FIRST DIVISION
[ G.R. No. 214864, March 22, 2017 ]PHILIPPINE PORTS AUTHORITY () v. NASIPIT INTEGRATED ARRASTRE +
PHILIPPINE PORTS AUTHORITY (PPA), REPRESENTED BY OSCAR M.SEVILLA, GENERAL MANAGER, BENJAMIN B. CECILIO, ASSISTANT MANAGER FOR OPERATIONS, AND SISALI B. ARAP, PORT MANAGER, PETITIONER, V. NASIPIT INTEGRATED ARRASTRE AND STEVEDORING SERVICES, INC. (NIASSI), REPRESENTED BY RAMON CALO, RESPONDENT.
DECISION
PHILIPPINE PORTS AUTHORITY () v. NASIPIT INTEGRATED ARRASTRE +
PHILIPPINE PORTS AUTHORITY (PPA), REPRESENTED BY OSCAR M.SEVILLA, GENERAL MANAGER, BENJAMIN B. CECILIO, ASSISTANT MANAGER FOR OPERATIONS, AND SISALI B. ARAP, PORT MANAGER, PETITIONER, V. NASIPIT INTEGRATED ARRASTRE AND STEVEDORING SERVICES, INC. (NIASSI), REPRESENTED BY RAMON CALO, RESPONDENT.
DECISION
CAGUIOA, J:
The Facts
PPA is a government agency created by virtue of Presidential Decree No. 505 (PD 505). Under PD 505, PPA is charged with the management and control of all ports in the Philippines.[5] On the other hand, NIASSI is a duly organized Philippine corporation engaged in the business of cargo handling.[6]
Sometime in November 2000, PPA, through its Pre-qualification, Bids and Awards Committee (PBAC) accepted bids for a 10-year contract to operate as the sole cargo handler at the port of Nasipit, Agusan del Norte (Nasipit Port).[7] Subsequently, PBAC issued Resolution No. 005-2000[8] recommending that the 10-year cargo-handling contract be awarded to NIASSI as the winning bidder.[9]
On November 20, 2000, the second highest bidder, Concord Arrastre and Stevedoring Corporation (CASCOR) filed a protest with PPA's General Manager, Oscar M. Sevilla[10] (Sevilla), alleging that two of NIASSI's stockholders on record are legislators who are constitutionally prohibited from having any direct or indirect financial interest in any contract with the government or any of its agencies during the term of their office.[11]
Notwithstanding the protest, PPA issued a Notice of Award in favor of NIASSI on December 21, 2000.[12] The Notice of Award directed NIASSI to signify its concurrence thereto by signing the conforme portion and returning the same to PPA within 10 days from receipt.[13] PPA received notice of NIASSI's conformity to the Notice of Award on January 3, 2001.[14]
However, instead of formally executing a written contract, NIASSI requested PPA to issue a Hold-Over Authority (HOA) in its favor, in view of CASCOR's pending protest. PPA granted NIASSI's request and issued a HOA dated August 1, 2001, effective until October 31, 2001, "or until [such time] a cargo[-]handling contract shall have been awarded, whichever comes first."[15]
Meanwhile, the Office of the Government Corporate Counsel (OGCC) issued Opinion No. 028, series of 2002 on February 7, 2002 (OGCC Opinion) which confirmed the authority of PPA to bid out the cargo-handling contract and affirmed the validity of the award in NIASSI's favor.[16] Despite this, the HOA was subsequently extended several times upon NIASSI's request. While the exact number of extensions and their particulars cannot be ascertained from the records, the last extension of the HOA appears to have been issued on October 13, 2004, for a term of six months.[17]
However, barely two months after the last extension of the HOA, PPA, through its Assistant General Manager for Operations, Benjamin B. Cecilio (Cecilio), issued a letter dated December 6, 2004 revoking the extension.[18] In said letter, Cecilio advised NIASSI that PPA received numerous complaints regarding the poor quality of its services due to the use of inadequately maintained equipment. Cecilio further relayed that PPA would take over the cargo-handling services at the Nasipit Port beginning December 10, 2004.[19]
Proceedings before the RTC
On the scheduled date of the take-over, NIASSI filed with the RTC a Petition for Injunction with Prayer for the Writ of Preliminary Injunction and/or Temporary Restraining Order. The petition was later amended to a Petition for Mandamus with Prayer for the Writ of Preliminary Mandatory Injunction and/or Temporary Restraining Order on December 22, 2004. (Amended Petition).[20]
The Amended Petition prayed for the issuance of a writ of mandamus directing PPA to formally execute a written contract, and a writ of preliminary mandatory injunction directing PPA to turn over the management and operations of Nasipit Port's cargo-handling services back to NIASSI.[21]
On March 18, 2005, the RTC issued a resolution granting NIASSI's prayer for a writ of preliminary mandatory injunction, conditioned upon the posting of a P1,000,000.00 surety bond.[22] The pertinent portion of the said resolution reads:
It is undeniable that petitioner spent a considerable capital outlay, in the form of equipment, machineries and appliances in the establishment of its port operation. Moreover, it has also supplied the necessary manpower to wheel its operation.
When the PPA took an active part in the management, control and supervision of the port operations, it practically utilized all the available resources supplied by the petitioner.
What actually happened was that PPA made only adjustment/correction in the port operation to improve the delivery of basic services. No additional capital outlay was spent.
