FRANCISCO I. CHAVEZ, petitioner, vs.PUBLIC ESTATES AUTHORITY and AMARI COASTAL BAY DEVELOPMENT CORPORATION, respondents.The petition seeks to compel the Public Estates Authority ("PEA" for brevity) to disclose all facts on PEA's then on!oin! rene!otiations "ith Amari #oastal $ay and %evelopment #orporation ("A&A'("for brevity) to reclaim portions of &anila $ay. The Facts). On November 20, 1973, the C!!"ss"ne# $ P%&'"c H"(h)a*s, si!ned a contract "ith theCnst#%ct"n and De+e',!ent C#,#at"n $ the Ph"'",,"nes -.CDCP. $# e+"t*) to reclaim certain foreshore and offshore areas of &anila $ay. #%#P obli!ated itself to carry out all the "orks in consideration of /01 $ the tta' #ec'a"!ed 'and.*. On February 4, 1977, then President +erdinand E. &arcos issued Presidential %ecree ,o. )-./ creatin! PEA. P% ,o. )-./ tasked PEA "to reclaim land, includin! foreshore and submer!ed areas," and "to develop, improve, ac0uire, 1 1 1 lease and sell any and all kinds of lands.") 2n the same date, then President &arcos issued Presidential %ecree ,o. )-.3 transferrin! to PEA the "lands reclaimed in the foreshore and offshore of the &anila $ay"* under the &anila#avite #oastal 'oad and 'eclamation Pro4ect (#''P).5. 2n %ecember *6, )6.), then President &arcos issued a memorandum directin! PEA to amend its contract "ith #%#P, so that "7A8ll future "orks in #''P 1 1 1 shall be funded and o"ned by PEA." Accordin!ly, PEA and #%#P e1ecuted a &emorandum of A!reement dated %ecember *6, )6.), "hich stated9"(i) #%#P shall undertake all reclamation, construction, and such other "orks in the #''P as may be a!reed upon by the parties, to be paid accordin! to pro!ress of "orks on a unit price:lump sum basis for items of "ork to be a!reed upon, sub4ect to price escalation, retention and other terms and conditions provided for in Presidential %ecree ,o. )36/. All the financin! re0uired for such "orks shall be provided by PEA.1 1 1(iii) 1 1 1 CDCP shall give up all its development rights and hereby a!rees to cede and transfer in favor of PEA, all of the ri!hts, title, interest and participation of #%#P in and to all the areas of land reclaimed by #%#P in the #''P as of %ecember 5-, )6.) "hich have not yet been sold, transferred or other"ise disposed of by #%#P as of said date,"hich areas consist of appro1imately N"net*2N"ne Th%sand F%# H%nd#ed Se+ent* Th#ee -33,4567 s8%a#e !ete#s and a,,#9"!ate'* Th#ee M"''"n Th#ee H%nd#ed E"(ht* T) Th%sand E"(ht H%nd#ed E"(ht* E"(ht -6,6:;,:::7 s8%a#e !ete#s $ #ec'a"!ed a#eas at varyin! elevations above &ean ;o" DA also re0uired the reclamation of an additional *3- hectares of submer!ed areas surroundin! these islands to complete the confi!uration in the &aster %evelopment Plan of the @outhern 'eclamation Pro4ect#''P. PEA and A&A'( entered into the >DA throu!h ne!otiation "ithout public biddin!./ 2n April *., )663, the $oard of %irectors of PEA, in its 'esolution ,o. )*/3, confirmed the >DA.32n >une ., )663, then President +idel D. 'amos, throu!h then E1ecutive @ecretary 'uben Torres, approved the >DA.EE. 2n ,ovember *6, )66E, then @enate President Ernesto &aceda delivered a privile!e speechin the @enate and denounced the >DA as the "!randmother of all scams." As a result, the @enate #ommittee on Fovernment #orporations and Public Enterprises, and the #ommittee on Accountability of Public 2fficers and (nvesti!ations, conducted a 4oint investi!ation. The @enate #ommittees reported the results of their investi!ation in @enate #ommittee 'eport ,o. 3E- dated @eptember )E, )66A.A Amon! the conclusions of their report are9 ()) the reclaimed lands PEA seeks to transfer to A&A'( under the >DA are lands of the public domain "hich the !overnment has not classified as alienable lands and therefore PEA cannot alienate these landsG (*) the certificates of title coverin! the +reedom (slands are thusvoid, and (5) the >DA itself is ille!al.A. 2n %ecember 3, )66A, then President +idel D. 'amos issued Presidential Administrative 2rder ,o. 5E3 creatin! a ;e!al Task +orce to conduct a study on the le!ality of the >DA in vie" of @enate #ommittee 'eport ,o. 3E-. The members of the ;e!al Task +orce "ere the @ecretary of >ustice,. the #hief Presidential ;e!al #ounsel,6 and the Fovernment #orporate #ounsel.)- The ;e!al Task +orce upheld the le!ality of the >DA, contrary to the conclusions reached by the @enate #ommittees.)).. 