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[ G.R. No. 139128. September 6, 1999]

MARK SENSING [AUST] PTY. LTD. vs. CA, et al.

FIRST DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this court dated SEPT 6 1999.

G.R. No. 139128 (Mark Sensing [Aust] Pty. Ltd. vs. Court of Appeals, et al.)

This resolves the urgent motion to lift the Temporary Restraining Order this Court issued on July 26, 1999, filed by respondents. Movants alleged that PCSO has terminated its BOT Agreement with petitioner after the latter consistently failed to supply PCSO's critical lotto paper requirements. It was for this reason that PCSO was constrained to turn to other suppliers, which is authorized in Section 2-3 of the Agreement1 [Petition Annex "D"; Rollo, pp. 90-105.], viz.:

"xxx during the Team of Operation, PCSO shall source all its requirements for betslips, thermal paper and impact paper for its lottery operations from MSA unless the latter is unable to fulfill PCSO's order in terms of the agreed schedule, quantity and quality." 2 [Rollo, p. 91.]

Movants further alleged that not only did petitioner repeatedly default in its obligations, it also delivered supplies of inferior quality which had to be rejected. Moreover, petitioner is requiring PCSO to pay for the customs duties and taxes for the lotto paper importation.

Petitioner filed an opposition alleging, in fine that its prices are slightly higher because its supplies are of better quality; that customs duties have always been paid by PCSO; and that PCSO cannot compel delivery inasmuch as it has incurred a past due account to petitioner.

After a careful deliberation of the respective arguments of the contending parties, this Court finds that the overriding consideration of public interest justified PCSO in sourcing its paper requirements from other suppliers during the period that petitioner failed to deliver. Notably, petitioner did not deny the non-deliveries, but merely raised as an excuse PCSO's non-payment of its past due account. Indeed, this Court agrees with movants that the shortage of paper supplies will paralyze its operation and, consequently, jeopardize its integrity as the government's lead public agency for charitable projects whose fund-raising activities depend on the continuous and uninterrupted supply of lotto quality bet slips or pay slips.

ACCORDINGLY, in view of the foregoing, the Temporary Restraining Order issued on July 26, 1999 is * [REVISION: Note ADDED.] hereby LIFTED. Davide, Jr., C.J. and CHAIRMAN, is on official leave.

Very truly yours,

(Sgd.) VIRGINIA ANCHETA-SORIANO

Clerk of Court

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