SIAIN ENTERPRISES vs F.F. CRUZ & CO.

Case Digest
G.R. No. 146616
SIAIN ENTERPRISES, INC. v. F.F. CRUZ & CO., INC.
500 SCRA 406 (2006), THIRD DIVISION (Carpio-Morales, J.)
That the foreshore area had been reclaimed does not remove it from its classification of foreshore area subject to the preferential right to lease of the
littoral owner.
FACTS: Western Visayas Industrial Corporation (WESVICO) filed a foreshore lease application over the foreshore land adjacent to certain lots registered in its name.
It eventually withdrew the application and filed a petition for registration over the same foreshore land with the then Court of First Instance of Iloilo. The case was,
however, archived as WESVICOs representative could no longer be contacted, and later on, WESVICO has ceased operations.
F.F. Cruz & Co. (F.F. Cruz) filed with the Bureau of Lands, Iloilo City a foreshore lease application over a foreshore land, a portion of which is adjacent to the lot
previously occupied by WESVICO. Sian Enterprises Inc. (SIAIN) purchased the properties previously owned by WESVICO from the Development Bank of the
Philippines. It subsequently filed a foreshore lease application over the foreshore land adjacent to the properties it bought from DBP.
Upon learning that 130 linear meters of the foreshore land subject of F.F. Cruz's foreshore lease application overlapped that covered by its foreshore lease
application, SIAIN filed a protest 8 alleging that it being the owner of the property adjoining the overlapping area, it should be given preference in its lease.
F.F. Cruz, argued that SIAIN must not be given preferential right since the area in dispute is classified as reclaimed and that the ownership was not by means of
accretion. This argument has been sustained by the Land Management Bureau.
Upon appeal to the DENR Secretary, SIAIN was upheld, declaring that there was no basis to declare the area as reclaime. F.F. Cruz however appealed to the
Office of the President which overturned the decision of the DENR Secretary and found that the area is reclaimed. On appeal, the Court of Appeals affirmed the
decision. Hence, the present petition. SIAIN contends that the evidence overwhelmingly proves that the disputed area is foreshore land and not reclaimed land.
ISSUES: Whether the disputed land is a foreshore or reclaimed area
HELD: That the foreshore area had been reclaimed does not remove it from its classification of foreshore area subject to the preferential right to lease of the littoral
owner.
It bears noting that it was not the reclamation that brought the disputed foreshore area into existence. Such foreshore area existed even before F.F. Cruz undertook
its reclamation. It was formed by accretions or alluvial deposits due to the action of the sea. Following Santulan, the littoral owner has preferential right to lease
the same.
Contrary to the ruling of the Office of the President, as affirmed by the appellate court, littoral owner WESVICO cannot be considered to have waived or abandoned
its preferential right to lease the disputed area when it subsequently filed an application for registration thereover. For being a part of the public domain, ownership of
the area could not be acquired by WESVICO. Its preferential right remained, however. Its move to have the contested land titled in its name, albeit a faux pas, in fact
more than proves its interest to utilize it.
As correctly argued by SIAIN, were WESVICOs petition for registration which, as stated earlier, was archived by the trial court, pursued but eventually denied,
WESVICO would not have been barred from filing anew a foreshore lease application. Parenthetically, the petition for registration of WESVICO was archived not on
account of lack of interest but because it ceased operations due to financial reasons.
Laguna Lake Development Authority v CA
GR No. 110120
March 16, 1994
FACTS:
The LLDA Legal and Technical personnel found that the City Government of Caloocan was maintaining an open dumpsite at the Camarin area without first
securing an Environmental Compliance Certificate (ECC) from the Environmental Management Bureau (EMB) of the Department of Environment and
Natural Resources, as required under Presidential Decree N o. 1586, and clearance from LLDA as required under Republic Act N o. 4850 and issued a CEASE
and DESIST ORDER (CDO) for the City Government of Caloocan to stop the use of the dumpsite.
ISSUES:
1. Does the LLDA and its amendatory laws, have the authority to entertain the complaint against the dumping of garbage in the open dumpsite in
Barangay Camarin authorized by the City Government of Caloocan?
2. Does the LLDA have the power and authority to issue a "cease and desist" order?
APPLICABLE LAWS:
Executive Order N o. 927 series of 1983 which provides, thus: Sec. 4. Additional Powers and Functions. The authority shall have the following powers and
functions: (d) Make, alter or modify orders requiring the discontinuance of pollution specifying the conditions and the time within which such discontinuance
must be accomplished