2n April / and 3, )66., the Philippine Daily Inquirer and Toay published reports that there "ere on!oin! rene!otiations bet"een PEA and A&A'( under an order issued by then President +idel D. 'amos. Accordin! to these reports, PEA %irector ,estor Hala", PEA #hairman Arsenio Iulo and retired ,avy 2fficer @er!io #ru? composed the ne!otiatin! panelof PEA.6. 2n April )5, )66., Antonio &. Julueta filed before the #ourt a Pe!i!ion "or Prohibi!ion #i!h $ppli%a!ion "or !he I&&uan%e o" a Temporary 'e&!rainin( Orer an Preliminary In)un%!ion docketed as F.'. ,o. )5*66/ seekin! to nullify the >DA. The #ourt dismissed the petition "for un"arranted disre!ard of 4udicial hierarchy, "ithout pre4udice to the refilin! of thecase before the proper court.")*)-. 2n April *A, )66., petitioner +rank (. #have? ("Petitioner" for brevity) as a ta1payer, filed the instant Pe!i!ion "or *anamu& #i!h Prayer "or !he I&&uan%e o" a +ri! o" Preliminary In)un%!ionan Temporary 'e&!rainin( Orer. Petitioner contends the !overnment stands to lose billionsof pesos in the sale by PEA of the reclaimed lands to A&A'(. Petitioner prays that PEA publicly disclose the terms of any rene!otiation of the >DA, invokin! @ection *., Article ((, and@ection A, Article (((, of the )6.A #onstitution on the ri!ht of the people to information on matters of public concern. Petitioner assails the sale to A&A'( of lands of the public domain as a blatant violation of @ection 5, Article K(( of the )6.A #onstitution prohibitin! the sale of alienable lands of the public domain to private corporations. +inally, petitioner asserts that heseeks to en4oin the loss of billions of pesos in properties of the @tate that are of public dominion.)). After several motions for e1tension of time,)5 PEA and A&A'( filed their #omments on 2ctober )6, )66. and >une *3, )66., respectively. &ean"hile, on %ecember *., )66., petitioner filed an 2mnibus &otion9 (a) to re0uire PEA to submit the terms of the rene!otiatedPEAA&A'( contractG (b) for issuance of a temporary restrainin! orderG and (c) to set the case for hearin! on oral ar!ument. Petitioner filed a 'eiterative &otion for (ssuance of a T'2dated &ay *E, )666, "hich the #ourt denied in a 'esolution dated >une **, )666.)*. (n a 'esolution dated &arch *5, )666, the #ourt !ave due course to the petition and re0uired the parties to file their respective memoranda.)5. 2n &arch 5-, )666, PEA and A&A'( si!ned the Amended >oint Denture A!reement ("Amended >DA," for brevity). 2n &ay *., )666, the 2ffice of the President under the administration of then President >oseph E. Estrada approved the Amended >DA.)/. %ue to the approval of the Amended >DA by the 2ffice of the President, petitioner no" prays that on "constitutional and statutory !rounds the rene!otiated contract be declared null and void."The Iss%esThe issues raised by petitioner, PEA)3 and A&A'()E are as follo"s9(. DA containin! the terms and conditions a!reed upon in the rene!otiations. Thus, PEA has satisfied petitioner's prayer for a public disclosure of the rene!otiations. ;ike"ise, petitioner's prayer to en4oin the si!nin! of the Amended >DA is no" moot because PEA and A&A'( have already si!ned the Amended >DA on &arch 5-, )666. &oreover, the 2ffice of the President has approved the Amended >DA on &ay *., )666.Petitioner counters that PEA and A&A'( cannot avoid the constitutional issue by simply fasttrackin!the si!nin! and approval of the Amended >DA before the #ourt could act on the issue. Presidential approval does not resolve the constitutional issue or remove it from the ambit of 4udicial revie".DA by PEA and A&A'( and its approval by the President cannot operate to moot the petition and divest the #ourt of its 4urisdiction. PEA and A&A'( have still to implement the Amended >DA. The prayer to en4oin the si!nin! of the Amended >DA on constitutional !rounds necessarily includes preventin! its implementation if in the meantime PEA and A&A'( have si!ned one in violation of the #onstitution. Petitioner's principal basis in assailin! the rene!otiation of the >DA is its violation of @ection 5, Article K(( of the #onstitution, "hich prohibits the !overnment from alienatin! lands of the public domain to private corporations. (f the Amended >DA indeed violates the #onstitution, it is the duty of the #ourt to en4oin its implementation, and if already implemented, to annul the effects of such unconstitutional contract.The Amended >DA is not an