after consultation with the
naval officer in command and the provincial engineer, it appear that the work might be substantially
prejudicial to the public interests. In such an event the interested party may appeal to the
Government." But as to the applicability of this article, it necessarily would have to conform to the
principles of the existing public law.

Nuisances are of two classes: Nuisances per se and per accidens. As to the first, since they affect
the immediate safety of persons and property, they may be summarily abated under the undefined
law of necessity. But if the nuisance be of the second class, even the municipal authorities, under
their power to declare and abate nuisances, would not have the right to compel the abatement of a
particular thing or act as a nuisance without reasonable notice to the person alleged to be
maintaining or doing the same of the time and place of hearing before a tribunal authorized to
decide whether such a thing or act does in law constitute a nuisance. Such in effect was the holding
in Iloilo Ice and Cold Storage Co. v. Municipal Council of Iloilo ([1913], 24 Phil., 471). Applied here,
it is selfevident that a dam or a fishery constructed in a navigable stream is not a nuisance per se.
Of course, a dam or a fishpond may be found to be a nuisance where it endangers or impairs the
health or depreciates property by causing water to become stagnant. The public health may be
conserved but conserved only in a legal manner. Due process of law must be observed before the
citizens property or personal rights or liberty can be interfered with. Conceding without deciding
that article 24 of the Law of Waters is in force, we reiterate that it can only be made use of by
conforming to the provisions of the organic law.

The case of Lawton v. Steele, originally decided in the Court of Appeals of New York and then taken
to the United States Supreme Court, is the leading case on the subject. This was an action brought
to recover the value of sixteen nets belonging to the plaintiffs which were destroyed by defendant.
He, as a state fish and game protector, justified himself by citing the section of the law authorizing
the seizure and removal of nets. The court recognized the legislative power to regulate fishing in
public waters, and the right of summary abatement of nuisances without judicial process or
proceeding for the protection of the health; but said the court: "In the process of abating a nuisance
there are limitations both in respect of the agencies which may be employed, and as to what may
be done in execution of the remedy." In the United States Supreme Court, it was in part said: jgc:chanrobles.com.ph

"It is not easy to draw the line between cases where the property illegally used may be destroyed
summarily and where judicial proceedings are necessary for its condemnation. If the property were
of great value, as, for instance, if it were a vessel employed for smuggling or other illegal purposes,
it would be putting a dangerous power in the hands of a custom officer to permit him to sell or
destroy it as a public nuisance, and the owner would have good reason to complain of such act, as
depriving him of his property without due process of law. But where the property is of trifling value,
and its destruction is necessary to effect the object of a certain statute, we think it is within the
power of the legislature to order its summary abatement. For instance, if the legislature should
prohibit the killing of fish by explosive shells, and should order the cartridges so used to be
destroyed, it would seem like belittling the dignity of the judiciary to require such destruction to be
preceded by a solemn condemnation in a court of justice. The same remark might be made of the
cards, chips, and dice of a gambling room.

x x x

"Upon the whole we agree with the Court of Appeals in holding this act to be constitutional, and the
judgment of the Supreme Court is, therefore, affirmed." (119 N. Y., 226; 152 U. S., 133.)

In contrast with Lawton v. Steele, supra, (l) there is no law authorizing the summary abatement of
nuisances by the provincial governor; and (2) the dams and fishponds are not of trifling value. The
question at issue is answered in the negative.

In accordance with the foregoing, the judgment appealed from must be as it is hereby reversed,
and instead the injunction prayed for shall issue prohibiting the defendants from destroying the
dams and fishponds in question. It is so ordered without express finding as to costs in either
instance.
 [G.R. No. L-15829. December 4, 1967.]

ROMAN R. SANTOS, Petitioner-Appellee, v. HON. FLORENCIO MORENO, as Secretary of

Public Works and Communications and JULIAN C. CARGULO, Respondents-Appellants.

Gil R. Carlos & Associates for Petitioner-Appellee.

Solicitor General for Respondents-Appellants.

SYLLABUS

1. ADMINISTRATIVE LAW; EXHAUSTION OF ADMINISTRATIVE REMEDIES; WHEN MOTION FOR

RECONSIDERATION MUST BE FILED. Whether a litigant, in exhausting available administrative
remedies, need move for the reconsideration of am administrative decision before he can turn to
the courts for relief, would largely depend upon the pertinent law, the rules of procedure and the
usual practice followed in a particular office.

2. ID., ID.; ID.; FILING OF MOTION FOR RECONSIDERATION NOT A CONDITION PRECEDENT FOR
JUDICIAL RELIEF UNDER REPUBLIC ACT NO. 2056. Republic Act No. 2056 does not require the
filing of a motion for reconsideration as a condition precedent to judicial relief. On the contrary, the
intention of the legislature to forego such a motion manifests itself clearly. Indeed, by providing for
a speedy and a most expeditious proceeding for the removal of illegal obstructions to rivers, it can
logically be concluded that Congress intended the decision of the Secretary of Public Works and
Communications to be final and executory subject to a timely review by the courts without going
through formal and time-consuming preliminaries.

3. ID., ID.; ID.; ID.; PURELY LEGAL QUESTIONS NOT WITHIN THE COMPETENCE OF THE
SECRETARY OF PUBLIC WORKS AND COMMUNICATIONS TO DECIDE UPON A MOTION FOR
RECONSIDERATION. The constitutionality of Republic Act No. 2056 and the jurisdiction of the
Secretary of Public Works and Communications to order the demolition of dams across rivers or
streams are purely legal and not administrative in nature, and, therefore, not within the
competence of the said official to decide upon a motion for reconsideration, but should properly be
raised before a competent court.

4. ID.; ID.; APPEAL TO THE PRESIDENT FROM DECISION OF THE SECRETARY OF PUBLIC WORKS
AND COMMUNICATIONS DISPENSABLE. The Secretary of Public Works and Communications
being the alter ego of the President, his actions are presumed to have implied sanction of the latter.
Hence, an appeal from his decision to the President can be dispensed with.

5. VENUE; WHERE REVIEW OF DECISIONS OF THE SECRETARY OF PUBLIC WORKS AND

COMMUNICATIONS SHOULD BE FILED. Where the purpose of the suit is to review the decisions of
the Secretary of Public Works and Communications, to enjoin him from enforcing them and to
prevent him from making and issuing similar decisions concerning the streams in a certain province,
the acts of the said official are the object of the litigation. Hence, the suit must be filed in the Court
of First Instance whose territorial jurisdiction encompasses the place where the Secretary is found
or is holding office. For the Rule is that outside its territorial limits, the court has no power to
enforce its orders.

6. ADMINISTRATIVE LAW; JUDICIAL REVIEW OF ADMINISTRATIVE PROCEEDINGS; COURTS

LIMITED TO EVIDENCE ALREADY PRESENTED. In reviewing a decision of the Secretary of Public
Works and Communications, the Court of First Instance shall confine its inquiry to the evidence
presented during the administrative proceedings. Evidence not presented therein shall not be
admitted and considered by the trial court.

7. WATERS; ILLEGAL OBSTRUCTION IN PUBLIC STREAMS; REPUBLIC ACT 2056 CONSTITUTIONAL.

Republic Act No. 2056 which provides for an expeditious administrative process to determine
whether or not a dam or dike should be declared a public nuisance and ordered demolished has
already been held as constitutional (Lovina v. Moreno, L-17821, Nov. 29, 1963).

8. ID.; STREAMS WHICH FORMERLY WERE MAN-MADE CANALS ARE OF PRIVATE OWNERSHIP;
CASE AT BAR. The evidence adduced in the administrative proceedings show that the streams
involved in this case, except one, were originally man-made canals constructed by the former
owners of Hacienda San Esteban and that said streams were not held open for public use. Under
Art. 339 of the old Civil Code, canals constructed by the State and devoted to public use are of
public ownership. Conversely, canals constructed by private persons within private lands and
devoted exclusively for private use must be of private ownership. Hence, the dams across them
should not be ordered demolished as public nuisances.

9. ID.; ID.; DAMMING OF NATURAL STREAM WHICH IS PART OR A RIVER ILLEGAL; CASE AT BAR.
Sapang Cansusu, being a natural stream and a continuation of the Cansusu River, admittedly a
public stream, belongs to the public domain. Its closure therefore by the predecessors of Roman
Santos was illegal.

DECISION

BENGZON, J.P., J.:

THE APPEAL

The Honorable Secretary of Public Works & Communications appeals from the decision of the Court
of First Instance of Manila declaring of private ownership certain creeks situated in barrio San
Esteban, Macabebe, Pampanga.

THE BACKGROUND

The Zobel family of Spain formerly owned a vast track of marshland in the municipality of
Macabebe, Pampanga province. Called Hacienda San Esteban, it was administered and managed by
the Ayala y Cia. From the year 1860 to about the year 1924 Ayala y Cia., devoted the hacienda to
the planting and cultivation of nipa palms from which it gathered nipa sap or "tuba." It operated a
distillery plant in barrio San Esteban to turn nipa tuba into potable alcohol which was in turn
manufactured into liquor.

Accessibility through the nipa palms deep into the hacienda posed as a problem. Ayala y Cia.
therefore dug canals leading towards the haciendas interior where most of them interlinked with
each other. The canals facilitated the gathering of tuba and the guarding and patrolling of the
hacienda by security guards called "arundines." By the gradual process of erosion these canals
acquired the characteristics and dimensions of rivers.

In 1924 Ayala y Cia., shifted from the business of alcohol production to bangus culture. It converted
Hacienda San Esteban from a forest of nipa groves to a web of fishponds. To do so, it cut down the
nipa palms, constructed dikes and closed the canals criss-crossing the hacienda.

Sometime in 1925 or 1926 Ayala y Cia., sold a portion of Hacienda San Esteban to Roman Santos
who also transformed the swamp land into a fishpond. In so doing, he closed and built dikes across
Sapang Malauling Maragul, Quiorang Silab, Pepangebunan, Bulacus, Nigui and Nasi.

The closing of the man-made canals in Hacienda San Esteban drew complaints from residents of the
surrounding communities. Claiming that the closing of the canals caused floods during the rainy
season, and that it deprived them of their means of transportation and fishing grounds, said
residents demanded re-opening of those canals. Subsequently, Mayor Lazaro Yambao of Macabebe,
accompanied by policemen and some residents went to Hacienda San Esteban and opened the
closure dikes at Sapang Malauling Maragul, Nigui and Quiorang Silab. Whereupon, Roman Santos
filed Civil Case No. 4488 in the Court of First Instance of Pampanga which preliminarily enjoined
Mayor Yambao and others from demolishing the dikes across the canals. The municipal officials of
Macabebe countered by filing a complaint (docketed as Civil Case No. 4527) in the same court. The
Pampanga Court of First Instance rendered judgment in both cases against Roman Santos who
immediately elevated the case to the Supreme Court.

In the meantime, the Secretary of Commerce and Communications 1 conducted his own
investigation and found that the aforementioned six streams closed by Roman Santos were natural,
floatable and navigable and were utilized by the public for transportation since time immemorial. He
consequently ordered Roman Santos on November 8, 1930 to demolish the dikes across said six
streams. However, on May 8, 1931 the said official revoked his decision of November 3, 1930 and
declared the streams in question privately owned because they were artificially constructed.
Subsequently, upon authority granted under Act 3982 the Secretary of Commerce and
Communications entered into a contract with Roman Santos whereby the former recognized the
private ownership of Sapang Malauling Maragul, Quiorang Silab, Pepangebunan, Bulacus, Nigui and
Nasi and the latter turned over for public use two artificial canals and bound himself to maintain
them in navigable state. The Provincial Board of Pampanga and the municipal councils of Macabebe
and Masantol objected to the contract. However, the Secretary of Justice, in his opinion dated March
6, 1934, upheld its legality. Roman Santos withdraw his appeals in the Supreme Court.

With respect to the portion of Hacienda San Esteban still owned by the Zobel family, the municipal
authorities of Macabebe filed in 1930 an administrative complaint in the Bureau of Public Works
praying for the opening of the dikes and dams across certain streams in Hacienda San Esteban.
Whereupon, the district engineer of Pampanga and a representative of the Bureau of Public Works
conducted investigations. In the meantime, the Attorney General, upon a query from the Secretary
of Commerce and Communications, rendered an opinion dated October 11, 1930 sustaining the
latters power to declare streams as publicly owned under Sec. 4 of Act 2152, as amended by Act
3208.

On September 29, 1930 the investigator of the Bureau of Public Works, Eliseo Panopio, submitted
his report recommending the removal of the dikes and dams in question. And on the basis of said
report, the Secretary of Commerce and Communications rendered his decision on November 3,
1930 ordering Ayala y Cia., to demolish the dikes and dams across the streams named therein
situated in Hacienda San Esteban. Ayala y Cia., moved for reconsideration, questioning the power of
the Secretary of Commerce and Communications to order the demolition of said dikes.

Days before the Secretary of Commerce and Communications rendered his aforementioned
decision, Ayala y Cia., thru counsel, made representations with the Director of Public Works for a
compromise agreement. In its letter dated October 11, 1930, Ayala y Cia., offered to admit public
ownership of the following creeks: chanrob1es virtual 1aw library

Antipolo, Batasan Teracan, Biuas or Batasan, Capiz, Carbon, Cutut, Dalayap, Enrique, Iba, Inaun,
Margarita, Malauli or Budbud, Matalaba, Palapat, Palipit Maisac, Panlovenas, Panquitan, Quinapati,
Quiorang Bubong or Malauli Malati, Salop, Sinubli and Vitas.

provided the rest of the streams were declared private. Acting on said offer, the Director of Public
Works instructed the surveyor in his office, Eliseo Panopio, to proceed to Pampanga and conduct
another investigation.

On January 23, 1931 Panopio submitted his report to the Director of Public Works recommending
that some streams enumerated therein be declared public and some private on the ground that they
were originally dug by the hacienda owners. The private streams were: chanrob1es virtual 1aw library

Agape, Atlong Cruz, Balanga, Batasan, Batasan Matlaue, Balibago, Baliti, Bato, Buengco Malati,
Bungalin, Bungo Malati, Bungo Maragul, Buta-buta, Camastiles, Catlu, Cauayan or Biabas, Cela,
Dampalit, Danlimpu, Dilinquente, Babian, Laguzan, Lalap Maburac, Mabutol, Macabacle Maragul or
Macanduli, Macabacle or Mababo, Maisac, Malande Malati, Magasawa, Maniup, Manulit, Mapanlao
Maisac, Maragul, Mariablus Malate, Matalaba Malati, Masamaral, Mitulid, Nasi, Nigui or Bulacus,
Palipit Maragul, Pangebonan, Paumbong, Pasco or Culali, Pilapil, Pinac Malati, Pinac Maragul or
Macabacle, Quiorang Silab or Malauli Maragul, Raymundo, Salamin, Salop Maisac, Salop Maragul,
Sermon and Sinca or Mabulog.

