G.R. No. 188500; July 24, 2013
PROVINCE OF CAGAYAN, represented by HON. ALVARO T. ANTONIO, Governor, and ROBERT ADAP, Environmental and Natural Resources Officer, Petitioners, vs. JOSEPH LASAM LARA, Respondent.

FACTS

Respondent Joseph Lasam Lara obtained an Industrial Sand and Gravel Permit (ISAG Permit) from the national Mines and Geosciences Bureau and an Environmental Compliance Certificate from the DENR, authorizing quarrying operations in Peñablanca, Cagayan. When his representative attempted to pay the provincial extraction fees, petitioner ENRO Robert Adap refused to issue the required Order of Payment. Lara’s counsel subsequently tendered and deposited the fee amount with the Provincial Treasurer’s Office. Lara commenced operations but was soon served a Stoppage Order from petitioner Governor Alvaro Antonio, citing non-compliance with the Mining Act, failure to pay local fees under a provincial ordinance, and lack of necessary local permits.
Lara filed an action for injunction. The Regional Trial Court made permanent a preliminary injunction, ruling Lara’s national permits conferred a legal right to operate and that his deposit constituted substantial compliance with fee payment. The court held the Governor should have questioned the permit’s validity with the MGB, not unilaterally halt operations.

ISSUE

Whether the RTC correctly issued a permanent injunction to protect Lara’s quarrying operations despite his failure to secure a provincial permit.

RULING

The Supreme Court reversed the RTC and dissolved the injunction. The legal logic centers on the hierarchy of authority and mandatory local requirements under the Local Government Code. While the MGB issues permits for quarry resources on public lands, Section 138 of the LGC explicitly requires any person extracting sand, gravel, and other quarry resources to first secure a permit from the provincial governor. Provincial Ordinance No. 2005-07 of Cagayan operationalized this mandate.
The Court held that the governor’s permit is a distinct and prerequisite local clearance, separate from the national ISAG Permit. Lara’s possession of the ISAG Permit did not excuse him from this indispensable local requirement. Consequently, having admittedly failed to secure the governor’s permit, Lara possessed no clear and unmistakable right to conduct quarrying operations. An injunction, being an equitable remedy, protects only existing rights. Since no such right existed due to non-compliance with a mandatory precondition, the injunction was improperly granted. The Governor’s Stoppage Order was thus a valid exercise of local regulatory power.