 As a general rule, the adjudication of pollution cases generally pertains to the Pollution Adjudication Board (PAB), except in cases w here the special law
provides for another forum
RULING:
1. YES, LLDA has authority. It must be recognized in this regard that the LLDA, as a specialized administrative agency, is specifically mandated under
Republic Act No. 4850 and its amendatory law s to carry out and make effective the declared national policy of promoting and accelerating the development
and balanced growth of the Laguna Lake area and the surrounding provinces of Rizal and Laguna and the cities of San Pablo, Manila, Pasay, Quezon
and Caloocan with due regard and adequate provisions for environmental management and control, preservation of the quality of human life and ecological
systems, and the prevention of undue ecological disturbances, deterioration and pollution. Under such a broad grant and power and authority, the LLDA, by virtue
of its special charter, obviously has the responsibility to protect the inhabitants of the Laguna Lake region from the deleterious effects of pollutants emanating
from the discharge of wastes from the surrounding areas.
2. YES, pursuant to EO 927 Section 4. While it is a fundamental rule that an administrative agency has only such powers as are expressly granted to it by law , it is
likewise a settled rule that an administrative agency has also such powers as are necessarily implied in the exercise of its ex press powers. In the exercise,
therefore, of its express powers under its charter as a regulatory and quasi-judicial body with respect to pollution cases in the Laguna Lake region, the
authority of the LLDA to issue a "cease and desist order" is, perforce, implied. NOTE: HOWEVER, writs of mandamus and injunction are beyond the power
of the LLDA to issue.
Merida Waterworks District V. Bacarro (2008)
G.R. No. 165993 September 30, 2008
Lessons Applicable: Doctrine of Primary Jurisdiction, Doctrine of exhaustion
Laws Applicable:

FACTS:
Merida Water District, a government-owned and controlled corporation4 that operates the water utility services in the municipality of Merida, Leyte conducted a public
hearing for the purpose of increasing the water rate
March 7, 2002: Merida Water District received a letter from the Local Water Utilities Administration (LWUA) that on March 5, 2002, the LWUA Board of Trustees, per
Board Resolution No. 63, series of 2002, confirmed Merida Water Districts proposed water rates.
September 3, 2002: Merida implemented a water rate increase of P90 for the first ten cubic meters of water consumption.
February 13, 2003: consumers of Merida Water District, filed a Petition for Injunction, etc. because the rates are contrary to the rate increase agreed upon during the
public hearing
Merida filed a motion to dismiss (then later motion for reconsideration) with the RTC due to failure to exhaust administrative remedies under Presidential Decree
(P.D.) No. 198, the Provincial Water Utilities Act of 1973, as amended by P.D. Nos. 768 and 1479 - denied
Petition for Review on Certiorari with the CA (then later motion for reconsideration) - denied
Petition for Review on Certiorari with the SC
ISSUE: W/N there is lack of jurisdiction with the RTC since the primary jurisdiction should belong to the NWRB under P.D. No. 1067. (The NWRB does not exercise
exclusive jurisdiction)

HELD: YES. petition is GRANTED

petitioners failed to cite any law which impliedly grants the NWRB original and exclusive jurisdiction to resolve a dispute regarding the increase of water rates. A grant
of exclusive jurisdiction cannot be implied from the language of a statute in the absence of a clear legislative intent to that effect. An administrative agency with quasijudicial power is a tribunal of limited jurisdiction, and its jurisdiction should be interpreted in strictissimi juris."
The doctrine of exhaustion does not apply when jurisdiction is exclusive. An administrative agencys exclusive jurisdiction over a certain dispute renders the courts
without jurisdiction to adjudicate the same at that stage. The doctrine of exhaustion applies "where a claim is cognizable in the first instance by an administrative
agency alone; judicial intervention is withheld until the administrative process has run its course. To cite Abe-Abe v. Manta as the authority to support the allegation
that the NWRB has original and exclusive jurisdiction over a dispute regarding a water rate increase is a strained construction of this Courts pronouncements. Thus,