He therefore recommended revocation of the decision already mentioned above, dated November 3,
1930 of the Secretary of Commerce and Communications ordering the demolition of the dikes
closing Malauling Maragul, Quiorang Silab, Pepangebonan, Nigui, Bulacus, Nasi and Pinac. On
February 13, 1931 the Director of Public Works concurred in Panopios report and forwarded the
same to the Secretary of Commerce and Communications.

On February 25, 1935 the municipality of Macabebe and the Zobel family executed an agreement
whereby they recognized the nature of the streams mentioned in Panopios report as public or
private, depending on the findings in said report. This agreement was approved by the Secretary of
Public Works and Communications on February 27, 1935 and confirmed the next day by the
municipal council of Macabebe under Resolution No. 36.

A few months later, that is, on June 12, 1935, the then Secretary of Justice issued an opinion
holding that the contract executed by the Zobel family and the municipality of Macabebe has no
validity for two reasons, namely, (1) the streams although originally dug by Ayala y Cia., lost their
private nature by prescription inasmuch as the public was allowed to use them for navigation and
fishing, citing Mercado v. Municipality of Macabebe, 59 Phil. 592; and (2) at the time the Secretary
of Commerce and Communications approved the said contract, he had no more power so to do,
because such power under Sec. 2 of Act 2152 was revoked by the amending Act 4175 which took
effect on December 7, 1934.

Despite the above ruling of the Secretary of Justice, the streams in question remained closed.

In 1939 administrative investigations were again conducted by various agencies of the Executive
branch of our government culminating in an order of President Manuel Quezon immediately before
the national elections in 1941 requiring the opening of Sapang Macanduling Maragul, Macabacle,
Balbaro and Cansusu. Said streams were again closed in 1942 allegedly upon order of President
Quezon.

THE CASE

Roman Santos acquired in 1940 from the Zobel family a larger portion of Hacienda San Esteban
wherein are located 25 streams which were closed by Ayala y Cia., and are now the subject matter
in the instant controversy.

Eighteen years later, that is in 1950, Congress enacted Republic Act No. 2056 2 following a
congressional inquiry which was kindled by a speech delivered by Senator Rogelio de la Rosa in the
Senate. On August 15, 1958 Senator de la Rosa requested in writing the Secretary of Public Works
and Communications to proceed in pursuance of Republic Act No. 2056 against fishpond owners in
the province of Pampanga who have closed rivers and appropriated them as fishponds without color
of title. On the same day, Benigno Musni and other residents in the vicinity of Hacienda San Esteban
petitioned the Secretary of Public Works and Communications to open the following streams: chanrob1es virtual 1aw library

Balbaro, Batasan Matua, Bunga, Cansusu, Macabacle, Macanduling Maragul, Mariablus Malate,
Matalabang Maisac, Nigui, Quiorang Silab, Sapang Maragul and Sepung Bato.

Thereupon, the Secretary of Public Works and Communications instructed Julian C. Cargullo to
conduct an investigation on the above named streams.

On October 20, 1958 Musni and his co-petitioners amended their petition to include other streams.
The amended petition therefore covered the following streams: chanrob1es virtual 1aw library

Balbaro, Balili, Banawa, Batasan Matua, Bato, Bengco, Bunga, Butabuta, Camastiles, Cansusu, Cela,
Don Timpo, Mabalanga, Mabutol, Macabacle, Macabacle qng. Iba, Macanduling Maragul, Malauli,
Magasawa, Mariablus Malate, Masamaral, Matalabang Maisac, Mariablus, 3 Nigui, Pita, Quiorang
Silab, Sapang Maragul, Sepung Bato, Sinag and Tumbong.

On March 2, 4, 10, 30 and 31, and April 1, 1959, the Secretary of Public Works and
Communications rendered his decisions ordering the opening and restoration of the channel of all
the streams in controversy except Sapang Malauling Maragul, Quiorang Silab, Nigui,
Pepangebonan, Nasi and Bulacus, within 30 days on the ground that said streams belong to the
public domain.

On April 29, 1959, that is, after receipt of the Secretarys decision dated March 4, 1959, Roman
Santos filed a petition with the Court of First Instance of Manila for injunction against the Secretary
of Public Works and Communications and Julian C. Cargullo. As prayed for, preliminary injunction
was granted on May 8, 1959. The Secretary of Public Works and Communications answered and
alleged as defense that venue was improperly laid; that Roman Santos failed to exhaust
administrative remedies; that the contract between Ayala y Cia., and the Municipality of Macabebe
is null and void; and, that Section 39 of the Act 496 excludes public streams from the operation of
the Torrens System.

On April 29 and June 12, 1959, Roman Santos received the decision of the Secretary of Public
Works and Communications dated March 10 and March 30, March 31, and April 1, 1959.
Consequently, on June 24, 1959 he asked the court to cite in contempt Secretary Florencio Moreno,
Undersecretary M. D. Bautista and Julian Cargullo for issuing and serving upon him the said
decisions despite the existence of the preliminary injunction. The Solicitor General opposed the
motion alleging that the decisions in question had long been issued when the petition for injunction
was filed, that they were received after preliminary injunction issued because they were transmitted
through the District Engineer of Pampanga to Roman Santos; that their issuance was for Roman
Santos information and guidance and, that the motion did not allege that respondents took steps to
enforce the decision. Acting upon said motion, on July 17, 1959, the trial court considered
unsatisfactory the explanation of the Solicitor General but ruled that Secretary Florencio Moreno,
Undersecretary M. D. Bautista and Julian Cargullo acted in good faith. Hence, they were merely
"admonished to desist from any and further action in this Court, with the stern warning, however,
that a repetition of the acts complained of shall be dealt with severely." cralaw virtua1aw library

On July 18, 1959 the trial court declared all the streams under litigation private, and rendered the
following judgment: jgc:chanrobles.com.ph

"The Writ of preliminary injunction restraining the respondent Secretary of Public Works &
Communications from enforcing the decisions of March 2 and 4, 1959 and all other similar decisions
is hereby made permanent." cralaw virtua1aw library

The Secretary of Public Works and Communications and Julian Cargullo appealed to this Court from
the order of July 17, 1959 issued in connection with Roman Santos motion for contempt and from
the decision of the lower court on the merits of the case.

ISSUES

The issues are: (1) Did Roman Santos exhaust administrative remedies? (2) Was venue properly
laid? (3) Did the lower court err in conducting a trial de novo of the case and in admitting evidence
not presented during the administrative proceeding? (4) Do the streams involved in this case belong
to the public domain or to the owner of Hacienda San Esteban according to law and the evidence
submitted to the Department of Public Works and Communications?

DISCUSSION OF THE ISSUES

1. Respondents maintain that Roman Santos resorted to the court without first exhausting
administrative remedies available to him, namely, (a) motion for reconsideration of the decisions of
the Secretary of Public Works and Communications; and, (b) appeal to the President of the
Philippines.

Whether a litigant, in exhausting available administrative remedies, need move for the
reconsideration of an administrative decision before he can turn to the courts for relief, would
largely depend upon the pertinent law, 4 the rules of procedure and the usual practice followed in a
particular office. 5

Republic Act 2056 does not require the filing of a motion for reconsideration as a condition
precedent to judicial relief. From the context of the law, the intention of the legislators to forego a
motion for reconsideration manifests itself clearly. Republic Act No. 2056 underscores the urgency
and summary nature of the proceedings authorized thereunder. Thus in Section 2 thereof the
Secretary of Public Works and Communications under pain of criminal liability is duty bound to
terminate the proceedings and render his decision within a period not exceeding 90 days from the
filing of the complaint. Under the same section, the party respondent concerned is given not more
than 30 days within which to comply with the decision of the Secretary of Public Works and
Communications, otherwise the removal of the dams would be done by the Government at the
expense of said party. Congress has precisely provided for a speedy and a most expeditious
proceeding for the removal of illegal obstructions to rivers and on the basis of such a provision it
would be preposterous to conclude that it had in mind to require a party to file a motion for
reconsideration an additional proceeding which would certainly lengthen the time towards the
final settlement of existing controversies. The logical conclusion is that Congress intended the
decision of the Secretary of Public Works and Communications to be final and executory subject to a
timely review by the courts without going through formal and time consuming preliminaries.

Moreover, the issues raised during the administrative proceedings of this case are the same ones
submitted to court for resolution. No new matter was introduced during the proceedings in the court
below which the Secretary of Public Works and Communications had no opportunity to correct under
his authority.

Furthermore, Roman Santos assailed the constitutionality of Republic Act No. 2056 and the
jurisdiction of the Secretary of Public Works and Communications to order the demolition of dams
across rivers or streams. Those questions are not within the competence of said Secretary to decide
upon a motion for reconsideration. They are purely legal questions, not administrative in nature,
and should properly be aired before a competent court as was rightly done by petitioner Ramon
Santos.

At any rate, there is no showing in the records of this case that the Secretary of Public Works and
Communications adopted rules of procedure in investigations authorized under Republic Act No.
2056 which require a party litigant to file a motion for the reconsideration of the Secretarys
decision before he can appeal to the courts. Roman Santos however stated in his brief that the
practice is not to entertain motions for reconsideration for the reason that Republic Act No. 2056
does not expressly or impliedly allow the Secretary to grant the same. Roman Santos statement is
supported by Opinion No. 61, Series of 1959, dated April 14, 1959 of the Secretary of Justice.

As to the failure of Roman Santos to appeal from the decision of the Secretary of Public Works and
Communications to the President of the Philippines, suffice it to state that such appeal could be
dispensed with because said Secretary is the alter ego of the President. The actions of the former
are presumed to have the implied sanction of the latter. 6

2. It is contended that if this case were considered as an ordinary civil action, venue was improperly
laid when the same was instituted in the Court of First Instance of Manila for the reason that the
case affects the title of a real property. In fine, the proposition is that since the controversy dwells
on the ownership of or title to the streams located in Hacienda San Esteban, the case is a real
action which, pursuant to Sec. 3 of Rule 5 of the Rules of Court, should have been filed in the Court
of First Instance of Pampanga.

The mere fact that the resolution of the controversy in this case would wholly rest on the ownership
of the streams involved herein would not necessarily classify it as a real action. The purpose of this
suit is to review the decisions of the Secretary of Public Works and Communications, to enjoin him
from enforcing them and to prevent him from making and issuing similar decisions concerning the
streams in Hacienda San Esteban. The acts of the Secretary of Public Works are Communications
are the object of the litigation, that is, petitioner Roman Santos seeks to control them, hence, the
suit ought to be filed in the Court of First Instance whose territorial jurisdiction encompasses the
place where the respondent Secretary is found or is holding office. For the rule is that outside its
territorial limits, the court has no power to enforce its orders. 7

Section 3 of Rule 5 of the Rules of Court does not apply to determine venue of this action,
Applicable is Sec. 1 of the same rule, which states: jgc:chanrobles.com.ph

"SECTION 1. General rule. Civil actions in Courts of First Instance may be commenced and tried
where the defendant or any of the defendants resides or may be found, or where the plaintiff or any
of the plaintiffs resides, at the election of the plaintiff." cralaw virtua1aw library

Accordingly, the petition for injunction was correctly filed in the Court of First Instance of Manila.
Respondents Secretary of Public Works and Communications and Julian Cargullo are found and hold
office in the City of Manila.

3. The lower court tried this case de novo. Against this procedure respondents objected and
maintained that the action, although captioned as an injunction, is really a petition for certiorari to
review the decision of the Secretary of Public Works and Communications. Therefore, they now
contend that the court should have confined itself to reviewing the decisions of the respondent
Secretary of Public Works and Communications only on the basis of the evidence presented in the
administrative proceedings. On the other hand, Roman Santos now submits that the action is a
proceeding independent and distinct from the administrative investigation; that, accordingly, the
lower court correctly acted in trying the case anew and rendering judgment upon evidence adduced
during the trial.

Whether the action instituted in the Court of First Instance be for mandamus, injunction
or certiorari is not very material. In reviewing the decision of the Secretary of Public Works and
Communications, the Court of First Instance shall confine its inquiry to the evidence presented
during the administrative proceedings. Evidence not presented therein shall not be admitted and
considered by the trial court. As aptly stated by this Court speaking through Mr. Justice J.B.L.
Reyes, in a similar case:jgc:chanrobles.com.ph

"The findings of the Secretary can not be enervated by new evidence not laid before him, for that
would be tantamount to holding a new investigation, and to substitute for the discretion and
judgment of the Secretary the discretion and judgment of the court, to whom the statute had not
entrusted the case. It is immaterial that the present action should be one for prohibition or
injunction and not one for certiorari; in either event the case must be resolved upon the evidence
submitted to the Secretary, since a judicial review of executive decisions does not import a trial de
novo, but only an ascertainment of whether the executive findings are not in violation of the
Constitution or of the laws, and are free from fraud or imposition, and whether they find reasonable
support in the evidence . . ." 8

The case at bar, no matter what the parties call it, is in reality a review of several administrative
decisions of the Secretary of Public Works and Communications. Being so, it was error for the lower
court to conduct a trial de novo. Accordingly, for purposes of this review, only the evidence
presented and admitted in the administrative investigation will be considered in our determination
of whether on the basis thereof the decisions of the Secretary of Public Works and Communications
were correct.

4. We come to the question whether the streams involved in this case belong to the public domain
or to the owner of Hacienda San Esteban. If said streams are public, then Republic Act 2056
applies; if private, then the Secretary of Public Works and Communications cannot order demolition
of the dikes and dams across them pursuant to his authority granted by said law.

First, we come to the question of the constitutionality of Republic Act 2056. The lower court held
Republic Act No. 2056 constitutional but ruled that it was applied by respondents unconstitutionally.
That is, it held that Roman Santos was being deprived of his property without due process of law,
for the dikes of his fishponds were ordered demolished through an administrative, instead of a
judicial, proceeding. This conclusion and rationalization of the lower court amount in effect to
declaring the law unconstitutional, stated inversely. Note that the law provides for an expeditious
administrative process to determine whether or not a dam or dike should be declared a public
nuisance and ordered demolished. And to say that such an administrative process, when put to
operation, is unconstitutional is tantamount to saying that the law itself violates the Constitution. In
Lovina v. Moreno, supra, We held said law constitutional We see no reason here to hold otherwise.