In summation, this Court recognizes and declares that petitioner's right to continue the cargo handling operations should be protected. It cannot be denied that the continued operation by respondents will probably work injustice to the petitioner, causing irreparable damage to the latter. The better ends of justice [will] be served if the state of affairs [will] be maintained prior to respondent's actual takeover, until finally the main action is disposed.[23]
After NIASSI posted the required surety bond, the RTC issued the writ of preliminary mandatory injunction on March 28, 2005.[24] PPA filed a Motion for Reconsideration on even date, fol1owed by a Supplemental Motion on March 30, 2005. The Supplemental Motion alleged that the writ of preliminary mandatory injunction should be quashed since its corresponding surety bond designated NIASSI's President Ramon Calo as principal, instead of NIASSI itself.[25]
Subsequently, PPA filed a Manifestation expressing its willingness to file a counter-bond in the event that its Motion for Reconsideration is granted.[26] Thereafter, NIASSI filed an Opposition/Reply to PPA's Motion for Reconsideration.[27]
On April 11, 2005, the RTC issued an order (April 2005 RTC Order) granting PPA's Motion for Reconsideration. The April 2005 RTC Order immediately dissolved the writ of preliminary mandatory injunction and directed NIASSI to surrender the management and control of Nasipit Port's cargo-handling operations to PPA.[28]
Prompted by the April 2005 RTC Order, NIASSI filed a Petition for Certiorari before the CA (CA petition), docketed as CA-G.R. SP No. 00214.[29] The CA petition assailed the immediately executory nature of the April 2005 RTC Order and questioned the dissolution of the writ of preliminary injunction without prior hearing. In addition, the CA petition alleged that the April 2005 RTC Order reversed the RTC's previous order despite the absence of new matters or issues raised.[30] The CA petition thus prayed for the reversal of the April 2005 RTC Order, and ultimately, the reinstatement of the writ of preliminary injunction.[31]
For its part, PPA argued, among others, that NIASSI was not entitled to the issuance of the injunctive writ because it had no legal right to continue providing cargo-handling services at Nasipit Port, considering that PPA has no existing cargo-handling contract with NIASSI.[32]
In a Decision[33] dated August 8, 2006, the CA granted the petition observing that Presiding Judge Godofredo B. Abul, Jr. (Judge Abul) of the RTC committed several procedural errors when he issued the April 2005 RTC Order. According to the CA, Judge Abul did not conduct a hearing on PPA's Motion for Reconsideration nor did he direct PPA to file a counter-bond before quashing the writ of preliminary mandatory injunction, in violation of Section 6, Rule 58 of the Rules of Court.[34] The CA concluded that these lapses, taken together with Judge Abul's sudden and inexplicable change of mind, gave rise to suspicions that the issuance of the April 2005 RTC Order was tainted with irregularity and grave abuse of discretion.[35] Thus, the CA directed the reinstatement of the writ of preliminary mandatory injunction.[36] This decision was later affirmed by this Court in the case of Philippine Ports Authority v. Nasipit Integrated Arrastre and Stevedoring Services, Inc. [37]
Notably, in the process of resolving NIASSI's CA petition, it became necessary for the CA to determine whether NIASSI had any legal right to continue its operations at Nasipit Port. In this connection, the CA found that a perfected contract between NIASSI and PPA in respect of the cargo handling operations in fact existed, albeit unwritten.[38] The CA held:
Under Article 1318 of the Civil Code, there can be no contract unless the following requisites concur: (a) consent of the contracting parties; (b) object certain which is the subject matter of the contract; and (c) cause of the obligation which is established.
Under Article 1315 of the same Code, contracts are perfected by mere consent, upon the acceptance by the offeree of the offer made by the offeror. From that moment, the parties are bound not only to the fulfillment of what has been expressly stipulated but also to all the consequences which, according to their nature, may be in keeping with good faith, usage and law.
In the case at bar, there is no dispute as to the subject matter of the contract and the cause of the obligation. The controversy lies in the consent - whether the Notice of Award constitutes as a counter-offer and, as a consequence, did not give rise to a perfected contract.
A perusal of the records shows that PPA conducted a public bidding for a ten-year contract to operate as sole cargo handler at Nasipit Port, and among the bidders, only two (2) pre-qualified, one of which is the petitioner. In its Resolution No. 005-2000, the Pre-qualification, Bids and Awards Committee (PBAC) declared the petitioner as the winning bidder, and, consequently, a Notice of Award was given to the latter. x x x
xxxx
Since respondent PPA started the process of entering into the contract by conducting a bidding, Article 1326 of the Civil Code shall apply, to wit:
Advertisements to bidders are simply invitations to make proposals, and the advertiser is not bound to accept the highest or lowest bidder, unless the contrary appears.
Accordingly, the rules and regulations issued by the PPA for the public bidding constituted the advertisement to bid on the contract, while the bid proposals submitted by the bidders constituted the offer. The reply of respondent PPA shows its acceptance or rejection of the respective offers.
x x x PPA categorically awarded the contract to the petitioner in accordance with the terms and conditions of the latter's bid proposal. This is the acceptance of petitioner's offer as contemplated by the law. A thorough reading of the required documents clearly shows that they had no material or significant bearing to the perfection of the contract. These were mere formal requirements that will not affect the award of the contract to the petitioner. If at all, the need to submit the documents in question pertains to the issuance of the written evidence of the contract.
xxxx
Verily, the Holdover Authority (HOA) granted by the private respondent and the series of extensions allowing the petitioner to operate provisionally the arrastre service confirm the perfection of their contract despite the delay in its consummation due to acts attributable to the private respondents. But it cannot be gainsaid that the series of extensions constitute partial fulfillment and execution of the contract of cargo handling services.
xxxx
It is therefore Our submission that a perfected contract of cargo handling services existed when the petitioner won the bidding, given the Notice of Award and conformed (sic) to the conditions set forth in the Notice of Award because the requirements prescribed in the Notice of Award have no bearing on the perfection of the contract. On the contrary, it amounted to a qualified acceptance of petitioner's offer, a clear legal right to continue its operations in the port. Since the respondent is bound by the contract, the act of taking over the cargo handling service from the petitioner is violative of its right.[39] (Emphasis supplied)
In view of the foregoing CA decision, and this Court's decision in G.R. No. 174136 affirming the same, the RTC directed the parties to submit their simultaneous memoranda on the issue of whether the Amended Petition had been rendered moot and academic.[40] On the basis of such memoranda, Judge Abul issued a Resolution[41] dated June 1, 2011 (June 2011 RTC Resolution) dismissing the Amended Petition for being moot and academic. The June 2011 RTC Resolution observed that since the CA had already made a definitive ruling that a contract had been perfected between the parties, the RTC had "nothing left to do" in respect of the Amended Petition.[42]
However, on NIASSI's Motion for Reconsideration, the RTC issued a Resolution[43] dated September 20, 2011 (September 2011 RTC Resolution) reversing the June 2011 RTC Resolution. The dispositive portion of the September 2011 RTC Resolution reads:
WHEREFORE, premises considered, the Motion for Reconsideration is granted.
The defendant is hereby ordered to execute a formal ten (10) years contract in favor of the plaintiff, upon the finality of this order. The writ of preliminary injunction issued by the Court dated August 8, 2006, will be considered dissolved upon perfection of the formal arrastre service contract.
