Shenzhou Mining Group Corp. vs. Mamanwa Tribes

A power once delegated cannot be redelegated absent express authorization from the delegating authority, and acts performed pursuant to an invalid redelegation may be declared void by the delegating authority. The de facto officer doctrine does not apply to one who is merely designated as officer-in-charge, as the doctrine presupposes an election or appointment to office.

The Mamanwa Tribes are indigenous peoples who have continuously occupied, possessed, and used an ancestral domain in the Municipalities of Alegria, Bacuag, Claver, Gigaquit, and Tubod in Surigao del Norte since time immemorial, their ownership recognized under Certificate of Ancestral Domain Title No. R13-CLA-0906-048 issued by the National Commission on Indigenous Peoples (NCIP). The NCIP is the agency specifically authorized under Republic Act No. 8371, the Indigenous Peoples Rights Act (IPRA), to issue certification preconditions for any entity undertaking operations within ancestral domains, ensuring that free, prior, and informed consent (FPIC) has been obtained from the concerned indigenous cultural communities/indigenous peoples (ICCs/IPs). The NCIP En Banc had delegated the authority to sign compliance certificates to its Chairperson, who in turn purported to redelegate that authority to a commissioner serving as officer-in-charge.

The Mamanwa Tribes reside in Barangays Taganito and Urbiztondo, Claver, Surigao del Norte, and form part of the Mamanwa tribes that have continuously occupied, possessed, and used an ancestral domain spanning the Municipalities of Alegria, Bacuag, Claver, Gigaquit, and Tubod in Surigao del Norte since time immemorial under a bona fide claim of ownership. Their ownership was formally recognized by the National Commission on Indigenous Peoples through Certificate of Ancestral Domain Title No. R13-CLA-0906-048.

On February 21, 2010, the Mamanwa Tribes, represented by tribal leaders Datu Reynante Buklas and Datu Alicia Patac, executed a Memorandum of Agreement with Shenzhou Mining Group Corporation and the NCIP, through then Chairperson Eugenio A. Insigne. The agreement provided for the exploration, exploitation, use, and development of mineral resources found in Barangay Cagdianao, Claver, Surigao del Norte. During the signing, Datu Buklas and Datu Patac were made to believe that Shenzhou was a bona fide holder of Mineral Production Sharing Agreement No. 102-98-XIII allegedly issued on February 23, 1998. Commissioner Felecito L. Masagnay then issued Compliance Certificate Control No. CCRXIII-19-02-13, certifying that Shenzhou had complied with the procedure and process requirements for the issuance of a certificate of precondition and the free and prior informed consent of the affected community.

Datu Buklas and Datu Patac subsequently discovered that the true contractor of Mineral Production Sharing Agreement No. 102-98-XIII was not Shenzhou but Claver Mineral Development Corporation. The Mamanwa Tribes were also not paid royalty shares of ₱5 million for the third and fourth quarters of 2010, and another ₱5 million for the first and second quarters of 2011. They then filed a petition with the NCIP for the cancellation of Shenzhou's Certificate of Precondition, with a prayer for the issuance of a writ of preliminary injunction.

The NCIP En Banc, in its Resolution of January 12, 2012, declared Compliance Certificate Control No. CCRXIII-19-02-13 void ab initio, noting that it was issued under circumstances similar to those in Royalco Philippines, Inc. vs. National Commission on Indigenous Peoples, then pending with the Court of Appeals, where the compliance certificate signed by Masagnay was held void for having been issued without proper authority. The NCIP had earlier issued Resolution No. A-004, series of 2011, voiding the certificate in the Royalco case on the ground that Masagnay was not authorized to sign any compliance certificate under the principle of potestas delegata non delegari. To maintain consistency, the Commission applied the same ruling to Shenzhou's compliance certificate. Shenzhou appealed to the Court of Appeals, which denied the petition and affirmed the NCIP's resolution, finding that the authority to sign compliance certificates, having been delegated to the NCIP Chairperson, could not be redelegated to Masagnay.

