GR 162331; (November, 2006) (Digest)
G.R. No. 162331 ; November 20, 2006
LEPANTO CONSOLIDATED MINING CO., Petitioner, vs. WMC RESOURCES INT’L. PTY. LTD., WMC PHILIPPINES, INC. and SAGITTARIUS MINES, INC., Respondents.
FACTS
On March 22, 1995, the Philippine Government and WMC Philippines executed Financial and Technical Assistance Agreement (FTAA) No. 02-95-XI (Columbio FTAA). This FTAA was partly covered by mining claims held by the Tampakan Companies (including respondent Sagittarius Mines, Inc.) under an Option Agreement granting them a right of first refusal should WMC Philippines dispose of its interests. WMC Resources later decided to divest and, on July 12, 2000, executed a Sale and Purchase Agreement with petitioner Lepanto for its shareholdings in WMC Philippines, subject to the Tampakan Companies’ right of first refusal. Petitioner sought DENR approval for this agreement.
The Tampakan Companies exercised their right of first refusal on October 6, 2000. Petitioner objected, claiming the terms were not matched, and subsequently filed a civil case for injunction and specific performance in the Makati RTC against the respondents. Simultaneously, petitioner continued to seek administrative approval from the DENR for its own Sale and Purchase Agreement, actively contesting the validity of the Tampakan Companies’ exercise of their right before the agency.
ISSUE
Whether petitioner Lepanto is guilty of forum shopping for simultaneously pursuing judicial and administrative actions involving the same core dispute over the transfer of interests under the FTAA.
RULING
Yes, petitioner is guilty of forum shopping. Forum shopping exists when a party, anticipating an unfavorable ruling in one forum, seeks a favorable ruling in another involving the same essential cause. The Court found that the civil case in the RTC and the proceedings before the DENR involved identical fundamental issues: the validity of the Tampakan Companies’ exercise of their right of first refusal and the rightful party to which WMC Resources’ interests should be transferred.
Although petitioner argued that the DENR was exercising purely administrative functions, the Court ruled that the DENR, through the Mines and Geosciences Bureau (MGB), was exercising quasi-judicial power in this instance. The MGB was required to evaluate the opposing claims, resolve contentious factual and legal issues, and make a determination on which contract to recommend for approval. This process necessitated a declarative resolution on the validity of the competing sale agreements and the exercise of the contractual right of first refusal, which is a quasi-judicial function. By initiating the court action while the administrative question was pending and unresolved, petitioner sought concurrent relief in two fora over the same cause, constituting forum shopping. The Court of Appeals’ dismissal of the petition on this ground was affirmed.