December 2011 - Philippine Supreme Court Resolutions
Philippine Supreme Court Resolutions
[G.R. No. 183789 : December 14, 2011]
POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT CORPORATION VS. POZZOLANIC PHILIPPINES, INCORPORATED
G.R. No. 183789 (Power Sector Assets and Liabilities Management Corporation vs. Pozzolanic Philippines, Incorporated). - For resolution of the Court are the following: (1) Manifestation and Compliance[1] dated 28 September 2011 filed by petitioner Power Sector Assets and Liabilities Management Corporation, (2) Urgent Motion for Leave to Admit "Urgent Motion to Dismiss Appeal"[2] dated 10 October 2011 filed by respondent Pozzolanic Philippines, Incorporated; (3) Urgent Motion (To Consider the "Urgent Motion for Leave to Admit 'Urgent Motion to Dismiss Appeal�� as a Supplement to the "Motion for Reconsideration� of Pozzolanic Philippines, Inc.)[3] dated 11 October 2011 filed by respondent; and (4) Urgent Motion for Leave to Present Additional Annex[4] dated 19 October 2011, likewise filed by respondent.
In the Decision of the Court dated 24 August 2011, the Court: (1) granted petitioner's petition for review on certiorari; (2) reversed and set aside the Decision of the Regional Trial Court declaring respondent's right of first refusal to the fly ash of National Power Corporation's (NPC) power plants valid and binding on petitioner; (3) declared as null and void the respective contracts granting respondent the right to withdraw the fly ash of the Calaca, Sual and Masinloc Power Plants; and (4) ordered petitioner to conduct a bidding of the right to purchase the fly ash produced by the aforesaid power plants.
Respondent filed a motion for reconsideration of the above-mentioned Decision, which motion was denied by the Court with finality in a Resolution dated 5 October 2011.
On 30 September 2011, petitioner filed a Manifestation and Compliance informing the Court of the following:
1. The Masinloc Plant was bid out through an open and competitive public bidding on 26 July 2007 and turned over to Power Partners Co. Ltd. (MPPCL), the winning bidder, on 16 April 2008;
2. The Calaca Plant was bid out through open and competitive negotiation process on 8 July 2009 and turned over to the winning bidder, DMCI Holdings, Inc. (DMCI), on 3 December 2009. The negotiation process was conducted after two failed competitive biddings;[5] and
3. The Sual Power Plant was constructed by CEPA Pangasinan Electric Ltd. (CEPA) under an Energy Conversion Agreement (ECA). The ECA for the Sual Power Plant is one of the Independent Power Producer (IPP) contracts which petitioner is mandated to privatize through the appointment of IPP administrators. In the bidding conducted for the purpose, San Miguel Energy Corporation (SMEC) emerged as the winning bidder. Consequently, the operation of the plant was turned over to SMEC on 6 November 2009.[6]
In view of the foregoing, petitioner prays that the biddings it conducted for the sale of the Calaca and Masinloc Plants and the bidding for the appointment of an IPP administrator for the Sual Plant be deemed as sufficient compliance with the directive of the Court to conduct a bidding of the right to purchase the fly ash produced by the aforementioned power plants.
As a result of the disclosures made by petitioner in its Manifestation and Compliance, respondent is once again before Us through an Urgent Motion for Leave to Admit "Urgent Motion to Dismiss Appeal" praying that: (1) the 24 August 2011 Decision of the Court be reversed and set aside; (2) the appeal of petitioner be dismissed in toto; and (3) the Decision of the RTC be affirmed and declared final.
Further to its Motion for Leave to Admit "Urgent Motion to Dismiss Appeal," respondent also filed: (1) another Urgent Motion (To Consider the "Urgent Motion for Leave to Admit 'Urgent Motion to Dismiss Appeal,'" as a Supplement to the "Motion for Reconsideration" of Pozzolanic Philippines, Inc.) praying that its Urgent Motion for Leave to Admit "Urgent Motion to Dismiss Appeal" be considered and treated as a Supplement to the Motion for Reconsideration and be resolved together with the Motion for Reconsideration; and (2) an Urgent Motion for Leave to Present Additional Annex praying that the Court allow and consider the affidavit executed by Mr. Edgardo Espiritu, the Chairman of NPC from the year 1986 to 1988. The affidavit of Mr. Espiritu alleged that the Batangas Contract "was a negotiated contract, precisely because previous attempts of NPC to bid the fly ash had failed as there were no bidders."
