G.R. No. 245981 - Concurring Opinion

G.R. No. 245981, August 9, 2022,
♦ Decision, J. Lopez, [J]
♦ Dissenting Opinion, Leonen, [J]
♦ Separate Concurring Opinion, Caguioa, [J]
♦ Concurring Opinion, Lazaro-Javier, [J]
♦ Concurring Opinion, Gaerlan, [J]

NERI J. COLMENARES, BAYAN MUNA PARTY-LIST REPRESENTATIVE CARLOS ISAGANI T. ZARATE, ANAKPAWIS PARTY-LIST REPRESENTATIVE ARIEL B. CASILAO, GABRIELA WOMEN'S PARTY-LIST REPRESENTATIVE EMERENCIANA A. DE JESUS, GABRIELA WOMEN'S PARTY-LIST REPRESENTATIVE ARLENE D. BROSAS, ACT TEACHERS PARTY-LIST REPRESENTATIVE ANTONIO L. TINIO, ACT TEACHERS PARTY-LIST REPRESENTATIVE FRANCISCA L. CASTRO, KABATAAN PARTY-LIST REPRESENTATIVE SARAH JANE I. ELAGO, KILUSANG MAGBUBUKID NG PILIPINAS CHAIRPERSON DANILO H. RAMOS, AND ELMA A. TUAZON, PETITIONERS, VS. RODRIGO R. DUTERTE, PRESIDENT OF THE REPUBLIC OF THE PHILIPPINES, EXECUTIVE SECRETARY SALVADOR C. MEDIALDEA, DEPARTMENT OF FINANCE SECRETARY CARLOS G. DOMINGUEZ III, NATIONAL ECONOMIC AND DEVELOPMENT AUTHORITY SECRETARY ERNESTO M. PERNIA, DEPARTMENT OF JUSTICE SECRETARY MENARDO I. GUEVARRA, NATIONAL IRRIGATION ADMINISTRATION ADMINISTRATOR RICARDO R. VISAYA, RESPONDENTS.

NERI J. COLMENARES, BAYAN MUNA PARTY-LIST REPRESENTATIVE CARLOS ISAGANI T. ZARATE, ANAKPAWIS PARTY-LIST REPRESENTATIVE ARIEL B. CASILAO, GABRIELA WOMEN'S PARTY-LIST REPRESENTATIVE EMMI A. DE JESUS, GABRIELA WOMEN'S PARTY-LIST REPRESENTATIVE ARLENE D. BROSAS, ACT TEACHERS PARTY-LIST REPRESENTATIVE ANTONIO L. TINIO, ACT TEACHERS PARTY-LIST REPRESENTATIVE FRANCE L. CASTRO, KABATAAN PARTY-LIST REPRESENTATIVE SARAH JANE I. ELAGO, CASEY ANNE CRUZ, FRANCISCA TOLENTINO, APRIL PORTERIA, JOSE LEON A. DULCE, MARIA FINESA COSICO, AND FR. ALEX BERCASIO, CSSR, PETITIONERS, VS. RODRIGO R. DUTERTE, PRESIDENT OF THE REPUBLIC OF THE PHILIPPINES, EXECUTIVE SECRETARY SALVADOR C. MEDIALDEA, METROPOLITAN WATERWORKS AND SEWERAGE SYSTEM ADMINISTRATOR REYNALDO V. VELASCO, DEPARTMENT OF FINANCE SECRETARY CARLOS G. DOMINGUEZ III, NATIONAL ECONOMIC AND DEVELOPMENT AUTHORITY SECRETARY ERNESTO M. PERNIA, OFFICE OF THE GOVERNMENT CORPORATE COUNSEL ELPIDIO J. VEGA AND DEPARTMENT OF JUSTICE SECRETARY MENARDO I. GUEVARRA, RESPONDENTS.

On October 20, 2016, the Government of the Republic of the Philippines (GRP), represented by the Department of Finance (DOF), and the Export-Import Bank of China (EXIM Bank) entered into a Memorandum of Understanding on Financing Cooperation (MOU). The MOU was intended as a precursor to more binding and detailed loan agreements for GRP-nominated infrastructure projects.

