Boracay Foundation, Inc. vs. Province of Aklan

A national project affecting the environmental and ecological balance of local communities requires both prior consultation with the affected communities and prior approval of the appropriate sanggunian under Sections 26 and 27 of the Local Government Code; subsequent endorsements do not cure the lack of prior approval. Additionally, the rule on exhaustion of administrative remedies does not apply when the petitioner was not a party to the administrative proceedings below and the action seeks to compel the performance of a duty under environmental laws via a writ of continuing mandamus.

Boracay Island, a premier tourist destination in the municipality of Malay, Aklan, relies on its distinctive white-sand beaches. The Province of Aklan built the Caticlan Jetty Port as the main gateway to the island. Due to increasing tourist arrivals and congestion, the Province conceptualized the expansion of port facilities and the reclamation of foreshore areas for commercial purposes. The Province initially proposed a 2.64-hectare reclamation but later revised the project to 40 hectares under a Memorandum of Agreement with the Philippine Reclamation Authority (PRA), although the Environmental Compliance Certificate (ECC) issued by the DENR-EMB Region VI covered only the 2.64-hectare Phase 1. The Municipality of Malay and Barangay Caticlan opposed the project, citing lack of consultation and potential environmental harm to Boracay's coastline.

• The Caticlan Jetty Port and the Marina Project: The Province of Aklan operates the Caticlan Jetty Port, the gateway to Boracay. To address congestion and coastal erosion, the Province proposed the "Aklan Beach Zone Restoration and Protection Marina Development Project," initially covering 2.64 hectares of reclamation for port expansion and commercial buildings, funded by bond flotation amounting to ₱260,000,000.
• Expansion to 40 Hectares: In October 2009, the Province revised its application with the PRA to reclaim 40 hectares, covering areas in Barangay Caticlan and Barangay Manoc-manoc (Boracay side), to maximize resource utilization and address geohazard findings. The Sangguniang Panlalawigan authorized the Governor to enter into a MOA with PRA for this 40-hectare project.
• Issuance of the ECC: The DENR-EMB Region VI issued ECC-R6-1003-096-7100 for Phase 1 (2.64 hectares) on the Caticlan side. The ECC was based on an Environmental Performance Report and Monitoring Program (EPRMP), which classified the project as a "Group II – Non ECP in an ECA" and a mere expansion of the existing jetty port.
• LGU Opposition and Lack of Prior Consultation: The Sangguniang Barangay of Caticlan and the Sangguniang Bayan of Malay strongly opposed the project as early as 2008, citing lack of consultation and deprivation of their right to develop local resources. The Province conducted "information-education campaigns" only in mid-2010, after the ECC and MOA had already been issued. The Municipality of Malay denied the Province's request for a favorable endorsement.
• Subsequent Manifestations: During the pendency of the petition, the Province manifested that it was no longer pursuing the 40-hectare expansion due to failure to comply with PRA requirements, limiting the project to 2.64 hectares. Later, the Barangay of Caticlan and the Municipality of Malay issued resolutions favorably endorsing the 2.6-hectare reclamation, albeit with explicit conditions (e.g., limiting reclamation to 2.6 hectares, conducting a comprehensive environmental impact study).

• EIA Classification and Requirements: Petitioner argued that the Province misclassified the project as a "single" and "Non-ECP in an ECA" project instead of a "co-located" project within an ECA to evade the requirement of submitting a Programmatic Environmental Impact Statement (PEIS) or Programmatic Environmental Performance Report and Management Plan (PEPRMP). The Province also fraudulently classified it as a mere expansion rather than a new project.
• Lack of Prior Consultation and LGU Approval: Petitioner contended that the Province violated Sections 26 and 27 of the Local Government Code by failing to conduct prior consultations and secure the prior approval of the Sangguniang Barangay of Caticlan and the Sangguniang Bayan of Malay before implementing the project.
• Adverse Environmental Impact: Petitioner asserted that the reclamation would adversely affect the frail ecological balance of the area, particularly the white-sand beaches of Boracay, due to changes in the hydrodynamics and sediment transport in the strait.

• Mootness: Respondent Province argued that the petition was rendered moot and academic by the subsequent favorable endorsements from the Barangay of Caticlan and the Municipality of Malay, and by the manifestation that the project was limited to 2.64 hectares.
• Prematurity/Exhaustion of Administrative Remedies: Respondents contended that petitioner should have exhausted administrative remedies by appealing the ECC issuance to the DENR Secretary under DENR DAO 2003-30, instead of directly filing a petition with the Supreme Court.
• Proper EIA Classification: Respondent Province maintained that the 2.64-hectare project is a "stand-alone" expansion of the old jetty port, not a co-located project, and thus only an EPRMP was required. The DENR-EMB Region VI claimed it properly evaluated the EPRMP based on its best professional judgment.
• Compliance with Consultation Requirements: Respondent Province argued that the duty to consult does not require adherence to the LGU's opinions or a favorable endorsement, and that DENR Memorandum Circular No. 2007-08 no longer requires LGU permits/clearances as a prerequisite for an ECC.

• Mootness: Whether the petition should be dismissed for having been rendered moot and academic by subsequent LGU endorsements and the limitation of the project to 2.64 hectares.
• Exhaustion of Administrative Remedies: Whether the petition is premature due to petitioner's failure to exhaust administrative remedies before filing the case.
• EIA Scope and Classification: Whether respondent Province failed to perform a full EIA as required by laws and regulations based on the scope and classification of the project.
• Compliance with Legal Requirements: Whether respondent Province complied with all the requirements under pertinent laws and regulations.
• Public Consultation: Whether there was proper, timely, and sufficient public consultation for the project.