petitioners contention that the RTC has no jurisdiction because the NWRB has original and exclusive jurisdiction over a dispute concerning the increase of water
rates is clearly without merit.
One of the reasons for the doctrine of exhaustion is the separation of powers, which enjoins upon the Judiciary a becoming policy of non-interference with matters
coming primarily (albeit not exclusively) within the competence of the other departments. The theory is that the administrative authorities are in a better position to
resolve questions addressed to their particular expertise and that errors committed by subordinates in their resolution may be rectified by their superiors if given a
chance to do so It may be added that strict enforcement of the rule could also relieve the courts of a considerable number of avoidable cases which otherwise
would burden their heavily loaded dockets.
Although the doctrine of exhaustion does not preclude in all cases a party from seeking judicial relief, cases where its observance has been disregarded require a
strong showing of the inadequacy of the prescribed procedure and of impending harm. Respondents justify their failure to observe the administrative process on the
following exceptions to the doctrine of exhaustion of administrative remedies: (1) patent illegality; and (2) a denial of due process. However, respondents fail to show
that the instant case merits the application of these exceptions.
Jurisprudence affirming the failure to observe the doctrine of exhaustion due to a denial of due process involves instances when the party seeking outright judicial
intervention was denied the opportunity to be heard. Here, respondents admit that Merida Water District conducted a public hearing. . The existence of a hearing for
this purpose renders the allegation of a denial of due process without merit. The failure of the respondents to show that the instant case falls within the exceptions to
the doctrine of exhaustion necessitates in the due observance of exhausting the proper administrative remedies before seeking judicial intervention.

G.R. No. 101083 July 30, 1993

JUAN ANTONIO, ANNA ROSARIO and JOSE ALFONSO, all surnamed OPOSA, minors, and represented by their parents petitioners,
vs.
THE HONORABLE FULGENCIO S. FACTORAN, JR., in his capacity as the Secretary of the Department of Environment and Natural Resources, and THE
HONORABLE ERIBERTO U. ROSARIO, Presiding Judge of the RTC, Makati, Branch 66, respondents.
Issue
Whether children have the legal standing to file the case?
Facts
This case is unique in that it is a class suit brought by 44 children, through their parents, claiming that they bring the case in the name of their generation
as well as those generations yet unborn. Aiming to stop deforestation, it was filed against the Secretary of the Department of Environment and Natural
Resources, seeking to have him cancel all the timber license agreements (TLAs) in the country and to cease and desist from accepting and approving more timber
license agreements. The children invoked their right to a balanced and healthful ecology and to protection by the State in its capacity as parens patriae.
The petitioners claimed that the DENR Secretary's refusal to cancel the TLAs and to stop issuing them was "contrary to the highest law of humankind-- the
natural lawand violative of plaintiffs' right to self-preservation and perpetuation." The case was dismissed in the lower court, invoking the law on non-impairment of
contracts, so it was brought to the Supreme Court on certiorari.
Ruling
Yes. The Supreme Court in granting the petition ruled that the children had the legal standing to file the case based on the concept of intergenerational
responsibility. Their right to a healthy environment carried with it an obligation to preserve that environment for the succeeding generations. In this, the Court
recognized legal standing to sue on behalf of future generations. Also, the Court said, the law on non-impairment of contracts must give way to the exercise of the
police power of the state in the interest of public welfare.

LA BUGAL-BLAAN TRIBAL ASSOCIATION, Inc. vs RAMOS

G.R. No. 127882

January 27, 2004

FACTS:
On March 3, 1995, President Ramos signed into law R.A. No. 7942. Section 15 thereof declares that the Act shall govern the exploration, development,
utilization, and processing of all mineral resources. Such declaration notwithstanding, R.A. No. 7942 does not actually cover all the modes through which the State
may undertake the exploration, development, and utilization of natural resources.
The State, being the owner of the natural resources, is accorded the primary power and responsibility in the exploration, development and utilization thereof.
As such, it may undertake these activities through four modes:
The State may directly undertake such activities.
(2) The State may enter into co-production, joint venture or production-sharing agreements with Filipino citizens or qualified corporations.

