Manila Prince Hotel vs GSIS

Self Executing Statutes

MANILA PRINCE HOTEL VS. GSIS

G.R. NO. 122156. February 3, 1997

MANILA PRINCE HOTEL petitioner,

vs.
GOVERNMENT SERVICE INSURANCE SYSTEM, MANILA HOTEL CORPORATION, COMMITTEE ON
PRIVATIZATION and OFFICE OF THE GOVERNMENT CORPORATE COUNSEL, respondents.

Facts: The controversy arose when respondent Government Service Insurance System (GSIS), pursuant to the
privatization program of the Philippine Government, decided to sell through public bidding 30% to 51% of the issued and
outstanding shares of respondent Manila Hotel Corporation (MHC). The winning bidder, or the eventual strategic
partner, will provide management expertise or an international marketing/reservation system, and financial support to
strengthen the profitability and performance of the Manila Hotel.

In a close bidding held on 18 September 1995 only two (2) bidders participated: petitioner Manila Prince Hotel
Corporation, a Filipino corporation, which offered to buy 51% of the MHC or 15,300,000 shares at P41.58 per share, and
Renong Berhad, a Malaysian firm, with ITT-Sheraton as its hotel operator, which bid for the same number of shares at
P44.00 per share, or P2.42 more than the bid of petitioner. Prior to the declaration of Renong Berhard as the winning
bidder, petitioner Manila Prince Hotel matched the bid price and sent a managers check as bid security, which GSIS
refused to accept.

Apprehensive that GSIS has disregarded the tender of the matching bid and that the sale may be consummated with
Renong Berhad, petitioner filed a petition before the Court.

Issues:

1. Whether or not Sec. 10, second par., Art. XII, of the 1987 Constitution is a self-executing provision.
2. Whether or not the Manila Hotel forms part of the national patrimony.
3. Whether or not the submission of matching bid is premature
4. Whether or not there was grave abuse of discretion on the part of the respondents in refusing the matching bid of
the petitioner.

Rulings: In the resolution of the case, the Court held that:

1. It is a self-executing provision.
1. Since the Constitution is the fundamental, paramount and supreme law of the nation, it is deemed written
in every statute and contract. A provision which lays down a general principle, such as those found in Art.
II of the 1987 Constitution, is usually not self-executing. But a provision which is complete in itself and
becomes operative without the aid of supplementary or enabling legislation, or that which supplies
sufficient rule by means of which the right it grants may be enjoyed or protected, is self-executing.
2. A constitutional provision is self-executing if the nature and extent of the right conferred and the liability
imposed are fixed by the constitution itself, so that they can be determined by an examination and
construction of its terms, and there is no language indicating that the subject is referred to the legislature
for action. Unless it is expressly provided that a legislative act is necessary to enforce a constitutional
mandate, the presumption now is that all provisions of the constitution are self-executing. If the
constitutional provisions are treated as requiring legislation instead of self-executing, the legislature
would have the power to ignore and practically nullify the mandate of the fundamental law.
3. 10, second par., Art. XII of the 1987 Constitution is a mandatory, positive command which is complete in
itself and which needs no further guidelines or implementing laws or rules for its enforcement. From its
very words the provision does not require any legislation to put it in operation. It is per se judicially
 enforceable. When our Constitution mandates that in the grant of rights, privileges, and concessions
covering national economy and patrimony, the State shall give preference to qualified Filipinos, it means
just that qualified Filipinos shall be preferred. And when our Constitution declares that a right exists in
certain specified circumstances an action may be maintained to enforce such right notwithstanding the
absence of any legislation on the subject; consequently, if there is no statute especially enacted to enforce
such constitutional right, such right enforces itself by its own inherent potency and puissance, and from
which all legislations must take their bearings. Where there is a right there is a remedy. Ubi jus ibi
remedium.
2. The Court agree.
1. In its plain and ordinary meaning, the term patrimony pertains to heritage. When the Constitution speaks
of national patrimony, it refers not only to the natural resources of the Philippines, as the Constitution
could have very well used the term natural resources, but also to the cultural heritage of the Filipinos.
2. It also refers to Filipinos intelligence in arts, sciences and letters. In the present case, Manila Hotel has
become a landmark, a living testimonial of Philippine heritage. While it was restrictively an American
hotel when it first opened in 1912, a concourse for the elite, it has since then become the venue of various
significant events which have shaped Philippine history.
3. Verily, Manila Hotel has become part of our national economy and patrimony. For sure, 51% of the
equity of the MHC comes within the purview of the constitutional shelter for it comprises the majority
and controlling stock, so that anyone who acquires or owns the 51% will have actual control and
management of the hotel. In this instance, 51% of the MHC cannot be disassociated from the hotel and
the land on which the hotel edifice stands.
3. It is not premature.
1. In the instant case, where a foreign firm submits the highest bid in a public bidding concerning the grant
of rights, privileges and concessions covering the national economy and patrimony, thereby exceeding the
bid of a Filipino, there is no question that the Filipino will have to be allowed to match the bid of the
foreign entity. And if the Filipino matches the bid of a foreign firm the award should go to the Filipino. It
must be so if the Court is to give life and meaning to the Filipino First Policy provision of the 1987
Constitution. For, while this may neither be expressly stated nor contemplated in the bidding rules, the
constitutional fiat is omnipresent to be simply disregarded. To ignore it would be to sanction a perilous
skirting of the basic law.
2. The Court does not discount the apprehension that this policy may discourage foreign investors. But the
Constitution and laws of the Philippines are understood to be always open to public scrutiny. These are
given factors which investors must consider when venturing into business in a foreign jurisdiction. Any
person therefore desiring to do business in the Philippines or with any of its agencies or instrumentalities
is presumed to know his rights and obligations under the Constitution and the laws of the forum.
4. There was grave abuse of discretion.
1. To insist on selling the Manila Hotel to foreigners when there is a Filipino group willing to match the bid
of the foreign group is to insist that government be treated as any other ordinary market player, and bound
by its mistakes or gross errors of judgement, regardless of the consequences to the Filipino people. The
miscomprehension of the Constitution is regrettable. Thus, the Court would rather remedy the indiscretion
while there is still an opportunity to do so than let the government develop the habit of forgetting that the
Constitution lays down the basic conditions and parameters for its actions.
2. Since petitioner has already matched the bid price tendered by Renong Berhad pursuant to the bidding
rules, respondent GSIS is left with no alternative but to award to petitioner the block of shares of MHC
and to execute the necessary agreements and documents to effect the sale in accordance not only with the
bidding guidelines and procedures but with the Constitution as well. The refusal of respondent GSIS to
execute the corresponding documents with petitioner as provided in the bidding rules after the latter has
matched the bid of the Malaysian firm clearly constitutes grave abuse of discretion.

Hence, respondents GOVERNMENT SERVICE INSURANCE SYSTEM, MANILA HOTEL CORPORATION,

COMMITTEE ON PRIVATIZATION and OFFICE OF THE GOVERNMENT CORPORATE COUNSEL are directed to
CEASE and DESIST from selling 51% of the shares of the Manila Hotel Corporation to RENONG BERHAD, and to
ACCEPT the matching bid of petitioner MANILA PRINCE HOTEL CORPORATION to purchase the subject 51% of the
shares of the Manila Hotel Corporation at P44.00 per share and thereafter to execute the necessary agreements and
documents to effect the sale, to issue the necessary clearances and to do such other acts and deeds as may be necessary for
the purpose.
Province of North Cotabato v. Government of the Republic of the Philippines
(G.R. Nos. 183591, 183752, 183893, 183951, &183962) (14 October 2008)

