Hutchison Ports Philippines Limited (HPPL) v. SBMA Ponente: Ynares-Santiago, J.

Facts: SBMA invited bidders for an opportunity to develop and operate a modern marine container terminal within the Subic Bay Freeport Zone. Out of the seven (7) bidders, three (3) were deemed to have qualified: ICTSI, RPSI and HPPL. The bidders were subsequently required to submit their business plans. Before the envelopes containing the business plans could be opened, RPSI formally protested that ICTSI is legally barred from operating a second port, on the ground of E.O. no. 212 and the fact that it was already operating the Manila International Container Port, giving rise to a conflict of interest. SBMA-PBAC rejected ICTSIs bid and awarded the winning bid to HPPL. However, ICTSI filed an appeal with the SBMA and the Office of the President. In a memorandum, the President ordered then SBMA Chairman Gordon to reevaluate the bids together with the Commission on Audit. Again, the SBMA awarded the bid to HPPL, on the basis of it having a realistic business plan offering the greatest financial return to the SBMA and the most advantageous to the government. Notwithstanding the SBMAs board recommendations, then Executive Secretary Reuben Torres submitted a memorandum to the Office of the President, recommending a rebidding. Feeling aggrieved by the SBMAs refusal to begin negotiations, HPPL, on July 7, 1997, filed a complaint against the SBMA before the RTC alleging that a binding and legally enforceable contract had been established between HPPL and SBMA under Article 1305 of the Civil Code, considering that the SBMA had repeatedly declared and confirmed that the HPPL was the winning bidder. Pursuant to the Presidents memorandum to conduct another bidding, the SBMA sent notices to the bidders who initially qualified, including HPPL, to declare their interest in participating in a rebidding of the proposed project. Upon learning that the SBMA had accepted the bids of ICTSI and RPSI, HPPL filed a motion for maintenance of the status quo. It was denied.

Issues:

1. WON the Court may issue an injunctive writ 2. WON the president can set aside the awarding of the project to HPPL by the SBMA? If yes, can the Office of the President direct SBMA to conduct rebidding of the proposed project? Held/Ratio: 1. No. For an injunctive writ to be issued, it must be proven that (1) the petitioner/applicant has a clear and unmistakable right and (2) that there is a material and substantial invasion of such right.

HPPL has not shown that it has a clear and unmistakable right to be declared the winning bidder with finality, such that the SBMA can be compelled to negotiate a concession contract. Though the SMA may have declared it the winner, said award cannot be final and unassailable. 2. Yes. The SBMA Board of Directors and other officers are subject to the control and supervision of the Office of the President. All projects undertaken by the SBMA require the approval of the Office of the President, as per LoI no. 620, which places the SBMA under its ambit as an instrumentality. Letters of Instruction No. 620 mandates that the approval of the President is required in all contracts of the national government offices, agencies and instrumentalities including GOCCS involving P2M and above, awarded through public bidding or negotiation. The President may, within his authority, overturn or reverse any award made by the SBMA Board of Directors for justifiable reasons. When the President issued the memorandum setting aside the award previously declared by SBMA in favor of HPPL, the same was within authority of the President and was a valid exercise of his prerogative. Petition dismissed.