(3) Congress may, by law, allow small-scale utilization of natural resources by Filipino citizens.
(4) For the large-scale exploration, development and utilization of minerals, petroleum and other mineral oils, the President may enter into agreements with
foreign-owned corporations involving technical or financial assistance.
R.A. No. 7942 primarily concerns itself with the second and fourth modes.
Petitioners submit that, in accordance with the text of Section 2, Article XII of the Constitution, FTAAs should be limited to technical or financial assistance
only. They observe, however, that, contrary to the language of the Constitution, the WMCP FTAA allows WMCP, a fully foreign-owned mining corporation, to extend
more than mere financial or technical assistance to the State, for it permits WMCP to manage and operate every aspect of the mining activity
On January 10, 1997, counsels for petitioners sent a letter to the DENR Secretary demanding that the DENR stop the implementation of R.A. No. 7942 and
DAO No. 96-40, giving the DENR fifteen days from receipt to act thereon. The DENR, however, has yet to respond or act on petitioners letter.
Petitioners thus filed the present petition for prohibition and mandamus, with a prayer for a temporary restraining order. They allege that at the time of the filing
of the petition, 100 FTAA applications had already been filed, covering an area of 8.4 million hectares, 64 of which applications are by fully foreign-owned
corporations covering a total of 5.8 million hectares, and at least one by a fully foreign-owned mining company over offshore areas.

ISSUE:
WHETHER OR NOT Republic Act No. 7942 IS UNCONSTITUTIONAL.
HELD:
The Court hereby declares unconstitutional and void the following:
(1) provisions of Republic Act No. 7942:
(a) The proviso in Section 3 (aq),
(b) Section 23,
(c) Section 33 to 41,
(d) Section 56,
(e) The second and third paragraphs of Section 81, and
(f) Section 90.
(2) All provisions of Department of Environment and Natural Resources Administrative Order 96-40, s. 1996 which are not in conformity with this Decision, and
(3) The Financial and Technical Assistance Agreement between the Government of the Republic of the Philippines and WMC Philippines, Inc.
It is undisputed that R.A. No. 7942 and DAO No. 96-40 contain provisions that are more favorable to WMCP, hence, these laws, to the extent that they are
favorable to WMCP, govern the FTAA.
In addition, R.A. No. 7942 explicitly makes certain provisions apply to pre-existing agreements.
R.A. No. 7942 is invalid insofar as said Act authorizes service contracts. Although the statute employs the phrase financial and technical agreements in
accordance with the 1987 Constitution, it actually treats these agreements as service contracts that grant beneficial ownership to foreign contractors contrary to the
fundamental law.
MUSTANG LUMBER V. CA
G.R. No. 104988
June 18, 1996
Ponente: Davide, Jr.

FACTS: A consolidation of three cases. Petitioner is a domestic corporation engaged in a lumber dealer registered with the Bureau of Forest Development.
Respondents are DENR Sec. Factoran and Atty. Robles of the Special Actions and Investigations Division (SAID) of the DENR.
Acting based on an information, the SAID team went to the lumberyard of petitioner and based on a search warrant, were able to execute an
administrative seizure of different kinds of lumber, to which the petitioner failed to produce upon demand the documents such as corresponding certificate of lumber

origin and auxiliary invoices which shall prove the legitimacy of their source and origin. Robles then submitted a memorandum report to Factoran, ordering the
cancellation of petitioners Dealers Permit, filing of criminal charges, and confiscation of the trucks and lumbers. Lower court ruled in favor of respondents, stating
that possession of lumber without permit or authority is not a crime.

ISSUE: W/N a lumber cannot be considered timber and that petitioner should not be held for illegal logging under Sec. 68 of the Revised Forestry Code. NO.

RATIO:While PD 705 explicitly provides that timber is included in the term forest products, the term lumber is found in paragraph (aa) of Section 3 which states that
the latter is a processed log or processed forest raw material. Clearly, the law uses the word lumber in its plain and common usage, and in the absence of a
legislative intent to the contrary, it shall be interpreted as such. Hence, it is safe to conclude that the law makes no distinction whether the forest product is processed
or not. Therefore, Judge Teresita Capulong committed grave abuse of discretion in dismissing the case.

