Case Summary (G.R. No. 70836)
Joint Venture Under the BOT Law
After RA 6957 (July 1990) and Joint Resolution No. 3 (Feb. 1992) authorized BOT projects, NHA invited bids. TECHCOM and EXECOM evaluations declared RBI top bidder (88.475%) in August 1992. President Ramos’s Proclamation No. 39 (Sept. 9, 1992) reserved and conveyed dumpsite and 400,000 m² foreshore to NHA. October 7, 1992 authorization paved the way for the March 19, 1993 JVA under PD 757, MO 161-A, and MO 415.
Presidential Approvals and Land Conveyance
MO 415-A (Jan. 1992) directed NHA to implement SMDRP via private joint venture; PEA and DENR joined EXECOM/TECHCOM. Special Patents Nos. 3591 and 3592 (Sept. 1994) conveyed dumpsite (211,975 m²) and 401,485 m² reclaimed land to NHA. Proclamation No. 465 (Aug. 31, 1994) expanded reclamation to 790,000 m² (79 ha) and issued Special Patent No. 3598 for an additional 390,000 m².
Amendments and Asset Pool Formation
February 21, 1994 ARJVA delineated Phase I (temporary housing, medium-rise units, 79 ha reclamation) and Phase II (incinerator, 119 ha reclamation). August 11, 1994 AARJVA clarified port integration and compensation upon termination. September 26, 1994 Asset Pool Agreement with PNB and HIGC secured financing and guarantees.
Project Implementation and Suspension
DENR granted ECC; RBI commenced preparatory work and construction. Clean Air Act (1999) outlawed incinerator, halting Phase II. By August 1996 reclamation completed. EXECOM approved change orders exceeding 25% contract price; Supplemental Agreement (Mar. 20, 1998) covered additional works, but approval delayed under President Estrada. Work suspended August 1, 1998 due to lack of enabling component and financing shortfall.
Subsequent Supplemental Agreements and MOA
Estrada’s Nov. 1998 reconstitution of EXECOM led to proposed additional reclamation (150 ha) and conveyance of 17 ha NHA Vitas property. March 23, 2000 OP Memorandum authorized completion of SMDRP; NHA resolutions (2000–2002) approved Vitas transfer and PhP 480 M advances. Cabinet directed public bidding for remaining works (2002). August 27, 2003 MOA terminated JVA, ARJVA, Supplemental Agreements; provided cash and property compensation mechanism for RBI claims subject to validation.
Counsel’s Petition for Prohibition and Mandamus
Former Solicitor General Chavez filed Rule 65 petition (Aug. 5, 2004), seeking nullification of JVA, amendments, Asset Pool Agreement, and related transactions for unconstitutionality; prohibitory injunction against NHA; and mandamus compelling disclosure of all SMDRP documents and financial data.
Procedural Issues of Locus Standi and Jurisdiction
SC held petitioner, as taxpayer, had standing given issues of transcendent public importance (constitutional use of public land, right to information) and indirect public-fund involvement. Direct SC recourse was justified by urgency, constitutional questions, and national significance, despite general preference for lower courts. Factual core was undisputed.
Applicability of PEA Precedent and Factual Basis
PEA v. Chavez (2002) concerned EO 525/PD 1084 reclamation by PEA/Amari without bidding; SMDRP differed materially: NHA–RBI JVA under BOT Law, proper bidding, presidential proclamations and patents, completion and termination pre-dating petition. Hence, PEA precedent not controlling.
Authority to Reclaim: Executive and Implied Powers
SC found valid reclamation authority: (a) Presidential powers under PD 3-A (reclamation exclusive to National Government), EO 525 (delegation to agencies), and Revised Administrative Code; (b) NHA’s implied reclamation power under PD 757, successor to TFDA (PD 570), including land development and joint ventures; (c) explicit BOT Law authorization for reclamation as repayment; (d) PEA consultation via EXECOM/TECHCOM and DENR involvement; (e) issuance of Special Patents conveying reclaimed lands to NHA.
