GREGORIO R. VIGILAR v. ARNULFO D. AQUINO, GR No. 180388, 2011-01-18
Facts:
On July 7, 1992, A.D. Aquino Construction and Supplies,
through its owner Arnulfo D. Aquino, was awarded the project for the
construction of a dike by bulldozing part of the Porac River as Brg. Ascomo-Pulungmasle,
Guagua, Pampanga. A "Contract of Agreement" was thereafter executed
between him and concerned petitioners for the amount of PhP1,873,790.69, to
cover the project cost.
By 9 July 1992, the project was duly completed by
respondent, who was then issued a Certificate of Project Completion dated 16
July 1992. The certificate was signed by Romeo M. Yumul, the Project Engineer;
as well as petitioner Romeo N. Supan, Chief of the Construction Section, and by
petitioner Twaño.
Respondent Aquino, however, claimed that PhP1,262,696.20 was
still due him, but petitioners refused to pay the amount. He thus filed a
Complaint for the collection of sum of money with damages before the Regional Trial
Court of Guagua, Pampanga.
Petitioners, for their part, set up the defense that the Complaint was a suit against the
state; that respondent failed to exhaust administrative remedies; and that the
"Contract of Agreement" covering the project was void for violating
Presidential Decree No. 1445, absent the proper appropriation and the Certificate
of Availability of Funds.
On 28 November 2003, the lower court ruled in favor of
respondent
On appeal, the Court of Appeals reversed and set aside the
Decision of the lower court
Dissatisfied with the Decision of the Court of Appeals,
petitioners are now before this Court, seeking a reversal of the appellate
court's Decision
Issues:
DOCTRINE OF NON-SUABILITY OF THE STATE
FAILURE OF RESPONDENT TO EXHAUST ALL ADMINISTRATIVE REMEDIES
Ruling:
It has been established that the doctrine of exhaustion of
administrative remedies and the doctrine of primary jurisdiction are not
ironclad rules.
In Republic of the Philippines v. Lacap, this Court enumerated the numerous exceptions
to these rules, namely: (a) where there is estoppel on the part of the party
invoking the doctrine; (b) where the challenged administrative act is patently
illegal, amounting to lack of jurisdiction; (c) where there is unreasonable
delay or official inaction that will irretrievably prejudice the complainant;
(d) where the amount involved is relatively so small as to make the rule
impractical and oppressive; (e) where the question involved is purely legal and
will ultimately have to be decided by the courts of justice; (f) where judicial
intervention is urgent; (g) where the application of the doctrine may cause
great and irreparable damage; (h) where the controverted acts violate due
process; (i) where the issue of non-exhaustion of administrative remedies has
been rendered moot; (j) where there is no other plain, speedy and adequate
remedy; (k) where strong public interest is involved; and (l) in quo warranto
proceedings. In the present case, conditions (c) and (e) are present.
The government project contracted out to respondent was
completed almost two decades ago. To delay the proceedings by remanding the
case to the relevant government office or agency will definitely prejudice
respondent. More importantly, the issues in the present case involve the
validity and the enforceability of the "Contract of Agreement"
entered into by the parties. These are questions purely of law and clearly
beyond the expertise of the Commission on Audit or the DPWH.
C.V. Canchela & Associates is similar to the case at
bar, in that the contracts involved in both cases failed to comply with the
relevant provisions of Presidential Decree No. 1445 and the Revised
Administrative Code of 1987. Nevertheless, "(t)he illegality of the
subject Agreements proceeds, it bears emphasis, from an express declaration or
prohibition by law, not from any intrinsic illegality. As such, the Agreements
are not illegal per se, and the party claiming thereunder may recover what had
been paid or delivered."
The government project involved in this case, the
construction of a dike, was completed way back on 9 July 1992. For almost two
decades, the public and the government benefitted from the work done by
respondent. Thus, the Court of Appeals was correct in applying Eslao to the
present case. In Eslao, the Court stated:
To deny the payment to the contractor of the two buildings
which are almost fully completed and presently occupied by the... university
would be to allow the government to unjustly enrich itself at the expense of
another. Justice and equity demand compensation on the basis of quantum meruit.
Neither can petitioners escape the obligation to compensate
respondent for services rendered and work done by invoking the state's immunity
from suit.
The Court has long established in Ministerio v. CFI of Cebu,
[16] and recently reiterated in Heirs of Pidacan v. ATO, that the doctrine of governmental immunity
from suit cannot serve as an instrument for perpetrating an injustice to a
citizen.
As the Court enunciated in EPG Construction: it would be the
apex of injustice and highly inequitable to defeat respondent's right to be
duly compensated for actual work performed and services rendered, where both
the government and the public have for years received and accepted benefits
from the project and reaped the fruits of respondent's honest toil and labor.
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