G.R. No. 202897 , August 6, 2019.
MAYNILAD WATER SERVICES, INC., PETITIONER, VS. THE SECRETARY OF THE DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES (“DENR”), THE POLLUTION ADJUDICATION BOARD (“PAB”), THE REGIONAL EXECUTIVE DIRECTOR, ENVIRONMENTAL MANAGEMENT BUREAU-NATIONAL CAPITAL REGION (“EMB-NCR”), THE REGIONAL DIRECTOR, ENVIRONMENTAL MANAGEMENT BUREAU-REGION III (“EMB-REGION III”), THE REGIONAL DIRECTOR, ENVIRONMENTAL MANAGEMENT BUREAU-REGION IV (“EMB-REGION IV”), RESPONDENTS. [G.R. No. 206823] MANILA WATER COMPANY, INC., PETITIONER, VS. THE SECRETARY OF THE DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES (DENR), THE REGIONAL EXECUTIVE DIRECTOR, ENVIRONMENTAL MANAGEMENT BUREAU-NATIONAL CAPITAL REGION (EMB-NCR), THE REGIONAL DIRECTOR, ENVIRONMENTAL MANAGEMENT BUREAU-REGION III (EMB-REGION III), THE REGIONAL DIRECTOR, ENVIRONMENTAL MANAGEMENT BUREAU-REGION IV (“EMB-REGION IV-A”), AND THE POLLUTION ADJUDICATION BOARD (PAB), RESPONDENTS. [G.R. No. 207969] METROPOLITAN WATERWORKS AND SEWERAGE SYSTEM, PETITIONER, VS. THE POLLUTION ADJUDICATION BOARD AND ENVIRONMENTAL MANAGEMENT BUREAU, RESPONDENTS.

FACTS

On April 2, 2009, the DENR Environmental Management Bureau-Region III (EMB-RIII) filed a complaint before the Pollution Adjudication Board (PAB) charging Metropolitan Waterworks and Sewerage System (MWSS) and its concessionaires, Maynilad Water Services Inc. (Maynilad) and Manila Water Company, Inc. (Manila Water), with failure to provide, install, operate, and maintain adequate Wastewater Treatment Facilities (WWTFs) for sewerage system as required by the Philippine Clean Water Act of 2004 ( R.A. No. 9275 ). Similar complaints were filed by EMB-NCR and EMB-Region IV-A. They alleged that this failure resulted in the degraded quality of water bodies leading to Manila Bay and hindered the rehabilitation of Manila Bay. The Secretary of Environment and Natural Resources (SENR) issued a Notice of Violation, finding petitioners in violation of Section 8 of the Clean Water Act for not providing sufficient WWTFs and sewerage connections within the five-year period provided by the law. Petitioners defended themselves, with MWSS claiming compliance, and Maynilad and Manila Water citing their Concession Agreements with MWSS and arguing that the Department of Public Works and Highways (DPWH) must first prepare a national program on sewerage and septage management under Section 7 of the law. The SENR, in an Order dated October 7, 2009, found petitioners liable and imposed a fine of Twenty-Nine Million Four Hundred Thousand Pesos (PhP 29,400,000.00) jointly and solidarily for the period from May 7, 2009, to September 30, 2009, and a continuing fine of Two Hundred Thousand Pesos (PhP 200,000.00) per day until full compliance. Motions for reconsideration by MWSS and Manila Water were denied. Petitioners filed separate Petitions for Review with the Court of Appeals, which were dismissed. They then elevated the case to the Supreme Court via Petitions for Review on Certiorari.

ISSUE

Whether the petitioners (MWSS, Maynilad, and Manila Water) are liable for violating Section 8 of the Philippine Clean Water Act of 2004 for their alleged failure to provide, install, operate, and maintain adequate wastewater treatment facilities and sewerage systems within the prescribed period.

RULING

Yes, the petitioners are liable. The Supreme Court denied the petitions and affirmed the rulings of the Court of Appeals. The Court held that the five-year period under Section 8 of the Clean Water Act for connecting existing sewage lines in all areas, including households, to an available sewerage system is mandatory. The obligation to provide sewerage and sanitation services is a non-delegable duty of the State, which MWSS, as a government instrumentality, must perform. This duty was passed on to its concessionaires, Maynilad and Manila Water, through their Concession Agreements. The Court ruled that the Clean Water Act is a special law that prevails over the general provisions and timelines in the Concession Agreements. Petitioners’ defenses, including the alleged need for a DPWH national program first and customer refusal to connect, were rejected. The fines imposed by the SENR were upheld. The Court computed the total accrued fines from May 7, 2009, to August 6, 2019, to be Nine Hundred Twenty-One Million Four Hundred Sixty-Four Thousand One Hundred Eighty-Four Pesos (PhP 921,464,184.00), subject to a 6% per annum interest until full payment. Petitioners were ordered to fully comply with their obligations under the Clean Water Act.