DANILO P. VILLAREY III, 2019-21368 Malaga v.

Penachos
Administrative Law General Concepts 1992 Cruz
SUMMARY DOCTRINE
ISCOF caused the publication of Invitation Instrumentality refers to any agency of the National Government, not integrated
to Bid. Petitioners submitted their within the department framework, vested with special functions or jurisdiction by law,
documents but was considered late. After endowed with some if not all corporate powers, administering special funds, and
filing complaint with RTC, RTC issued enjoying operational autonomy, usually through a charter. This term includes
restraining order from conducting the regulatory agencies, chartered institutions, and government-owned or controlled
bidding. ISCOF argues that Courts cannot corporations.
do so because they are prohibited under
PD 1818. SC ruled that, though ISCOF is Chartered institution refers to any agency organized or operating under a special
an instrumentality, the irregularities in the charter, and vested by law with functions relating to specific constitutional policies or
bidding can allow courts to issue objectives. This term includes the state universities and colleges, and the monetary
restraining order. authority of the state.

FACTS

▪ Iloilo State College of Fisheries (ISCOF) through its Pre-qualification, Bids and Awards Committee (PBAC) caused the publication
an Invitation to Bid for the construction of the Micro Laboratory Building at ISCOF. Petitioners BE Construction and Best Built
Construction submitted their documents at 2pm on December 2, 1988. Petitioner Occeña submitted his PRE-C1 on Dec. 5. All of
them were not allowed to participate in the bidding because the documents were considered late.
▪ RTC Ilolilo
o Petitioners filed complaint against the chairman and PBAC members.
o RTC issued a restraining order prohibiting PBAC from conducting the bidding and awarding the project.
o ISCOF filed a motion to lift the restraining order on the ground that Court is prohibited from issuing the same by PD
1818, and for being moot and academic since the bidding already took place.
o Petitioners argued that ISCOF is not covered by PD 1818 as it has its own charter and separate and distinct corporate
personality and is not part of the national government or any local political subdivision.

RATIO

W/N the Courts can issue a restraining order for the irregularities in the bidding process? YES.

 Definition under the 1987 Administrative Code:

o Instrumentality refers to any agency of the National Government, not integrated within the department framework, vested
with special functions or jurisdiction by law, endowed with some if not all corporate powers, administering special funds,
and enjoying operational autonomy, usually through a charter. This term includes regulatory agencies, chartered
institutions, and government-owned or controlled corporations. (Sec. 2 (5) Introductory Provisions).
o Chartered institution — refers to any agency organized or operating under a special charter, and vested by law with
functions relating to specific constitutional policies or objectives. This term includes the state universities and colleges,
and the monetary authority of the state. (Sec. 2 (12) Introductory Provisions).
 It is clear from the definitions that ISCOF is a chartered institution and is therefore covered by PD1818.
 Indications that it is a government instrumentality:
o ISCOF was created in pursuance of the integrated fisheries development policy of the State
o The Treasurer of the RP is also the ex-officio treasurer
o Heads of bureaus and offices of the national government are authorized to loan or transfer to it equipment
o 1.5M is appropriated out of funds of National Treasury and the funds are included in the General Appropriations Law
 HOWEVER, it does not automatically follow that ISCOF is covered by the prohibition of said decree.
 This is similar to Datiles v. Sucaldito:
o prohibition pertained to the issuance of injunctions or restraining orders by courts against administrative acts
in controversies involving facts or the exercise of discretion in technical cases.
o that on issues definitely outside of this dimension and involving questions of law, courts could not be prevented
by P.D. No. 605 from exercising their power to restrain or prohibit administrative acts.
 In this case, there were 2 irregularities
o PBAC set deadlines for filing the PRE-C1 and the opening of bids and then changed these deadlines without prior notice
o PBAC was required to issue to pre-qualified applicants the plans, specifications and proposal book forms for the project
to be bid 30 days before the date of bidding if the estimate project cost was between P1M and P5M. This was provided
late.
 It is apparent that the present controversy did not arise from the discretionary acts of the administrative body nor does
it involve merely technical matters. What is involved here is non-compliance with the procedural rules on bidding which
required strict observance. The purpose of the rules implementing P.D. 1594 is to secure competitive bidding and to prevent
favoritism, collusion and fraud in the award of these contracts to the detriment of the public. This purpose was defeated by the
irregularities committed by PBAC.
 It has been held that the three principles in public bidding are the offer to the public, an opportunity for competition and a
basis for exact comparison of bids. A regulation of the matter which excludes any of these factors destroys the distinctive
character of the system and thwarts the purpose of its adoption.
 In the case at bar, it was the lack of proper notice regarding the pre-qualification requirement and the bidding that caused the
elimination of petitioners B.E. and Best Built.
 P.D. 1818 was not intended to shield from judicial scrutiny irregularities committed by administrative agencies such as the
anomalies above described. Hence, the challenged restraining order was not improperly issued by the respondent judge and the
writ of preliminary injunction should not have been denied.
 However, this fait accompli has made the petition for a writ of preliminary injunction moot and academic.
FALLO
Judgement upheld the restraining order.