SO ORDERED.[44]
PPA moved for the reconsideration of the September 2011 RTC Resolution. However, the RTC denied PPA's motion in an Order dated December 20, 2011 (December 2011 RTC Order).[45]
Proceedings before the CA
Aggrieved, PPA filed an appeal before the CA, docketed as CA-G.R. SP No. 04828. In said appeal, PPA faulted the RTC for reversing the June 2011 RTC Order, insisting that the Amended Petition had already become moot and academic. The PPA also alleged that the CA erred in directing it to execute a written 10-year contract with NIASSI reckoned from the finality of the September 2011 RTC Resolution, as this was tantamount to extending the original term of the contract between the parties that was perfected on January 3, 2001, the date when PPA received notice of NIASSI's conformity to the Notice of Award.[46]
PPA thus prayed that the September 2011 RTC Resolution and December 2011 RTC Order be set aside, and a new order be issued dismissing the Amended Petition for being moot and academic.[47]
On December 11, 2013, the CA rendered a Decision[48] granting PPA's appeal in part (CA Decision) by annulling the September 2011 RTC Resolution and December 2011 RTC Order in so far as they failed to consider that the 10-year cargo-handling contract had been partially fulfilled. The CA ruled:
There is already a perfected contract of ten years, albeit it is not written. In fact, NIASSI is already exercising the subject matter of that unwritten contract. To compel PPA to execute a new written ten-year contract without deducting the periods mentioned above is to create another contract for the parties and to unjustly enrich NIASSI. Consequently, the written contract should only cover the remaining period of the original ten-year contract. In the event that the total period is already more than ten (10) years, then the petition should be dismissed for being moot and academic.
WHEREFORE, the instant appeal is partly GRANTED. The case is remanded to the Regional Trial Court to determine the total period of time during which NIASSI was in operation of the cargo handling services of Nasipit port, which period covers the following:
(1) The several hold-over permits granted to NIASSI since 2001, the year the contract was perfected;
(2) The operation of NIASSI as a consequence of Our decision in 2006; and
(3) The operation of NIASSI as a consequence of the granting of its motion for reconsideration in 2011 until the finality of this case.
The total period shall then be deducted, as partial fulfillment, to the ten-year contract in favor of NIASSI. The written contract should only cover the balance of the ten-year period awarded to NIASSI in the Notice of Award. Otherwise, the petition should be dismissed for being moot and academic.
SO ORDERED.[49] (Emphasis and underscoring supplied)
On NIASSI's Motion for Reconsideration, however, the CA issued its Amended Decision dated September 15, 2014.[50] As stated earlier, the Amended Decision affirmed the September 2011 RTC Resolution and December 2011 RTC Order directing PPA to execute the cargo-handling contract in favor of NIASSI for a full 10-year term from the finality of the September 2011 RTC Resolution,[51] on the ground that NIASSI's operations for the period covered by the HOA and its extensions should not be deducted therefrom:
Having a Notice of Award in its favor and having complied with the requirements, NIASSI has established that it has a right for (sic) the ten year cargohandling contract; yet no written contract embodying the terms of the agreement was signed between the parties. "A contract is perfected by mere consent and from that moment the parties are bound not only to the fulfillment of what has been expressly stipulated but also to all the consequences which, according to their nature, may be in keeping with good faith, usage and law." What remains then is just the execution of the written contract embodying the terms of the agreement so that both parties can comply. And "there is no unjust enrichment where the one receiving the benefit has a legal right or entitlement thereto." Thus, pursuant to the Notice of Award, the PPA is now directed to execute the 10-year written contract in favor of NIASSI. Based on the language of the last hold-over authority, the PPA does not consider the hold-over permits as partial fulfillment of the unwritten cargo handling contract. The HOA is a separate agreement between the parties pending the issuance of the cargo-handling services contract.[52] (Italics in the original; emphasis supplied)
PPA received a copy of the Amended Decision on October 20, 2014.[53]
On November 4, 2014, PPA filed a motion with the Court asking for an additional period of 30 days within which to file a Petition for Review on Certiorari.[54] PPA's motion was granted by the Court in its Resolution dated November 17, 2014.[55]
Finally, on December 3, 2014, PPA filed the instant Petition.
Issue
The sole issue for resolution of this Court is whether the CA erred when it issued the Amended Decision affirming the September 2011 RTC Resolution and December 2011 RTC Order, and directing PPA to execute a cargo-handling contract in favor of NIASSI for a full 10-year term without deducting the period covered by the HOA.
The Court's Ruling
In the instant Petition, PPA contends that the Amended Petition before the RTC had been rendered moot and academic by virtue of the CA's decision in CA-G.R. SP No. 00214.[56] On this basis, PPA concludes that it can no longer be compelled to formally execute a contract with NIASSI upon finality of the Amended Decision, since the term of the perfected contract already expired on January 3, 2011, 10 years after PPA received notice of NIASSI's conformity to the Notice of Award.[57]
The Petition is impressed with merit.
The CA's findings in CA-G.R. SP No. 00214 constitute the law of the case between the parties, and are thus binding herein. |
In its decision in CA-G.R. SP No. 00214, the CA held that (i) the 10-year cargo-handling contract had already been perfected, and (ii) the HOA and its subsequent extensions constituted partial fulfillment thereof. For emphasis, the relevant portions are reproduced:
Verily, the Holdover Authority (HOA) granted by the private respondent and the series of extensions allowing the petitioner to operate provisionally the arrastre service confirm the perfection of their contract despite the delay in its consummation due to acts attributable to the private respondents. But it cannot be gainsaid that the series of extensions constitute partial fulfillment and execution of the contract of cargo handling services.
x x x x
It is therefore Our submission that a perfected contract of cargo handling services existed when the petitioner won the bidding, given the Notice of Award and conformed to the conditions set forth in the Notice of Award because the requirements prescribed in the Notice of Award have no bearing on the perfection of the contract. On the contrary, it amounted to a qualified acceptance of petitioner's offer, a clear legal right to continue its operations in the port. Since the respondent is bound by the contract, the act of taking over the cargo handling service from the petitioner is violative of its right.[58]
This decision was affirmed by the Court in toto in G.R. No. 174136, thus:
WHEREFORE, the petition is DENIED and the appealed Decision of the Court of Appeals is AFFIRMED.[59]
In turn, the Court's decision became final and executory after the lapse of 15 days from notice thereof to the parties. From such time, the Court's decision became immutable and unalterable.[60]
The Court notes that CA-G.R. SP No. 00214 and the instant Petition both stem from the Amended Petition, and seek the same relief - the execution of a written contract in accordance with the Notice of Award. Moreover, both cases involve the same facts, parties and arguments. For these reasons, the Court believes that the doctrine of the law of the case is applicable.