Classification of Reclaimed Lands and Sale Authority
Reclaimed lands became alienable/disposable upon Proclamations 39/465 and Special Patents 3591, 3592, 3598, then patrimonial property when titled to NHA. BOT Law Sec. 6 presumes such lands eligible as non-monetary payment. NHA charter (PD 757) empowers disposition of patrimonial assets; CA 141 leasing/sale provisions inapplicable to patrimonial lands held by NHA.
Public Bidding and Contractor Acquisition of Lands
Bidding covered SMDRP joint venture right (not direct land sale). CA 141 Sections 63–67 govern disposition of public-domain lands by Director of Lands, not patrimonial assets of NHA post-patent. PD 1445 p
...continue readingCase Syllabus (G.R. No. 70836)
Parties and Procedural History
- Petitioner: Francisco I. Chavez, in his capacity as taxpayer and former Solicitor General.
- Respondents: National Housing Authority (NHA); R-II Builders, Inc. (RBI); R-II Holdings, Inc.; Harbour Centre Port Terminal, Inc. (HCPTI); and Mr. Reghis Romero II.
- Relief sought: Writs of prohibition and mandamus (with prayer for Temporary Restraining Order/Writ of Preliminary Injunction) to declare null and void the Smokey Mountain Development and Reclamation Project (SMDRP) agreements and to compel disclosure of all related documents and information.
- Filed under Rule 65, 1997 Rules of Civil Procedure.
Factual Background and Chronology
- March 1–2, 1988: President Aquino issues MO 161 approving the Metro Manila waste management plan and MO 161-A assigning roles to government agencies. NHA tasked to develop low-cost housing at dumpsites.
- Smokey Mountain dumpsite (Tondo, Manila) identified as site for housing and reclamation project.
- July 9, 1990: BOT Law (RA 6957) enacted, authorizing government infrastructure agencies to enter into build-operate-transfer/ build-and-transfer contracts, including land reclamation as repayment.
- Feb. 10, 1992: Joint Resolution No. 03 by Congress approves infrastructure projects under RA 6957, including land reclamation and new townsites.
- Jan. 17, 1992: MO 415 directs NHA to implement SMDRP via private sector joint venture and conveys Smokey Mountain dumpsite and to-be-reclaimed area across R-10 to NHA. EXECOM and TECHCOM created; DENR, PEA, DPWH, PPA among members.
- Jan–Feb 1992: TECHCOM publishes notices to pre-qualify and bid; five contractors pre-qualify; RBI and New San Jose Builders declared top two; Technical and Financial Proposals evaluated.
- Sept. 9, 1992: President Ramos issues Proclamation No. 39 placing the dumpsite and R-10 area under NHA administration for housing and commercial/industrial use.
- Oct. 7, 1992: President Ramos authorizes NHA to enter into JVA with RBI, subject to OP approval.
- March 19, 1993: NHA and RBI sign Joint Venture Agreement (JVA) for development of Smokey Mountain (212,234 sqm) and reclamation of 400,000 sqm across R-10. Profit-sharing and detailed obligations set.
- Feb. 21, 1994: Parties execute Amended and Restated JVA (ARJVA), delineating Phase I (housing and 79-ha reclamation) and Phase II (incinerator and 119-ha reclamation), design changes, cost estimate of PhP 6.693 billion for Phase I.
- Aug. 11, 1994: Amendment to ARJVA (AARJVA) clarifies reclamation area, port integration, compensation upon Government termination.
- Aug. 31, 1994: President Ramos issues Proclamation No. 465 increasing reclamation area from 40 ha to 79 ha.
- Sept. 1, 1994 & Sept. 8, 1994: DENR issues Special Patents Nos. 3591, 3592 (transferring dumpsite and 401,485 sqm reclaimed lands to NHA).
- Sept. 26, 1994: Smokey Mountain Asset Pool Formation Trust Agreement executed by NHA, RBI, HIGC (Home Guaranty Corporation), and PNB.
- June 23, 1994: Clean Air Act passed, rendering planned incinerator (Phase II) illegal and halting that component.
- Aug. 1996: Reclamation completed; Sept. patent 3598 conveys additional 390,000 sqm to NHA.
- Dec. 1997–Mar. 1998: EXECOM authorizes NHA to enter Supplemental Agreement for change orders (>25% of original price) without rebidding per DOJ Opinion Nos. 119