Case Summary (G.R. No. 131367)
Protests and Initial Award by SBMA-PBAC
Before opening financial bids, RPSI protested ICTSI’s legal capacity under EO 212 and DOTC Order 95-863. Despite protests, SBMA-PBAC opened sealed royalty fee bids: ICTSI (US$57.80/TEU), HPPL (US$20.50/TEU), RPSI (US$15.08/TEU). SBMA-PBAC then rejected ICTSI’s bid for non-compliance and declared HPPL the winner, subject to negotiations within 45 days.
Appeals and Presidential Review
ICTSI appealed to SBMA’s Board and to the Office of the President. Chief Presidential Legal Counsel Cayetano recommended reinstating ICTSI, disregarding monopoly arguments, and re-evaluating financial bids with COA participation. President Ramos approved and directed SBMA to re-evaluate.
SBMA Board Re-evaluation and Re-award
With COA concurrence, SBMA re-evaluation under tender criteria again selected HPPL as the most advantageous bidder offering the greatest financial return. The Board submitted its resolution to the President on September 24, 1996.
Executive Secretary’s Re-bidding Directive
Despite SBMA Board action, Executive Secretary Torres recommended a new bidding. The Office of the President then ordered SBMA to refrain from executing HPPL’s concession contract and to conduct a re-bidding.
RTC Action for Specific Performance
On July 7, 1997, HPPL sued SBMA in the Regional Trial Court of Olongapo for specific performance, mandatory injunction, and damages, alleging a binding award under Article 1305, Civil Code, and seeking to prohibit re-bidding and compel negotiations. ICTSI, RPSI, and the Office of the President intervened.
Supreme Court Injunction Application
HPPL filed for a writ of preliminary injunction in the Supreme Court to maintain status quo and enjoin SBMA’s re-bidding scheduled for December 5, 1997. The trial court denied a similar maintenance motion under RA 7227’s exclusive SC injunction power. On December 3, 1997, the Supreme Court granted a temporary restraining order.
Requisites for Injunctive Relief
Under the 1987 Constitution and jurisprudence, an injunction requires:
- Clear and unmistakable right
- Material and substantial invasion of that right
- Urgent and permanent necessity to prevent serious damage
Absence of a Final, Enforceable Award
The Court held that HPPL lacked a clear and unmistakable right because the SBMA award was not final: SBMA’s Board and officers are subject to presidential control under LOI No. 620. Presidential authority includes overturning any award for justifiable reasons, and such revocation here was a valid exercise of executive discretion.
Presidential Prerogative over SBMA Contracts
As an instrumentality under LOI No. 620, SBMA’s contracts above P2 million require presidential approval. The President lawfully set aside SBMA’s award and ordered a re-bidding. Courts will not interfere absent arbitrariness or unfairness, which was not
...continue readingCase Syllabus (G.R. No. 131367)
Invitation of Bids and Pre-Qualification
- On February 12, 1996, SBMA publicly invited private entities to develop and operate a modern container terminal in the Subic Bay Freeport Zone.
- Seven firms responded; three passed the SBMA-TEC pre-qualification evaluation: ICTSI; a consortium of RPSI and HPC Hamburg Port Consulting GMBH; and HPPL, representing a consortium with Guoco Holdings (Phils.) Inc. and Unicol Management Services, Inc.
- All three qualified bidders were instructed to submit formal bid packages by July 1, 1996, to the SBMA-PBAC.
Expert Evaluation of Business Plans
- SBMA engaged three international consultants recommended by the World Bank, and Davis, Langdon and Seah Philippines, Inc., to ensure transparency and rigor in bid evaluation.
- After comprehensive review, all consultants unanimously found HPPL’s business plan to be far superior to those of ICTSI and RPSI.
Submission of Financial Bids and Protests
- At the scheduled opening, financial bids (expressed in US$ per TEU) were revealed under advisement due to a pending protest:
• ICTSI – 57.80 TEU
• HPPL – 20.50 TEU
• RPSI – 15.08 TEU - RPSI lodged a formal protest seeking ICTSI’s disqualification on grounds of legal bar under EO No. 212 and DOTC Order 95-863. HPPL joined that protest alleging conflict of interest.
SBMA-PBAC Resolution and Initial Award
- On August 15, 1996, the SBMA-PBAC resolved to reject ICTSI’s financial bid as non-compliant and designated HPPL as the winning bidder.
- The resolution directed immediate negotiations with HPPL for a concession agreement, subject to a 45-day negotiation period, else negotiations would shift to RPSI.
Appeals and Presidential Intervention
- ICTSI appealed the SBMA-PBAC resolution to the SBMA Board and simultaneously to the Office of the President.
- On August 30, 1996, the Chief Presidential Legal Counsel recommended a limited re-eva