The doctrine of the law of the case precludes departure from a rule previously made by an appellate court in a subsequent proceeding essentially involving the same case.[61] Pursuant to this doctrine, the Court, in De La Salle University v. De La Salle University Employees Association (DLSUEANAFTEU),[62] (DLSU) denied therein petitioner's prayer for review, since the petition involved a single issue which had been resolved with finality by the CA in a previous case involving the same facts, arguments and relief.
We note that both G.R. No. 168477 and this petition are offshoots of petitioner's purported temporary measures to preserve its neutrality with regard to the perceived void in the union leadership. While these two cases arose out of different notices to strike filed on April 3, 2003 and August 27, 2003, it is undeniable that the facts cited and the arguments raised by petitioner are almost identical. Inevitably, G.R. No. 168477 and this petition seek only one relief, that is, to absolve petitioner from respondent's charge of committing an unfair labor practice, or specifically, a violation of Article 248(g) in relation to Article 252 of the Labor Code.
For this reason, we are constrained to apply the law of the case doctrine in light of the finality of our July 20, 2005 and September 21,2005 resolutions in G.R. No. 168477. In other words, our previous affirmance of the Court of Appeals' finding — that petitioner erred in suspending collective bargaining negotiations with the union and in placing the union funds in escrow considering that the intra-union dispute between the Aliazas and Bañez factions was not a justification therefor — is binding herein. Moreover, we note that entry of judgment in G.R. No. 168477 was made on November 3, 2005, and that put to an end to the litigation of said issues once and for all.
The law of the case has been defined as the opinion delivered on a former appeal. It means that whatever is once irrevocably established as the controlling legal rule or decision between the same parties in the same case continues to be the law of the case, whether correct on general principles or not, so long as the facts on which such decision was predicated continue to be the facts of the case before the court.[63] (Italics in the original; emphasis supplied; citations omitted)
In Heirs of Felino M. Timbol, Jr. v. Philippine National Bank[64] (Heirs of Timbol), the Court was confronted with procedural antecedents similar to those attendant in this case. Therein, the Court affirmed the CA's decision declaring as valid the extrajudicial foreclosure assailed by petitioners on the basis of factual findings which were affirmed by the Court in a previous decision that dealt with the dissolution of a writ of preliminary injunction issued in the same case. Thus, in Heirs of Timbol, the Court ruled that the CA correctly applied the doctrine of the law of the case.
The Court of Appeals correctly applied the law of the case doctrine.
In PNB v. Timbol, PNB brought a petition for certiorari to set aside the order of Judge Zeus L. Abrogar that issued a writ of preliminary injunction in Civil Case No. 00-946. The Court struck down this order, holding that the order "was attended with grave abuse of discretion."
The Court found that the Spouses Timbol "never denied that they defaulted in the payment of the obligation." In fact, they even acknowledged that they had an outstanding obligation with PNB, and simply requested for more time to pay.
The Court also held that the extrajudicial foreclosure of the mortgage was proper, since it was done in accordance with the terms of the Real Estate Mortgage, which was also the Court's basis in finding that Supreme Court Administrative Order No. 3 does not apply in that case.
The Court also found that the Spouses Timbol's claim that PNB bloated the amount of their obligation was "grossly misleading and a gross misinterpretation" by the Spouses Timbol. The Court noted the Spouses Timbol's letter to PNB that acknowledged they had an outstanding obligation to PNB, as well as affirmed that they received the demand letter directing them to pay, contrary to their claim. Thus, the Court in PNB v. Timbol concluded that the RTC committed grave abuse of discretion when it issued a writ of preliminary injunction.
No doubt, this Court is bound by its earlier pronouncements in PNB v. Timbol.
The term law of the case has been held to mean that "whatever is once irrevocably established as the controlling legal rule or decision between the same parties in the same case continues to be the law of the case, whether correct on general principles or not, so long as the facts on which such decision was predicated continue to be the facts of the case before the court. As a general rule, a decision on a prior appeal of the same case is held to be the law of the case whether that question is right or wrong, the remedy of the party deeming himself aggrieved being to seek a rehearing."
xxxx
The Court is bound by its earlier ruling in PNB v. Timbol finding the extrajudicial foreclosure to be proper. The Court therein thoroughly and thoughtfully examined the validity of the extrajudicial foreclosure in order to determine whether the writ of preliminary injunction was proper. To allow a reexamination of this conclusion will disturb what has already been settled and only create confusion if the Court now makes a contrary finding.
Thus, "[q]uestions necessarily involved in the decision on a former appeal will be regarded as the law of the case on a subsequent appeal, although the questions are not expressly treated in the opinion of the court, as the presumption is that all the facts in the case bearing on the point decided have received due consideration whether all or none of them are mentioned in the opinion."[65] (Italics in the original; emphasis supplied; citations omitted)
The Court's discussions in DLSU and Heirs of Timbol are in point here where the allegations and reliefs prayed for in NIASSI's Amended Petition show that their disposition required the RTC to resolve a single issue - whether PPA is bound to formally execute the 10-year cargo-handling contract pursuant to the Notice of Award. The relevant portions of the Amended Petition state:
14. Petitioner won the bidding to operate cargo-handling services in the port of Nasipit, Agusan del Norte, for ten (10) years. Notwithstanding due compliance by petitioner of (sic) all the requirements as indicated in the Notice of Award x x x petitioner was surprised to receive a communication from respondent CECILIO for public respondent to take over instead the management and operations of cargo-handling services in the port of Nasipit, Agusan del Norte.
xxxx
19. The act of public respondent in taking-over the management and operations of cargo-handling services of petitioner utilizing the existing facilities and manpower constitutes not only a blatant disregard to the existing permit to operate, it likewise demonstrates a notorious abuse of power reminiscent of the dark days of martial rule. The same act is oppressive, capricious, whimsical, arbitrary and despotic as it denied petitioner of (sic) its right to be heard and dispute the malicious allegations against it. Essentially, the act is a calculated move to snatch away the award of the ten-year contract of petitioner to operate the Cargo Handling Services. x x x
24. WHEREFORE, FOR ALL THE FOREGOING, it is most respectfully prayed of (sic) this Honorable Court that upon filing of this Petition, a Temporary Restraining Order (TRO) and/or the Writ of Preliminary Mandatory Injunction be issued commanding or enjoining the respondents and all persons acting in their behalf or direction, to refrain, cease and desist from further implementing the take-over of the management and operations of the cargo-handling services in Nasipit Port, Agusan del Norte, as contained in the letter dated 6 December 2004 x x x, and to refrain from issuing similar orders pending resolution of the instant case and to restore to the herein petitioner the management and operation of the cargo handling services at the Port of Nasipit and until after the Honorable Court shall have heard and resolved the application for the issuance of the Writ of Preliminary Mandatory Injunction.