In its Urgent Motion for Leave to Admit ''Urgent Motion to Dismiss Appeal," respondent argued that after the sale of the three power plants to private entities, petitioner lost its personality to continue prosecuting its appeal and the issues in this case became moot and academic as early as 3 December 2009 - when the last of the three power plants were disposed of by petitioner by public auction - way before the Decision of the Supreme Court in this case was promulgated. Thus, according to respondent, it is imperative that the appeal of petitioner be dismissed, as the adverse Decision of the Court, if continued to be enforced, would constitute a grave injustice to both respondent and the administration of justice.
The lack of merit in respondent's position is readily discernible; one need only recall the focal issue in this case.
Our decision of 24 August 2011 declared as invalid respondent's right of first refusal to the fly ash of NPC's power plants for having been obtained in contravention of the requirements of public bidding and therefore contrary to public policy. Therefore, the basic issue presented in this case was the validity of respondent's right of first refusal. It confounds the Court how, as claimed by respondent, this issue is mooted by the fact that petitioner has, in the meantime, sold the power plants. Regardless of such sale, the question of whether or not respondent acquired any right to withdraw the fly ash of NPC's power plants by virtue of its supposed right of first refusal remains.
The trial court declared such right valid, and furthermore, binding on petitioner. In our Decision, We said otherwise because it violates the rules of competitive public bidding.
Respondent cannot claim that: (1) the sale of the power plants renders moot the present petition; (2) the mootness of this petition renders moot the issue of the correctness of the RTC decision; and (3) ergo, its right of first refusal over the purchase of the fly ash of NPC's power plants should now be honored. Put otherwise, the sale of the power plants by petitioner do not and cannot validate respondent's right of first refusal; the defect in the bidding process by which the same was acquired is not erased.
The allegation in the affidavit of the Chairman of NPC that at the time the Batangas Contract was drafted the contract for the purchase of the fly ash of the Calaca Plant had to be negotiated because of a failure of public bidding - and, therefore, no public bidding was actually conducted, much less did respondent win in any such bidding - is a new matter which is now only being raised for the first time after our 24 August 2011 Decision. It is well-settled that issues not raised and/or ventilated in the lower court cannot be raised for the first time on appeal.[7] From the time its complaint was filed in the trial court until the promulgation of the decision in this case, respondent has maintained that it entered into a long-term contract with NPC for the purchase of the fly ash produced by its plants "after it won the public bidding of the same.�[8] Thus, respondent cannot, at this late stage, raise this matter for the first time.
If there was a mistake on the part of the counsel of respondent in alleging that it participated in a public bidding of the right to purchase the fly ash of the Calaca Plant and won the same, then respondent is bound by such mistake. It is settled that clients are bound by the mistakes, negligence and omissions of their counsel.[9]cralaw
In any case, this allegation does not in any way affect the earlier findings and disquisitions of the Court in this case. The right of first refusal remains invalid because, as We pointed out in our Decision, it bars any and all true biddings in the future. The grant of the right to respondent was a grant of the right to buy the fly ash of all the coal-fired plants of NPC without having to go through public bidding.
WHEREFORE, the Court hereby RESOLVES to:
1. NOTE petitioner's Manifestation and Compliance dated 28 September 2011;
2. CONSIDER AS SUFFICIENT COMPLIANCE with the directive of the Court contained in its 24 August 2011 Decision, the sale through public bidding and the turn over of the Calaca, Masinloc and Sual Power Plants to private corporations on 3 December 2009, 16 April 2008, and 6 November 2009, respectively; and
3. DENY FOR UTTER LACK OF MERIT respondent's Urgent Motion for Leave to Admit "Urgent Motion to Dismiss Appeal." Accordingly, the Urgent Motion (To Consider the "Urgent Motion for Leave to Admit 'Urgent Motion to Dismiss Appeal,'" as a Supplement to the "Motion for Reconsideration" of Pozzolanic Philippines, Inc.) and the Urgent Motion for Leave to Present Additional Annex, filed in connection therewith, are likewise DENIED.
SO ORDERED.
Very truly yours,
(Sgd.) MA. LUISA L. LAUREA
Division Clerk of Court
Endnotes:
[1] Rollo, pp. 1064-1073.[2] Id. at 1075-1081.
[3] Id at 1082-1086.
[4] Id. at 1087-1091.
[5] Id. at 1065.
[6] Id. at 1067, 1068-1069.
[7] Tinio v. Manzano, G.R. 132102, 19 May 1999, 307 SCRA 460, 465 citing Rebodos v. WCC, 6 SCRA 7171, DBP v. CA, 116 SCRA 636, Galicia v. Polo, 179 SCRA 372.
[8] Rollo, p 87.
[9] Ruiz, et al. vs. Delos Santos, G.R. No. 166386, 27 January 2009, 577 SCRA 29; 47 citing Fukuzumi v. Sanritsu Great International Corporation, G.R. No. 140630, 12 August 2004, 436 SCRA 228,234.