Discussing now the applicability of Republic Act 2056, the same applies to two types of bodies of
water, namely, (1) public navigable rivers, streams, coastal waters, waters or waterways and (b)
areas declared as communal fishing grounds, as provided for in Section 1 thereof: jgc:chanrobles.com.ph

"SECTION 1. . . . the construction or building of dams, dikes or any other works which encroaches
into any public navigable river, stream, coastal waters and any other navigable public waters or
waterways as well as the construction or building of dams, dikes or any other works in areas
declared as communal fishing grounds, shall be ordered removed as public nuisances or as
prohibited constructions as herein provided: . . ."cralaw virtua1aw library

We are not concerned with communal fishing grounds because the streams here involved have not
been so declared, but with public navigable streams. The question therefore is: Are the streams in
Hacienda San Esteban which are mentioned in the petition of Benigno Musni and others, public and
navigable?
Respondents contend that said streams are public on the following grounds: chanrob1es virtual 1aw library

(1) Hacienda San Esteban was formerly a marshland and being so, it is not susceptible to
appropriation. It therefore belongs to the State. Respondents rely on Montano v. Insular
Government, 12 Phil. 572.

(2) The streams in question are natural streams. They are tributaries of public streams. Cited are
the cases of Samson v. Dionisio, Et Al., 11 Phil. 538 and Bautista v. Alarcon, 23 Phil. 636.

(3) The streams have for their source public rivers, therefore they cannot be classified as canals.

(4) Assuming the streams were artificially made by Ayala y Cia., said titleholder lost ownership over
them by prescription when it allowed the public to use them for navigation for a long time.
Respondents cite Mercado v. Municipal President of Macabebe, 59 Phil. 592.

(5) Assuming the streams in question are not mentioned as public in the certificates of title held by
Ayala y Cia., over Hacienda San Esteban, still they cannot be considered as privately owned for
Section 39 of Act 496 expressly excepts public streams from private ownership.

(6) The Panopio Report, which found the streams in question of private ownership was nullified by
the Secretary of Justice in his opinion dated June 12, 1935. And, the contract between Ayala y Cia.,
and the Secretary of Commerce and Communications agreeing on the ownership of the streams in
question is ultra vires.

The doctrine in Montano v. Insular Government, supra, that a marshland which is inundated by the
rise of tides belong to the State and is not susceptible to appropriation by occupation has no
application here inasmuch as in said case the land subject matter of the litigation was not yet titled
and precisely Isabelo Montano sought title thereon on the strength of ten years occupation
pursuant to paragraph 6, section 5 of Act 926 of the Philippine Commission. Whereas, the subject
matter in this case Hacienda San Esteban is titled land and private ownership thereof by Ayala
y Cia., has been recognized by the King of Spain and later by the Philippine Government when the
same was registered under Act 496.

Respondents further cite Bautista v. Alarcon, 23 Phil. 631, where the plaintiff sought injunction
against the defendants who allegedly constructed a dam across a public canal which conveyed water
from the Obando River to fishponds belonging to several persons. The canal was situated within a
public land. In sustaining the injunction granted by the Court of First Instance, this Court said: jgc:chanrobles.com.ph

"No private person has a right to usurp possession of a water- course, branch of a river, or lake of
the public domain and use, unless it shall have been proved that he constructed the same within
property of his exclusive ownership, and such usurpation constitutes a violation of the legal
provisions which explicitly exclude such waterways from the exclusive use or possession of a private
party." (Emphasis supplied)

As indicated in the above-cited case, a private person may take possession of a watercourse if he
constructed the same within his property. This puts Us into inquiry whether the streams in question
are natural or artificial. In so doing, We shall examine only the evidence presented before the
Department of Public Works and Communications and disregard that which was presented for the
first time before the lower court, following our ruling in Lovina v. Moreno, supra.

(1) Sapang Macanduling Maragul or Macanduli is presently enclosed in Fishpond No. 12 of Roman
Santos. Its banks cannot anymore be seen but some traces of them could be noted by a row of
isolated nipa palms. Its water is subject to the rise and fall of the tides coming from Guagua and
Antipolo Rivers and it is navigable by light watercrafts. Its inlet is Antipolo River and its outlet is the
Palapat River. 9 It is closed by four dikes: One dike at its inlet along the Palapat River; and, two
dikes in between. The exit channel at the Palapat River where the fishpond gate lies has been filled
up with dredge spoils from the Pampanga River Control Project.

(2) Sapang Macabacle is found in Fishpond No. 13. Its banks are still evident. This stream is about
30 meters wide, two meters deep and one and one-half to two kilometers long. Its source is Rio
Cansusu. Like Macanduli, its channel is obstructed by four dikes. One of them was constructed by
the engineers of the Pampanga River Control Project.

(3) Sapang Balbaro which is found in Fishpond No. 13, runs from Canal Enrique near Rio Cansusu to
Sapang Macabacle, a distance of about one-half kilometer. It is passable by banca. The closures of
this stream consist of two dikes located at each ends on Canal Enrique and Sapang Macabacle.

(4) Sapang Cansusu is a continuation of the Cansusu River. The Cansusu River opens at the Guagua
River and allegedly ends at the Palanas River in front of Barrio San Esteban. At a point near the
mouth of Sapang Balbaro, the owners of Hacienda San Esteban built a canal leading straight to one
end of Barrio San Esteban. They called this canal "Canal Enrique." And at the point where Canal
Enrique joins Cansusu they built a dike across Cansusu, thus closing this very portion of the river
which extends up to Palanas River where they built another closure dike. This closed portion, called
"Sapang Cansusu," is now part of Fishpond No. 1.

Sapang Cansusu is half a kilometer long and navigable by banca.

Appellants witnesses, Benigno Musni, 41, Macario Quiambao, 96, Roman Manansala, 55 and Castor
Quiambao, 76, all residents of Barrio San Esteban, testified that prior to their closure, Sapang
Macanduli, Macabacle, Balbaro and Cansusu were used as passageway and as fishing grounds; that
people transported through them tuba, 10 wood and sasa; 11 and that the tuba was brought to the
distillery in Barrio San Esteban. Macario Quiambao testified also that said four streams "were
created by God for the town people" ; and that if any digging was done it was only to deepen the
shallow parts to make passage easier. According to witness Anastacio Quiambao said streams were
navigable, even Teodoro Yangcos ship "Cababayan" could pass through. Simplicio Quiambao, 36,
and Marcelino Ocampo, 55 stated on direct examination that before closure of the abovenamed four
streams, people from the surrounding towns of Guagua, Bacolor, Macabacle, Masantol and Sexmoan
fished and navigated in them.

Against the afore-mentioned testimonial evidence Roman Santos presented the testimony of
Nicanor Donarber, 80, Mariano Guinto, 71, and his own. Donarber, who started working as an
arundin 12 testified that Ayala y Cia., dug Sapang Macanduli, Balbaro and Macabacle; that he
worked also in the construction together with other workers; and, that as an overseer he inspected
their work. Mariano Guinto testified that he worked for Ayala y Cia., as a tuba gatherer; that in
order to reach remote nipa groves by banca, they made canals; and, that he was one of those who
worked in the construction of those canals. Roman Santos also testified that Sapang Macanduli,
Macabacle, Balbaro and Cansusu are artificial canals excavated as far back as 1850 and due to
erosion coupled with the spongy nature of the land, they acquired the proportion of rivers; that he
joined Sapang Balbaro to Sapang Macabacle because the former was a dying canal; and that
Cansusu river is different from Sapang Cansusu. Witness Domingo Yumang likewise testified that
Sapang Balbaro is man-made.

We observe that witnesses positively stated that Sapang Macanduli, Macabacle and Balbaro were
made by the owners of Hacienda San Esteban. With respect to Sapang Cansusu, none, except
Roman Santos himself, testified that Sapang Cansusu is an artificial canal. It is not one of the
streams found and recommended to be declared private in the Panopio Report. Sapang Cansusu
follows a winding course different and distinct from that of a canal such as that of Canal Enrique
which is straight. Moreover, Sapang Cansusu is a part of Cansusu River, admittedly a public stream.

(5) Sapang Maragul, Mabalanga and Don Timpo are all part of Fishpond No. 1. Maragul is 600
meters long and 30 to 35 meters wide. Mabalanga is 250 meters in length and 50 meters in width.
Don Timpo is 220 meters long and 20 meters wide. All of them are navigable by banca. Maragul and
Mabalanga open at Guagua River and join each other inside the hacienda to form one single stream,
Sapang Don Timpo, which leads to the Matalaba River. Maragul, Mabalanga and Don Timpo,
formerly ended inside the hacienda but later Mabalanga was connected to Don Timpo. Maragul was
connected to Mabalanga and Sapang Cela was extended to join Maragul.

Witnesses Nicanor Donarber, Mariano Ocampo and Mariano Guinto testified that Maragul,
Mabalanga and Don Timpo are artificial canals dug by Ayala y Cia., and that they (Donarber and
Mariano Guinto) worked in said excavations. 13 Witness Mariano Guinto clarified that Don Timpo
was originally dug but Mabalanga and Maragul were formerly small non-navigable streams which
were deepened into artificial navigable canals by Ayala y Cia. 14
Exhibit F, which is a map showing the streams and rivers in Hacienda San Esteban, shows that
Maragul, Mabalanga and Don Timpo are more or less straight. From the big rivers (Guagua and
Matalaba Rivers) they lead deep into the interior of the hacienda, thus confirming the testimony
that they were built precisely as a means of reaching the interior of the estate by banca. The weight
of evidence, therefore, indicates that said streams are man-made.

(6) Sapang Bunga, now part of Bunga fishpond, gets its water from Sapang Iba and empties at Sta.
Cruz River. It is about 300-400 meters long, 5-6 meters wide and 1-1.60 meters deep.

(7) Sapang Batu is found in Capiz Fishpond. About 300-400 meters long, 4-5 meters wide and 1.50-
2.20 meters deep, it starts at Capiz River and ends at Malauling Maragul. From Capiz River until it
intersects Sapang Nigui, the stream is called Sapang Batu. Commencing from Sapang Nigui and up
to its end at Sapang Malauling Maragul, the stream is called Sepong Batu. Sepong Batu is not
among those streams declared in the Panopio report as private.

(8) Sapang Banawa has one end at Palanas River and the other at Sapang Macabacle. It is about
300 meters long; 3-4 meters wide and 1.30-1.40 meters deep. Its whole length is within Fishpond
No. 13 of Roman Santos.

(9) Sapang Mabutol is a dead-end stream, that is, it ends inside the hacienda. It opens along the
Guagua River. Since its closure, it has become part of Fishpond No. 1.

(10) Sapang Buta-buta, like Mabutol, dies inside the hacienda. It connects with Cansusu River and
is about 100 meters long, 3-4 meters wide and 1.2-1.5 meters deep. It is now a part of Fishpond
No. 13.

(11) Sapang Masamaral, another stream which opens at Cansusu River and ends inside the
hacienda, is 100-200 meters long, 3-4 meters wide and 1.50-2 meters deep. It now forms part of
Fishpond No. 13.

The uncontradicted testimony of Marcos Guinto is that Sapang Bunga, Batu, Sepong Batu, Banawa,
Mabutol, Buta-buta and Masamaral were constructed by Ayala y Cia., to gain access to the nipa in
the interior of the hacienda. This testimony tallies with the findings in the Panopio Report which will
be discussed herein later. The evidence adduced in the administrative proceedings conducted before
a representative of the Secretary of Public Works and Communications supports the contention that
said streams are merely canals built by Ayala y Cia., for easy passage into the hinterland of its
hacienda.

(12) Sapang Magasawa consists of two streams running parallel to each other commencing from
Matalaba River and terminating at Mariablus River. About 600-700 meters long, 4-5 meters wide
and 1.5-2 meters deep, these two streams are navigable by banca. They are enclosed within
Fishpond No. 1.

(13) Sapang Mariablus Malate, about 3-4 meters wide and 230 meters long, is another stream that
ends inside the hacienda and gets its water from Guagua River. It is now part of Fishpond No. 1.

(14) Sapang Matalabang Malate or Maisac opens at Guagua River and ends at Sapang Cela and
Matalabang Maragul. This stream, which is about 800 meters long and 18 meters wide, forms part
of Fishpond No. 1 of Roman Santos.

(15) Sapang Batasan Matua, about 600 meters long, three meters wide and .80 meters deep at low
tide and 1.90 meters deep at high tide, crosses the hacienda from Mariablus River to Cansusu River.
It is at present a part of Fishpond No. 1-A.

(16) Sapang Camastiles, a dead-end stream of about 200 to 300 meters in length, gets its water
from Biuas River. It is within Fishpond No. 1.

(17) Sapang Cela is within Fishpond No. 1. Its whole length situated inside the hacienda, it opens at
Sapang Matalabang Malate or Maisac and ends at Sapang Malungkot. Later Cela was extended to
connect with Sapang Maragul. It is about 200 meters long and four meters wide.

Mariano Guinto, 71, testified without contradiction that Sapang Mariablus Malate and Matalabang
Malate were formerly small and non- navigable streams which were dug by Ayala y Cia., 15 while
Batasan Matua, Camastiles, Magasawa and Cela are original canals made by Ayala y Cia.; 16 that
he was one of those who worked in the construction of said canals; and that it took years to
construct them. All these streams were recommended in the Panopio Report for declaration as
private streams.

(18) Sapang Sinag, 200 meters long, four to five meters wide, one meter and one and one-half
meters deep at low and high tides, respectively, gets its water from Cutod River and leads inside
the hacienda to connect with Sapang Atlong Cruz, a stream declared private in the Panopio Report.
It is now inside Fishpond No. 14.

(19) Sapang Balili, also found inside Fishpond No. 14, is about 200 meters long, three to four
meters wide and one meter deep at low tide. From its mouth at Cutod River it drifts into the interior
of the hacienda and joins Sapang Bengco. 17

(20) Sapang Pita is within Fishpond Capiz. It takes water from Capiz River but dies 250 meters
inside the hacienda. It is about four to five meters wide, and one meter deep at low tide and 1.50
meters deep at high tide.

