G.R. No. 214864 - Philippine Ports Authority vs. Nasipit Integrated Arrastre and Stevedoring Services, Inc.

In November 2000, the Philippine Ports Authority (PPA) held a public bidding through its Pre-qualification, Bids and Awards Committee (PBAC) for a 10‑year cargo-handling contract at Nasipit Port, Agusan del Norte.
The PBAC, via Resolution No. 005‑2000, recommended awarding the contract to Nasipit Integrated Arrastre and Stevedoring Services, Inc. (NIASSI), a duly organized cargo-handling corporation.
PPA issued a Notice of Award on December 21, 2000, directing NIASSI to sign the “conforme” portion within 10 days, which NIASSI duly did by January 3, 2001.
Despite the formalities suggesting a perfected contract, the expectation was for the parties to subsequently execute a written contract incorporating the awarded terms.

Instead of immediately executing a written contract, NIASSI requested that PPA issue a Hold‑Over Authority (HOA) pending resolution of a protest filed by the second highest bidder, Concord Arrastre and Stevedoring Corporation (CASCOR).
PPA granted the initial HOA on August 1, 2001, effective until October 31, 2001, or until a written contract was executed.
The HOA was extended several times upon NIASSI’s request, even after the Office of the Government Corporate Counsel (OGCC) affirmed PPA’s authority and the validity of the award in an opinion dated February 7, 2002.
Ultimately, after repeated extensions, PPA, citing complaints regarding NIASSI’s alleged poor service due to inadequately maintained equipment, revoked the HOA on December 6, 2004, announcing its intention to take over cargo-handling operations.

In response to PPA’s revocation of the HOA and takeover of operations, NIASSI filed a Petition for Injunction on December 22, 2004, later amended to a Petition for Mandamus with Prayer for a Writ of Preliminary Mandatory Injunction.
On March 18, 2005, the RTC granted the petition for a preliminary mandatory injunction, conditioned on NIASSI posting a P1,000,000 surety bond.
Shortly thereafter, PPA filed motions for reconsideration (including a supplemental motion) arguing procedural issues regarding the bond and the manner of the injunction’s dissolution.
The RTC subsequently issued an order on April 11, 2005, dissolving the writ and directing NIASSI to surrender control of the port operations to PPA.

NIASSI elevated the matter to the Court of Appeals (CA) via a petition (docketed CA‑G.R. SP No. 00214), contending that the dissolution of the injunction was procedurally flawed.
In an August 8, 2006 decision, the CA set aside the RTC’s dissolution order, reinstated the writ of preliminary mandatory injunction, and held that:

A perfected contract between PPA and NIASSI existed based on the Notice of Award and NIASSI’s compliance.
The series of HOAs and extensions, though not constituting a written contract, amounted to partial fulfillment of the contractual obligations.

The CA’s ruling was later affirmed by the Supreme Court in a decision involving similar issues.

The RTC later rendered a Resolution on June 1, 2011, dismissing NIASSI’s Amended Petition on the ground that the contract had already been perfected, rendering the issue moot and academic.
Upon NIASSI’s Motion for Reconsideration, the RTC reversed its June 2011 Resolution with a new order dated September 20, 2011, ordering PPA to execute a formal 10‑year contract.
PPA then appealed before the CA (docketed as CA‑G.R. SP No. 04828‑MIN), arguing that:

The perfected contract had already existed and its term had expired.
Enforcing another 10‑year contract without deducting the period of partial execution (via the HOAs) would unjustly extend the contractual term.

On December 11, 2013, the CA partially granted PPA’s appeal, holding that while a perfected contract existed, the written contract should reflect only the remaining period after deducting the period during which NIASSI had operated under the HOA and provisional relief.
Shortly after, on September 15, 2014, the CA issued an Amended Decision directing PPA to execute a full 10‑year written contract, maintaining that the HOA did not constitute partial fulfillment of the original award.
PPA filed a Petition for Review on Certiorari with the Supreme Court, seeking to set aside the CA’s Amended Decision on the basis that the perfected contract had already expired and that the law of the case should bar re-litigation of the issues.

Whether the Court of Appeals erred in its Amended Decision directing PPA to execute a full 10‑year written cargo‑handling contract with NIASSI without deducting the period during which NIASSI had been operating under the HOA and provisional relief.

Specifically, whether the prior findings that a perfected contract existed (and that the HOAs and extensions constituted partial fulfillment) should bind the main issue as the law of the case.
Whether, given that the perfected contract’s term had effectively expired through PPA’s takeover of operations on various occasions, PPA could now be compelled to enter into a new 10‑year contract.