PAAT V. CA
G.R. No. 111107
January 10, 1997
Ponente: Torres, Jr.
FACTS: On May 19, 1989, the truck of private respondent Victoria de Guzman while on its way to Bulacan from Cagayan, was seized by DENR personnel in Nueva
Vizcaya because the driver could not produce the required documents for the forest products found concealed in the truck. Petitioner Jovito Layugan, the
Community Environment and Natural Resources Officer (CENRO) in Aritao, Cagayan, issued an order of confiscation of the truck and gave the owner 15 days within
which to submit an explanation why the truck should not be forfeited. Private respondents, however, failed to submit the required explanation. Later, the Regional
Executive Director of DENR sustained petitioner Layugans action of confiscation and ordered the forfeiture of the truck invoking Section 68-A of Presidential
Decree No. 705 as amended by Executive Order No. 277. Respondents then appealed.
Pending resolution however of the appeal, a suit for replevin was filed by the private respondents against petitioner Layugan and Executive Director, which
thereafter issued a writ ordering the return of the truck to private respondents. Petitioner Layugan and Executive Director Baggayan filed a motion to dismiss with the
trial court contending, inter alia, that private respondents had no cause of action for their failure to exhaust administrative remedies. The trial court denied the motion
to dismiss, which the CA affirmed upon petitioners appeal.

ISSUES:
1.

W/N an action for replevin prosper to recover a movable property which is the subject matter of an administrative forfeiture proceeding in the DENR
pursuant to Section 68-A of P. D. 705. NO.

2.

W/N the Secretary of DENR and his representatives empowered to confiscate and forfeit conveyances used in transporting illegal forest products in favor
of the government. YES.

RATIO: Firstly, the Court held that before a party is allowed to seek the intervention of the court, it is a pre-condition that he should have availed of all the means of
administrative processes afforded him. The premature invocation of courts intervention is fatal to ones cause of action. In the case at bar, there is no question that
the controversy was pending before the Secretary of DENR when it was forwarded to him following the denial by the petitioners of the motion for reconsideration of
private respondents through the order of July 12, 1989. In their letter of reconsideration dated June 28, 1989, private respondents clearly recognize the presence of
an administrative forum to which they seek to avail, as they did avail, in the resolution of their case.
Secondly, as to the power of the DENR to confiscate, SECTION 68-A. Administrative Authority of the Department or His Duly Authorized Representative To Order
Confiscation. In all cases of violation of this Code or other forest laws, rules and regulations, the Department Head or his duly authorized representative, may order
the confiscation of any forest products illegally cut, gathered, removed, or possessed or abandoned, and all conveyances used either by land, water or air in the
commission of the offense and to dispose of the same in accordance with pertinent laws, regulations and policies on the matter.