ordinary commercial contract but one "hich seeks to transfer title and ownership to 367.5 hectares of reclaimed lands and submerged areas of Manila ay to a single private corporation. (t no" becomes more compellin! for the #ourt to resolve the issue to insure the !overnment itself does not violate a provision of the #onstitution intended to safe!uard the national patrimony. @upervenin! events, "hether intended or accidental, cannot prevent the #ourt from renderin! a decision if there is a !rave violation of the #onstitution. (n the instant case, if the Amended >DA runs counter to the #onstitution, the #ourt can still prevent the transfer of title and o"nership of alienable lands of the public domain in the name of A&A'(. Even in cases "here supervenin! events had made the cases moot, the #ourt did not hesitate to resolve the le!al or constitutional issues raised to formulate controllin! principles to !uide the bench, bar, and the public.)AAlso, the instant petition is a case of first impression. All previous decisions of the #ourt involvin! @ection 5, Article K(( of the )6.A #onstitution, or its counterpart provision in the )6A5 #onstitution,). covered agricultural landssold to private corporations "hich ac0uired the lands from private parties. The transferors of the private corporations claimed or could claim the ri!ht to !udicialconfirmation of their imperfect titles)6 under "itle ## of #ommon"ealth Act. )/) ("#A ,o. )/)" for brevity). (n the instant case, A&A'( seeks to ac0uire from PEA, a public corporation, reclaimed lands and submer!ed areas for non$agricultural purposes by purchase under P% ,o. )-./ (charter of PEA) and "itle ### of #A ,o. )/). #ertain undertakin!s by A&A'( under the Amended >DA constitute the consideration for the purchase. ,either A&A'( nor PEA can claim 4udicial confirmation of their titles because the lands covered by the Amended >DA are ne"ly reclaimed or still to be reclaimed. >udicial confirmation of imperfect title re0uires open, continuous, e1clusive and notorious occupation of a!ricultural lands of the public domain for at least thirty years since >une )*, )6/3 or earlier. $esides, the deadline for filin! applications for 4udicial confirmation of imperfect title e1pired on %ecember 5), )6.A.*-;astly, there is a need to resolve immediately the constitutional issue raised in this petition because of the possible transfer at any time by PEA to A&A'( of title and o"nership to portions of the reclaimed lands. =nder the Amended >DA, PEA is obli!ated to transfer to A&A'( the latter's seventy percent proportionate share in the reclaimed areas as the reclamation pro!resses. The Amended >DA even allo"s A&A'( to mort!a!e at any time the entire reclaimed area to raise financin! for the reclamation pro4ect.*)%econd issue: whether the petition merits dismissal for failing to observe the principlegoverning the hierarchy of courts.PEA and A&A'( claim petitioner i!nored the 4udicial hierarchy by seekin! relief directly from the #ourt. The principle of hierarchy of courts applies !enerally to cases involvin! factual 0uestions. As itis not a trier of facts, the #ourt cannot entertain cases involvin! factual issues. The instant case, ho"ever, raises constitutional issues of transcendental importance to the public.** The #ourt can resolve this case "ithout determinin! any factual issue related to the case. Also, the instant case is apetition for mandamus "hich falls under the ori!inal 4urisdiction of the #ourt under @ection 3, Article D((( of the #onstitution. ustice 'eynato @. Puno summari?ed succinctly the la" on this matter, as follo"s9"+oreshore lands are lands of public dominion intended for public use. @o too are lands reclaimed by the !overnment by dred!in!, fillin!, or other means. Act )E3/ mandated that the control and disposition of the foreshore and lands under "ater remained in the national !overnment. @aid la" allo"ed only the 'leasin!' of reclaimed land. The Public ;and Acts of )6)6 and )65E also declared that the foreshore and lands reclaimed by the !overnment "ere to be "disposed of to private parties by lease only and not other"ise." $efore leasin!, ho"ever, the FovernorFeneral, upon recommendation of the @ecretary of A!riculture and ,atural 'esources, had first to determine that the land reclaimed "as not necessary for the public service. This re0uisite must have been met before the land could