CA stops Puerto Princesa court from hearing mining dispute

MANILA, Philippines – The Court of Appeals has stopped the Puerto Princesa Regional Trial Court from hearing the dispute between two mining firms in Palawan.

In a 15-page decision, the CA’s Special Former Fifteenth Division said the RTC cannot issue an injunction against the Department of Environment and Natural Resources (DENR), Environment Management Bureau (EMB), and Mines and Geosciences Bureau (MGB) because they are not parties to the case.

The CA said the ruling is void on grounds that Citinickel Mining Corp. was not impleaded in the case, being an indispensable party.

“It is clear that the presence of indispensable parties is necessary to vest the court with jurisdiction, which is ‘the authority to hear and determine a cause, the right to act in a case,’” read the CA decision.

“We stress that the absence of indispensable parties renders all subsequent actuations of the court null and void, because of that court’s want of authority to act, not only as to the absent parties but even as to those present.”

The CA said Citinickel is an indispensable party to the case, considering that it has already acquired the mining rights of Olympic Mines and Development Corp. by virtue of a deed of assignment before Platinum Group Metals Corp. filed its complaint against Olympic Mines.

“As a rule, an indispensable party’s interest in the subject matter is such that a complete and efficient determination of the equities and rights of the parties is not possible if he is not joined,” read the CA decision.

“In fact, a valid judgment cannot even be rendered where there is want of indispensable parties.”

The case arose from a petition filed by Polly Dy, a member of the board of directors of Rockworks Resources Corp., questioning the RTC’s decision favoring Platinum.

The CA said Dy had been unjustly impleaded as a defendant in the case despite the non-joinder of Citinickel, as indispensable party.

Citinickel’s interest would be adversely affected in case there will be an order or decision directing Olympic to abide by its operating agreement with Platinum, the CA added.

Records show Olympic Mines was granted mining lease and contracts by the DENR covering mining rights over the Toronto Nickel Mine in the municipality of Narra and the Pulot Nickel Mine in the municipality of Española in Palawan.

On July 18, 2003, Olympic Mines entered into an operating agreement with Platinum, which gave the latter exclusive rights to do mining activities in the two municipalities for a period of 25 years.

However, Olympic decided to terminate the contract after almost three years on grounds that Platinum committed gross violation in the implementation of the agreement.

On June 9, 2006, Olympic Mines executed a deed of assignment in favor of Citinickel for the  exploration, development and mining of nickel and other associated minerals covered by its previous contract with Platinum.

Citinickel is a joint venture corporation formed by and composed of Olympic and Rockworks.

However, Platinum refused to leave the mining areas and surrender possession of the properties to Olympic.

On June 14, 2006, Platinum filed a complaint for quieting of title/interest, breach of contract and damages, and specific performance before the Puerto Princesa RTC seeking to compel Olympic to respect their operating agreement.

The RTC granted Platinum’s prayer for the issuance of a temporary restraining order  to prevent Olympic from retaking the properties.

The RTC granted that motion on Oct. 26, 2006.

On Aug. 28, 2006, Platinum filed a motion for leave to amend complaint, seeking to include Rockworks and its board of directors as defendants.

On April 13, 2007, the RTC granted Platinum’s motion for an expanded writ of preliminary injunction against the DENR, EMB and the MGB.