G.R. No. 201284 November 19, 2014
LUVIMIN CEBU MINING CORP. and LUVIMIN PORT SERVICES COMPANY, INC., Petitioners, vs. CEBU PORT AUTHORITY and PORT MANAGER ANGELO C. VERDAN, Respondents.

FACTS

On October 28, 1997, the Cebu Port Authority (CPA) issued a Certificate of Registration and Permit to Operate to petitioners Luvimin Cebu Mining Corp. and Luvimin Port Services Company, Inc., authorizing them to operate a private port facility in Barangay Talo-ot, Argao, Cebu until December 31, 2022. On March 1, 2006, CPA rescinded this permit on the grounds that: 1) a Foreshore Lease Agreement (FLA) was a prerequisite, and petitioners’ FLA application was still pending with the DENR when the license was approved; 2) the DENR denied the FLA application in 1999 because the area could not be subjected to foreshore lease but instead required a special land use application for Other Lawful Purposes (OLP); and 3) petitioners submitted an OLP application in 2000 but no permit had been granted. CPA declared the permit defective, took possession of the port facility, and began fencing the premises.
Petitioners filed a complaint for Injunction and Damages with a prayer for a Temporary Restraining Order (TRO) and/or Writ of Preliminary Injunction before the Regional Trial Court (RTC) of Cebu City. They alleged that the unilateral cancellation denied them due process, as they had reclaimed the land and built the wharf using their own funds in 1985. They claimed CPA’s actions were without prior warning and that they had obtained various favorable endorsements and an Environmental Compliance Certificate. The RTC initially issued a 20-day TRO and later, in an Order dated February 19, 2008, granted the writ of preliminary injunction, enjoining CPA from taking over the wharf and constructing structures, and directed petitioners to post a bond. The RTC reasoned the takeover was premature and violated due process, that the wharf was private, and that the principle of exhaustion of administrative remedies could be disregarded. It also held that the prohibition under Republic Act (R.A.) No. 8975 against injunctions on government projects was not absolute due to the constitutional issue and threat of irreparable injury. The RTC denied CPA’s motion for reconsideration in an Order dated August 27, 2008.
CPA filed a petition for certiorari with the Court of Appeals (CA). The CA, in a Decision dated October 19, 2011, nullified the RTC’s orders, ruling that the RTC gravely abused its discretion. The CA held that the repair and construction activities at the port constituted national government projects under R.A. No. 8975 , against which no injunctive writ could be issued. It also found no irreparable injury as any loss could be quantified as damages, and that enjoining the takeover would be detrimental to public interest as the acts sought to be restrained were already fait accompli. Petitioners appealed to the Supreme Court.

ISSUE

Whether the Court of Appeals correctly nullified the Regional Trial Court’s Orders granting the writ of preliminary injunction.

RULING

The Supreme Court denied the petition and affirmed the CA Decision. It held that the RTC’s issuance of the writ of preliminary injunction was void for being contrary to R.A. No. 8975 . The Court ruled that the acts sought to be enjoined—specifically, the repair of the RORO ramp, asphalting, and construction of office, passenger terminal, and covered walkway—constituted “national government projects” as defined under Section 2(a) of R.A. No. 8975 . The law explicitly prohibits courts, except the Supreme Court, from issuing temporary restraining orders or preliminary injunctions against such projects. The Court found no compelling reason to justify an exception, as the alleged violation of due process and threat of irreparable injury did not outweigh the public interest in the expeditious completion of infrastructure projects. The Court also noted that the issues of whether the port was a private facility or whether petitioners were entitled to just compensation were evidentiary matters to be fully threshed out in the main case, not in the provisional remedy of injunction.