A Philippines court decision to halt the signing of a land deal between the government and separatist rebels is only a temporary setback, Foreign Secretary Alberto Romulo said Tuesday.

The pact was meant to pave the way for a final political settlement to end the 30-year fight by the Moro Islamic Liberation Front (MILF) for an independent Islamic state in the southern Philippines.

Romulo, who had flown to Kuala Lumpur for the planned signing, admitted the Supreme Court's decision Monday was disappointing but said he was confident the deal did not contravene the constitution.

"This temporary delay has disappointed all of us and at the Supreme Court we will present our case why we should continue with the signing of the memorandum agreement for ancestral domain, which is within the law," he said.

"We are confident eventually we should be able to return and have this memorandum on ancestral domain signed," he told a press conference.

Asked whether the Supreme Court deliberations would be lengthy, he said he expected the court to handle the case with "the importance and urgency that it deserves."

The planned deal had sparked massive street protests in the country's south amid fears that non-Muslim areas could be covered under the pact giving the MILF control over large swathes of lands in southern Mindanao island.

The agreement, seen as paving the way for a formal peace deal, would give MILF power over an autonomous area with its own civil service, internal security force and legal, banking and education systems.

Muslim separatists traded mortar fire with troops in the south just hours after the court decision, in an attack lasting several hours, the military said.

"What should simmer in our minds is for peace and tranquility to exist. There ought not to be violence in any instance," Malaysian Foreign Minister Rais Yatim said at the joint press conference.

Agreement on ancestral domain

Malaysia, which has hosted peace talks between the two sides, on Monday reversed its decision to withdraw troops from the southern Philippines, where they are monitoring a ceasefire between the government and MILF.

Hermogenes Esperon, an adviser to the Philippines president on the peace process, said violence was a concern now because the rebels lacked tight control over their forces, but that major clashes were unlikely.

"We are calling for calm on all sides and not to be provoked," he told reporters in Kuala Lumpur, adding that trouble that had broken out so far was "isolated and controllable."

Esperon said the agreement on "ancestral domain" was necessary for the two sides to go into formal peace talks, which they had hoped could be resolved within 15 months.

Negotiations for a peace deal will now be put on hold until the Supreme Court makes its decision, he said. The government will submit written arguments on August 8 with oral argument to follow on Aug 15.

Esperon said the legal issue could be resolved within weeks, and that it "had not entered our minds" that the court would strike out the land agreement.

-AFP