Alvarez vs PICOP dec 3, 2009

DOCTRINE A timber license is not a contract within the purviewof the non-impairment clause FACTS

PICOP filed with the DENR an application to have its Timber License Agreement (TLA) No. 43converted into

an IFMA.PICOP filed before the (RTC) City a Petition for Mandamus against then DENR Sec

Alvarez for unlawfully refusing and/or neglecting to sign and execute the IFMA contract of PICOP even as

thelatter has complied with all the legal requirements for the automatic conversion of TLA No. 43,

asamended, into an IFMA.The cause of action of PICOP Resources, Inc. (PICOP) in its Petition for Mandamus with

the trialcourt is clear: the government is bound by contract, a 1969 Document signed by then President

Ferdinand Marcos, to enter into an Integrated Forest Management Agreement (IFMA)

with PICOP. ISSUE Whether the 1969 Document is a contract recognized under the nonimpairment

clause by which thegovernment may be bound (for the issuance of the IFMA) HELD NO. A timber

license is not a contract within the purviewof the nonimpairment clause is edifying. Since timber

licenses are not contracts, the non-impairment clause, which reads: "SEC. 10. No law impairing the obligation of

contracts shall be passed." cannot be invoked.The Presidential Warranty cannot, in any

manner, be construed as a contractual undertaking assuringPICOP of exclusive possession and enjoyment of its

concession areas. Such an interpretation wouldresult in the complete abdication by the State in

favor of PICOP of the sovereign power to control and supervise the exploration,

development and utilization of the natural resources in the area.