WT Construction v. Department of Public Works
REITERATIONFacts
The Antecedents: Petitioners WT Construction, Inc. and Chiara Construction formed a joint venture to bid for the construction of the "2nd Archbishop Reyes Avenue Flyover." DPWH published an invitation to bid. Petitioners submitted their bid. On December 27, 2002, BAC Region VII excluded petitioners' bid from opening and disqualified them for failing to inform BAC of the joint venture and present a special license from the Philippine Construction Accreditation Board (PCAB) as such joint venture. BAC Region VII declared WTG Construction and Development Corp. (WTG) as the lowest bidder. Procedural History: Petitioners appealed to the DPWH Secretary. On May 28, 2003, the DPWH Secretary directed BAC Region VII to open and read petitioners' bid and award the contract if it was the lowest and most advantageous. BAC Region VII scheduled the opening for November 3, 2003, with DPWH Central Office officials present. On November 28, 2003, BAC Region VII recommended disqualification of petitioners, citing lack of PCAB special license and required surety bond, and reiterated the award to WTG. Petitioners filed a complaint with the DPWH Secretary and subsequently filed a petition for mandamus with the RTC of Cebu City. The RTC dismissed the case on April 30, 2004, for non-exhaustion of administrative remedies. DPWH Secretary Soriquez denied petitioners' appeal on March 12, 2004, and affirmed the award to WTG. WTG was issued the Notice to Commence Work on March 15, 2004, and proceeded with construction. The Petition: Petitioners filed a Petition for Preliminary Mandatory Injunction with Temporary Restraining Order, seeking to compel DPWH and BAC Region VII to award the contract to them, alleging they submitted the lowest numerical bid and that bad faith, conspiracy, forgery, and premature award attended their disqualification and the award to WTG. They contended the PCAB license was only needed after award and their bidder's bond sufficed as a surety bond.
Issue(s)
Whether the petitioners are entitled to the award of the contract for the Flyover Project as the lowest bidder. Whether the disqualification of the petitioners' bid was justified. Whether the issuance of a writ of preliminary mandatory injunction is proper. Whether the petition was properly filed with the Supreme Court considering Republic Act No. 8975.
Ruling
The petition is DENIED. The Supreme Court affirmed the disqualification of the petitioners' bid and the award of the contract to WTG Construction and Development Corp. The Court held that the mere submission of the lowest bid does not automatically entitle a bidder to the award, as the bid must still undergo post-evaluation and post-qualification. The petitioners failed to meet the requirements of a special PCAB license for a joint venture and a surety bond, justifying their disqualification. The Court also found that the petitioners failed to substantiate their allegations of fraud and bad faith, and that the petition for preliminary mandatory injunction was properly filed with the Supreme Court under R.A. 8975.
Ratio Decidendi
On whether the petitioners are entitled to the award of the contract for the Flyover Project as the lowest bidder: The mere submission of the lowest bid does not automatically entitle a bidder to the award of the contract. The bid must still undergo evaluation and post-qualification to be declared the lowest responsive bid. The Invitation to Bid explicitly states that the Government reserves the right to reject any and all bids and accept the offer most advantageous to the Government. This reservation allows the Government discretion in awarding the contract, and the Court will not substitute its judgment for that of the agency unless the discretion is arbitrarily exercised. In this case, the petitioners' bid was found to be non-responsive due to defects in required documents. On whether the disqualification of the petitioners' bid was justified: The disqualification of the petitioners' bid was justified. While the technical and financial envelopes were opened, a post-evaluation and qualification were essential. The petitioners failed to present a special PCAB license for the joint venture, submitting only a notarized application. Furthermore, they submitted a bidder's bond instead of the required surety bond under Section 19.2 of Executive Order No. 40. These defects rendered their bid non-responsive and non-compliant with the requirements of the project and existing laws, rules, and regulations. The subsequent presentation of a special license after the disqualification did not cure the defect at the time of bidding. On whether the issuance of a writ of preliminary mandatory injunction is proper: The petitioners failed to discharge the burden of showing entitlement to a writ of preliminary mandatory injunction. This extraordinary remedy requires the movant to show the existence of a clear and unmistakable right to be protected, that the invasion of such right is material and substantial, and that there is an urgent need to prevent serious damage. The petitioners' claims of fraud, bad faith, conspiracy, and forgery were not sufficiently substantiated. The allegations of fraud and bad faith, and the claim of forgery, involve factual issues that require evidentiary proof and cannot be resolved in a petition for injunction. On whether the petition was properly filed with the Supreme Court considering Republic Act No. 8975: The petition for preliminary mandatory injunction was properly filed with the Supreme Court in accordance with Republic Act No. 8975 (R.A. 8975). R.A. 8975 vests in the Supreme Court the exclusive authority to issue temporary restraining orders, preliminary injunctions, and preliminary mandatory injunctions against the Government or its instrumentalities in cases involving bidders or those claiming rights through bidders concerning government infrastructure projects. Lower courts are prohibited from issuing such injunctive orders unless the case involves extreme urgency and constitutional issues that would lead to grave injustice and irreparable injury. This case, arising from a bidder's complaint seeking to enjoin the award and implementation of a government infrastructure project, falls squarely within the purview of R.A. 8975.
Main Doctrine
The mere submission of the lowest bid does not automatically entitle a bidder to the award of a contract; the bid must undergo post-evaluation and post-qualification to determine its responsiveness and compliance with legal requirements. Failure to meet these requirements, such as lacking a special license for a joint venture or failing to submit a required surety bond, justifies disqualification.