(21) Sapang Tumbong, situated inside Capiz Fishpond, derives its water from Sapang Quiorang
Silab, a stream declared private by the Secretary of Public Works and Communications, and ends
inside the hacienda. 18

(22) Sapang Bengco is found within Fishpond No. 14. Two hundred meters long, five meters wide,
and one meter deep at low tide and 1.50 meters deep at high tide, it gets water from Sapang
Biabas and connects with Baliling Maisac. 19

According to Marcos Guinto, a witness for Roman Santos, Sapang Sinag, Balili, Pita, Tumbong and
Bengco were excavated a long time ago by Ayala y Cia.; and that they have a winding course
because when they were made the workers followed the location of the nipa palms. 20 On the other
hand, Marcelo Quiambao, testified that Sapang Tumbong is a natural stream and that the reason he
said so is because the stream was already there as far back as 1910 when he reached the age of
ten. No other oral evidence was presented to contradict the testimony of Marcos Guinto that the
said five streams were artificially made by Ayala y Cia.

To show that the streams involved in this case were used exclusively by the hacienda personnel and
occasionally by members of their families, Roman Santos introduced the testimony of Eliseo
Panopio, Nicanor Donarber, Blas Gaddi, Mariano Ocampo, Mariano Guinto, Alejandro Manansala and
himself. The witnesses categorically testified that the public was prohibited from using the streams
as a means of navigation and that the prohibition was enforced by guards called arundines.

One and all, the evidence, oral and documentary, presented by Roman Santos in the administrative
proceedings supports the conclusion of the lower court that the streams involved in this case were
originally man-made canals constructed by the former owners of Hacienda San Esteban and that
said streams were not held open for public use. This same conclusion was reached 27 years earlier
by an investigator of the Bureau of Public Works whose report and recommendations were approved
by the Director of Public Works and submitted to the Secretary of Commerce and Communications.

As stated, pursuant to Act 2152, as amended by Act 3208, the Bureau of Public Works and the
Department of Commerce and Communications looked into and settled the question of whether or
not the streams situated within Hacienda San Esteban are publicly or privately owned. We refer to
the so-called Panopio Report which contains the findings and recommendations of Eliseo Panopio, a
surveyor in the Bureau of Public Works, who was designated to conduct formal hearings and
investigation. Said report found the following streams, among others, of private ownership: chanrob1es virtual 1aw library

Camastiles, Cela, Balanga, Bato, Batasan, Bengco, Buta-buta, Don Timpo, Mabutol, Macabacle,
Macanduli, Malande Malate (Bunga), Magasawa, Masamaral, Maragul, Mariablus Malate, Matalaba
Malate, Nasi, Nigui, Pangebonan and Quiorang Silab.

on the ground that

"The preponderance of the probatory facts, . . ., shows that the rivers, creeks, esteros and canals
listed in (1) have originally been constructed, deepened, widened, and lengthened by the owners of
the Hacienda San Esteban. That they have been used as means of communication from one place to
another and to the inner most of the nipales, exclusively for the employees, colonos and laborers of
the said Hacienda San Esteban. That they have never been used by the public for navigation
without the express consent of the owners of the said Hacienda." 21

Bases for the above-quoted conclusion were "the reliable informations gathered from old residents
of the locality, from outsiders, the sworn statements obtained from different persons not interested
in this case and the comparison of the three plans prepared in 1880, 1906 and 1930. 22 The
persons referred to are Martin Isip, Hilarion Lobo, Emigdio Ignacio, Castor Quiambao, Matias Sunga,
Bonifacio Cruz, Inocencio Dayrit, Gabriel Manansala, Lope Quiambao, Marcelino Bustos and Juan
Lara.

On February 13, 1931 the Director of Public Works transmitted the Panopio Report to the Secretary
of Commerce and Communications recommending approval thereof. Later, on February 27, 1935,
Secretary of Public Works and Communications De las Alas approved the agreement of Ayala y Cia.,
and the Municipality of Macabebe, concerning the ownership of the streams in Hacienda San
Esteban, for being in conformity with said Panopio Report.

This agreement of Ayala y Cia., and the Municipality of Macabebe which was approved by the
Secretary of Public Works and Communications only on February 27, 1935, could not however bind
the Government because the power of the Secretary of Public Works and Communications to enter
thereto had been suppressed by the Philippine Legislature when it enacted Act 4175 which took
effect on December 7, 1934.

Nullity of the aforesaid contract would not of course affect the findings of fact contained in the
Panopio Report.

In weighing the evidence presented before the administrative investigation which culminated in this
appeal, respondent Secretary seems to have ignored the Panopio Report and other documentary
evidence as well as the testimony of witnesses presented by petitioner but instead gave credence
only to the witnesses of Benigno Musni, Et. Al. Upon review, however, the lower court, taking into
account all the evidence adduced in the administrative hearing, including the Panopio Report, as
well as those presented for the first time before it, sustained petitioners averment that the streams
in question were artificially made, hence of private ownership. As stated, this conclusion of the
lower court which is in accordance with the findings of Panopio as contained in his report, finds
ample support from the evidence presented and admitted in the administrative investigation.
Accordingly, we see no merit in disturbing the lower courts findings of fact.

We next consider the issue of whether, under pertinent laws, the streams in question are public or
private.

We quote Articles 339, 407 and 408 of the Spanish Civil Code of 1889: jgc:chanrobles.com.ph

"ART. 339. Property of public ownerships is

"1. That devoted to public use, such as roads, canals, rivers, torrents, ports and bridges constructed
by the State, riverbanks, shores, roadsteads, and that of a similar character;"

"ART. 407. The following are of public ownership: jgc:chanrobles.com.ph

"1. Rivers and their natural channels;

"2. Continuous or intermittent waters from springs or brooks running in then natural channels and
the channels themselves;

"3. Waters rising continuously or intermittently on lands of public;

"4. Lakes and ponds formed by nature on public lands, and their beds;

"5. Rain waters running through ravines or sand beds, the channels of which are of public
ownership;
"6. Subterranean waters on public lands;

"7. Waters found within the zone of operation of public works, even though constructed under
contract;

"8. Waters which flow continuously or intermittently from lands belonging to private persons, to the
State, to provinces, or to towns from the moment they leave such lands;

"9. The waste waters of fountains, sewers, and public institutions." cralaw virtua1aw library

"ART. 408. The following are of private ownership: jgc:chanrobles.com.ph

"1. Waters, either continuous or intermittent rising on private estates, while they run through them;

"2. Lakes and ponds and their beds when formed by nature on such estates;

"3. Subterranean waters found therein;

"4. Rain waters falling thereon as long as they remain within their boundaries;

"5. The channels of flowing streams, continuous or intermittent formed by rain water, and those of
brooks crossing estates which are not of public ownership.

"The water, bed, banks, and floodgates of a ditch or aqueduct are deemed to be an integral part of
the estate or building for which the waters are intended. The owners of estates through or along the
boundaries of which the aqueduct passes can assert no ownership over it, nor any right to make use
of its beds or banks, unless they base their claim on title deed which specify the right or the
ownership claimed." cralaw virtua1aw library

Articles 71 and 72 of the Spanish Law of Waters of August 8, 1866 state: jgc:chanrobles.com.ph

"ART. 71. The water-beds of all creeks belong to the owners of the estates or lands over which they
flow."
cralaw virtua1aw library

"ART. 72. The water-beds on public land, of creeks through which spring waters run, are a part of
the public domain.

"The natural water-beds or channels of rivers are also part of the public domain." cralaw virtua1aw library

Pursuant to Article 71 of the Spanish Law of Waters of August 3, 1866, and Article 408(5) of the
Spanish Civil Code, channels of creeks and brooks belong to the owners of estates over which they
flow. The channels, therefore, of the streams in question which may be classified as creeks, belong
to the owners of Hacienda San Esteban.

The said streams, considered as canals, of which they originally were, are of private ownership in
contemplation of Article 339(1) of the Spanish Civil Code. Under Article 339, canals constructed by
the State and devoted to public use are of public ownership. Conversely, canals constructed by
private persons within private lands and devoted exclusively for private use must be of private
ownership.

Our attention has been called to the case of Mercado v. Municipal President of Macabebe, 59 Phil.
592. There the creek (Batasan-Limasan) involved was originally dug by the estates owner who,
subsequently allowed said creek to be used by the public for navigation and fishing purposes for a
period of 22 years. Said this Court through Mr. Justice Diaz: jgc:chanrobles.com.ph

"And even granting that the Batasan-Limasan creek acquired the proportions which it had, before it
was closed, as a result of excavations made by laborers of the appellants predecessor in interest, it
being a fact that, since the time it was opened as a water route between the Nasi River and Limasan
creek, the owners thereof as well as strangers, that is, both the residents of the hacienda and those
of other nearby barrios and municipalities, has been using it not only for their bancas to pass
through but also for fishing purposes, and it being also a fact that such was the condition of the
creek at least since 1906 until it was closed in 1928, if the appellant and her predecessors in
interest had acquired any night to the creek in question by virtue of excavations which they had
made thereon, they had lost such right through prescription, inasmuch as they failed to obtain, and
in fact they have not obtained, the necessary authorization to devote it to their own use to the
exclusion of all others, The use and enjoyment of a creek, as any other property susceptible of
appropriation, may be acquired or lost through prescription, and the appellant and her predecessors
in interest certainly lost such right through the said cause, and they cannot now claim it exclusively
for themselves after the general public had been openly using the same from 1906 to 1928 . . ." cralaw virtua1aw library

In the cited case, the creek could have been of private ownership had not its builder lost it by
prescription. Applying the principle therein enunciated to the case at bar, the conclusion would be
inevitably in favor of private ownership, considering that the owners of Hacienda San Esteban held
them for their exclusive use and prohibited the public from using them.

It may be noted that in the opinion, mentioned earlier, issued on June 12, 1935, the Secretary of
Justice answered in the negative the query of the Secretary of Public Works and Communications
whether the latter can declare of private ownership those streams which "were dug up artificially",
because it was assumed that the streams were used "by the public as fishing ground and in
transporting their commerce in bancas or in small crafts without the objection of the parties who
dug" them. Precisely, Mercado v. Municipality of Macabebe was given application therein. However,
the facts, as then found by the Bureau of Public Work, do not support the factual premise that the
streams in question were used by the public "without the objection of the parties who dug" them.
We cannot therefore take as controlling in determining the merits of this case the factual premises
and the legal conclusion contained in said opinion.

The case at bar should be differentiated from those cases where We held illegal the closing and/or
appropriation of rivers or streams by owners of estates through which they flow for purposes of
converting them into fishponds or other works. 23 In those cases, the watercourses which were
dammed were natural navigable streams and used habitually by the public for a long time as a
means of navigation. Consequently, they belong to the public domain either as rivers pursuant to
Article 407(1) of the Spanish Civil Code of 1889 or as property devoted to public use under Article
339 of the same Code. Whereas, the streams involved in this case were artificially made and
denoted to the exclusive use of the hacienda owner.

Finally, Sapang Cansusu, being a natural stream and a continuation of the Cansusu River,
admittedly a public stream, belongs to the public domain. Its closure therefore by the predecessors
of Roman Santos was illegal.

The petition for the opening of Sapang Malauling Maragul, Quiorang Silab, Nigui, Pepangebunan,
Nasi and Bulacus was dismissed by the Secretary of Public Works and Communications and the case
considered closed. The said administrative decision has not been questioned in this appeal by either
party. Hence, they are deemed excluded herein.

All the other streams, being artificial and devoted exclusively for the use of the hacienda owner and
his personnel, are declared of private ownership. Hence, the dams across them should not be
ordered demolished as public nuisances.

With respect to the issue of contempt of court on the part of the Secretary of Public Works and
Communications and Julian Cargullo for the alleged issuance of administrative decisions ordering
demolition of dikes involved in this case after the writ of injunction was granted and served, suffice
it to state that the lower court made no finding of contempt of court. Necessarily, there is no
conviction for contempt reviewable by this Court and any discussion on the matter would be
academic.

WHEREFORE, the decision appealed from is affirmed, except as to Sapang Cansusu which is hereby
declared public and as to which the judgment of the lower court is reversed. No costs. So ordered.

G.R. No. 4223 August 19, 1908

NICOLAS LUNOD, ET AL., plaintiffs-appellees,
vs.
HIGINO MENESES, defendant-appellant.

T. Icasiano, for appellant.

R. Salinas, for appellee.

TORRES, J.:

On the 14th of March, 1904, Nicolas Lunod, Juan de la Vega, Evaristo Rodriguez, Fernando
Marcelo, Esteban Villena, Benito Litao, Ventura Hernandez, and Casimiro Pantanilla,
residents of the town of Bulacan, province of the same name, filed a written complaint
against Higino Meneses, alleging that they each owned and possessed farm lands, situated
in the places known as Maytunas and Balot, near a small lake named Calalaran; that the
defendant is the owner of a fish-pond and a strip of land situated in Paraanan, adjoining the
said lake on one side, and the River Taliptip on the other; that from time immemorial, and
consequently for more than twenty years before 1901, there existed and still exists in favor of
the rice fields of the plaintiffs a statutory easement permitting the flow of water over the said
land in Paraanan, which easement the said plaintiffs enjoyed until the year 1901 and
consisted in that the water collected upon their lands and in the Calalaran Lake flow through
Paraanan into the Taliptip River. From that year however, the defendant, without any right or
reason, converted the land in Paraanan into a fishpond and by means of a dam and a
bamboo net, prevented the free passage of the water through said place into the Taliptip
River, that in consequence the lands of the plaintiff became flooded and damaged by the
stagnant waters, there being no outlet except through the land in Paraanan; that their
plantation were destroyed, causing the loss and damages to the extent of about P1,000,
which loss and damage will continue if the obstructions to the flow of the water are allowed to
remain, preventing its passage through said land and injuring the rice plantations of the
plaintiffs. They therefore asked that judgment be entered against the defendant, declaring
that the said tract of land in Paraanan is subject to a statutory easement permitting the flow
of water from the property of the plaintiffs, and that, without prejudice to the issuing of a
preliminary injunction, the defendant be ordered to remove and destroy the obstructions that
impede the passage of the waters through Paraanan, and that in future, and forever, he
abstain from closing in any manner the aforesaid tract of land; that, upon judgment being
entered, the said injunction be declared to be final and that the defendant be sentenced to
pay to the plaintiffs an indemnity of P1,000, and the costs in the proceedings; that they be
granted any other and further equitable or proper remedy in accordance with the facts
alleged and proven.