Facts:
On 8 August 2008, the Government of the Republic of the Philippines (GRP), represented by the GRP Peace Panel and
the Presidential Adviser on the Peace Process (PAPP), and the Moro I s l a m i c L i b e r a t i o n F r o n t ( M I L F ) w e r e
s c h e d u l e d t o s i g n t h e Memorandum of Agreement on the Ancestral Domain (MOA-AD)Aspect of the previous
GRP-MILF Tripoli Agreement on Peace of 2001 in Kuala Lumpur, Malaysia. The MOA-AD included, among others, a
stipulation that creates the Bangsamoro Juridical Entity (BJE), to which the GRP grants the authority and jurisdiction over
the ancestral domain and a n c e s t r a l l a n d s o f t h e B a n g s a m o r o d e f i n e d a s t h e p r e s e n t g e o g r a p h i c
a r e a o f t h e A R M M c o n s t i t u t e d b y L a n a o d e l S u r , Maguindanao, Sulu, Tawi-Tawi, Basilan, and Marawi
City, as well as the municipalities of Lanao del Norte which voted for inclusion in the ARMM in the 2001 plebiscite. The BJE is
then granted the power to build, develop, and maintain its own institutions. The MOA-AD a l s o d e s c r i b e d t h e
r e l a t i o n s h i p o f t h e G R P a n d t h e B J E a s associative , characterized by shared authority and
responsibility. It further provides that its provisions requiring amendments to the e x i s t i n g l e g a l f r a m e w o r k
s h a l l t a k e e f f e c t u p o n s i g n i n g o f a Comprehensive Compact. Before the signing, however, the Province of
North Cotabato sought to compel the respondents to disclose and furnish it with complete and official copies of the MOA-
AD, as well as to hold a public consultation thereon, invoking its right to information on matters of public concern. A
subsequent petition sought to have the City of Zamboanga excluded from the BJE. The Court then issued a Temporary
Restraining Order (TRO) on 4 August 2008, directing the public respondents and their agents to cease and desist from
formally signing the MOA-AD.
Issues and Ruling:
1. W/N the President has the power to pursue r eforms that w o u l d r e q u i r e n e w
l e g i s l a t i o n a n d c o n s t i t u t i o n a l amendments.
Y E S . H o w e v e r , t h e s t i p u l a t i o n i n t h e M O A - A D t h a t v i r t u a l l y guarantees that necessary changes shall
be effected upon the legal framework of the GRP must be struck down as unconstitutional as itis inconsistent with the
limits of the Presidents authority to propose constitutional amendments. Because although the Presidents power to
conduct peace negotiations is implicitly included in her powers as Chief Executive and Commander-in-Chief, and, in the
course of conducting peace negotiations, may validly consider implementing even those policies that require changes to
the Constitution, she may n o t u n i l a t e r a l l y i m p l e m e n t t h e m w i t h o u t t h e i n t e r v e n t i o n o f C o n g r e s s ,
o r a c t i n a n y w a y a s i f t h e a s s e n t o f t h a t b o d y w e r e assumed as a certainty.

2. W / N t h e r e i s a v i o l a t i o n o f t h e p e o p l e s r i g h t t o information on matters of public

concern (1987 Constitution, Art. III, Sec. 7) under a state policy of full disclosure of all its transactions involving public
interest (1987 Constitution, Art. II, Sec. 28), including public consultation under RA No.7160 (Local Government Code
of 1991).
YES. At least three pertinent laws animate these constitutional imperatives and justify the exercise of the peoples right to
be consulted on relevant matters relating to the peace agenda:

a. EO No. 3, which enumerates the functions and responsibilities of the PAPP, is replete with mechanics for continuing
consultations on both national and local levels and for a principal forum for consensus-building. In fact, it is the duty of
the PAPP to conduct regular dialogues to seek relevant information, comments, advice, and recommendations from peace
partners and concerned sectors of society;

b. RA No. 7160 (LGC) requires all national offices to conduct consultations before any project or program critical to the
environment and human ecology including those that may call for the eviction of a particular group of people residing in
such locality, is implemented therein. The MOA-AD is one peculiar program that unequivocally and unilaterally vests
ownership of a vast territory to the Bangsamoro people, which could pervasively and drastically result to the diaspora or
displacement of a great number of inhabitants from their total environment;
c. RA No. 8371 (IPRA) provides for clear-cut procedure for the recognition and delineation of ancestral domain, which
entails, among other things, the observance of the free and prior informed consent of the Indigenous Cultural
Communities/Indigenous Peoples (ICC/IP).

