G.R. No. 30342, September 26, 1929
THE PHILIPPINE SUGAR ESTATES DEVELOPMENT COMPANY, LTD., INC. vs. CIPRIANO E. UNSON, Secretary of Commerce and Communications, and A. D. WILLIAMS, Director of the Bureau of Public Works

FACTS

The Philippine Sugar Estates Development Company, Ltd., Inc. (plaintiff-appellee) owns a parcel of land in Calamba, Laguna, which was part of the friar lands purchased by the Philippine government. A canal called “El Real,” part of the irrigation system of the friar lands, runs through this land. In 1921, the plaintiff applied for and obtained permission from the Director of Lands to install a turbine in the canal for electric power development for its sugar central. However, in 1925, the Director of Lands revoked the permission, advising the plaintiff to secure a permit from the Secretary of Commerce and Communications through the Director of Public Works under Act No. 2152 (the Irrigation Act), as amended. The plaintiff, believing it had a right to use the canal waters without such permit, filed an action to assert its entitlement. The trial court ruled in favor of the plaintiff, holding that under its Torrens title and an agreement with the government, it could maintain the turbine without the Director of Public Works’ permission. The defendants (government officials) appealed.

ISSUE

Whether the plaintiff is required to obtain permission from the Director of Public Works under the Irrigation Act to use the waters of “El Real” canal for power development via a turbine, despite its Torrens title and agreement with the government.

RULING

The Supreme Court REVERSED the trial court’s decision and DISMISSED the complaint. The plaintiff is required to obtain permission under the Irrigation Act.

The Court held that while the plaintiff’s Torrens title, based on an agreement with the government, granted it the right to jointly use the canal waters with the government in accordance with “laws and customs in the Philippine Islands in 1898,” this right is subject to subsequent legislation. The Irrigation Act (Act No. 2152), enacted in 1912, modified the prior water laws by requiring any person seeking to appropriate or use public waters to apply for permission through the Director of Public Works. Although the plaintiff’s water rights were acquired before the Act, the regulatory provisions, including the permit requirement, apply. The Court emphasized that the government, as a co-participant in the water use and as the entity controlling the irrigation system, has the authority to regulate such use under the Act. Thus, the plaintiff must comply with the Irrigation Act and obtain the necessary permit from the Director of Public Works.