In view of the demurrer interposed by the plaintiffs to the answer of the defendant, the latter,
on the 29th of August, 1904, filed an amended answer, denying each and everyone of the
allegations of the complaint, and alleged that no statutory easement existed nor could exist
in favor of the lands described in the complaint, permitting the waters to flow over the fish
pond that he, together with his brothers, owned in the sitio of Bambang, the area and
boundaries of which were stated by him, and which he and his brothers had inherited from
their deceased mother.

Apolinara de Leon; that the same had been surveyed by a land surveyor in September,
1881, he also denied that he had occupied or converted any land in the barrio of Bambang
into a fishpond; therefore, and to sentence the plaintiffs to pay the costs and corresponding
damages.
Upon the evidence adduced by both parties to the suit, the court, on the 13th of March,
1907, entered judgment declaring that the plaintiffs were entitled to a decision in their favor,
and sentenced the defendant to remove the dam placed on the east of the Paraanan
passage on the side of the Taliptip River opposite the old dam in the barrio of Bambang, as
well as to remove and destroy the obstacles to the free passage of the waters through the
strip of land in Paraanan; to abstain in future, and forever, from obstructing or closing in any
manner the course of the waters through the said strip of land. The request that the
defendant be sentenced to pay an indemnity was denied, and no ruling was made as to
costs.

The defendant excepted to the above judgment and furthermore asked for a new trial which
was denied and also excepted to, and, upon approval of the bill of exceptions, the question
was submitted to this court.

Notwithstanding the defendant's denial in his amended answer, it appears to have been
clearly proven in this case that the lands owned by the plaintiffs in the aforesaid barrio, as
well as the small adjoining lake, named Calalaran, are located in places relatively higher
than the sitio called Paraanan where the land and fish pond of the defendant are situated,
and which border on the Taliptip River; that during the rainy season the rain water which falls
on he land of the plaintiffs, and which flows toward the small Calalaran Lake at flood time,
has no outlet to the Taliptip River other than through the low land of Paraanan: that the
border line between Calalaran and Paraanan there has existed from time immemorial a dam,
constructed by the community for the purpose of preventing the salt waters from the Taliptip
River, at high tide, from flooding the land in Calalaran, passing through the lowlands of
Paraanan; but when rainfall was abundant, one of the residents was designated in his turn
by the lieutenant or justice of the barrio to open the sluice gate in order to let out the water
that flooded the rice fields, through the land of Paraanan to the above-mentioned river, that
since 1901, the defendant constructed another dam along the boundary of this fishpond in
Paraanan, thereby impeding the outlet of the waters that flood the fields of Calalaran, to the
serious detriment of the growing crops.

According to article 530 of the Civil Code, an easement is charge imposed upon one estate
for the benefit of another estate belonging to a different owner, and the realty in favor of
which the easement is established is called the dominant estate, and the one charged with it
the servient estate.

The lands of Paraanan being the lower are subject to the easement of receiving and giving
passage to the waters proceeding from the higher lands and the lake of Calalaran; this
easement was not constituted by agreement between the interested parties; it is of a
statutory nature, and the law had imposed it for the common public utility in view of the
difference in the altitude of the lands in the barrio Bambang.

Article 552 of the Civil code provides:

Lower estates must receive the waters which naturally and without the intervention of
man descend from the higher estates, as well as the stone or earth which they carry
with them.

Neither may the owner of the lower estates construct works preventing this
easement, nor the one of the higher estate works increasing the burden.

Article 563 of the said code reads also:

 The establishment, extent, form, and conditions of the easements of waters to which
this section refers shall be governed by the special law relating thereto in everything
not provided for in this code.

The special law cited in the Law of Waters of August 3, 1866, article 111 of which, treating of
natural easements relating to waters, provides:

Lands situated at a lower level are subject to receive the waters that flow naturally,
without the work of man, from the higher lands together with the stone or earth which
they carry with them.

Hence, the owner of the lower lands can not erect works that will impede or prevent such an
easement or charge, constituted and imposed by the law upon his estate for the benefit of
the higher lands belonging to different owners; neither can the latter do anything to increase
or extend the easement.

According to the provisions of law above referred to, the defendant, Meneses, had no right to
construct the works, nor the dam which blocks the passage, through his lands and the outlet
to the Taliptip River, of the waters which flood the higher lands of the plaintiffs; and having
done so, to the detriment of the easement charged on his estate, he has violated the law
which protects and guarantees the respective rights and regulates the duties of the owners
of the fields in Calalaran and Paraanan.

It is true that article 388 of said code authorizes every owner to enclose his estate by means
of walls, ditches fences or any other device, but his right is limited by the easement imposed
upon his estate.

The defendant Meneses might have constructed the works necessary to make and maintain
a fish pond within his own land, but he was always under the strict and necessary obligation
to respect the statutory easement of waters charged upon his property, and had no right to
close the passage and outlet of the waters flowing from the lands of the plaintiffs and the
lake of Calalaran into the Taliptip River. He could not lawfully injure the owners of the
dominant estates by obstructing the outlet to the Taliptip River of the waters flooding the
upper lands belonging to the plaintiffs.

It is perhaps useful and advantageous to the plaintiffs and other owners of high lands in
Calalaran, in addition to the old dike between the lake of said place and the low lands in
Paraanan, to have another made by the defendant at the border of Paraanan adjoining the
said river, for the purpose of preventing the salt waters of the Taliptip River flooding, at high
tide, not only the lowlands in Paraanan but also the higher ones of Calalaran and its lake,
since the plaintiffs can not prevent the defendant from protecting his lands against the influx
of salt water; but the defendant could never be permitted to obstruct the flow of the waters
through his lands to the Taliptip River during the heavy rains, when the high lands in
Calalaran and the lake in said place are flooded, thereby impairing the right of the owners of
the dominant estates.

For the above reasons, and accepting the findings of the court below in the judgment
appealed from in so far as they agree with the terms of this decision, we must and do hereby
declare that the defendant, Higino Meneses, as the owner of the servient estate, is obliged to
give passage to and allow the flow of the waters descending from the Calalaran Lake and
from the land of the plaintiffs through his lands in Paraanan for their discharge into the
Taliptip River; and he is hereby ordered to remove any obstacle that may obstruct the free
passage of the waters whenever there may be either a small or large volume of running
water through his lands in the sitio of Paraanan for their discharge into the Taliptip River; and
in future to abstain from impeding, in any manner, the flow of the waters coming from the
higher lands. The judgment appealed from is affirmed, in so far as it agrees with decision,
and reversed in other respects, with the costs of this instance against the appellants. So
ordered.

G.R. No. 96410 July 3, 1992

NATIONAL POWER CORPORATION and BENJAMIN CHAVEZ, petitioners,

vs.
THE COURT OF APPEALS, RICARDO CRUZ, DOMINGO CRUZ, FERNANDO CRUZ,
LEOPOLDO CRUZ, MARIA CRUZ, MAURA MARCIAL, JUAN PALAD, NICANOR PALAD,
ZOSIMO PALAD, NICASIO SAN PEDRO, FELIMON SANTOS, ISAIAS SANTOS,
JEREMIAS SANTOS, and JOSE SANTOS, respondents.

NOCON, J.:

Before Us is a petition for review on certiorari instituted by the National Power Corporation
(NPC) and Benjamin Chavez, Plant Superintendent of NPC, from the decision of the Court of
Appeals promulgated on September 18, 1990. The appellate court affirmed in toto the
1

decision in Civil Case No. SM-1552 of the Regional Trial Court of Malolos, Bulacan, Branch
XVI, which awarded damages, interest, attorney's fees and litigation expenses against
petitioners in the following amounts with interest at 12% per annum from the date of filing of
the complaint until fully paid:

Ricardo Cruz P 22,800.00

Zosimo Palad 24,200.00
Isaias T. Santos 45,500.00
Felimon Santos 42,900.00
Maura T. Marcial 49,280.00
Domingo Cruz 121,900.00
Leopoldo Cruz 21,000.00
Maria R. Cruz 34,000.00
Nicanor Palad 28,768.00
Nicasio San Pedro 16,950.00
Juan Palad 27,600.00
Jose T. Santos 38,410.00
Jeremias T. Santos 11,500.00
Fernando Cruz 55,780.00

The petitioners were further ordered to pay the private respondents 30% of the amounts
payable by them as attorney's fees and P10,000.00 as litigation expenses, and to pay the
costs of suit.
2

It appears that in the early morning hours of October 27, 1978, at the height of typhoon
"Kading", a massive flood covered the towns near Angat Dam, particularly the town of
Norzagaray, causing several deaths and the loss and destruction of houses, farms, plants,
working animals and other properties of the people residing near the Angat River. Private
respondents recalled that on the said day, they were awakened by the sound of rampaging
water all around them. The water came swiftly and strongly that before they could do
anything to save their belongings, their houses had submerged, some even swept away by
the strong current. A number of people were able to save their lives only by climbing trees.

Private respondents blamed the sudden rush of water to the reckless and imprudent opening
of all the three (3) floodgates of the Angat Dam spillway, without prior warning to the people
living near or within the vicinity of the dam.
3

Petitioners denied private respondents' allegations and, by way of defense, contended that
they have maintained the water in the Angat Dam at a safe level and that the opening of the
spillways was done gradually and after all precautionary measures had been taken.
Petitioner NPC further contended that it had always exercised the diligence of a good father
in the selection of its officials and employees and in their supervision. It also claimed that
written warnings were earlier sent to the towns concerned. At the time typhoon "Kading" hit
Bulacan with its torrential rain, a great volume of flood water flowed into the dam's reservoir
necessitating the release of the water therein in order to prevent the dam from collapsing
and causing the loss of lives and tremendous damage to livestock and properties.

Petitioners further contended that there was no direct causal relationship between the
alleged damages suffered by the respondents and the acts and omissions attributed to the
former. That it was the respondents who assumed the risk of residing near the Angat River,
and even assuming that respondents suffered damages, the cause was due to a fortuitous
event and such damages are of the nature and character of damnum absque injuria, hence,
respondents have no cause of action against them.

As assignment of errors of the appellate court, petitioners raised the following:

(a) IN HOLDING THAT THE RULING IN JUAN F. NAKPIL & SONS VS. COURT OF
APPEALS, IS APPLICABLE TO THE INSTANT CASE UNDER WHICH PETITIONERS ARE
4

LIABLE EVEN THOUGH THE COMING OF A TYPHOON WAS FORCE MAJEURE;

(b) IN NOT HOLDING THAT THE GIVING OF THE WRITTEN NOTICE OF WARNING BY
PETITIONERS ABSOLVED THEM FROM LIABILITY;

(c) IN NOT HOLDING THAT ANY DAMAGE SUFFERED BY PRIVATE RESPONDENTS

WAS DAMNUM ABSQUE INJURIA; and

(d) IN NOT AWARDING THE COUNTERCLAIM OF PETITIONERS FOR ATTORNEY'S

FEES AND EXPENSES OF LITIGATION.

We find the petition devoid of merit.

We do not agree with the petitioners that the decision handed down in Juan F. Nakpil &
Sons, supra, is not applicable to the present case. The doctrine laid down in the said case is
still good law, as far as the concurrent liability of an obligor in case of a force majeure, is
concerned.

The case of National Power Corp. v. Court of Appeals, as a matter of fact, reiterated the
5

ruling in Juan F. Nakpil & Sons. In the former case, this Court ruled that the obligor cannot
escape liability, if upon the happening of a fortuitous event or an act of God, a corresponding
fraud, negligence, delay or violation or contravention in any manner of the tenor of the
obligation as provided in Article 1170 of the Civil Code which results in loss or damage.
6

Petitioners contended that unlike in Juan F. Nakpil & Sons, there was no privity of contract
between herein petitioners and private respondents. They further alleged that they owed no
specific duty to private respondents in the same way that the architect of a building owed a
specific duty to its owner. Petitioners, however, failed to consider that even if there was no
contractual relation between themselves and private respondents, they are still liable under
the law on quasi-delict. Article 2176 of the Civil Code explicitly provides "whoever by act or
omission causes damage to another there being fault or negligence is obliged to pay for the
damage done."

Neither can petitioners escape liability by invoking force majeure. Act of God or force
majeure, by definition, are extraordinary events not foreseeable or avoidable, events that
could not be foreseen, or which, though foreseen, are inevitable. It is therefore not enough
that the event should not have been foreseen or anticipated, as is commonly believed, but it
must be one impossible to foresee or to avoid. As a general rule, no person shall be
7

responsible for those events which could not be foreseen or which though foreseen, were
inevitable. 8

However, the principle embodied in the act of God doctrine strictly requires that the act must
be occasioned solely by the violence of nature. Human intervention is to be excluded from
creating or entering into the cause of the mischief. When the effect is found to be in part the
result of the participation of man, whether due to his active intervention or neglect or failure
to act, the whole occurrence is then humanized and removed from the rules applicable to the
acts of God. 9

So generally it cannot be said that damage, injury or loss is due to an act of

God where it was caused merely by excessive or heavy rainfall, storms and
to weather conditions which are not unusual in character, those which could
have been reasonably anticipated or where the injury complained of is due
rather to the negligence or mismanagement of man than to the disturbance of
the elements or where such damage, injury or loss might have been
mitigated or prevented by diligence exercised after the occurrence. 10

In the case at bar, although the typhoon "Kading" was an act of God, petitioners can not
escape liability because their negligence was the proximate cause of the loss and damage.
The Court of Appeals found that:

As hereinabove stated, it has been shown that the defendants failed to take
the necessary safeguards to prevent the danger that the Angat Dam posed in
a situation of such nature as that of typhoon "Kading". The representative of
the "PAG-ASA" who testified in these proceedings, Justo Iglesias, Jr., stated
that based on their records the rainfall on October 26 and 27, 1978 is
classified only as moderate, and could not have caused flash floods. He
testified that flash floods exceeds 50 millimeters per hour and lasts for at
least two (2) hours. He stated that typhoon "Yaning" which occurred on
October 7 to 14, 1978 gave a much heavier rainfall than "Kading", and so did
other previous typhoons. 11

This was corroborated by the testimonies of private respondents, most of whom have
lived in the area all their lives, but had never before experienced such flooding as
 would have placed them on alert, even during previous stronger typhoons such as
"Dading" and "Yoling."