be disposed of. ut even then- the foreshore and lands under water were not to be alienated and sold to private parties. "he disposition of the reclaimed land was only by lease. "he land remained property of the %tate." (Emphasis supplied)As observed by >ustice Puno in his concurrin! opinion, "#ommon"ealth Act ,o. )/) has remained in effect at present."The @tate policy prohibitin! the sale to private parties of !overnment reclaimed, foreshore and marshy alienable lands of the public domain, first implemented in )6-A "as thus reaffirmed in #A ,o. )/) after the )653 #onstitution took effect. The prohibition on the sale of foreshore lands, ho"ever, became a constitutional edict under the )653 #onstitution. +oreshore lands became inalienable as natural resources of the @tate, unless reclaimed by the !overnment and classified as a!ricultural lands of the public domain, in "hich case they "ould fall under the classification of !overnment reclaimed lands.After the effectivity of the )653 #onstitution, !overnment reclaimed and marshy disposable lands of the public domain continued to be only leased and not sold to private parties.3E These lands remained sui generis, as the only alienable or disposable lands of the public domain the !overnment could not sell to private parties.@ince then and until no", the only "ay the !overnment can sell to private parties !overnment reclaimed and marshy disposable lands of the public domain is for the le!islature to pass a la" authori?in! such sale. #A ,o. )/) does not authori?e the President to reclassify !overnment reclaimed and marshy lands into other nona!ricultural lands under @ection 36 (d). ;ands classified under @ection 36 (d) are the only alienable or disposable lands for nona!ricultural purposes that the!overnment could sell to private parties.&oreover, @ection E- of #A ,o. )/) e&pressly re0uires con!ressional authority before lands under @ection 36 that the !overnment previously transferred to !overnment units or entities could be sold to private parties. @ection E- of #A ,o. )/) declares that N"@ec. E-. 1 1 1 The area so leased or sold shall be such as shall, in the 4ud!ment of the @ecretary of A!riculture and ,atural 'esources, be reasonably necessary for the purposes for "hich such sale or lease is re0uested, and shall not e1ceed one hundred and fortyfour hectares9 Provided, ho"ever, That this limitation shall not apply to !rants, donations, or transfers made to a province, municipality or branch or subdivision of the Fovernment for thepurposes deemed by said entities conducive to the public interestGbut the land so granted- donated- or transferred to a province- municipality or branch or subdivision of the ,overnment shall not be alienated- encumbered- or otherwise disposed of in a manner affecting its title- e&cept when authori+ed by *ongress9 1 1 1." (Emphasis supplied)The con!ressional authority re0uired in @ection E- of #A ,o. )/) mirrors the le!islative authority re0uired in @ection 3E of Act ,o. *.A/.2ne reason for the con!ressional authority is that @ection E- of #A ,o. )/) e1empted !overnment units and entities from the ma1imum area of public lands that could be ac0uired from the @tate. These !overnment units and entities should not 4ust turn around and sell these lands to private parties in violation of constitutional or statutory limitations. 2ther"ise, the transfer of lands for nona!ricultural purposes to !overnment units and entities could be used to circumvent constitutional limitations on o"nership of alienable or disposable lands of the public domain. (n the same manner, such transfers could also be used to evade the statutory prohibition in #A ,o. )/) on the sale of !overnment reclaimed and marshy lands of the public domain to private parties. @ection E- of #A ,o. )/) constitutes by operation of la" a lien on these lands.3A(n case of sale or lease of disposable lands of the public domain fallin! under @ection 36 of #A ,o. )/), @ections E5 and EA re0uire a public biddin!. @ections E5 and EA of #A ,o. )/) provide as follo"s9"@ec. E5. DA as the total reclaimed area less 5- percent earmarked for common areas. Title to A&A'('s share in the net usable area, totalin! 5EA.3 hectares, "ill be issued in the name of A&A'(. @ection 3.