G.R. No. 181735 - Land Registration Authority vs. Lanting Security and Watchman Agency

The petitioner, Land Registration Authority (LRA), is represented by its administrator and attached officials, while the respondent is Lanting Security and Watchman Agency, represented by Atty. Thomas L. Lanting.
LRA had an existing six-month security service contract with the respondent, which was operative from July 1, 2002, to December 31, 2002, and subsequently underwent several extensions.

In the second quarter of 2004, LRA issued an invitation to bid for a new security service contract.
A total of 16 prospective bidders submitted their letters of intent, among which only six, including the respondent and Quiambao Risk Management Specialist, qualified.
On November 19, 2004, the respondent submitted a letter to the LRA’s Bids and Awards Committee-Procurement of Goods, Services and Materials (BAC-PGSM) requesting that it be declared the winning bidder.

Alleging bidding irregularities committed by the BAC-PGSM, the respondent lodged a complaint with the Philippine Association of Detective and Protective Agency Operators, Inc. (PADPAO).
PADPAO then requested LRA to hold the awarding of the new contract pending an investigation into the alleged irregularities.
On November 24, 2004, LRA informed the respondent via letter that its contract was extended on a “day to day” basis, and on December 6, 2004, LRA directed the respondent to withdraw its security personnel to clear the way for the lowest calculated responsive bidder.

On December 16, 2004, the respondent, through its counsel, filed a Petition for Annulment of Public Bidding and Award, along with a prayer for a Temporary Restraining Order (TRO) or Writ of Preliminary Prohibitive Injunction before the Regional Trial Court (RTC) of Quezon City (Civil Case No. Q-04-54385).
In its Answer with Counterclaim, LRA raised a special affirmative defense regarding lack of jurisdiction, alleging that the respondent failed to comply with the protest mechanism under Section 55 of R.A. No. 9184, which requires filing a verified position paper and the payment of a protest fee.
Meanwhile, at respondent’s motion, the RTC issued an order (June 28, 2005) directing LRA to pay compensation to the respondent’s security guards based on the principle of quantum meruit for services rendered from December 16, 2004 onward.
LRA assailed the RTC’s decision via certiorari before the Court of Appeals (CA). The CA later denied LRA’s petition in its September 19, 2007 decision and upheld the trial court’s order on compensatory payments.
LRA then filed a Motion for Reconsideration with the appellate court, arguing that the RTC lacked jurisdiction because the respondent did not comply with the protest requirements under R.A. No. 9184. The appellate court, in its February 15, 2008 resolution, upheld LRA’s assertion by clarifying that the respondent’s action did not satisfy the statutory protest procedure.

Section 55 of R.A. No. 9184 mandates that protests against BAC decisions must be submitted in a verified written position paper, addressed to the head of the procuring entity, and must include payment of a non-refundable protest fee.
Section 58 of the law states that only after these procedural requirements are fully completed may affected parties resort to litigation; failure to comply results in dismissal for lack of jurisdiction.
The respondent’s November 19, 2004 letter, along with subsequent communications (May 18, 2006 and June 28, 2006 requests), did not fulfill these statutory conditions—being unverified and not accompanied by the requisite protest fee.

Whether the trial court properly acquired jurisdiction over the respondent’s Petition for Annulment despite its failure to comply with the protest procedure outlined in Section 55 of R.A. No. 9184.
Whether the respondent’s subsequent protest-like communications (in lieu of a proper verified position paper and protest fee) can be legally equated to the required protest under the said law.

Whether the trial court’s order directing LRA to pay compensation based on the principle of quantum meruit was appropriate given the jurisdictional defect arising from the protest process violation.

Whether LRA’s acceptance of the respondent’s initial protest, despite the non-payment of the protest fee, constitutes a waiver of the statutory requirement and thereby validates the protest and subsequent judicial intervention.