FACTS:

The petitioner was granted a Timber License Agreement (TLA), authorizing it to cut, remove and utilize timber within the concession area covering 29,500 hectares of forest land in Zamboanga del Sur, for a period of ten years expiring on September 31, 1992.‘

in 1987, herein private respondents filed a petition with the DENR for the cancellation of the TLA on the ground of serious violations of its conditions and the provisions of forestry laws and regulations.

The same charges were subsequently made, also by the herein private respondents, in a complaint for injunction with damages against the petitioner.

The petitioner moved to dismiss this case on three grounds, to wit: 1) the court had no jurisdiction over the complaint; 2) the plaintiffs had not yet exhausted administrative remedies; and 3) the injunction sought was expressly prohibited by section 1 of PD 605.

Judge Alfonso G. Abad denied the motion to dismiss and the motion for reconsideration. The petitioner then elevated the matter to the CA, which sustained the trial court .The CA held that the doctrine of exhaustion of administrative remedies was not without exception and pointed to the several instances approved by this Court where it could be dispensed with. The respondent court found that in the case before it, the applicable exception was the urgent need for judicial intervention.

The decision also declared invalid Section 1 of PD 605, which provides:

Sec. 1. No court of the Philippines shall have jurisdiction to issue any restraining order, preliminary injunction or preliminary mandatory injunction in any case involving or growing out of the issuance, approval or disapproval, revocation or suspension of, or any action whatsoever by the proper administrative official or body on concessions, licenses, permits, patents, or public grants of any kind in connection with the disposition, exploitation, utilization, exploration and/or development of the natural resources of the Philippines.

This was held to be an encroachment on the judicial power vested in the Supreme Court and the lower courts by Article VIII, Section 1, of the Constitution. The respondent court cited Export Processing Zone Authority v. Dulay, where several presidential decrees were declared unconstitutional for divesting the courts of the judicial power to determine just compensation in expropriation cases.

 

ISSUES:

1. Whether the doctrine of exhaustion of administrative remedies was not correctly applied and that the declaration of the unconstitutionality of Section 1 of PD 605 was improper.
2. Whether the RTC is correct when it declared invalid Section 1 of PD 605.

RULING:

1. The doctrine of exhaustion of administrative remedies calls for resort first to the appropriate administrative authorities in the resolution of a controversy falling under their jurisdiction before the same may be elevated to the courts of justice for review. Non-observance of the doctrine results in lack of a cause of action, which is one of the grounds allowed in the Rules of Court for the dismissal of the complaint. The deficiency is not jurisdictional. Failure to invoke it operates as a waiver of the objection as a ground for a motion to dismiss and the court may then proceed with the case as if the doctrine had been observed.

One of the reasons for the doctrine of exhaustion is the separation of powers, which enjoins upon the Judiciary a becoming policy of non-interference with matters coming primarily (albeit not exclusively) within the competence of the other departments. The theory is that the administrative authorities are in a better position to resolve questions addressed to their particular expertise and that errors committed by subordinates in their resolution may be rectified by their superiors if given a chance to do so. A no less important consideration is that administrative decisions are usually questioned in the special civil actions of certiorari, prohibition and mandamus, which are allowed only when there is no other plain, speedy and adequate remedy available to the petitioner. It may be added that strict enforcement of the rule could also relieve the courts of a considerable number of avoidable cases which otherwise would burden their heavily loaded dockets. 9

As correctly suggested by the respondent court, however, there are a number of instances when the doctrine may be dispensed with and judicial action validly resorted to immediately.

Among these exceptional cases are:

1) when the question raised is purely legal;

2) when the administrative body is in estoppel;

3) when the act complained of is patently illegal;

4) when there is urgent need for judicial intervention;

5) when the claim involved is small;

6) when irreparable damage will be suffered;

7) when there is no other plain, speedy and adequate remedy;

8) when strong public interest is involved;

9) when the subject of the controversy is private land; and

10) in quo warranto proceedings.

The private respondents now submit that their complaint comes under the exceptions because forestry laws do not require observance of the doctrine as a condition precedent to judicial action; the question they are raising is purely legal; application of the doctrine will cause great and irreparable damage; and public interest is involved.

We rule for the petitioner.

Even if it be assumed that the forestry laws do not expressly require prior resort to administrative remedies, the reasons for the doctrine above given, if nothing else, would suffice to still require its observance. Even if such reasons were disregarded, there would still be the explicit language of pertinent laws vesting in the DENR the power and function “to regulate the development, disposition, extraction, exploration and use of the country’s forests” and “to exercise exclusive jurisdiction” in the “management and disposition of all lands of the public domain,” and in the Forest Management Bureau (formerly the Bureau of Forest Development) the responsibility for the enforcement of the forestry laws aid regulations here claimed to have been violated. This comprehensive conferment clearly implies at the very least that the DENR should be allowed to rule in the first instance on any controversy coming under its express powers before the courts of justice may intervene.

The argument that the questions raised in the petition are purely legal is also not acceptable. The private respondents have charged, both in the administrative case before the DENR and in the civil case before the RTC, that the petitioner has violated the terms and conditions of the TLA and the provisions of forestry laws and regulations.

The charge involves factual issues calling for the presentation of supporting evidence. Such evidence is best evaluated first by the administrative authorities, employing their specialized knowledge of the agreement and the rules allegedly violated, before the courts may step in to exercise their powers of review.

As for the alleged urgent necessity for judicial action and the claimed adverse impact of the case on the national interest, the record does not show that the petitioners have satisfactorily established these extraordinary circumstances to justify deviation from the doctrine by exhaustion of administrative remedies and immediate resort to the courts of justice. In fact, this particular submission must fall flat against the petitioner’s uncontested contention that it has since 1988 stopped its operations under the TLA in compliance with the order of the DENR.

 

2.

There in no question that Civil Case No. 2732 comes within the jurisdiction of the respondent court. Nevertheless, as the wrong alleged in the complaint was supposedly committed as a result of the unlawful logging activities of the petitioner, it will be necessary first to determine whether or not the TLA and the forestry laws and regulations had indeed been violated. To repeat for emphasis, determination of this question is the primary responsibility of the Forest Management Bureau of the DENR. The application of the expertise of the administrative agency in the resolution of the issue raised is a condition precedent for the eventual examination, if still necessary, of the same question by a court of justice.

In view of the above observations, we find that there was no need for the respondent court to declare the unconstitutionality of Section 1 of PD 605. The rule is that a question of constitutionality must be avoided where the case can be decided on some other available ground, as we have done in the case before us. The resolution of this same question must await another case, where all the indispensable requisites of a judicial inquiry into a constitutional question are satisfactorily established. In such an event, it will be time for the Court “to make the hammer fall, and heavily,” in the words of Justice Laurel, if such action is warranted.

The petition is GRANTED.