25. Petitioner further prays that after due notice and hearing, the Writ of Mandamus be issued commanding the respondents to execute or cause the final execution of a Cargo-Handling contract between petitioner and the Philippine Ports Authority as represented by herein respondents.[66] (Underscoring omitted; emphasis supplied)
In CA-G.R. SP No. 00214, the CA determined the existence of a perfected contract between PPA and NIASSI in order to ascertain whether the issuance of a writ of preliminary injunction in favor of NIASSI was proper. Thus, the sole issue for the RTC's determination had been resolved in CA G.R. SP No. 00214, when the CA made the following findings:
- The 10-year cargo-handling contract had been perfected on January 3, 2001, the date when PPA received notice of NIASSI's conformity to the Notice of Award;
- The parties are bound to formally execute the perfected cargo handling contract in accordance with the Notice of Award; and
- NIASSI's operations during the period covered by the HOA constitute partial fulfillment of the perfected cargo-handling contract.
A preliminary injunction is in the nature of an ancillary remedy to preserve the status quo during the pendency of the main case. As a necessary consequence, matters resolved in injunction proceedings do not, as a general rule, conclusively determine the merits of the main case or decide controverted facts therein.[67] Generally, findings made in injunction proceedings are subject to the outcome of the main case which is usually tried subsequent to the injunction proceedings.
In this case, however, no further proceedings were conducted after the Decision of the Supreme Court relative to the injunction proceedings had become final. To be sure, the RTC directed the parties to submit their respective memoranda on the issue of whether or not the main case had become moot and academic because of the finality of said Decision and, on the basis of the memoranda, the RTC resolved to dismiss the Amended Petition, as it had nothing left to determine.[68] As such, no evidence to controvert the findings of the CA in CA-G.R. SP No. 00214 were presented in the main case. This being the case, the factual findings of the CA in respect of the perfected cargo-handling contract in the injunction proceedings became conclusive upon finality of this Court's decision affirming the same. These circumstances thus render the application of the law of the case doctrine proper.
In any case, it is worth noting that NIASSI recognized the perfection of the cargo-handling contract in its Comment to the instant Petition, thus:
x x x When NIASSI received and signed the "conforme" portion [of the Notice of Award], there [was] already [a] meeting of minds between the parties as to the object and cause of the cargo handling contract, including the terms and duration thereof.[69]
To NIASSI, the cargo-handling contract was a valid and binding agreement, and it was thus bound by the concomitant rights and obligations arising therefrom.
The term of the perfected contract has
already expired.
PPA avers that its 10-year cargo-handling contract with NIASSI already expired on January 3, 2011, after the lapse of 10 years from the date when said contract was perfected.[70] In turn, PPA concludes that it can no longer be directed to formally execute another contract with NIASSI, since such a directive would unduly lengthen the term of the cargo-handling contract contrary to the intention of the parties.[71]
While the Court agrees with PPA's submission that the perfected contract has already expired, the Court clarifies that such expiration is not because of the mere lapse of 10 years reckoned from the date when the same was perfected. To hold as such would be to feign ignorance of the events that transpired thereafter, which led to the institution of this very Petition.
It bears emphasizing that PPA assumed the management and operations of the cargo-handling services at Nasipit Port on two separate instances - first, by virtue of its letter dated December 6, 2004 revoking the last extension of the HOA, and second, by virtue of the April 2005 RTC Order lifting the preliminary mandatory injunction granted in NIASSI's favor. The 10-year term of the perfected contract must be deemed interrupted during the periods when PPA assumed management and control over NIASSI's cargo-handling operations.
The relevant periods are summarized, thus:
Based on the table above, NIASSI conducted the cargo-handling operations at Nasipit Port for a total period of 3 years, 11 months and 20 days. Notably, NIASSI does not dispute that it has been conducting such operations since the reinstatement of the preliminary mandatory injunction.
Thus, even if the Court assumes a conservative stance for purposes of illustration and sets the cut-off date for NIASSI's current operations on the date when this Petition was filed, NIASSI's total period of operation would be pegged at 12 years, 3 months and 15 days, computed as follows:
January 3, 2001 to December 9, 2004 March 28, 2005 to Apri1 11, 2005 August 8, 2006 to December 3, 2014
Clearly, the 10-year term of the perfected contract had already expired, leaving the RTC with nothing to enforce.[72]
Finally, it bears stressing that PPA issued the Notice of Award on December 21, 2000. To compel PPA to formally execute a 10-year cargo handling contract at this time on the basis of conditions prevailing nearly two decades ago would certainly be unreasonable and iniquitous.
For the foregoing reasons, the Court resolves to grant the instant Petition.
WHEREFORE, premises considered, the Petition for Review on Certiorari is GRANTED. The Amended Decision dated September 15, 2014 of the Court of Appeals in CA-G.R. SP No. 04828-MIN is SET ASIDE. Consequently, SP. Civil Case No. 1242 pending before the Regional Trial Court of Butuan City, Branch 4, is hereby DISMISSED.
SO ORDERED.
Sereno, C.J., (Chairperson), Leonardo-De Castro and Del Castillo, JJ., concur.
Perlas-Bernabe, J., please see separate concurring opinion.
[1] Rollo, pp. 18-38.
[2] Id. at 41-45. Penned by Associate Justice Henri Jean Paul B. Inting, with Associate Justices Edgardo A. Camello and Pablito A. Perez concurring.
[3] Id. at 75-84.
[4] Docketed as SP Civil Case No. 1242.
[5] Id. at 86.
[6] See id. at 181.
[7] Id. at 86.