What more, when the evidence shows that as early as October 25, 1978 the newspapers
had announced the expected occurrence of a powerful typhoon code-named "Kading". On 12

October 26, 1978, Bulletin Today had as its headline the coming of the typhoon. Despite
13

these announcements, the water level in the dam was maintained at its maximum from
October 21, until midnight of October 26, 1978. 14

At 2100 hrs. of October 26, 1978, NPC started to open the three floodgates simultaneously
from 1 meter to 8 meters at 0100 hrs. of October 27, 1978, until all floodgates were opened
to the maximum of 14 to 14.5 meters by 0600 hrs. of the same day. 15

This was also the finding of the court a quo which We quote:

The defendants contended that the release of water had been "gradual". The
lower court did not find this true. The exhibit presented by the defendants
(Exhs. AA and BB-2) show that on October 26, 1978 there was very little
opening of the spillways, ranging from 1 meter to 2 meters. However, from
midnight or from the first hours of October 27, 1978 the opening of all the
three (3) spillways started at 5 meters and swiftly went as far up as 14
meters. As observed correctly by the trial court had the opening of all the
three (3) spillways been made earlier and gradually, there would have been
no need to open the same suddenly.

What made the situation worse was that the opening of the spillways was
made at the unholy hours when residents were asleep. The plaintiffs all
testified that they were never given any warning that the spillways would be
opened to that extent. . . .
16

It has been held in several cases that when the negligence of a person concurs with an act
of God producing a loss, such person is not exempt from liability by showing that the
immediate cause of the damage was the act of God. To be exempt he must be free from any
previous negligence or misconduct by which the loss or damage may have been
occasioned. 17

Thus, We cannot give credence to petitioners' third assignment of error that the damage
caused by the opening of the dam was in the nature of damnum absque injuria, which
presupposes that although there was physical damage, there was no legal injury in view of
the fortuitous events. There is no question that petitioners have the right, duty and obligation
to operate, maintain and preserve the facilities of Angat Dam, but their negligence cannot be
countenanced, however noble their intention may be. The end does not justify the means,
particularly because they could have done otherwise than simultaneously opening the
spillways to such extent. Needless to say, petitioners are not entitled to counterclaim.

Petitioners insist that their giving of prior written warning should absolve them from liability.
Notice of warning was served by them on "a responsible employee in the office of the mayor
of the municipality, or in the absence of such responsible employee, on a member of the
municipal police force." That being the case, they alleged that the presumption that official
18

duty has been performed must be credited in their favor. The presumption was, however,
refuted by the evidence and testimonies of respondents who all denied having been given
any warning that the spillways would be opened to such extent and at a short period of time.
The letter itself, addressed merely "TO ALL CONCERNED", would not strike one to be of
19

serious importance, sufficient enough to set alarm and cause people to take precautions for
their safety's sake. As testified to by driver Leonardo Garcia of the NPC, he was instructed
by Chavez to give notice "to any personnel of the municipality [sic] or even the policemen of
the municipalities concerned regarding the release of water from the reservoir." His
20

instructions did not specify the municipal officer who should receive the notice, but that
priority must be given to the police. Thus, copies of the notices were given to Pat. Carillo of
21

Norzagaray, Cicero Castro, municipal employee of Angat, Pat. Jaime Nicholas of Bustos,
Cpl. Josefino Legaspi of Baliwag, Pat. Luzvimin Mariano of Plaridel and Pat. Dantes
Manukduk of Calumpit.

As observed by the Court of Appeals:

Clearly, the notices were not delivered, or even addressed to responsible

officials of the municipalities concerned who could have disseminated the
warning properly. They were delivered to ordinary employees and policemen.
As it happened, the said notices do not appear to have reached the people
concerned, which are the residents beside the Angat River. The plaintiffs in
this case definitely did not receive any such warning. Indeed, the methods by
which the defendants allegedly sent the notice or warning was so ineffectual
that they cannot claim, as they do in their second assignment of error, that
the sending of said notice has absolved them from liability. 22

WHEREFORE, finding no reversible error in the Decision appealed from, the same is hereby
affirmed in toto, with cost against petitioner.

SO ORDERED.

DERMALINE, INC., G.R. No. 190065

Petitioner,

Present:

CARPIO, J.,
- versus - Chairperson,
NACHURA,
PERALTA,
ABAD, and
MENDOZA, JJ.

MYRA PHARMACEUTICALS, INC., Promulgated:

Respondent.
August 16, 2010

x------------------------------------------------------------------------------------x
 DECISION

NACHURA, J.:

This is a petition for review on certiorari[1] seeking to reverse and set aside
the Decision dated August 7, 2009[2] and the Resolution dated October 28,
2009[3] of the Court of Appeals (CA) in CA-G.R. SP No. 108627.

The antecedent facts and proceedings

On October 21, 2006, petitioner Dermaline, Inc. (Dermaline) filed before the
Intellectual Property Office (IPO) an application for registration of the
trademark DERMALINE DERMALINE, INC. (Application No. 4-
2006011536). The application was published for Opposition in the IPO E-
Gazette on March 9, 2007.

On May 8, 2007, respondent Myra Pharmaceuticals, Inc. (Myra) filed a

Verified Opposition[4] alleging that the trademark sought to be registered by
Dermaline so resembles its trademark DERMALIN and will likely cause
confusion, mistake and deception to the purchasing public. Myra said that
the registration of Dermalines trademark will violate Section 123 [5] of
Republic Act (R.A.) No. 8293 (Intellectual Property Code of
the Philippines). It further alleged that Dermalines use and registration of its
applied trademark will diminish the distinctiveness and dilute the goodwill
of Myras DERMALIN, registered with the IPO way back July 8, 1986,
renewed for ten (10) years on July 8, 2006. Myra has been extensively using
DERMALIN commercially since October 31, 1977, and said mark is still
valid and subsisting.

Myra claimed that, despite Dermalines attempt to differentiate its applied

mark, the dominant feature is the term DERMALINE, which is practically
identical with its own DERMALIN, more particularly that the first eight (8)
letters of the marks are identical, and that notwithstanding the additional
letter E by Dermaline, the pronunciation for both marks are
identical. Further, both marks have three (3) syllables each, with each
syllable identical in sound and appearance, even if the last syllable of
DERMALINE consisted of four (4) letters while DERMALIN consisted
only of three (3).

Myra also pointed out that Dermaline applied for the same mark
DERMALINE on June 3, 2003 and was already refused registration by the
IPO. By filing this new application for registration, Dermaline appears to
have engaged in a fishing expedition for the approval of its
mark. Myra argued that its intellectual property right over its trademark is
protected under Section 147[6] of R.A. No. 8293.

Myra asserted that the mark DERMALINE DERMALINE, INC. is aurally

similar to its own mark such that the registration and use of Dermalines
applied mark will enable it to obtain benefit from Myras reputation,
goodwill and advertising and will lead the public into believing that
Dermaline is, in any way, connected to Myra. Myra added that even if the
subject application was under Classification 44[7] for various skin treatments,
it could still be connected to the DERMALIN mark under Classification
5[8] for pharmaceutical products, since ultimately these goods are very
closely related.

In its Verified Answer,[9] Dermaline countered that a simple comparison of

the trademark DERMALINE DERMALINE, INC. vis--vis Myras
DERMALIN trademark would show that they have entirely different
features and distinctive presentation, thus it cannot result in confusion,
mistake or deception on the part of the purchasing public. Dermaline
contended that, in determining if the subject trademarks are confusingly
similar, a comparison of the words is not the only determinant, but their
entirety must be considered in relation to the goods to which they are
attached, including the other features appearing in both labels. It claimed
that there were glaring and striking dissimilarities between the two
trademarks, such that its trademark DERMALINE DERMALINE, INC.
speaks for itself (Res ipsa loquitur). Dermaline further argued that there
could not be any relation between its trademark for health and beauty
services from Myras trademark classified under medicinal goods against
skin disorders.

The parties failed to settle amicably. Consequently, the preliminary

conference was terminated and they were directed to file their respective
position papers.[10]

On April 10, 2008, the IPO-Bureau of Legal Affairs rendered Decision No.
2008-70[11] sustaining Myras opposition pursuant to Section 123.1(d) of R.A.
No. 8293. It disposed

WHEREFORE, the Verified Opposition is, as it is, hereby

SUSTAINED. Consequently, Application Serial No. 4-2006-
011536 for the mark DERMALINE, DERMALINE, INC.
Stylized Wordmark for Dermaline, Inc. under class 44 covering
the aforementioned goods filed on 21 October 2006, is as it is
hereby, REJECTED.

Let the file wrapper of DERMALINE, DERMALINE, INC.

Stylized Wordmark subject matter of this case be forwarded to the
Bureau of Trademarks (BOT) for appropriate action in accordance
with this Decision.

SO ORDERED.[12]

Aggrieved, Dermaline filed a motion for reconsideration, but it was denied

under Resolution No. 2009-12(D)[13] dated January 16, 2009.

Expectedly, Dermaline appealed to the Office of the Director General of the

IPO. However, in an Order[14] dated April 17, 2009, the appeal was dismissed
for being filed out of time.

Undaunted, Dermaline appealed to the CA, but it affirmed and upheld the
Order dated April 17, 2009 and the rejection of Dermalines application for
registration of trademark. The CA likewise denied Dermalines motion for
reconsideration; hence, this petition raising the issue of whether the CA
erred in upholding the IPOs rejection of Dermalines application for
registration of trademark.

The petition is without merit.

A trademark is any distinctive word, name, symbol, emblem, sign, or

device, or any combination thereof, adopted and used by a manufacturer or
merchant on his goods to identify and distinguish them from those
manufactured, sold, or dealt by others. [15] Inarguably, it is an intellectual
property deserving protection by law. In trademark controversies, each case
must be scrutinized according to its peculiar circumstances, such that
jurisprudential precedents should only be made to apply if they are
specifically in point.[16]
As Myra correctly posits, as a registered trademark owner, it has the right
under Section 147 of R.A. No. 8293 to prevent third parties from using a
trademark, or similar signs or containers for goods or services, without its
consent, identical or similar to its registered trademark, where such use
would result in a likelihood of confusion.

In determining likelihood of confusion, case law has developed two (2) tests,
the Dominancy Test and the Holistic or Totality Test.

The Dominancy Test focuses on the similarity of the prevalent

features of the competing trademarks that might cause confusion or
deception.[17] It is applied when the trademark sought to be registered
contains the main, essential and dominant features of the earlier registered
trademark, and confusion or deception is likely to result. Duplication or
imitation is not even required; neither is it necessary that the label of the
applied mark for registration should suggest an effort to imitate. The
important issue is whether the use of the marks involved would likely cause
confusion or mistake in the mind of or deceive the ordinary purchaser, or
one who is accustomed to buy, and therefore to some extent familiar with,
the goods in question.[18] Given greater consideration are the aural and visual
impressions created by the marks in the public mind, giving little weight to
factors like prices, quality, sales outlets, and market segments. [19] The test of
dominancy is now explicitly incorporated into law in Section 155.1 of R.A.
No. 8293 which provides

155.1. Use in commerce any reproduction, counterfeit,

copy, or colorable imitation of a registered mark or the same
container or a dominant feature thereof in connection with the
sale, offering for sale, distribution, advertising of any goods or
services including other preparatory steps necessary to carry out
the sale of any goods or services on or in connection with which
such use is likely to cause confusion, or to cause mistake, or to
deceive; (emphasis supplied)

On the other hand, the Holistic Test entails a consideration of the

entirety of the marks as applied to the products, including labels and
packaging, in determining confusing similarity. The scrutinizing eye of the
observer must focus not only on the predominant words but also on the other
features appearing in both labels so that a conclusion may be drawn as to
whether one is confusingly similar to the other.[20]

Relative to the question on confusion of marks and trade names,

jurisprudence has noted two (2) types of confusion, viz: (1) confusion of
goods (product confusion), where the ordinarily prudent purchaser would be
induced to purchase one product in the belief that he was purchasing the
other; and (2) confusion of business (source or origin confusion), where,
although the goods of the parties are different, the product, the mark of
which registration is applied for by one party, is such as might reasonably be
assumed to originate with the registrant of an earlier product, and the public
would then be deceived either into that belief or into the belief that there is
some connection between the two parties, though inexistent.[21]

In rejecting the application of Dermaline for the registration of its

mark DERMALINE DERMALINE, INC., the IPO applied the Dominancy
Test. It declared that both confusion of goods and service and confusion of
business or of origin were apparent in both trademarks. It also noted that, per
Bureau Decision No. 2007-179 dated December 4, 2007, it already sustained
the opposition of Myra involving the trademark DERMALINE of Dermaline
under Classification 5. The IPO also upheld Myras right under Section 138
of R.A. No. 8293, which provides that a certification of registration of a
mark is prima facie evidence of the validity of the registration, the
registrants ownership of the mark, and of the registrants exclusive right to
use the same in connection with the goods and those that are related thereto
specified in the certificate.

We agree with the findings of the IPO. As correctly applied by the

IPO in this case, while there are no set rules that can be deduced as what
constitutes a dominant feature with respect to trademarks applied for
registration; usually, what are taken into account are signs, color, design,
peculiar shape or name, or some special, easily remembered earmarks of the
brand that readily attracts and catches the attention of the ordinary consumer.
[22]

Dermalines insistence that its applied trademark DERMALINE

DERMALINE, INC. had differences too striking to be mistaken from Myras
DERMALIN cannot, therefore, be sustained. While it is true that the two
marks are presented differently Dermalines mark is written with the first
DERMALINE in script going diagonally upwards from left to right, with an
upper case D followed by the rest of the letters in lower case, and the portion
DERMALINE, INC. is written in upper case letters, below and smaller than
the long-hand portion; while Myras mark DERMALIN is written in an
upright font, with a capital D and followed by lower case letters the
likelihood of confusion is still apparent. This is because they are almost
spelled in the same way, except for Dermalines mark which ends with the
letter E, and they are pronounced practically in the same manner in three (3)
syllables, with the ending letter E in Dermalines mark pronounced
silently. Thus, when an ordinary purchaser, for example, hears an
advertisement of Dermalines applied trademark over the radio, chances are
he will associate it with Myras registered mark.

Further, Dermalines stance that its product belongs to a separate and

different classification from Myras products with the registered trademark
does not eradicate the possibility of mistake on the part of the purchasing
public to associate the former with the latter, especially considering that both
classifications pertain to treatments for the skin.