* (c) of the Amended >DA provides that N"1 1 1, PEA shall have the duty to e1ecute "ithout delay the necessary deed of transfer or conveyance of the title pertainin! to A&A'('s ;and share based on the ;and Allocation Plan. '()- when requested in writing by )M)4#- shall then cause the issuance and delivery of the proper certificates of title covering )M)4#0s 6and %hare in the name of )M)4#, 1 1 1G provided, that if more than seventy percent (A-Q) of the titled area at any !iven time pertains to A&A'(, PEA shall deliver to A&A'( only seventy percent (A-Q) of the titles pertainin! to A&A'(, until such time "hen a correspondin! proportionate area of additional land pertainin! to PEA has been titled." (Emphasis supplied)#ndisputably- under the )mended /.) )M)4# will acquire and own a ma&imum of 367.5 hectares of reclaimed land which will be titled in its name.To implement the Amended >DA, PEA dele!ated to the unincorporated PEAA&A'( 4oint venture PEA's statutory authority, ri!hts and privile!es to reclaim foreshore and submer!ed areas in &anila $ay. @ection 5.*.a of the Amended >DA states that N"PEA hereby contributes to the 4oint venture its ri!hts and privile!es to perform 'a"land 'eclamation and Cori?ontal %evelopment as "ell as o"n the 'eclamation Area, thereby !rantin! the >oint Denture the full and e1clusive ri!ht, authority and privile!e to undertake thePro4ect in accordance "ith the &aster %evelopment Plan."The Amended >DA is the product of a rene!otiation of the ori!inal >DA dated April *3, )663 and its supplemental a!reement dated Au!ust 6, )663."he "hreshold #ssueThe threshold issue is "hether A&A'(, a private corporation, can ac0uire and o"n under the Amended >DA 5EA.3 hectares of reclaimed foreshore and submer!ed areas in &anila $ay in vie" of @ections * and 5, Article K(( of the )6.A #onstitution "hich state that9"@ection *. All lands of the public domain, "aters, minerals, coal, petroleum, and other mineral oils, all forces of potential ener!y, fisheries, forests or timber, "ildlife, flora and fauna,and other natural resources are o"ned by the @tate. 7ith the e&ception of agricultural lands- all other natural resources shall not be alienated. 1 1 1.1 1 1@ection 5. 1 1 1 Alienable lands of the public domain shall be limited to a!ricultural lands. 'rivate corporations or associations may not hold such alienable lands of the public domain e&cept by lease, 1 1 1."(Emphasis supplied)*lassification of 4eclaimed Foreshore and %ubmerged )reasPEA readily concedes that lands reclaimed from foreshore or submer!ed areas of &anila $ay are alienable or disposable lands of the public domain. (n its &emorandum,EA PEA admits that N"=nder the Public ;and Act (#A )/), as amended), reclaimed lands are classified as alienable and disposable lands of the public domain9'@ec. 36. The lands disposable under this title shall be classified as follo"s9(a) ;ands reclaimed by the !overnment by dred!in!, fillin!, or other meansG1 1 1.'" (Emphasis supplied);ike"ise, the ;e!al Task +orceE. constituted under Presidential Administrative 2rder ,o. 5E3 admitted in its 'eport and 'ecommendation to then President +idel D. 'amos, 3C4Declaimed lands are classified as alienable and disposable lands of the public domain."E6 The ;e!al Task +orce concluded that N"%. #onclusion'eclaimed lands are lands of the public domain. Co"ever, by statutory authority, the ri!hts ofo"nership and disposition over reclaimed lands have been transferred to PEA, by virtue of "hich PEA, as o"ner, may validly convey the same to any 0ualified person "ithout violatin! the #onstitution or any statute.The constitutional provision prohibitin! private corporations from holdin! public land, e1cept by lease (@ec. 5, Art. KD((,A- )6.A #onstitution), does not apply to reclaimed lands "hose o"nership has passed on to PEA by statutory !rant."=nder @ection *, Article K(( of the )6.A #onstitution, the foreshore and submer!ed areas of &anila $ay are part of the "lands of the public domain, "aters 1 1 1 and other natural resources" and conse0uently "o"ned by the @tate." As such, foreshore and submer!ed areas "shall not be alienated," unless they are classified as "a!ricultural lands" of the public domain. The mere reclamation of these areas by PEA does not convert these inalienable natural resources of the @tate into alienable or disposable lands of the public domain. There must be a la" or presidential proclamation officially classifyin! these reclaimed lands as alienable or disposable and open to disposition or concession. &oreover, these