• De Facto Officer Doctrine: Petitioner argued that although Masagnay had no authority to sign the compliance certificate, he should have been considered a de facto officer whose acts were clothed with the color of legality, such that even if his appointment was null, his acts should not have been nullified. Invoking Tuanda vs. Sandiganbayan, petitioner asserted that the elements of a de facto officer were present: a de jure office existed, there was color of right or general acquiescence by the public, and there was actual physical possession of the office in good faith.
• Authority to Delegate Under the IRR: Petitioner contended that the NCIP Chairperson was authorized to delegate authority to other commissioners or the executive director under the implementing rules and regulations of IPRA, making Resolution No. 007, series of 2010 — which delegated to Masagnay the authority to sign compliance certificates — consistent with the IRR.
• Commission Approval: Petitioner argued that it was the NCIP acting as a body that approved the issuance of Shenzhou's compliance certificate, with Masagnay acting merely as its representative and signatory. Assuming Masagnay's appointment was void, it did not necessarily follow that the compliance certificate itself was void, as it fully complied with all requirements for its grant.

• Lack of Authority (NCIP): Public respondent NCIP argued that the Court of Appeals correctly upheld the nullity of the compliance certificate given Masagnay's lack of authority to sign it, pointing to its Resolution No. 22, series of 2010, which authorized the Chairperson to sign compliance certificates on its behalf — a delegated power that could not be redelegated by the Chairperson to another officer.
• Inapplicability of De Facto Officer Doctrine (NCIP): Public respondent refuted Shenzhou's claim that the de facto officer doctrine applied, arguing that Masagnay was never a de facto officer but only an officer-in-charge, as he was not appointed or elected to an office.
• Void Acts (Mamanwa Tribes): Private respondents Mamanwa Tribes argued that Masagnay was not a de facto officer but one whose appointment as officer-in-charge was void, rendering his acts void and legally nonexistent.

• Validity of the Compliance Certificate: Whether the NCIP correctly declared void the Compliance Certificate Control No. CCRXIII-19-02-13 issued in favor of petitioner Shenzhou Mining Group Corporation.
• De Facto Officer Doctrine: Whether the doctrine of de facto officer applies to Commissioner Masagnay such that his acts in signing the compliance certificate should be upheld despite his lack of authority.

• Validity of the Compliance Certificate: Yes. The NCIP correctly declared the compliance certificate void ab initio, as the power to sign compliance certificates — delegated by the NCIP En Banc to the Chairperson — could not be redelegated to Commissioner Masagnay without express authorization from the delegating authority.
• De Facto Officer Doctrine: No. The de facto officer doctrine does not apply because Masagnay was merely designated as officer-in-charge, not appointed or elected to the position; the doctrine presupposes an election or appointment to office.

• Validity of the Compliance Certificate: Section 59 of Republic Act No. 8371 vests the power to issue certification preconditions in the NCIP as a body, not in any individual member. The NCIP En Banc, through Resolution No. 007, series of 2010, delegated the authority to sign compliance certificates to the Chairperson. When the Chairperson, through Memorandum Circular No. 039, series of 2010, authorized Commissioner Masagnay to sign compliance certificates on his behalf as officer-in-charge, this constituted a redelegation of an already delegated power. The principle of nondelegation of delegated powers, expressed in the maxim potestas delegata non delegari potest, prohibits such redelegation absent express authorization from the delegating authority. While a delegatee may be permitted to redelegate functions, the power of redelegation must be granted by the delegating authority and not unilaterally exercised by the delegatee. Here, there was no showing that the NCIP En Banc allowed the Chairperson to redelegate the power to sign compliance certificates. The NCIP En Banc, as the delegating authority, subsequently confirmed through Resolution No. A-004, series of 2011, that Masagnay was not authorized to sign any compliance certificate. A void certificate cannot be the source of any right or the creator of any obligation; all acts performed pursuant to it have no legal effect. Voiding the certificate and ordering petitioner to desist from further mining activities within the ancestral domain were in keeping with the NCIP's statutory mandate under Section 39 of IPRA to protect and promote the interest and well-being of the ICCs/IPs.

• De Facto Officer Doctrine: The de facto officer doctrine, as explained in Civil Liberties Union vs. Executive Secretary, presupposes an election or appointment to some office. Masagnay was never appointed or elected to occupy the Chairperson's position. At the time he signed the compliance certificates, he was already the commissioner for Southern and Eastern Mindanao. The Chairperson could not have appointed Masagnay as a de facto officer, as he had no power to appoint anyone to the position he occupied. Masagnay was merely designated as officer-in-charge during the Chairperson's absence. The Court distinguished between appointment — the selection by the proper authority of an individual to exercise the functions of a given office — and designation, which connotes merely the imposition of additional duties upon a person already in the public service by virtue of an earlier appointment. Because Masagnay's status was a designation rather than an appointment, the de facto officer doctrine was inapplicable.

