CA voids Vizcaya gov order vs mine firm

The Court of Appeals has nullified an order issued by Gov. Luisa Cuaresma stopping the operations of an Australian mining firm, saying it was issued with grave abuse of discretion.

The CA’s fifth division upheld the petition filed by OceanaGold Philippines Inc. to stop Cuaresma from enforcing the cease-and-desist order (CDO) on the firm’s operations in Didipio village in Kasibu town, site of its $117-million gold-copper project.

The appellate court also voided the tax assessment issued by Perfecto Martinez Jr., provincial treasurer, collecting more than P27 million in sand and gravel fees from the company.

“The assailed CDO and assessments were issued without basis as the activities of OceanaGold which are sought to be enjoined and taxed by [Cuaresma and Martinez] do not fall squarely within the coverage of the law,” said Justice Remedios Salazar-Fernando, chair of the CA’s fifth division.

Cuaresma issued the CDO in May after OceanaGold refused to pay quarry taxes. The firm said it was granted tax exemption as a national project, and that it was not extracting sand and gravel for commercial purposes.

The conflict escalated in May when Cuaresma, along with provincial officials and armed policemen and security guards, barricaded the roads in Didipio after OceanaGold officials ignored her stoppage order.

OceanaGold stopped its construction work at the site in June after officials cited the company’s financial losses due to delays in the construction work.

The CA said the company couldn’t be taxed for quarrying activities at the site because the sand and gravel it has been extracting are not being used for its value.

“[The provincial officials’] persistence in enforcing the assailed CDO and assessments, despite the patent inapplicability of the taxing ordinance to [OceanaGold] amounts to nothing less than a whimsical or arbitrary exercise of judgment,” the CA said.

Lawyer Desiderio Perez Jr., provincial legal officer, on Monday said the provincial government would file a motion for reconsideration with the CA.

“In fact, we even look at the [CA decision] as something positive because the court impliedly recognized [the provincial government’s] power to collect taxes. The only issue is whether or not [OceanaGold’s] quarrying activities are subject to tax,” he said.

“We are ready to fight it out even up to the Supreme Court,” Perez said. The court said Cuaresma, in December 2007, issued a CDO against the company, but later allowed it to resume operations on the condition that the contract to extract sand and gravel be awarded to another firm.

“Without lifting the CDO, Cuaresma permitted [the company] to resume operations on condition that it replaced its contractor (winning bidder Delta Earthmoving Corp.) with another contractor,” the CA said.

This was confirmed earlier by Environment Secretary Lito Atienza, who said the CDO was issued “capriciously.”

“It is not right that the governor, after initially expressing support, now turns her back on this project and issues the [CDO] when she is fully aware that the root of all these is a contract that somebody did not get,” Atienza said in an earlier interview.

OceanaGold officials said they could not yield to Cuaresma’s condition because Delta won the contract fairly, having offered the lowest bid. - Melvin Gascon, Northern Luzon Bureau (Inquirer.net)