It is, thus, clear from the foregoing provision that the Secretary and his duly authorized representatives are given the authority to confiscate and forfeit any
conveyances utilized in violating the Code or other forest laws, rules and regulations.
Lastly, as to the contention that since they are not liable for qualified theft, then they should not have necessarily have committed a crime under Sec. 68.
This is unmeritorious. With the introduction of Executive Order No. 277 amending Section 68 of P.D. 705, the act of cutting, gathering, collecting, removing, or
possessing forest products without authority constitutes a distinct offense independent now from the crime of theft under Articles 309 and 310 of the Revised Penal
Code, but the penalty to be imposed is that provided for under Article 309 and 310 of the Revised Penal Code. This is clear from the language of Executive Order No.
277 when it eliminated the phrase shall be guilty of qualified theft as defined and punished under Articles 309 and 310 of the Revised Penal Code and inserted the
words shall be punished with the penalties imposed under Article 309 and 310 of the Revised Penal Code .
G.R. No. 79538. October 18, 1990
FELIPE YSMAEL, JR. & CO., INC., petitioner,
vs.
THE DEPUTY EXECUTIVE SECRETARY, THE SECRETARY OF ENVIRONMENT AND NATURAL RESOURCES, THE DIRECTOR
OF THE BUREAU OF FOREST DEVELOPMENT and TWIN PEAKS DEVELOPMENT AND REALTY CORPORATION, respondents.
FACTS:
On October 12, 1965, petitioner entered into a timber license agreement with the Department of Agriculture and Natural Resources, represented by then Secretary
Jose Feliciano, wherein it was issued an exclusive license to cut, collect and remove timber except prohibited species within a specified portion of public forest land
with an area of 54,920 hectares located in the municipality of Maddela, province of Nueva Vizcaya from October 12, 1965 until June 30, 1990.
However, on August 18, 1983, the Director of the Bureau of Forest Development (Bureau), Director Edmundo Cortes, issued a memorandum order stopping all
logging operations in Nueva Vizcaya and Quirino provinces, and cancelling the logging concession of petitioner and nine other forest concessionaires, pursuant to
presidential instructions and a memorandum order of the Minister of Natural Resources Teodoro Pena.
Subsequently, petitioners timber license agreement was cancelled. He sent a letter addressed to then President Ferdinand Marcos which sought reconsideration of
the Bureau's directive, citing in support thereof its contributions to forest conservation and alleging that it was not given the opportunity to be heard prior to the
cancellation of its logging operations, but no favorable action was taken on his letter;
Barely one year thereafter, approximately one-half of the area formerly covered by petitioners TLA was re-awarded to Twin Peaks Development and Realty
Corporation under a new TLA which was set to expire on July 31, 2009, while the other half was allowed to be logged by Filipinas Loggers, Inc. without the benefit of
a formal award or license. The latter entities were controlled or owned by relatives or cronies of deposed President Ferdinand Marcos.
Soon after the change of government in February 1986, petitioner sent a letter dated March 17, 1986 to the Office of the President, and another letter dated April 2,
1986 to Minister Ernesto Maceda of the Ministry of Natural Resources [MNR], seeking: (1) the reinstatement of its timber license agreement which was cancelled in
August 1983 during the Marcos administration; (2) the revocation of TLA No. 356 which was issued to Twin Peaks Development and Realty Corporation without
public bidding and in violation of forestry laws, rules and regulations; and, (3) the issuance of an order allowing petitioner to take possession of all logs found in the
concession area. However, petitioner's request was denied. Petitioner moved for reconsideration reiterating, among others, its request that the timber license
agreement issued to private respondent be declared null and void. The MNR however denied this motion. Petitioner subsequently appealed from the orders of the
MNR to the Office of the President. The Office of the President, acting through then Deputy Executive Secretary Catalino Macaraig, denied petitioner's appeal for
lack of merit. Petitioner filed with the Court a petition for certiorari, with prayer for the issuance of a restraining order or writ of preliminary injunction,
ISSUE: Whether or not petitioner has the right to seek the nullification of the Bureau orders cancelling his timber license agreement and the granting of TLA to
private respondent, which were issued way back in 1983 and 1984, respectively.
HELD:
NO. The failure of petitioner to file the petition for certiorari within a reasonable period of time renders the petitioner susceptible to the adverse legal consequences
of laches. Laches is defined as the failure or neglect for an unreasonable and unexplained length of time to do that which by exercising due diligence, could or should
have been done earlier, or to assert a right within a reasonable time, warranting a presumption that the party entitled thereto has either abandoned it of declined to
assert it. The rule is that unreasonable delay on the part of a plaintiff in seeking to enforce an alleged right may, depending upon the circumstances, be destructive of
the right itself. Verily, the laws did these who are vigilant, not those who sleep upon their rights. In the case at bar, petitioner waited for at least three years before it
finally filed a petition for certiorari with the Court attacking the validity of the assailed Bureau actions in 1983 and 1984. Considering that petitioner, throughout the
period of its inaction, was not deprived of the opportunity to seek relief from the courts which were normally operating at the time, its delay constitutes unreasonable
and inexcusable neglect, tantamount to laches. Accordingly, the writ of certiorari requiring the reversal of these orders will not lie. There is a more significant factor
which bars the issuance of a writ of certiorari in favor of petitioner and against public respondents herein. A long line of cases establish the basic rule that the courts
will not interfere in matters which are addressed to the sound discretion of government agencies entrusted with the regulation of activities coming under the special
technical knowledge and training of such agencies. More so where, as in the present case, the interests of a private logging company are pitted against that of the
public at large on the pressing public policy issue of forest conservation. For this Court recognizes the wide latitude of discretion possessed by the government in
determining the appropriate actions to be taken to preserve and manage natural resources, and the proper parties who should enjoy the privilege of utilizing these

resources. Timber licenses, permits and license agreements are the principal instruments by which the State regulates the utilization and disposition of forest
resources to the end that public welfare is promoted. And it can hardly be gainsaid that they merely evidence a privilege granted by the State to qualified entities,
and do not vest in the latter a permanent or irrevocable right to the particular concession area and the forest products therein. They may be validly amended,
modified, replaced or rescinded by the Chief Executive when national interests so require. Thus, they are not deemed contracts within the purview of the due
process of law clause.