• Nondelegation of Delegated Powers (Potestas Delegata Non Delegari Potest) — The principle that what has been delegated cannot be redelegated. It is based on the ethical principle that a delegated power constitutes not only a right but a duty to be performed by the delegate through the instrumentality of their own judgment and not through the intervening mind of another. Any ambiguity or vagueness in the delegation must be resolved in favor of nondelegation. While a delegatee may be permitted to redelegate functions, the power of redelegation must be granted by the delegating authority and not unilaterally exercised by the delegatee. In this case, the NCIP En Banc delegated the power to sign compliance certificates to the Chairperson, who then redelegated it to a commissioner without authorization from the En Banc, rendering the redelegation void.

• De Facto Officer Doctrine — A doctrine that validates the acts of an officer who, in good faith, has had possession of an office and discharged the duties pertaining thereto, entitling them to emoluments for actual services rendered. The doctrine presupposes an election or appointment to some office. It does not apply to one who is merely designated as officer-in-charge, as designation connotes merely the imposition of additional duties upon a person already in the public service by virtue of an earlier appointment, distinct from appointment which is the selection by the proper authority of an individual to exercise the functions of a given office.

• Distinction Between Appointment and Designation — Appointment is the selection by the proper authority of an individual who is to exercise the functions of a given office, resulting in security of tenure unless replaceable at pleasure. Designation connotes merely the imposition by law of additional duties on an incumbent official. Appointment is essentially executive while designation is legislative in nature.

• Void Acts of Unauthorized Officer — When a delegation is found to be void, all acts performed pursuant to that delegation may be declared void by the delegating authority. A void certificate cannot be the source of any right nor the creator of any obligation; all acts performed pursuant to it and all claims emanating from it have no legal effect.

• "The delegatee's exercise of the delegated power is always subject to the review of the delegating authority. When the delegation is found to be void, acts performed pursuant to it may be voided by the delegating authority." — This opening statement of the decision articulates the foundational principle governing the entire case: that a delegating authority retains the power to review and void acts done under an invalid delegation.

• "A power once delegated cannot be redelegated." — This concise formulation of the nondelegation principle, quoted from Heirs of Santiago vs. Lazaro, encapsulates the ratio decidendi for invalidating the compliance certificate signed by Masagnay.

• "This doctrine presupposes an election or appointment to some office." — This statement defines the essential precondition for the de facto officer doctrine, explaining why it could not apply to Masagnay, who was merely designated as officer-in-charge rather than appointed to the position.

• "Any ambiguity or vagueness in the delegation must be resolved in favor of [nondelegation]." — Quoted from In re Leonardo-De Castro, this principle establishes the interpretive rule that doubtful delegations are construed against redelegation, reinforcing the Court's refusal to validate Masagnay's authority.

• Abakada Guro Party List vs. Ermita, 506 Phil. 1 (2005) — Cited for the formulation of the principle of nondelegation of powers and the maxim potestas delegata non delegari potest.
• In re Leonardo-De Castro, 835 Phil. 26 (2018) — Cited for the proposition that any ambiguity or vagueness in delegation must be resolved in favor of nondelegation, and for the principle that the delegatee's exercise of delegated power is subject to review by the delegating authority.
• American Tobacco Company vs. Director of Patents, 160-A Phil. 439 (1975) — Cited as an example of valid delegation, where the Director of Patents was the entity originally designated by law and was permitted to delegate hearing functions to designated hearing officers for administrative flexibility. Distinguished from the present case, where the authority was vested in the Commission as a body, not in the individual who attempted to redelegate.
• Mollaneda vs. Umacob, 411 Phil. 159 (2001) — Cited as another example of valid delegation, where the Civil Service Commission was granted power by the Administrative Code of 1987 to deputize other agencies to hear complaints. Distinguished on the same ground as American Tobacco Company.
• In re Razon, 609 Phil. 472 (2009) — Cited to demonstrate that redelegation is permissible only when expressly granted by the delegating authority, as when the Court itself allowed authorized officers of law enforcement agencies to endorse search warrant applications.
• Heirs of Santiago vs. Lazaro, 248 Phil. 593 (1988) — Cited for the maxim that a power once delegated cannot be redelegated.
• Civil Liberties Union vs. Executive Secretary, 272 Phil. 147 (1991) — Cited for the explanation of the de facto officer doctrine and the principle that it presupposes an election or appointment to office.
• Santiago vs. Commission on Audit, 276 Phil. 127 (1991) — Cited for the distinction between appointment and designation, and for the definition of appointment as essentially executive while designation is legislative in nature.
• Binamira vs. Garrucho — Cited within the Santiago vs. Commission on Audit discussion for the definition of appointment as the selection by the authority vested with power of an individual to exercise the functions of a given office, contrasted with designation as the imposition by law of additional duties on an incumbent official.
• Nacar vs. Gallery Frames, 716 Phil. 267 (2013) — Cited as the controlling precedent for the computation of legal interest, applied to modify the NCIP resolution by imposing 6% per annum interest on the royalties from the time of filing of the cancellation petition, and 6% per annum from finality of the decision until fully paid.
• Royalco Philippines, Inc. vs. National Commission on Indigenous Peoples — Referenced as a then-pending Court of Appeals case involving the same issue of Masagnay's lack of authority to sign compliance certificates, used by the NCIP for factual comparison and consistency in declaring Shenzhou's certificate void.