Thereafter, the Department of Foreign Affairs (DFA) transmitted various Notes Verbale to the Embassy of the People's Republic of China (PRC Embassy), proposing the process for activating and utilizing the financing arrangement. The Chinese Ministry of Commerce (MOFCOM) sent out a Reply Note agreeing to the following procedure:

The Chico River Pump Irrigation Project (CRPIP), with the National Irrigation Authority as IA, was nominated for financing assistance. Consequently, the MOFCOM recommended Chinese contractors, which the DOF relayed to the NIA for vetting. The NIA conducted a background check by inquiring from various government agencies regarding ongoing transactions with the recommended contractors. Then, the NIA Bids and Awards Committee adopted Resolution No. CW-LCB 2018-1 recording the conduct of the requisite LCB, declaring China CAMC Engineering Co., Ltd. as the bidder with the lower calculated and responsive bid, recommending the approval of the award and issuance of a notice to that effect and urging the execution of a contract between NIA and China CAMC.

Consequently, the Bangko Sentral ng Pilipinas (BSP) Monetary Board (MB) adopted Resolution No. 305 dated February 22, 2018 approving in-principle the proposed loan of up to $70 Million for CRPIP conditioned on certain documentary submissions, deposit arrangements, parameters for subsequent negotiations and approvals and compliance with applicable laws. Thereafter, the CRPIP Loan Agreement was executed on April 10, 2018 between EXIM Bank as lender and the GRP as borrower. The MB gave its Final Approval to the CRPIP Loan Agreement worth $62,086,837.82 on May 17, 2018.

The New Centennial Water Source-Kaliwa Dam Project (NCWS) to be implemented by the Metropolitan Waterworks and Sewerage System (MWSS) was also nominated for financing assistance. The DOF and the National Economic Development Authority (NEDA) instructed the MWSS to review the project's financing strategy in light of the MOU. The MWSS Board of Trustees confirmed the project cost to be P10.857 Billion. Subsequently, the DOF forwarded the shortlist of MOFCOM-endorsed Chinese contractors to MWSS and urged the MWSS to vet the recommended firms. Thereafter, the MWSS conducted the LCB where China Energy Engineering Corporation Limited emerged with the lowest calculated bid. The MWSS then approved the proposed contract, authorizing its administrator to sign and submit the same to the DOF for loan processing.

The DOF endorsed MWSS 's proposed loan to the MB for approval-in principle. On September 28, 2018, the MB approved the loan in principle through Resolution No. 1581, imposing conditions necessary for final approval. Eventually, the NCWS Loan Agreement was entered into on November 20, 2018 between EXIM Bank as lender and the GRP as borrower. The MB gave its Final Approval to the NCWS Loan Agreement worth $211,214,646.54 on June 6, 2019.

The CRPIP Loan Agreement and the NCWS Loan Agreement (collectively, Loan Agreements) contain identical stipulations. Petitioners in

G.R. Nos. 245981 and 246594 filed their respective petitions to assail the validity of the Loan Agreements, enjoin their enforcement, and seek the disclosure of relevant documents. Ultimately, petitioners pray that the Loan Agreements and the implementation thereof be declared unconstitutional and illegal.

It recognized party autonomy as being impervious to the State Policy of an independent and national interest-based foreign policy under Article II, Section 7 of the Constitution.

The ponencia, too, upheld and applied Section 4, Republic Act No. (RA) 9184, Government Procurement Reform Act, which immunizes the provisions of any treaty, international or executive agreements from RA 9184' s coverage:

Scope and Application. - This Act shall apply to the Procurement of Infrastructure Projects, Goods and Consulting Services, regardless of source of funds, whether local or foreign, by all branches and instrumentalities of government, its departments, offices and agencies, including government-owned and/or -controlled corporations and local government units, subject to the provisions of Commonwealth Act No. 138. Any treaty or international or executive agreement affecting the subject matter of this Act to which the Philippine government is a signatory shall be observed.