Indeed, the registered trademark owner may use its mark on the same or
similar products, in different segments of the market, and at different price
levels depending on variations of the products for specific segments of the
market. The Court is cognizant that the registered trademark owner enjoys
protection in product and market areas that are the normal potential
expansion of his business. Thus, we have held

Modern law recognizes that the protection to which the owner of a

trademark is entitled is not limited to guarding his goods or
business from actual market competition with identical or similar
products of the parties, but extends to all cases in which the use by
a junior appropriator of a trade-mark or trade-name is likely to
lead to a confusion of source, as where prospective purchasers
would be misled into thinking that the complaining party has
extended his business into the field (see 148 ALR 56 et seq; 53
Am Jur. 576) or is in any way connected with the activities of the
infringer; or when it forestalls the normal potential expansion
of his business (v. 148 ALR 77, 84; 52 Am. Jur. 576, 577).
[23]
(Emphasis supplied)

Thus, the public may mistakenly think that Dermaline is connected to or

associated with Myra, such that, considering the current proliferation of
health and beauty products in the market, the purchasers would likely be
misled that Myra has already expanded its business through Dermaline from
merely carrying pharmaceutical topical applications for the skin to health
and beauty services.
Verily, when one applies for the registration of a trademark or label which is
almost the same or that very closely resembles one already used and
registered by another, the application should be rejected and dismissed
outright, even without any opposition on the part of the owner and user of a
previously registered label or trademark. This is intended not only to avoid
confusion on the part of the public, but also to protect an already used and
registered trademark and an established goodwill.[24]
Besides, the issue on protection of intellectual property, such as trademarks,
is factual in nature. The findings of the IPO, upheld on appeal by the same
office, and further sustained by the CA, bear great weight and deserves
respect from this Court. Moreover, the decision of the IPO had already
attained finality when Dermaline failed to timely file its appeal with the IPO
Office of the Director General.

WHEREFORE, the petition is DENIED. The Decision dated August 7,

2009 and the Resolution dated October 28, 2009 of the Court of Appeals in
CA-G.R. SP No. 108627 are AFFIRMED. Costs against petitioner.

SO ORDERED.

G.R. No. L-10251 February 10, 1916

COMPAIA GENERAL DE TABACOS DE FILIPINAS, plaintiff-appellee,

vs.
ALHAMBRA CIGAR & CIGARETTE MANUFACTURING CO., defendant-appellant.

Rohde and Wright for appellant.

Gilbert, Haussermann, Cohn and Fisher for appellee.

MORELAND, J.:

The plaintiff claims to have appropriated and to own the exclusive right to use the word
"Isabela" on cigarettes.

Sometime before the commencement of this action defendant began the manufacture of
cigarettes, offering them to the public in packages on the front side of each of which
appeared the words "Alhambra Isabelas." Judgment was for plaintiff and defendant
appealed.

The complaint contains two counts, one for the violation or infringement of the trade-name
"Isabela," and the other, claims the plaintiff, for unfair competition arising out of the use by
the defendant of the word "Isabelas" on its cigarettes in the manner already stated. The trial
court dismissed the count based on unfair competition, saying, "we doubt that the facts
established, under the circumstances of the case, justify the inference of actual intention on
defendant's part to deceive the public and defraud a competitor, and can, therefore, not find
the defendant guilty of unfair competition." Although neither count in the complaint was
based on the infringement or violation of a trade-mark, and plaintiff, during the trial, offered
no evidence on the subject, and, accordingly, no issue was framed thereon either by the
pleadings or on the trial (Lizarraga Hermanos vs. Yap Tico, 24 Phil. Rep., 504,), nevertheless
the court, in its decision for plaintiff, treated the action as one for the infringement of a trade-
mark under the first four sections of Act No. 666." The court then cited those section of the
Act relative to trade-marks, discussed them at some length, and finally founded its judgment
thereon.

Plaintiff did not appeal from that portion of the judgment finding the defendant not guilty of
unfair competition; while the defendant appealed from that part founded on the violation of
trade-mark and decreeing a perpetual injunction. Therefore the question involving unfair
competition is not really before us, that count of the complaint founded thereon having been
in effect dismissed by the trial court and no appeal having been taken from that dismissal.
While the court founded its judgment solely on the theory of a violation of a trade-mark and,
although the defendant insisted from the very beginning that the action as set out in the
complaint in no possible way involved the question of a trade-mark, nevertheless, the court,
as we have already seen, proceeded to try and resolve the case on that theory and based its
judgment exclusively thereon. Defendant now contends that, if it appears that the action was
not for a violation of a trade-mark, the judgment should be reversed as it was wholly misled
in its defense and would be seriously prejudiced by the change necessarily resulting. We
regard the action, however, as we necessarily must under the statute, as one for the violation
of a trade-name and not one for the violation of a trade-mark or for unfair competition. But,
inasmuch as we find for the defendant on the whole case and reverse the judgment against
it, we do not stop to dispose of the question as to whether the theory of the action was
change during or after trial or on appeal, so long as the parties have agreed on certain
questions which they have submitted and discussed, which questions include all those which
can arise whether the action be for the violation of a trade-name or for unfair competition. We
prefer to decide the case so as to end the litigation once for all.

Inasmuch as the plaintiff did not appeal from the judgment dismissing the complaint as to
unfair competition, we would be justified in holding that that question is not before us, and,
accordingly, in deciding the case from the single viewpoint of a violation of a trade-name. But
for the reasons just expressed we take up both alleged causes of action and decide all the
questions presented by both.

Plaintiff's claim is this: It has trade-name rights in the word "Isabela." The defendant has
violated those rights. Plaintiff is entitled to damages on the theory of violation of a trade
name, or unfair competition, or both. Can it recover? We hold that none of these claims have
been sustained and that plaintiff is not entitled to recover on any theory mentioned. We
proceed to show why.

Rights of action for the violation of a trade-mark or trade-name or to restrain unfair

competition are conferred by statute. Without such a statute right of action would not exist in
those cases. In deciding this appeal, therefore, we must be governed by the provisions of the
statute.

The Act is No. 666 of the Philippine Commission and confers a right of action in three cases
(1) for the violation of a trade-mark, (2) a trade-name, and (3) to restrain unfair
competition. The statute founds the cause of action in the first two cases exclusively on the
invasion of the right of property which the statute gives in the trade-mark or trade-name.
These actions are not based on fraud nor is the right given on the theory of unfair
competition. It is founded solely in the property which the statute creates in the trade-mark or
trade-name. These two cases are dealt with somewhat on the theory of patents, giving the
owner of the trade-mark or trade-name a right in the thing similar to the right created by a
patent. As a necessary consequence, an action for a violation or infringement of a trade-
mark or trade-name does not proceed primarily on the theory that either the plaintiff or the
public has been or will be defrauded, although that may be in effect, the result; but on the
hypothesis that plaintiff's right in the mark or the name has been invaded and that he is
entitled to the damages resulting from the invasion. In either case an action may be
maintained without proof of anything more than the right to the exclusive use of the mark or
name and that the defendant has violated it. No allegation or proof of fraud or intent to
defraud is necessarily. On the other hand, the action to prevent unfair competition is
based exclusively on fraud; and it would seem from the wording of the statute that it refers to
the fraud committed on the public rather than to the fraud committed on the plaintiff the
fraud against the plaintiff being only an incident the means by which the fraud is
perpetrated on the public. No right of property in the appearance which plaintiff gives to his
goods is required, if the word "property" may be used in such a connection, and none needs
to be alleged or proved. In such an action plaintiff, to recover, must prove that the defendant,
in selling his goods, gave them the same general appearance of the goods of the plaintiff
either in the wrapping of the package in which they were contained or in the devices of
words thereon or in some other feature of their appearance which would be likely to
influence purchasers to believe that the goods offered for sale by defendant were those of
the plaintiff; and that the defendant clothed his goods with such appearance for the
purpose of deceiving the public and of defrauding the plaintiff of his legitimate trade. The
statute expressly requires that the plaintiff prove the intent to deceive the public and defraud
a competitor before he can recover; and, while such intent may be inferred from the similarity
in the appearance of the goods as packed or offered for sale, such an inference is not a
necessary one, it being legally possible that such similarity exist and there still be no intent to
deceive. Fraud, then, is the essence of an action of unfair competition; right in property the
essence of the other two.

From these observations it is a necessary deduction that an action for the violation of a
trade-name cannot be carried on in conjunction with an action of unfair competition based on
a similarity to the plaintiff's trade-name. If an action on the trade-name will lie, then an action
of unfair competition based on similarity to the trade-name is impossible; whereas, on the
other hand, if an action of unfair competition is the proper action, then one for the violation of
a trade-name based on the same facts will not lie. The facts which will support an action for
the violation of a trade-name will not support an action of unfair competition. The same is
true of an action for the violation of a trade-mark except where such an action fails for the
reason that the trade-mark is invalid because it consists of a word or words which, in law, are
not capable of appropriation as a trade-mark. In such case, by express provision of the
statute (section 7), an action of unfair competition will lie. No such exception is made in favor
of a trade-name; and if the plaintiff fails to establish his right of property therein, his failure is
irremediable. He cannot fall back on the action of unfair competition. We apprehend that the
reason why this privilege was not extended to a plaintiff in an action for the violation of a
trade-name was that an action of unfair competition is based exclusively on the appearance
of the goods as they are exposed for sale; while, under the statute, the trade-name; unlike
the trade-mark, applies exclusively to the business, profession, trade or occupation of the
plaintiff and, as a consequence, it is not essential that the trade-name appear on plaintiff's
goods or go into the market with them. (Section 5). It is clear that, if the action of unfair
competition is based on the appearance of the goods as they exposed for sale, the facts
necessary to support an action for the violation of a trade-name will not sustain it, as neither
the trade-name of the plaintiff nor of the defendant need go into the market at all, and, as
consequence, the similarity of appearance between the goods of plaintiff and defendant, a
fact necessary to sustain an action of unfair competition, may not exist.

Another principle of the law of trade-marks, trade-names and unfair competition of

importance in this case, and one which naturally follows from what has already been said is
that there can be no secondary meaning, as that term is understood in the American law of
trade-marks and trade-names, with respect to a trade-name. It must be borne in mind, as we
stated at the outset, that the only rights existing in this jurisdiction with respect to trade-marks
and trade-names, as well as unfair competition, are conferred by Act No. 666; and,
accordingly, they are limited by the provisions of the Act. The statute prohibits the registration
of a trade-name when that trade-name represents the geographical place of production or
origin of the products or goods to which the trade-name refers, or when it is merely the
name, quality, or description of the merchandise with respect to which the trade-name is to
be used. In such cases, therefore, no trade-name can exist. The statute prescribes what a
trade-name may be and then gives a right of action to protect the owner of that trade-name.
If it is not a trade-name defined by statute, it does not carry with it the right of action granted
by the statute. No trade-name can legally exist except that prescribed by the Act. If it can
exist, it can be enforced as, and only as, the rights in trade-names are enforced under the
statute. If it cannot exist as a trade-name, i. e., as a property right, or on the theory of unfair
competition based on the doctrine of secondary meaning. Of course, if the trade-name is not
recognized in law, it can have no secondary meaning. Moreover, the doctrine of secondary
meaning as it is known in the United States, is carried into effect on the theory of unfair
competition and not on the theory of property in the trade-name. Indeed, the necessity of
basing the action on the theory of unfair competition negatives the existence at the time of
the trade-name in its primary meaning. In this jurisdiction that necessity in emphasized by
the fact that, as we have seen, the statute makes a sharp distinction between actions for the
violation of a trade-mark or trade-name and those based on unfair competition, the former
being founded in a property right and the latter on the fact that fraud has been or will be
committed on the public. Furthermore, if the action of unfair competition based on the
similarity of plaintiff's and defendant's trade-names cannot be maintained in this jurisdiction,
as we have seen that it cannot, then the fundamental basis of the doctrine of secondary
meaning disappears. We might add that the statute does not seem to have dealt with trade-
names as it has with trade-marks; for, with respect to the latter, it expressly confers, as we
have seen (sec. 7), a right of action for unfair competition even though the trade-mark, as
such, is illegal and unregistered by reason of being the name of the geographical place of
production or origin of the goods to which it is affixed, or the name, quality or description of
the merchandise on which it is placed. In a other words, the statute seems to create with
regard to a trade-mark a right which is, in many aspects, the equivalent of that springing from
the doctrine of secondary meaning, and where the trade-mark, though illegal and
unregistered under the Act, has been used by the plaintiff for such a length of time that it has
ceased to be used and understood in its primary meaning, the owner will be protected on the
theory of unfair competition. The statute does not confer a right on the owner of a trade-
nameunder similar circumstances.

The trial court was, therefore, correct in dismissing that count of the complaint based on
unfair competition. The statute, as we have already observed, does not permit these two
action to be maintained on the same facts. We might say, however, that the ownership of a
trade-name does not necessarily prevent the owner from bringing an action of unfair
competition founded on the appearance of the goods of defendant as exposed for
sale, which appearance is not based on similarity to the owner's trade-name. Such an action
would have to be based on the general appearance of the package, its form, color, style,
adornment, and matters of that character; and would not lie on appearance arising from the
similarity of plaintiff's and defendant's trade-names.

The effect of these observations and conclusions would necessarily be to end the case at
this point if we were disposed to leave the other questions presented for resolution unsettled;
for, if there can attach to a trade-name no secondary meaning, plaintiff's action must fail. It is
based exclusively on the secondary signification of the word "Isabela" which it has acquired
by long association with plaintiff's cigarettes, by virtue of which it no longer means to the
trade and the public generally when used in connection with tobacco products, a province of
Luzon or the tobacco grown in that province, but simply and solely the products of plaintiff's
factory. In other words, the claim is that it has completely lost its primary signification and
come to have a secondary meaning exclusively when used in connection with manufactured
tobacco. The action being based entirely on the theory of secondary meaning, and the
statute giving no right of action in cases of that character, it is evident that the action cannot
be maintained.

In spite of the fact, however, that we might have reverse the judgment on the grounds,
already stated, we prefer, in the interests of the parties, the bar and the public generally, to
decide the other questions presented, some of them being extremely important and of public
interest and they having been fully argued on the appeal. (Lichauco vs. Limjuco and
Gonzalo, 19 Phil. Rep., 12.)

