Implications of the Public Trust doctrine

I continue my series on Maynilad vs. DENR, potentially a revolutionary decision by the Supreme Court. It is the best environmental decision the Court has ever made and especially because of its introduction to the Philippines of the Public Trust doctrine to our jurisprudence. This should have been done years ago.

The concept of public trust lays down a framework of relationships where “the [s]tate is the trustee, which manages specific natural resources—the trust principal—for the trust principal—for the benefit of the current and future generations-—the beneficiaries.” Furthermore, “[t]he [S]tate has an affirmative duty to take the public trust into account in the planning and allocation of water resources, and to protect public trust uses whenever feasible.” This premise, however, has gotten more difficult in the advent of privatization and its trend of profit-making, in the rendering of basic utilities services, including that of water supply. Such services should, in fact, benefit the public’s interest.In consequence, the Public Trust doctrine holds to play a significant role in resource management, transitioning to serve as a flexible tool “to adapt to changing social priorities and address the correlative and consequent dangers thereof. The public is regarded as the beneficial owner of trust resources, and courts can enforce the public trust doctrine even against the government itself,” as in Maynilad. “[T]he right to distribute water was granted by the State via utility franchises to Maynilad and Manila Water, under express statutory regulation through its delegated representative, the MWSS. The State conferred the franchise to these concessionaires, working under the firm belief that they shall serve as protectors of the public interest and the citizenry.” Moreover, the State believed that in the granting of such franchise that “water rights [are] secured to achieve optimal use of water resources, its conservation, and its preservation for allocative efficiency.”

Public trust implies that “[f]or this purpose, water users who are subject to regulation by the State or by its own franchise must obtain permits and comply with the sanctions imposed on them. The enjoyment of these permits is not perpetual and require a continued demonstration of quality and good service. Water allocation decisions must coincide with a comprehensive water supply plan which reflects not only economic efficiency but also environmental and health values. Henceforth, whenever there are changing needs and circumstances, there must also be proper reallocation techniques.” “[T]he state can re[-]evaluate prior allocations and must act to preserve the right of present and future generations.” The idea of intergenerational responsibility in the realm of water resource management is encapsulated in this ‘Public Trust’ arena, which in effect looks at the concept of sustainability for the “benefit of present and future generations […].”

Through the “legislative act of police power, the enactment of the Clean Water Act (CWA) thrusts the obligation onto the water concessionaires to provide for a proper sewerage and septage system that complies with environmental and health standards to protect present and future generations. The magnitude of this law is highlighted by the trust relationship among the State, concessionaires, and water users […].” It explicates that the interactions of these actors “must reflect a universal intangible agreement that water is an ecological resource that needs to be protected for the welfare of the citizens.” Ultimately, “[t]he public trust doctrine is based on the notion that private individuals cannot fully own trust resources but can only hold them subject to a servitude on behalf of the public.” Therefore, a “[S]tate[…] can accomplish this goal more efficiently through statutory regulation[.]” The Philippines did this through the enactment of the CWA.

The CWA is an ideal piece of legislation as it illuminates comprehensive water quality management rules. It is holistic rather than single-minded, integrating into the law, water as a source in itself, the need for ecological protection, the necessity of water supply, and the wider abstractions for public health and quality of life.

Province of Rizal v. Executive Secretary, a decision made by the same Court in the 1990s, and as cited in Maynilad, pronounced that “[l]aws pertaining to the protection of the environment were not drafted in a vacuum. Congress passed these laws, fully aware of the perilous state of both our economic and natural wealth. It was precisely to minimize the adverse impact humanity’s actions on all aspects of the natural world, at the same time maintaining and ensuring an environment under which man and nature can thrive in productive and enjoyable harmony with each other, that these legal safeguards were put in place.” While not explicitly mentioned in Maynilad, it evinces that the CWA encapsulates Article I, Section 16 of the Constitution, that “[t]he State shall protect and advance the right of the people to a balanced and healthful ecology in accord with the rhythm and harmony of nature” and in this regard places even greater importance in the concept of ‘Public Trust.’

Maynilad, citing Province of Rizal, highlighted that “the freedom of contract is not absolute and is understood to be subject to reasonable legislative regulation aimed at the promotion of public health, moral, safety, and welfare.” In that respect, the ‘Public Trust Doctrine’, as applied to the case at bar, “construes the MOA between MWSS and Maynilad and the MOA between MWSS and Manila Water as a complicit acknowledgment of their obstinate defiance of their mandate under the [CWA]. Agreeing among themselves for a 15-year extension will not cancel their long-running liability under Section 8 […] in relation to Section 28 […]. A private contract cannot promote business convenience to the unwarranted disadvantage of public welfare and trust.” The public’s interest shall always be prioritized. The assertions of Maynilad and Manila Water that Agreements take primacy over a special law such as the CWA, is evidently misplaced. Section 8 of the CWA, which they violated, “demands unconditional compliance.”

In the fourth and final column of this series, I will highlight points made by Associate Justice Marvic Leonen that further clarify the Public Trust doctrine and make it even more effective in our jurisdiction.

Visit this website to access the article.

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