Malaga v Panachos
213 SCRA 516
Iloilo State College of Fisheries (ISCOF) through PBAC announced that the last day for submission of pre-qualification requirements was December 2, 1988 and that the bids would be received and opened on December 12, 1988. However, petitioners were not allowed to participate in the bidding because their documents were considered late for submitting the requirements after 10:00 am of December 2, 1988.
Petitioners filed a complaint against PBAC and prayed that the bidding be reset and their documents be accepted. In the event that the bidding had already been conducted, they further pray that the defendants be ordered not to award the project pending the resolution. Restraining order was then issued.
Respondents on the other hand filed a motion to lift the restraining order on the ground that courts are prohibited from issuing such under PD 1818.
Petitioner pointed out that PD 1818 is not applicable because ISCOF, although a State College, has its own charter and separate existence, making it not part of the national government or of any local political subdivision.
Issue:
1. W/N ISCOF is a part of the national government
2. W/N PD 1818 is applicable to this case
Ruling:
1. Yes. Under the Administrative Code of 1987, the definition of government instrumentality includes Regulatory agencies, chartered institutions and GOCCs. Chartered institutions, defined by the same code include the State Universities and Colleges and the monetary authority of the State. Further, there are clear indications that ISCOF is a government instrumentality, to wit: (1) it was created in pursuance of the integrated fisheries development policy of the State; (2) the Treasurer of the Republic of the Philippines shall be the ex-officio treasurer of the State College, with all accounts and expenses to be audited by CoA; (3) heads of the bureaus and offices are authorized to loan or transfer to it equipment, with the President's (State College) approval, for the benefit of the public and (4) maintenance and funds of the ISCOF be included in the General Appropriations Law.
2. No. Although ISCOF is a government instrumentality, the Court ruled that PD 1818 is not applicable in this case for there were irregularities committed by the PBAC. As a general rule, where a law requires a previous advertisement before government contracts be awarded, non compliance of the requirement will render the same VOID and of no offect. Two irregularities committed by the PBAC justified the injunction of the bidding and the award of the project. The purpose of the rules is to secure competitive bidding and to prevent favoritism, collusion and fraud in the award of these contracts to the detriment of the public.
PD 1818 was not intended to shield from judicial scrutiny irregularities committed by administrative agencies.