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In the second place, even if it is to be assumed that the same are contracts, the instant case does

not involve a law or even an executive issuance declaring the cancellation or modification of existing
timber licenses. Hence, the non-impairment clause cannot as yet be invoked. Nevertheless, granting
further that a law has actually been passed mandating cancellations or modifications, the same
cannot still be stigmatized as a violation of the non-impairment clause. This is because by its very
nature and purpose, such as law could have only been passed in the exercise of the police power of
the state for the purpose of advancing the right of the people to a balanced and healthful ecology,
promoting their health and enhancing the general welfare. In Abe vs. Foster Wheeler
Corp.   this Court stated:
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The freedom of contract, under our system of government, is not meant to be


absolute. The same is understood to be subject to reasonable legislative regulation
aimed at the promotion of public health, moral, safety and welfare. In other words,
the constitutional guaranty of non-impairment of obligations of contract is limited by
the exercise of the police power of the State, in the interest of public health, safety,
moral and general welfare.

The reason for this is emphatically set forth in Nebia vs. New York,   quoted in Philippine American
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Life Insurance Co. vs. Auditor General,  to wit:


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Under our form of government the use of property and the making of contracts are
normally matters of private and not of public concern. The general rule is that both
shall be free of governmental interference. But neither property rights nor contract
rights are absolute; for government cannot exist if the citizen may at will use his
property to the detriment of his fellows, or exercise his freedom of contract to work
them harm. Equally fundamental with the private right is that of the public to regulate
it in the common interest.

In short, the non-impairment clause must yield to the police power of the state.  31

Finally, it is difficult to imagine, as the trial court did, how the non-impairment clause could apply with
respect to the prayer to enjoin the respondent Secretary from receiving, accepting, processing,
renewing or approving new timber licenses for, save in cases of renewal, no contract would have as
of yet existed in the other instances. Moreover, with respect to renewal, the holder is not entitled to it
as a matter of right.

WHEREFORE, being impressed with merit, the instant Petition is hereby GRANTED, and the
challenged Order of respondent Judge of 18 July 1991 dismissing Civil Case No. 90-777 is hereby
set aside. The petitioners may therefore amend their complaint to implead as defendants the holders
or grantees of the questioned timber license agreements.

No pronouncement as to costs.

SO ORDERED.

Cruz, Padilla, Bidin, Griño-Aquino, Regalado, Romero, Nocon, Bellosillo, Melo and Quiason, JJ.,
concur.

Narvasa, C.J., Puno and Vitug, JJ., took no part.

 
 

Separate Opinions

FELICIANO, J., concurring

I join in the result reached by my distinguished brother in the Court, Davide, Jr., J., in this case
which, to my mind, is one of the most important cases decided by this Court in the last few years.
The seminal principles laid down in this decision are likely to influence profoundly the direction and
course of the protection and management of the environment, which of course embraces the
utilization of all the natural resources in the territorial base of our polity. I have therefore sought to
clarify, basically to myself, what the Court appears to be saying.

The Court explicitly states that petitioners have the locus standi necessary to sustain the bringing
and, maintenance of this suit (Decision, pp. 11-12). Locus standi is not a function of petitioners' claim
that their suit is properly regarded as a class suit. I understand locus standi to refer to the legal
interest which a plaintiff must have in the subject matter of the suit. Because of the very broadness
of the concept of "class" here involved — membership in this "class" appears to
embrace everyone living in the country whether now or in the
future — it appears to me that everyone who may be expected to benefit from the course of action
petitioners seek to require public respondents to take, is vested with the necessary locus standi. The
Court may be seen therefore to be recognizing a beneficiaries' right of action in the field of
environmental protection, as against both the public administrative agency directly concerned and
the private persons or entities operating in the field or sector of activity involved. Whether such
beneficiaries' right of action may be found under any and all circumstances, or whether some failure
to act, in the first instance, on the part of the governmental agency concerned must be shown ("prior
exhaustion of administrative remedies"), is not discussed in the decision and presumably is left for
future determination in an appropriate case.

The Court has also declared that the complaint has alleged and focused upon "one specific
fundamental legal right — the right to a balanced and healthful ecology" (Decision, p. 14). There is
no question that "the right to a balanced and healthful ecology" is "fundamental" and that,
accordingly, it has been "constitutionalized." But although it is fundamental in character, I suggest,
with very great respect, that it cannot be characterized as "specific," without doing excessive
violence to language. It is in fact very difficult to fashion language more comprehensive in scope and
generalized in character than a right to "a balanced and healthful ecology." The list of particular
claims which can be subsumed under this rubic appears to be entirely open-ended: prevention and
control of emission of toxic fumes and smoke from factories and motor vehicles; of discharge of oil,
chemical effluents, garbage and raw sewage into rivers, inland and coastal waters by vessels, oil
rigs, factories, mines and whole communities; of dumping of organic and inorganic wastes on open
land, streets and thoroughfares; failure to rehabilitate land after strip-mining or open-pit
mining; kaingin or slash-and-burn farming; destruction of fisheries, coral reefs and other living sea
resources through the use of dynamite or cyanide and other chemicals; contamination of ground
water resources; loss of certain species of fauna and flora; and so on. The other statements pointed
out by the Court: Section 3, Executive Order No. 192 dated 10 June 1987; Section 1, Title XIV, Book
IV of the 1987 Administrative Code; and P.D. No. 1151, dated 6 June 1977 — all appear to be
formulations of policy, as general and abstract as the constitutional statements of basic policy in
Article II, Section 16 ("the right — to a balanced and healthful ecology") and 15 ("the right to health").
P.D. No. 1152, also dated 6 June 1977, entitled "The Philippine Environment Code," is, upon the
other hand, a compendious collection of more "specific environment management policies" and
"environment quality standards" (fourth "Whereas" clause, Preamble) relating to an extremely wide
range of topics:

(a) air quality management;

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