reclaimed lands cannot be classified as alienable or disposable if the la" has reserved them for some public or 0uasipublic use.A)@ection . of #A ,o. )/) provides that "only those lands shall be declared open to disposition or concession "hich have been officially delimited and classified."A* The President has the authority to classify inalienable lands of the public domain into alienable or disposable lands of the public domain, pursuant to @ection E of #A ,o. )/). (n ;aurel vs. Farcia,A5 the E1ecutive %epartment attempted to sell the 'oppon!i property in Tokyo, >apan, "hich "as ac0uired by the Philippine Fovernment for use as the #hancery of the Philippine Embassy. Althou!h the #hancery had transferred to another location thirteen years earlier, the #ourt still ruled that, under Article /**A/of the #ivil #ode, a property of public dominion retains such character until formally declared other"ise. The #ourt ruled that N"The fact that the 'oppon!i site has not been used for a lon! time for actual Embassy service does not automatically convert it to patrimonial property. Any such conversion happens only if the property is "ithdra"n from public use (#ebu 21y!en and Acetylene #o. v. $ercilles, EE @#'A /.) 7)6A38. ) property continues to be part of the public domain- not available for private appropriation or ownership 0until there is a formal declaration on the part of the government to withdraw it from being such0((!nacio v. %irector of ;ands, )-. Phil. 553 7)6E-8." (Emphasis supplied)P% ,o. )-.3, issued on +ebruary /, )6AA, authori?ed the issuance of special land patents for lands reclaimed by PEA from the foreshore or submer!ed areas of &anila $ay. 2n >anuary )6, )6.. then President #ora?on #. A0uino issued @pecial Patent ,o. 53)A in the name of PEA for the )3A../ hectares comprisin! the partially reclaimed +reedom (slands. @ubse0uently, on April 6, )666 the 'e!ister of %eeds of the &unicipality of Parana0ue issued T#T ,os. A5-6, A5)) and A5)* in the name of PEA pursuant to @ection )-5 of P% ,o. )3*6 authori?in! the issuance of certificates of title correspondin! to land patents. To this day, these certificates of title are still in the name of PEA.P% ,o. )-.3, coupled "ith President A0uino's actual issuance of a special patent coverin! the +reedom (slands, is e0uivalent to an official proclamation classifyin! the +reedom (slands as alienable or disposable lands of the public domain. P% ,o. )-.3 and President A0uino's issuance of a land patent also constitute a declaration that the +reedom (slands are no lon!er needed for public service. "he Freedom #slands are thus alienable or disposable lands of the public domain- open to disposition or concession to qualified parties.At the time then President A0uino issued @pecial Patent ,o. 53)A, PEA had already reclaimed the +reedom (slands althou!h subse0uently there "ere partial erosions on some areas. The !overnmenthad also completed the necessary surveys on these islands. Thus, the +reedom (slands "ere no lon!er part of &anila $ay but part of the land mass. @ection 5, Article K(( of the )6.A #onstitution classifies lands of the public domain into "a!ricultural, forest or timber, mineral lands, and national parks." $ein! neither timber, mineral, nor national park lands, the reclaimed +reedom (slands necessarily fall under the classification of a!ricultural lands of the public domain. =nder the )6.A #onstitution, a!ricultural lands of the public domain are the only natural resources that the @tate mayalienate to 0ualified private parties. All other natural resources, such as the seas or bays, are ""aters1 1 1 o"ned by the @tate" formin! part of the public domain, and are inalienable pursuant to @ection *, Article K(( of the )6.A #onstitution.A&A'( claims that the +reedom (slands are private lands because #%#P, then a private corporation,reclaimed the islands under a contract dated ,ovember *-, )6A5 "ith the #ommissioner of Public Ci!h"ays. A&A'(, citin! Article 3 of the @panish ;a" of DA dated April *3, )663 covered not only the +reedom (slands and the additional *3- hectares still to be reclaimed, it also !ranted an option to A&A'( to reclaim another 53- hectares. The ori!inal >DA, a ne!otiated contract, enlar!ed the reclamation area to 75A hectares.6/ The failure of public biddin! on %ecember )-, )66), involvin! only /-A../ hectares,63 is not a valid 4ustification for a ne!otiated