Court allows BHP Billiton to operate Davao mine

MANILA, Philippines - Australian mining giant BHP Billiton and its local partner QNI Philippines Inc. may now continue their operations in the 16,000-hectare prospective mineral lands in Davao Oriental known as the Pujada properties.

This, after the Court of Appeals (CA) has nullified the writ of preliminary injunction issued by the Regional Trial Court of Makati City last year that stopped mining operations of the two firms upon damage complaint of Asiaticus Management Corp. and seven other mining companies collectively known as “Amcor Group.”

In a 36-page decision penned by Associate Justice Remedios Salazar-Fernando, the fifth division of the appellate court directed Makati RTC Judge Winlove Dumayas to suspend the proceedings in the damage suit filed against QNI and officers of BHP, Christopher Campbell, Philip Hopkins and Malcolm Boyd.

The CA also ordered the trial court to dismiss the complaint for damages and injunction against Campbell, Hopkins and Boyd and directed the parties to continue the arbitration proceedings that already started.

In reversing the trial court’s ruling, the CA upheld the arguments of petitioners BHP Billiton and QNIP that the trial court should have instantly dismissed the complaint filed by Amcor Group, which failed to comply with a provision of the shareholders agreements (SHAs) which states that disputes relating to the joint venture agreement should be first referred to arbitration.

“Thus, private respondents Amcor Group cannot just unilaterally issue a notice of rescission and subsequently file a complaint based thereon without first complying with the dispute resolution provisions of the SHAs,” the CA said.

The appellate court also declared that the lower court failed to assume jurisdiction over the case due to Amcor Group’s failure to implead all the indispensable parties and to serve the summons against the officers of BHP Billiton.

The CA noted that Hallmark Mining Corp. and Austral-Asia Mining Corp. are the actual holders of the Mineral Production Sharing Agreements (MPSA) issued by the Department of Environment and Natural Resources (DENR).

Being the holders of MPSA, HMC and AALMC were the ones contracted to carry put the mining in the Pujada properties, which in turn engaged the services of QNIP as their technical service contractor to explore and develop the same.

“Private respondents Amcor Group cannot just rescind the joint venture nor file an action in court without HMC and AALMC being affected.