G.R. No. L-18536 - Aznar vs. Yapdiangco

Petitioner: Aniceto D. Bertiz III, a member of the House of Representatives and taxpayer, who filed the petition for certiorari and prohibition.
Respondents: Executive branch officials including Salvador C. Medialdea (Executive Secretary), Arthur P. Tugade (Secretary of the Department of Transportation), Benjamin E. Diokno (Secretary of the Department of Budget and Management), Rosalia V. De Leon (National Treasurer), Michael G. Aguinaldo (Chairman of the Commission on Audit), Edgar C. Galvante (Assistant Secretary of the Land Transportation Office) and Dermalog with Nettix and CFP Joint Venture.
Nature of the dispute: Petitioner challenges the constitutionality of the LTO’s use of surplus funds from the 2016 General Appropriations Act (GAA) to supplement the 2017 Driver’s License Card (DLC) Project, alleging absence of a valid legislative appropriation and abuse of discretion.

Enacted on December 22, 2015, appropriating PHP 587,497,000.00 for “Issuance of Driver’s License and Permits” under the 2016 DLC Project.
Subsequent bidding for the 2016 DLC Project awarded to AllCard Plastics Philippines, Inc. at a total project cost of PHP 187,080,000.00, leaving a surplus balance of PHP 341,713,000.00.

The Department of Transportation submitted a budget proposal in August 2016 for the 2017 project valued at PHP 528,793,000.00.
On December 22, 2016, the 2017 GAA was enacted, appropriating PHP 573,450,000.00 for the project.
The LTO-Bids and Awards Committee (LTO-BAC) combined the surplus from the 2016 project (PHP 341,713,000.00) with the 2017 appropriation, pegging the Approved Budget for Contract (ABC) at PHP 836,000,000.00.
The Invitation to Bid indicated “General Fund 101” as the source of funding, leading eventually to the awarding of the contract to Dermalog for PHP 829,668,053.55 after a bidding process.

The 2017 DLC Project was implemented without a proper and specific appropriation under a designated fiscal year or fund, alleging a violation of Section 29(1), Article VI of the 1987 Constitution.
The absence of a dedicated item or indication for the “production of driver’s licenses” in the 2016 GAA clearly demonstrates Congress’s intent not to appropriate funds for the 2017 project.
The bidding process was “rigged and manipulated” with the disqualification of lower bidders and an award to the third lowest bidder, suggesting collusive practices and bid suppression.
The use of surplus funds from the 2016 GAA without proper legislative re-appropriation constitutes grave abuse of discretion amounting to lack or excess of jurisdiction.

The Invitation to Bid failed to specify the exact year for General Fund 101.
No law explicitly authorized the expenditure as either an existing or continuing appropriation.
The winning bid, being only marginally lower than the ABC, reflects an irregular bidding process allegedly designed to defraud the government.

Petitioner failed to establish that the application of the surplus funds or the conduct of the bidding process constitutes grave abuse of discretion.
Their bid was proper, substantiated by complying with the documentary and technical requirements.

The LTO acted within its legal bounds by employing the continuing appropriation clause.
The petition should be dismissed on procedural grounds for failure to comply with the requirements of Rule 65 of the Rules of Court.
The appropriations—both the new and the continuing funds—collectively provided sufficient budget for the 2017 DLC Project.

The petition for certiorari and prohibition was filed to challenge both the constitutional validity of the funding method used and, incidentally, aspects of the bidding process.
The case touches on broader issues of separation of powers, the legislature’s power of the purse, and the executive’s power to manage public funds, under the scrutiny of judicial review.

Whether the use of the remaining balance from the 2016 GAA, in the absence of a specific appropriation for the 2017 DLC Project, violates Section 29(1), Article VI of the 1987 Constitution.

Whether the alleged “rigged and manipulated” bidding procedural irregularities and the disqualification of lower bidders constitute grave abuse of discretion or violate principles of fair competition.

Whether the non-specification of a particular fiscal period in indicating “General Fund 101” as the funding source invalidates the expenditure or affects its constitutionality.

Whether the statutory provision in Section 65 of the 2016 GAA, authorizing the release and obligation of surplus funds for up to one fiscal year after the appropriation, sufficiently legitimizes the funding of the 2017 DLC Project.