sale of A3- hectares, almost double the area publicly auctioned. $esides, the failure of public biddin! happened on %ecember )-, )66), more than three years before the si!nin! of the ori!inal >DA on April *3, )663. The economic situation in the country had !reatly improved durin! the intervenin! period.4eclamation under the 1" 6aw and the 6ocal ,overnment *odeThe constitutional prohibition in @ection 5, Article K(( of the )6.A #onstitution is absolute and clear9 "Private corporations or associations may not hold such alienable lands of the public domain e1cept by lease, 1 1 1." Even 'epublic Act ,o. E63A ("$2T ;a"," for brevity), cited by PEA and A&A'( as le!islative authority to sell reclaimed lands to private parties, reco!ni?es the constitutional ban. @ection E of 'A ,o. E63A states N"@ec. E. 'epayment @cheme.+or the financin!, construction, operation and maintenance of any infrastructure pro4ects undertaken throu!h the buildoperateandtransfer arran!ementor any of its variations pursuant to the provisions of this Act, the pro4ect proponent 1 1 1 may like"ise be repaid in the form of a share in the revenue of the pro4ect or other nonmonetary payments, such as, but not limited to, the !rant of a portion or percenta!e of the reclaimed land, sub!ect to the constitutional requirements with respect to the ownership of the land9 1 1 1." (Emphasis supplied)A private corporation, even one that undertakes the physical reclamation of a !overnment $2T pro4ect, cannot ac0uire reclaimed alienable lands of the public domain in vie" of the constitutional ban.@ection 5-* of the ;ocal Fovernment #ode, also mentioned by PEA and A&A'(, authori?es local !overnments in land reclamation pro4ects to pay the contractor or developer in kind consistin! of a percenta!e of the reclaimed land, to "it9"@ection 5-*. +inancin!, #onstruction, &aintenance, 2peration, and &ana!ement of (nfrastructure Pro4ects by the Private @ector. 1 1 11 1 1(n case of land reclamation or construction of industrial estates, the repayment plan may consist of the !rant of a portion or percenta!e of the reclaimed land or the industrial estate constructed."Althou!h @ection 5-* of the ;ocal Fovernment #ode does not contain a proviso similar to that of the$2T ;a", the constitutional restrictions on land o"nership automatically apply even thou!h not e1pressly mentioned in the ;ocal Fovernment #ode.Thus, under either the $2T ;a" or the ;ocal Fovernment #ode, the contractor or developer, if a corporate entity, can only be paid "ith leaseholds on portions of the reclaimed land. (f the contractor or developer is an individual, portions of the reclaimed land, not e1ceedin! )* hectares6E of nona!ricultural lands, may be conveyed to him in o"nership in vie" of the le!islative authority allo"in! such conveyance. This is the only "ay these provisions of the $2T ;a" and the ;ocal Fovernment #ode can avoid a direct collision "ith @ection 5, Article K(( of the )6.A #onstitution.4egistration of lands of the public domain+inally, PEA theori?es that the "act of conveyin! the o"nership of the reclaimed lands to public respondent PEA transformed such lands of the public domain to private lands." This theory is echoed by A&A'( "hich maintains that the "issuance of the special patent leadin! to the eventual issuance of title takes the sub4ect land a"ay from the land of public domain and converts the property into patrimonial or private property." (n short, PEA and A&A'( contend that "ith the issuance of @pecial Patent ,o. 53)A and the correspondin! certificates of titles, the )3A../ hectares comprisin! the +reedom (slands have become private lands of PEA. (n support of their theory, PEA and A&A'( cite the follo"in! rulin!s of the #ourt9). /umail v1 4u(e o" -FI o" -o!aba!o,6A "here the #ourt held N"2nce the patent "as !ranted and the correspondin! certificate of title "as issued, the land ceased to be part of the public domain and became private property over "hich the %irector of ;ands has neither control nor 4urisdiction."*. ,ee 5on( 5o6 v1 Davi,6. "here the #ourt declared "After the re!istration and issuance of the certificate and duplicate certificate of title based ona public land patent, the land covered thereby automatically comes under the operation of 'epublic Act /6E sub4ect to all the safe!uards provided therein."5. 5eir& o" 7re(orio Ten(%o v1 5eir& o" 4o&e $li#ala&,66 "here the #ourt ruled "