[8] Id. at 46-48.
[9] Id.
[10] Id. at 86-87.
[11] Id. at 87.
[12] Id. at 49, 51.
[13] Id. at 51.
[14] See id. at 29.
[15] Id. at 50.
[16] Id. at 54-60.
[17] Id. at 62.
[18] Id. at 65.
[19] Id.
[20] Id. at 88.
[21] Id.
[22] Id.
[23] Id. at 89.
[24] Id. at 90.
[25] Id. at 90-91.
[26] See id. at 91.
[27] Id. at 92.
[28] Id.
[29] Id. at 85.
[30] Id. at 93.
[31] See id. at 85-86.
[32] Id. at 96.
[33] Id. at 85-116. Penned by Associate Justice Ricardo R. Rosario, with Associate Justices Ramon R. Garcia and Mario V. Lopez concurring.
[34] Id. at 96-100.
[35] Id. at 102.
[36] Id. at 115.
[37] 595 Phil. 887 (2008).
[38] See rollo, pp. 43, 111.
[39] Id. at 105-111.
[40] Id. at 24.
[41] Id. at 117-132.
[42] Id. at 131.
[43] Id. at 133-140.
[44] Id. at 140.
[45] Id. at 141.
[46] See id. at 153-158.
[47] Id. at 165.
[48] Id. at 167-172.
[49] Id. at 170-172.
[50] Id. at 41-45.
[51] Id. at 44.
[52] Id.
[53] Id. at 19.
[54] Id. at 3-7.
[55] Id. at 16.
[56] Id. at 26-28.
[57] Id. at 28-29.
[58] Id. at 109-111.
[59] Philippine Ports Authority v. Nasipit Integrated Arrastre and Stevedoring Services, Inc., 595 Phil. 887, 903 (2008).
[60] See Heirs of Emiliano San Pedro v. Garcia, et al., 609 Phil. 369, 383 (2009).
[61] See Spouses Sy v. Young, 711 Phil. 444, 450 (2013).
[62] 693 Phil. 205 (2012).
[63] Id. at 223-224.
[64] G.R. No. 207408, April 18, 2016.
[65] Id. at 11-13.
[66] Rollo, pp. 79-83.
[67] Bank of the Philippine Islands v. Hontanosas, Jr., 737 Phil. 38, 57 (2014).
[68] Rollo, p. 131.
[69] Id. at 188.
[70] Id. at 29, 31.
[71] See id. at 32.
[72] See generally PLDT v. Eastern Telecommunications, Philippines, Inc., 703 Phil. 1 (2013).
SEPARATE CONCURRING OPINION
PERLAS-BERNABE, J.:
I concur in the result, although express certain reservations on the ponencia's application of the law of the case doctrine to reach the intended conclusion.
I.
The facts[1] are as follows: petitioner Philippine Ports Authority (PPA) accepted bids for a ten (10)-year contract to operate as the sole cargo holder at the port of Nasipit, Agusan del Norte. Respondent Nasipit Integrated Arrastre and Stevedoring Services, Inc. (NIASSI) was proclaimed as the winning bidder. The second highest bidder filed a protest against the award to NIASSI. Despite the protest, PPA issued to NIASSI a Notice of Award, directing the latter to signify its concurrence by signing the conforme portion. PPA received notice of NIASSI's conformity on January 3, 2001.
The Notice of Award requires the parties to formally execute a written contract. Instead of executing the contract, NIASSI requested PPA to issue a Hold-Over Authority (HOA). PPA issued the HOA initially for three (3) months from August 1, 2001 or until the cargo-handling contract is awarded, whichever comes first. The HOA was extended several times upon NIASSI's request even after the Office of the Government Corporate Counsel issued an opinion affirming the validity of the award in NIASSI's favor.
Barely two (2) months after the last extension of the HOA was granted, PPA sent a letter revoking the extension. It allegedly received numerous complaints regarding the poor quality of NIASSI's services due to inadequately maintained equipment. Thus, PPA would take over the cargo-handling services at the port starting on December 10, 2004.
Aggrieved, NIASSI filed a petition for mandamus[2] against PPA before the Regional Trial Court of Butuan City, Branch 3 (RTC), praying that a writ of mandamus be issued compelling PPA to formally execute a written contract reflecting its right to operate the port.
II.
Ancillary thereto, NIASSI's petition included an application for the issuance of a writ of preliminary mandatory injunction (WPMI),[3] seeking that the cargo-handling operations of the said port be returned to it pending litigation of the main case.
The RTC initially granted NIASSI's application for the issuance of a WPMI in an Order dated March 18, 2005. However, on PPA's motion for reconsideration, it reversed itself and dissolved the WPMI, thus reinstating PPA's cargo-handling operations.[4]
The RTC's holding on this incident (i.e., the dissolution of the WPMI) was elevated by NIASSI to the Court of Appeals (CA) on certiorari, docketed as CA-G.R. SP No. 00214. In a Decision[5] dated August 8, 2006, the CA granted the certiorari petition, finding, among others, that NIASSI had "a clear legal right to continue its operations in the port":[6]
Verily, the Holdover Authority (HOA) granted by [PPA] and the series of extensions allowing [NIASSI] to operate provisionally the arrastre service confirm the perfection of their contract despite the delay in its consummation due to acts attributable to [PPA]. But it cannot be gainsaid that the series of extensions constitute partial fulfillment and execution of the contract of cargo handling services.
x x x x
It is therefore Our submission that a perfected contract of cargo handling services existed when [NIASSI] won the bidding, given the Notice of Award and conformed to the conditions set forth in the Notice of Award because the requirements prescribed in the Notice of Award have no bearing on the perfection of the contract. On the contrary, it amounted to a qualified acceptance of [NIASSI's] offer, a clear legal right to continue its operations in the port. x x x.[7] (Emphases and underscoring supplied)
Accordingly, the CA went on to discuss the grounds and requisites for the issuance of a writ of preliminary injunction,[8] and ultimately ruled that:
WHEREFORE, finding merit in the petition for certiorari, the same is GRANTED. Accordingly, the assailed Order dated 11 April 2005 is hereby NULLIFIED and SET ASIDE for having been issued with grave abuse of discretion amounting to lack or in excess of jurisdiction. Consequently, the Order dated 18 March 2005 granting the Writ of Preliminary Mandatory Injunction is hereby REINSTATED.[9]
This Court later affirmed the CA in PPA v. NIASSI,[10] docketed as G.R. No. 174136.