• Section 59, Republic Act No. 8371 (Indigenous Peoples Rights Act) — Mandates that all departments and governmental agencies are strictly enjoined from issuing, renewing, or granting any concession, license, lease, or production-sharing agreement without prior certification from the NCIP that the area affected does not overlap with any ancestral domain, and that such certification shall only be issued after a field-based investigation and with the free, prior, and informed, and written consent of the ICCs/IPs concerned. Applied as the statutory basis vesting the power to issue certification preconditions in the NCIP as a body.
• Section 57, Republic Act No. 8371 — Provides that ICCs/IPs shall have priority rights in the harvesting, extraction, development, or exploitation of natural resources within ancestral domains, and that a non-member may only participate upon a formal and written agreement with the concerned community. Applied to underscore the indispensability of the Mamanwa Tribes' consent and the NCIP's mandate to safeguard their rights.
• Section 39, Republic Act No. 8371 — States the NCIP's mandate to protect and promote the interest and well-being of the ICCs/IPs with due regard to their beliefs, customs, traditions, and institutions. Applied to justify voiding the certificate and ordering cessation of mining operations as consistent with the NCIP's statutory mandate.
• Part IV, Section 3(c), IRR of Republic Act No. 8371 (NCIP Administrative Order No. 1, series of 1998) — Empowers the NCIP to issue appropriate certification as a precondition to the grant or renewal of permits, concessions, licenses, leases, or production-sharing agreements within ancestral domains, taking into consideration the FPIC of the ICCs/IPs concerned.
• Part IV, Section 4, IRR of Republic Act No. 8371 — Provides that the Chairperson shall have authority to preside over the Commission en banc and serve as Chief Executive Officer, and that any delegation of authority by the Chairperson to other Commissioners and to the Executive Director shall be done in writing. Petitioner invoked this provision to argue that the Chairperson's delegation to Masagnay was valid; the Court found it insufficient to authorize redelegation of a power already delegated to the Chairperson by the En Banc.
• Section 5(e), Revised Guidelines on Free and Prior Informed Consent and Related Processes of 2012 (NCIP Administrative Order No. 3, series of 2012) — Defines Certification Precondition as the certificate issued by the NCIP, signed by the Chairperson, attesting to the grant of FPIC by the concerned ICCs/IPs. Cited to confirm that the certification precondition is issued by the Commission and signed by its Chairperson.
• Article XII, Section 5, 1987 Constitution — Directs the State to protect the rights of indigenous cultural communities to their ancestral lands to ensure their economic, social, and cultural well-being, and authorizes Congress to provide for the applicability of customary laws governing property rights in determining ownership and extent of ancestral domain. Applied as the constitutional basis for protecting the Mamanwa Tribes' rights.
• Section 7, Republic Act No. 8371 — Cited by the Court of Appeals in upholding the Mamanwa Tribes' entitlement to royalty payments.
• Section 17, Republic Act No. 7942 (Philippine Mining Act of 1995) — Cited by the Court of Appeals in upholding the Mamanwa Tribes' entitlement to royalty payments.

Lazaro-Javier, M. Lopez, J. Lopez, and Kho, Jr., JJ., concurred.