• Mootness: The petition was not rendered moot and academic. The subsequent LGU endorsements contained explicit conditions, including the requirement for a comprehensive environmental impact study, which remained the heart of the petition. The limitation to 2.64 hectares also did not moot the case, as the Court still had to verify compliance with environmental laws for the actual project.
• Exhaustion of Administrative Remedies: The rule on exhaustion of administrative remedies does not apply. Petitioner was not a party to the ECC proceedings below and thus could not be expected to appeal the decision. Furthermore, the writ of continuing mandamus under the Rules of Procedure for Environmental Cases provides a remedy to compel the performance of a duty specifically enjoined by law, justifying direct recourse to the Court.
• EIA Scope and Classification: The DENR-EMB Region VI's evaluation was found to be problematic. The classification of the project as a mere expansion rather than a new project, and as single rather than co-located, was questionable given that the project included commercial buildings and other facilities not covered by the old jetty port studies. The EIA report failed to predict the impact of these new constructions on the surrounding environment, particularly Boracay. The matter was remanded to the DENR-EMB Region VI for proper study and evaluation.
• Compliance with Legal Requirements: Respondent Province failed to comply with the mandatory requirements of the Local Government Code.
• Public Consultation: Prior public consultation and prior approval of the sanggunian concerned are mandatory under Sections 26 and 27 of the Local Government Code for national projects affecting the ecological balance of local communities. The information campaigns conducted after the ECC was issued were insufficient. A DENR Memorandum Circular cannot prevail over the statutory requirement of the Local Government Code. Subsequent endorsements do not cure the lack of prior approval.

• Exhaustion of Administrative Remedies — The rule requiring exhaustion of administrative remedies is not a hard and fast rule and is inapplicable where the question in dispute is purely legal, the controverted act is patently illegal, or the petitioner was not a party to the administrative proceedings and thus not officially furnished a copy of the decision to be appealed.
• Prior Consultation and Approval under the LGC — Under Sections 26 and 27 of the Local Government Code, two requisites must be met before a national project that affects the environmental and ecological balance of local communities can be implemented: (1) prior consultation with the affected local communities, and (2) prior approval of the project by the appropriate sanggunian. Absent either, the project's implementation is illegal. Subsequent endorsements do not cure the lack of prior approval.
• Writ of Continuing Mandamus — A special civil action under the Rules of Procedure for Environmental Cases to compel the performance of an act specifically enjoined by law, which permits the court to retain jurisdiction after judgment to ensure successful implementation of the reliefs mandated.

• "Under the Local Government Code, therefore, two requisites must be met before a national project that affects the environmental and ecological balance of local communities can be implemented: prior consultation with the affected local communities, and prior approval of the project by the appropriate sanggunian. Absent either of these mandatory requirements, the project’s implementation is illegal."
• "The lack of prior public consultation and approval is not corrected by the subsequent endorsement of the reclamation project by the Sangguniang Barangay of Caticlan on February 13, 2012, and the Sangguniang Bayan of the Municipality of Malay on February 28, 2012..."
• "This is because a Memorandum Circular cannot prevail over the Local Government Code, which is a statute and which enjoys greater weight under our hierarchy of laws."

• Pagara v. Court of Appeals, 325 Phil. 66 (1996) — Cited for the exceptions to the rule on exhaustion of administrative remedies, particularly that it is not applicable where the controverted act is patently illegal or performed without jurisdiction, or where the protestant has no other recourse.
• Lina, Jr. v. Paño, 416 Phil. 438 (2001) — Cited for the interpretation of Sections 26 and 27 of the Local Government Code, holding that Section 27 applies only to national projects whose effects are among those enumerated in Section 26 (e.g., may cause pollution, climatic change, depletion of resources).
• Republic of the Philippines v. The City of Davao, 437 Phil. 525 (2002) — Cited for the doctrine that LGUs, as juridical persons, are not excluded from the coverage of PD 1586 and have the duty to ensure the quality of the environment.
• Province of Rizal v. Executive Secretary, 513 Phil. 557 (2005) — Followed for the ruling that Sections 26 and 27 of the LGC are inapplicable to projects which are not environmentally critical, but conversely, they apply to projects that may cause pollution or ecological imbalance.

• Sections 26 and 27, Republic Act No. 7160 (Local Government Code of 1991) — Section 26 imposes the duty on national government agencies to consult with LGUs and NGOs regarding projects that may cause pollution or ecological imbalance. Section 27 requires prior consultations and prior approval of the sanggunian concerned before such projects are implemented. The Court held that these provisions apply to the reclamation project because it is a national project that could cause pollution and affect ecological balance, and that the lack of prior compliance renders the project's implementation illegal.
• Presidential Decree No. 1586 (Establishing the Environmental Impact Statement System) — Requires the securing of an Environmental Compliance Certificate before undertaking environmentally critical projects. The Court noted the duty of LGUs to ensure environmental quality under this decree.
• A.M. No. 09-6-8-SC (Rules of Procedure for Environmental Cases) — Provides for the writ of continuing mandamus and the issuance of a Temporary Environmental Protection Order (TEPO). The Court applied Rule 8, Section 1, allowing a person aggrieved by the unlawful neglect of a government agency to enforce an environmental law to file a verified petition for continuing mandamus.
• DENR Administrative Order No. 2003-30 (Revised Procedural Manual for DAO 2003-30) — Governs the EIS System and the classification of projects. The Court found that the DENR-EMB RVI's application of the classification rules (single vs. co-located, expansion vs. new) was problematic and required a revisit.

Carpio, A.T. (Senior Associate Justice), Velasco, Jr., P.J., Brion, A.D., Peralta, D.M., Bersamin, L., Del Castillo, M.C., Abad, R.A., Villarama, Jr., M.S., Perez, J.P., Mendoza, J.C., Sereno, M.L.P.A., Reyes, B.L., Perlas-Bernabe, E.M.