With the WPMI reinstated, the case was remanded to the RTC for proceedings on the main. Instead of advancing to the pre-trial and trial stages of the proceedings, the RTC, after the parties' filing of their respective memoranda, dismissed the case on the ground of mootness. According to the RTC, the issue of whether or not PPA should be directed to formally execute a 10-year cargo-handling contract with NIASSI had been rendered moot and academic by the CA's ruling in CA-G.R. SP No. 00214, that a contract had been perfected between the parties. As such, there was no more need for the parties to execute the 10-year contract.[11]
However, the RTC reversed itself upon reconsideration,[12] and its reversal was later upheld by the CA on appeal in CA-G.R. SP No. 04828-MIN.[13] The CA held that the HOA is a separate agreement between the parties pending the issuance of the cargo-handling contract. Based on the language of the HOA, the hold-over permits do not constitute partial fulfillment of the unwritten contact. Thus, finding that NIASSI has a right to the 10-year cargo-handling contract in view of the Notice of Award and its compliance with the necessary requirements, PPA is bound to execute a formal contract.[14] Notably, this ruling was an adjudication by the CA on the main case, whereby it granted the main relief prayed for by NIASSI in its mandamus petition[15] PPA now assails this CA ruling via the present petition.
III.
The ponencia stands to reverse the CA's ruling in CA-G.R. SP No. 04828-MIN on the following grounds:
First, the CA's findings in CA-G.R. SP No. 00214 - more particularly, that a contract between PPA had been perfected - constitute the law of the case between the parties, and hence, binding, thereby rendering NIASSI's mandamus petition moot; [16] and
Second, the 10-year term of the perfected contract between the parties had already expired, leaving the RTC with nothing to enforce.[17]
I agree with the ponencia 's reversal of the aforesaid CA ruling. However, I find it unnecessary (and even improper) to apply the law of the case doctrine to reach this conclusion.
As above-intimated, the CA's findings in CA-G.R. SP No. 00214 were only made for the purpose of determining whether or not the WPMI, which the RTC previously dissolved, should be reinstated. In particular, the CA's holding that "a perfected contract of cargo handling services existed when [NIASSI] won the bidding, given the Notice of Award and conformed to the conditions set forth in the Notice of Award" was made relative to its conclusion that NIASSI had "a clear legal right to continue its operations in the port." The existence of a clear legal right is one of the requisites for the issuance of a writ of preliminary injunction. As enumerated by the CA itself in the same ruling:
The requisites for the issuance of a writ of preliminary injunction are: (1) the existence of a clear and unmistakable right that must be protected; and (2) an urgent and paramount necessity for the writ to prevent serious damage. In taking cognizance of an application for a writ of preliminary injunction, a court has the duty to determine whether the requisites for the grant of an injunction are present in the case before it.[18]
Jurisprudence provides that in a proceeding to determine whether to issue a writ of preliminary injunction, the applicant must show that it has a clear legal right to be protected and that the other party's act against which the writ is to be directed violates that right.[19] The Court, however, clarified that although a clear right is necessary, its existence need not be conclusively established.[20] In fact, the evidence to be submitted need not be conclusive or complete but need only be a sampling to convince the court to issue the preliminary injunction pending the decision on the merits of the case.[21] In more explicit terms, the applicant only needs to show that it has the ostensible right to the final relief prayed for in the petition.[22] Therefore, the issuance of a preliminary injunction does not conclusively determine the merits of the main case or decide controverted facts therein.[23] This is because a preliminary injunction is merely an ancillary remedy to preserve the status quo and prevent irreparable harm until the merits of the main case resolving the rights of the parties are heard and decided.[24]
Verily, it is within the foregoing legal framework that we should treat and characterize the CA's findings in CA-G.R.SP No. 00214.
Again, the issue which the CA resolved in CA-G.R. SP No. 00214 was whether or not the WPMI, which the RTC previously dissolved, should be reinstated. The context, evidentiary parameters, and issue in CA-G.R. SP No. 00214 are clearly different from those that should apply in the adjudication of the main case.
In CA-G.R. SP No. 00214, the CA only resolved an incident pertaining to the issuance of a provisional relief, for which the parties need not submit complete or conclusive evidence. Only a sampling of evidence is required to determine the existence of an ostensible right to the final relief prayed for. This determination leads the issuing court to merely enjoin/restrain a particular conduct or preserve the status quo until the merits of the main case are fully heard and decided.
On the other hand, the resolution of the main case requires the parties to completely present their respective evidence during trial. While hearings were conducted in the proceedings a quo, these were only meant to ascertain the merits of NIASSI's application for a WPMI. In the final analysis, the CA in CA-G.R. SP No. 00214 did not determine, under the evidentiary standard of preponderance of evidence, whether or not to grant NIASSI's mandamus petition.
According to jurisprudence, the law of the case doctrine means that whatever is once irrevocably established as the controlling legal rule or decision between the same parties in the same case continues to be the law of the case, whether correct on general principles or not, so long as the facts on which such decision was predicated continue to be the facts of the case before the court.[25] In other words, when an appellate court passes on a question and remands the case to the lower court for further proceedings, the question settled therein becomes the law of the case upon subsequent appeal.[26]
What was irrevocably established by the CA in CA-G.R. SP No. 00214, as affirmed by this Court in PPA v. NIASSI, is that NIASSI was entitled to the reinstatement of the WPMI previously dissolved by the RTC. While the CA had to pass upon the question of whether or not a perfected contract already existed at the time of NIASSI's conformity to the Notice of Award, this sub-issue was resolved under the framework of preliminary injunctions, and hence, cannot bind the court in resolving the main case. Indeed, the CA's finding on the perfection of the said contract was made only for the limited purpose of determining whether NIASSI possessed an ostensible right to justify the reinstatement of the writ of preliminary injunction.
The ponencia supports its application of the law of the case doctrine by citing Timbol v. Philippine National Bank (Timbol).[27] While Timbol presents a situation similar to this case, I, however, believe that the doctrine was misapplied. At the risk of repetition, it is my view that a court cannot take as conclusive on the actual main case a mere incidental adjudication on a provisional relief. As above-illustrated, the context, evidentiary parameters, and issues involved are simply different between the two proceedings. Moreover, from a practical standpoint, a party can shrewdly avert a full-blown trial on the main case's merits by simply invoking the law of the case doctrine after the issue on the propriety of an injunctive relief has been finally resolved on appeal. In this regard, the parties would not be accorded the benefit of presenting their complete evidence under the rigors of a civil trial, and courts would simply shortcut the adjudication process on the basis of prima facie determinations.