It is admitted all through this case, in fact it is alleged in plaintiff's complaint and is set out in
all parts of its brief filed on this appeal, that plaintiff's trade-name, as evidenced by the
certificate issued under the Spanish regime, consists solely of the words "La Flor de la
Isabela." Plaintiff does not claim that the word "Isabela" has been registered by it as a trade-
name or that it has a title from any source conferring on it the exclusive right to use that
word. The certificate offered in evidence plaintiff to show its right to the exclusive use of the
phrase "La Flor de la Isabela" grants two rights: One in a trade-mark consisting of a
rectangular shield, surmounted by a crown and divided into four equal parts, in the right hand
upper corner of which is a full rigged sailing ship at sea, in the left hand upper corner a
growing tobacco plant, in the lower right hand corner a field of sugar cane with a pool of
water in the foreground, and in the lower left hand corner a factory in operation; the other, a
right in the trade-name "La Flor de la Isabela." As we have already seen, there is no claim
here based on the infringement or violation of the trade-mark just described, nor is there
contention or claim of any kind that the use of the word "Isabela" is a violation or an
infringement of the trade-name "La Flor de la Isabela." The action is not for the violation of
the trade-name "La Flor de la Isabela," but for the violation of an entirely different trade-
name, namely, "Isabela." The exclusive right to use this name, plaintiff claims arises from two
causes: First, the contraction of the phrase "La Flor de la Isabela" into the word "Isabela" by
popular expression and use and second, the use for more than twenty years of the word
"Isabela." In view of the fact that there is no claim of an infringement of the trade name "La
Flor de la Isabela," these two claims are identical; for, there could have been no contraction
brought about by popular expression except after long lapse of time. The contraction of the
phrase into the word would create no rights, there being no registration, unless it resulted
from long use. Therefore, to establish a right in the word, the contraction must be shown to
have existed for a length of time equivalent to that which would be necessary to give the
word "Isabela" the dignity and legal status of a trade-name. If therefore, it results from the
evidence in this action that the word "Isabela" has not been used by the plaintiff for a period
of time sufficient to give it the special value necessary to bring it within the law relating to
trade-names (if it be admitted for the moment that that could be done), then the plaintiff must
fail, whether it base its action on contraction, or use, or both.

There is another ground on which plaintiff would fail in his action. If it should appear in the
case that the word "Isabela" was a word which, at the time of its adoption by plaintiff and at
all times since, was the name of the geographical place of production or origin or was
ordinarily and generally used as the name, quality or description of the merchandise to which
it related, plaintiff would fail, as such name would not be capable of being registered as a
trade-name (secs. 2 and 13) and could not, for that reason, be appropriated by plaintiff as
such. That being so, no action for a violation thereof could be maintained, as none is granted
by the statute in such case. (Secs. 3, 5, and 7.)
Before entering on the discussion of the facts of the case, it may be well to set down certain
things that appear to be uncontroverted:

1. There is a province in the Island of Luzon known as Isabela Province. In that province
grows tobacco of a class and quality not grown in any other province or place in the
Philippine Islands.

2. That tobacco is known commercially and to the trade as Isabela tobacco and the
expression "Isabela tobacco" has in the Philippine Islands a meaning as definite, certain and
clear as the expression "Havanna tobacco" or "Virginia tobacco" in the United States.

3. The defendant has used on its cigarettes the words "Alhambra Isabela" with a statement
that the cigarettes inclosed in the package are composed exclusively of Isabela tobacco.
Aside from "Isabela" no other word or phrase or character is used on defendant's packages
which it is claimed is in violation of plaintiff's rights.

4. There is absolutely no resemblance between the packages of cigarettes manufactured

and sold by the plaintiff and those manufactured and sold by the defendant, except in the
word "Isabela."

5. The phrase "La Flor de la Isabela" means in English, giving it a free translation, "The best
tobacco grown in Isabela Province," or "The finest tobacco grown in Isabela Province," or
"The finest quality of tobacco grown in Isabela Province." The phrase, in its primary sense,
conveys the idea that the products on which it is placed are composed of the best tobacco
grown in the Province of Isabela.

6. Plaintiff's cigarettes marked with the design "La Flor de la Isabela," and referred to in this
case, are not manufactured or composed, either wholly or in part, of tobacco grown in
Isabela Province.

7. The cigarettes manufactured and sold by defendant as "Alhambra Isabelas" are

composed exclusively of tobacco grown in Isabela Province.

8. The word "Isabela," when used in connection with tobacco, cigars or cigarettes, signifies in
its primary sense that the tobacco itself, or that composing the cigars or cigarettes, is Isabela
tobacco.

We are of the opinion that the plaintiff must fail in this action for the reason that, in the first
place, it has not proved that the word "Isabela" has been used in the manner and form
alleged in the complaint; and, in the second place, for the reason that it is the name of the
geographical place of production or origin of the material composing the article to which it is
affixed and that it is the name, quality and description thereof. The burden is on plaintiff to
prove the use of word "Isabela" for such a length of time and under such circumstances as to
give it the right to its exclusive use. Reviewing the evidence of record, we are of the opinion
that the overwhelming weight thereof is contrary to plaintiff's contention. It shows that in not a
single instance in the history of the plaintiff corporation, so far as is disclosed by the record,
has a package of its cigarettes gone into the market, either at wholesale or retail, with the
word "Isabela" alone or the package as a separate or distinct word or name. In every
instance, so far as the documentary evidence goes, the packages have been marked by the
phrase "La Flor de la Isabela." There is not an exhibit of any probative value on the issues
involved which does not tend affirmatively to establish that the word was never used as a
separate and distinct word and to negative any intention on the part of the plaintiff to use it as
much. As far back as the time when the plaintiff obtained the right to use the trade-name "La
Flor de la Isabela" the exhibit filed in its application for registration of that trade-name
demonstrate, as they naturally must, that the trade-name which plaintiff desired to secure
was "La Flor de la Isabela" and not "Isabela." These exhibits are the wrappers which inclose
plaintiff's cigarettes as they are found exposed for sale and have on them the words, designs
and devices to the exclusive use of which plaintiff claims to be entitled. Every one of them
contains the phrase "La Flor de la Isabela" and not one of them the word "Isabela." In all of
them the word "Flor" is almost equally conspicuous with the word "Isabela" and from them
we can see no intent to emphasize the word "Isabela" more than the word "Flor." So far as
the record shows, plaintiff nowhere advertised or advertises its cigarettes as "Isabela"
cigarettes and we find nothing in the exhibits which shows that the plaintiff has or ever had
the slightest intention to use the word "Isabela" as a trade-name.

Much stress is laid by plaintiff on the fact that the wholesale packages of cigarettes, that is,
the packages containing a number of the small retail packages, have printed on the two
edges in large letters "Isabela Cortos," "Isabela Largos," and "Isabela Entrelargos," as the
case may be. But it is to be noted that it appears from the exhibits themselves that plaintiff's
trade-name "La Flor de la Isabela," in conspicuous letters, is also attached to both ends of
each of such packages; and each of the small packages inclosed in the larger carries the
phrase "La Flor de la Isabela" and we said at the outset, that not a single package of
plaintiff's cigarettes has ever gone into the market in the Philippine Islands with the word
"Isabela" alone thereon as a trade-name.

Much importance is attached by plaintiff to a letter dated April 8, 1914, received from one of
its employees in America. While this letter is of doubtful competency as evidence for plaintiff,
it is in the record, and inasmuch as so much stress is laid on a portion of it, and it appears to
be competent evidence as against plaintiff, we refer to it. The sentence in the letter to which
reference is particularly made in this : "Furthermore, the trade here knows the cigars as
'Isabela' pure and simple." As is seen, this letter refers to cigars and not cigarettes; but, be
that as it may, we believe that the plaintiff has quite overlooked the real nature of the letter as
evidence. In its attempt to demonstrate that its tobacco products are known in America as
"Isabela" products, it overlooked the first part of the letter which, to us, is the most significant
part of it. The writer says:

Ehrman Bros. and Co. have asked us to have the paster "La Flor de la Isabela,"
which goes on the end of the boxes, as per sample we inclose herewith, changed as
follows: Make the strip about half as wide again as the inclosed sample, and instead
of the words "La Flor de la Isabela," put on just the one word "Isabela" in large
letters. Ehram Bros. say their customers claim that the lettering on this strip is too
small for the customers to notice it readily behind the counter, whereas a large
lettering of the word "Isabela" will be much more attractive and more noticeable.

This portion of the letter demonstrates conclusively that the plaintiff has never advertised its
cigars in America as "Isabela" cigars. It has persisted always in advertising them as "La Flor
de la Isabela;" and the precise objection made by the dealers handling plaintiff's cigars in the
United States is that plaintiff insists on advertising its goods as "La Flor de la Isabela" instead
of "Isabela;" and it is clear from the letter that if, as the writer says, its cigars are known to
the trade in America as "Isabela" cigars, it is not by reason of plaintiff's efforts but in spite of
them. Plaintiff itself has put forth no effort, as far as we can see from the record, to create a
right in the word "Isabela." All of its money has been spent and all its energy used in the
advertisement of the phrase "La Flor de la Isabela."
A price list of the products of the plaintiff company has been introduced in evidence, on the
tenth and eleventh pages of which appear the words "Isabela Cortos," "Isabela Largos" and
"Isabela Entrelargos," together with the price. We do not regard this price list as indicating
anything more that the fact that the limited space (the price list is printed in very small letters)
forbade the use of the phrase "La Flor de la Isabela." But we note then, in extremely large
letters, comparatively speaking, on the front page of the price list, are found the words "La
Flor de la Isabela," while on each package of cigarettes which, in the price list, are called
"Isabela Cortos," "Isabela Largos," and "Isabela Entrelargos," is found, in more than one
place, the phrase "La Flor de la Isabela." Moreover, under the word "remarks" found at the
close of the price list, are these words: "When the Spanish Government abolished the
tobacco monopoly in the Philippine Islands this company acquired the exclusive right to use
the marks Cavite, Malabon, Princesa, and Meisic which were formerly the property of the
Government." Nothing is said about the word "Isabela." No rights are claimed by that
advertisement in that name.

The documentary evidence introduce by plaintiff is fully corroborated by the evidence of

defendant. The testimony of Mr. Olsen, one of the leading tobacco manufacturers of the
Philippine Islands, is to the effect that the products of plaintiff's factory are generally known in
the Philippine Islands as Tabacalera products, sometimes as "La Flor de la Isabela"
products, but not as "Isabela" products. He states that the cigarettes which plaintiff calls
"Isabela Cortos" and "Isabela Largos" are generally known to the trade as "Tabacalera
Cortos" and "Tabacalera Largos." The clerk of the Court of First Instance in which the action
was tried, being called as a witness for the defendant, testified that he smoked cigarettes of
the Tabacalera and Insular factories and that he had never heard of "Isabela" cigarettes
before the defendant began the manufacture of its cigarettes; but that he had frequently
heard of the factory "La Flor de la Isabela." Mr. Blanco, the interpreter of the court, testified
that he had smoked cigarettes for forty or fifty years and that he had not heard of "Isabela"
cigarettes.

While some of the witnesses for the plaintiff testified that the public knew the products of
plaintiff's factory as "Isabela" products, that testimony was in part contradicted by other
witnesses for the plaintiff and is entirely at variance with its documentary evidence.

It appearing from the record in the case that the plaintiff has always insisted on the
ownership of the trade-name "La Flor de la Isabela" and has invariably sent it into the market
with its products both in the Philippine Islands and in the United States, and that whatever
effort and money plaintiff has expended in securing a trade-name have been spent with
respect to "La Flor de la Isabela" and not "Isabela," we are driven to the conclusion that, as a
matter of fact, the word "Isabela" has never been used by the plaintiff as a trade-name in
such a way as to give it any exclusive right therein. Moreover, the persistent use of the trade-
name "La Flor de la Isabela" denies the possibility of any single word in that phrase being a
trade-name. It being kept in mind that there is no contention on the part of the plaintiff that
the use of the word "Isabela" by the defendant is an infringement of the trade-name "La Flor
de la Isabela," it is clear that the use of "La Flor de la Isabela" has given the plaintiff no right
to the use of the word "Isabela." Furthermore, plaintiff denies that it has abandoned the
trade-name "La Flor de la Isabela," but maintains that its rights therein are now in full force
and effect. Admitting, even for the sake of argument, that there can exist a trade-name
unless it has used it for a sufficient length of time to give it a special value. But plaintiff's
effort has been directed exclusively to the trade-name "La Flor de la Isabela," has, by
plaintiff's efforts, received any special value in connection with plaintiff's products.
We might say, in concluding this branch of the subject, that, even admitting that the word
"Isabela" may have been appropriable by plaintiff as a trade-name at the time it began to use
it, the evidence showing that is had been exclusively appropriated by the plaintiff would have
to be very strong to establish the fact of appropriation and the right to exclusive use. The law
as it now stands as his stood since the Royal Decree of 1888 prohibits the use of a
geographical name as a trade-name. Act No. 666 of prohibits the use not only of a
geographical name but also of a word which is either the name, quality, or the description of
the article to which the trade-name refers. Even if appropriation were possible, it would
require the clearest of proof to permit the appropriation of a word as a trade-name the use of
which in that connection the law expressly declines to sanction.

Furthermore, we are of the opinion that, even if plaintiff had proved a right to the exclusive
use of the word "Isabela," we would be forced to conclude that its use by the defendant in
connection with the word "Alhambra," which is made equally conspicuous with the word
"Isabela," would be a sufficient effort on the part of defendant to distinguish its cigarettes
from those of plaintiff; particularly in view of the fact that the word "Isabela" is the name of a
province and also the commercial name of the tobacco grown in that province.

We do not believe, however, that the word "Isabela" can be appropriated or could be
appropriated at the time plaintiff claimed that it began to use that word as descriptive of its
products. The Royal Decree of 1888 prohibited the use of a geographical name as trade-
name or trade-mark and that decree was in force before the use of the word "Isabela" began,
even under plaintiff's claim. At least if had not been used for a sufficient length of time to give
it a property right therein, it never having been registered as a trade-name either under that
decree or Act No. 666. From the date of that decree to the present time it has been unlawful
to select the word "Isabela" as a trade-name, and it would have been impossible during that
time for plaintiff to have obtained a right therein, no matter how much the word might have
been used or to what extent it had been advertised. While Act No. 666, as we have seen,
expressly permits the appropriation of a trade-mark, although it may be a geographical or
descriptive name, it does not permit the appropriation of a trade-name under the same
circumstance. We accordingly repeat, from the Royal Decree of 1888 to the present time, the
word "Isabela" has not been appropriable by anybody as a trade-name.

For these reasons and for the further reason that we regard the case of Baxter vs. Zuazua (5
Phil. Rep., 160), as decisive of the main questions involved in this case, we are of the
opinion that the judgment must be reversed.

The judgment appealed from is reversed and the perpetual injunction issued thereon is
dissolved. Without costs in this instance. So ordered.