3. W/N the GRP Peace Panel and the PAPP committed grave abuse of discretion amounting to lack or excess
of jurisdiction.
YES. The PAPP committed grave abuse of discretion when he failed to carry out the pertinent consultation process, as
mandated by EO No. 3, RA No. 7160, and RA No. 8371. The furtive process by which the MOA-AD was designed and
crafted runs contrary to and in excess of the legal authority, and amounts to a whimsical, capricious, oppressive, arbitrary,
and despotic exercise thereof. It illustrates a gross evasion of positive duty and a virtual refusal to perform the duty
enjoined.

4. W/N the MOA-AD is constitutional.

NO. It cannot be reconciled with the present Constitution and laws. Not only its specific provisions, but the very concept
underlying them, namely, the associative relationship envisioned between the GRP and the BJE, are unconstitutional, for
the concept presupposes that the associated entity is a state and implies that the same is on its way to independence.
While there is a clause in the MOA-AD stating that the provisions thereof inconsistent with the present legal framework
will not be effective until that framework is amended, the same does not cure its defect. The inclusion of provisions in the
MOA-AD establishing an associative relationship between the BJE and the Central Government is, itself, a violation of
the Memorandum of Instructions From The President addressed to the government peace panel. Moreover, as the clause is
worded, it virtually guarantees that the necessary amendments to the Constitution and the laws will eventually be put in
place. Neither the GRP Peace Panel nor the President herself is authorized to make such a guarantee. Upholding such an
act would amount to authorizing a usurpation of the constituent powers vested only in Congress, a Constitutional
Convention, or the people themselves through the process of initiative, for the only way that the Executive can ensure the
outcome of the amendment process is through an undue influence or interference with that process.

5. W/N the GRP can invoke executive privilege.

NO. Respondents effectively waived such defense after it unconditionally disclosed the official copies of the final draft of
the MOA-AD, for judicial compliance and public scrutiny.
Carpio-Morales, J.
The peoples right to information on matters of public concern under Sec. 7, Art. III of the Constitution is in splendid
symmetry with the state policy of full public disclosure of all its transactions involving public interest under Sec. 28, Art.
II of the Constitution.

The right to information guarantees the right of the people to demand information, while the policy of public disclosure
recognizes the duty of officialdom to give information even if nobody demands.

The IPRA does not grant the Executive Department or any government agency the power to delineate and recognize an
ancestral domain claim by mere agreement or compromise.

An association is formed when two states of unequal power voluntarily establish durable links. In the basic model, one
state, the associate, delegates certain responsibilities to the other, the principal, while maintaining its international status
as a state. Free associations represent a middle ground between integration and independence.

The recognized sources of international law establish that the right to self-determination of a people is normally fulfilled
through internal self-determinationa peoples pursuit of its political, economic, social, and cultural development within
the framework of an existing state. A right to external self-determination (which in this case potentially takes the form of
the assertion of a right to unilateral secession) arises only in the most extreme of cases and, even then, under carefully
defined circumstances.

That the authority of the President to conduct peace negotiations with rebel groups is not explicitly mentioned in the
Constitution does not mean that she has no such authority. The President has authority, as stated in her oath of office, only
to preserve and defend the Constitution. Such presidential power does not, however, extend to allowing her to change the
Constitution, but simply to recommend proposed amendments or revision. As long as she limits herself to recommending
these changes and submits to the proper procedure for constitutional amendments and revision, her mere recommendation
need not be construed as an unconstitutional act.

Public statements of a state representative may be construed as unilateral declaration only when the following conditions
are present: the statements were clearly addressed to the international community, the state intended to be bound to that
community by its statements, and that not to give legal effect to those statements would be detrimental to the security of
international intercourse. Plainly, unilateral declarations arise only in peculiar circumstances.