Contrary to the ponencia 's assertion,[28] the fact that no other proceedings were conducted and no other evidence were presented after the Court reinstated the WPMI does not render conclusive in the main case the CA's prima facie factual findings in CA-G.R. SP No. 00214. I reiterate that the context in which the CA made those factual findings differs from the context in the main case. After the Court reinstated the WPMI, what was incumbent upon the RTC was to receive evidence on the issue in the main case, instead of short railing the proceedings by requiring the parties to submit their respective memoranda anent its misplaced perception of mootness. To my mind, the RTC's failure to follow the proper procedure (i.e., to proceed to trial) is not sufficient reason to elevate the status of the CA's factual findings in CA-G.R. SP No. 00214 from prima facie to conclusive on the main. Instead, the proper recourse would be to remand this case to the trial court for reception of evidence on the issue in the main case. However, as will be explained below, NIASSI's admissions in this case render the remand unnecessary, and thus, ultimately validates the ponencia's reversal of the CA's ruling in CA-G.R. SP No. 04828-MIN.
In particular, although it appears that the RTC did not proceed to trial in the main proceedings, records show that NIASSI admitted that there was already a meeting of the minds between the parties when it signed the conforme of the Notice of Award.[29] By this admission therefore, this Court can already derive the conclusion that the contract between the parties had already been perfected on January 3, 2001. In fact, NIASSI also admitted that it was allowed to operate the cargo-handling services at the port via the hold-over permits from August 1, 2001 until PPA took over the operations on December 10, 2004.[30] However, NIASSI regained control of the operations of the cargo-handling services after the Court reinstated the WPMI.[31] NIASSI did not dispute that it has been conducting such operations since the reinstatement of the writ until the present. Thus, these admissions - which therefore dispenses with the need for trial - indubitably establish that the contract was not only perfected at the time of NIASSI's conformity to the Notice of Award but also that the obligations therein had been performed as soon as NIASSI took over the operations even without a formal written contract.
The usual procedure under the PPA Rules[32] is that the Philippine Ports Authority will issue the Notice of Award to the winning bidder and, thereafter, the parties will execute a cargo-handling contract to enable it to issue a Notice to Commence cargo-handling operations. Without the Notice to Commence, the winning bidder is prohibited from starting the cargo-handling operation.[33] In the present case, NIASSI conducted operations by virtue of the HOA and its extensions prior to the execution of the written contract. Thus, the HOA and the extensions took the place of the Notice to Commence while no written contract has been executed. As the ponencia observed, NIASSI had control over the operations of the cargo-handling services at the port for a total period of 12 years, 3 months, and 15 days, which is clearly way beyond the 10-year period.[34] Therefore, the cargo- handling contract between the parties has already expired and now, ceases to have any force and effect. Accordingly, the core issue in the main proceeding - whether PPA should be compelled by mandamus to execute a contract - is already moot and academic on this ground.
WHEREFORE, under these premises, I vote to GRANT the petition.
[1] See ponencia, pp. 1-3.
[2] Dated December 10, 2004. See rollo, pp. 66-73.
[3] See Amended Petition dated December 22, 2004; id. at 75-83.
[4] See ponencia, pp. 3.
[5] Rollo, pp. 85-116. Penned by Associate Justice Ricardo R. Rosario with Associate Justice Ramon R. Garcia and Mario V. Lopez concurring.
[6] Rollo, pp. 109-111.
[7] Id. at 111.
[8] Id. at 111-112.
[9] Id. at 115.
[10] 595 Phil. 887 (2008).
[11] See Resolution dated June 1, 2011, penned by Judge Godofredo B. Abul, Jr.; rollo, pp. 117-132.
[12] Id. at 133-140.
[13] See Amended Decision dated September 14, 2015, penned by Associate Justice Henri Jean Paul B. Inting with Associate Justices Edgardo A. Camello and Pablito A. Perez concurring; id. at 41-45.
[14] Id. at 44.
[15] See Amended Petition dated December 22, 2004; id. at 82.
[16] See ponencia, pp. 13-14.
[17] Id. at 15.
[18] Rollo, p. 112.
[19] China Banking Corporation v. Spouses Ciriaco, 690 Phil. 480, 488 (2012); Executive Secretary v. Forerunner Multi Resources, Inc., 701 Phil. 64, 68-69 (2013).
[20] Bank of the Philippine Islands v. Hontanosas, Jr., 737 Phil. 38, 56 (2014), citing Saulog v. CA, 330 Phil. 590, 602 (1996).
[21] Id.
[22] Id.
[23] Id.
[24] See BP Philippines, Inc. v. Clark Trading Corp.,695 Phil. 481, 491-492 (2012), citing Bacolod City Water District v. Labayen, 487 Phil. 335, 346-347 (2004).
[25] Spouses Sy v. Young, 711 Phil. 444, 449-450 (2013); Suarez-De Leon v. Estrella, 503 Phil. 34, 41 (2005); Cucueco v. CA, 484 Phil. 254, 267 (2004).
[26] Dela Cruz v. Sandiganbayan, 622 Phil. 908, 923-925 (2009); Cucueco v. CA, 484 Phil. 254, 267-268 (2004); Agustin v. CA, 338 Phil. 171, 176 (1997).
[27] See G.R. No. 207408, April 18, 2016.
[28] See ponencia, pp. 14-15.
[29] Rollo, p. 188.
[30] Id. at 190.
[31] Id. at 198.
[32] See PPA Administrative Order No. 03-2000, Revised Guidelines in the Conduct of Public Budding and Comparative Evaluation For Cargo Handling Services, February 15, 2000. (id. at 205-234) specifically Annex B or the template of Instruction to Bidders (id. at 228-234).
[33] Id.
[34] See ponencia, p. 15:
January 3, 2001 - December 9, 2004 Perfection of Contract until PPA's take over March 28, 2005 - April 11, 2005 Issuance of the Writ of Preliminary Injunction until Dissolution August 8, 2006 to December 3, 2014 Reinstatement of Preliminary Injunction days to Institution of the present Petition