It ruled that the hallmarks of RA 9184 of transparency, competitiveness, and public monitoring can be trumped by contrary provisions in any treaty or international or executive agreement.

What is clear from the ponencia is the sovereign immunity accorded to the Loan Agreements that is auto-limited1 to some degree solely by the provisions of the Loan Agreements themselves.

As it was, petitioners utterly failed to muster and adduce evidence based facts of the egregious impact and consequences of the Loan Agreements and the projects they intend to fund, if and when they are implemented. The benefits of establishing evidence-based facts in determining the relevance of our State Policies in relation to international loan agreements in general cannot be overemphasized. It is through these facts that we would be able to witness the social evils that the State Policies are meant to combat and overcome.2 When these facts are available, and they show concretely why the State Policies were enacted and what they were enacted to undo, for being anathema to our core existence as a country and nation, I am sure that the Court will be the first to grab on to the State Policies to nullify egregious governmental acts.

Indeed, petitioners would have better served their rightful cause had they developed more nuanced bases than what they already alleged, for resorting to public policy in assailing the international Loan Agreements. This is because their argument is not self-evident. It needs facts. It requires patterns of conduct. Petitioners have to prove that these Loan Agreements are contrary to public policy. This means they should have had an evidentiary record to show, not just say, that the Loan Agreements -

... [have] a tendency to injure the public, is against the public good, or contravenes some established interests of society, or is inconsistent with sound policy and good morals, or tends clearly to undermine the security of individual rights, whether of personal liability or of private property [t]he illegality or immorality [of these loan agreements have reached] a certain threshold such that, enforcement of the same would be against Our State's fundamental tenets of justice and morality, or would blatantly be injurious to the public, or the interests of the society.3

This is a mouthful of what contrary to public policy means which petitioners have to prove painstakingly vis-a-vis the challenged Loan Agreements. The standard requires facts. Facts are brought about by evidence. Taken individually or together, evidence-based facts produce proof. Only when the facts have settled can the Court meaningfully come in. We cannot short-circuit this process without upsetting the government order. This is the rule, no matter how valid and noble the cause is. The Court has to locate itself and perform its work within the system. I am reminded of what a young Filipino legal luminary once observed to be vigilante lawyering-

But this is the natural outcome when we constantly push institutions to bend to politics. We care only about results. We dismiss underlying legal principles as technicalities, as malleable and negotiable, at least for our side.... Are we willing to be loyal to law itself above the political fray, to rebuke legal vigilantism using outlandish cases, even the ones that suit us? If not, Sisyphus' lament is that we cannot protest how laws are never followed. Law ultimately draws strength not from intellect, but from society's conviction.4

The invocation of public policies, especially the State Policies in our Constitution, as an argument to invalidate juridical acts of the government, necessarily requires the elucidation of adjudicative facts including -

In light of the imp01iance and the impact which the ponencia or any similar decisions may have in the future, the Court has every right to expect and indeed to insist upon the careful preparation and presentation of a factual background. The relevant facts put forward may cover a wide spectrum dealing with scientific, social, economic and political aspects. Often expert opinion as to the future impact of the impugned Loan Agreements and the result of this ponencia pertaining to it may be of great assistance as a precedent. To underscore the importance of an evidentiary record, these facts may prove to be the clincher that will persuade the Court to invalidate a government act on the basis of specific public policies.

Decisions on the Constitution should not and must not be made in a factual vacuum. To attempt to do so would trivialize the State Policies if not the Constitution itself and may inevitably result in ill-considered opinions. The presentation of adjudicative facts is not a mere technicality; rather, it is essential to a proper consideration of the constitutional issues. A party cannot, by simply consenting to dispense with the factual background, require or expect the Court to deal with an issue such as this in a factual void. A decision on transcendental issues cannot be based upon the unsuppo1ied hypotheses of enthusiastic counsel.

ACCORDINGLY, I vote to dismiss the petition for failure to prove the invalidity of the assailed Loan Agreements or any portion thereof on the grounds alleged by petitioners.