Manila Prince Hotel v.

GSIS

FACTS:

Controversy arose when respondent GSIS, pursuant the privatization program of the PH
government under Proclamation No. 50 dated Dec 8 1986, decided to sell through public
bidding 30 – 50% of shares of Manila Hotel Corp. In a close bidding held on 18 Sept 1995 only 2
participated on 51% share; petitioner MPHC, a Filipino corporation, which offered to buy Php
41. 58 per share (Php 15,300,000) and Renong Berhad, a Malaysian Firm, with ITT-Sheraton as
its hotel operator, bid for Php 44.00 per share, 2.42 more than the petitioner’s bid.
Petitioner then sent a letter to respondent dated Sept 28, 1995 to match the bid price
tendered by Renong Berhad. In subsequent letter dated Oct 10, 1995 petitioner also sent a
manager’s check for Php 33,000,000.00 as bid security on which respondent refused to accept.
On Oct 18, 1995 the Court issued a TRO enjoining respondents from perfecting and
consummating the sale to Malaysian Firm.

PETA:

Petitioner invokes Sec 10 of Art. 12 of the 1987 Constitution and identified MHC is practically
become historical monument and become part of the national patrimony. Petitioner also
argues that any transaction involving 51% of shares of stock of MHC is clearly covered by the
term national economy, to which Sec 10 Art 12 of the Consti applies.

RESA:

Respondents maintain that; 1. Sec 10 Art 12 (known as the Filipino First Policy) of the 1987
Consti merely a statement of principle and policy since it is not a self-executing provision and
requires implementing legislation. 2. Granting that this provision is self-executing, MHC does
not fall under the term national patrimony which only refers to lands and public domains which
is cited on Sec 2 Art 12 of the Consti. 3. Granting that MH forms a part of National patrimony,
the consti provision invoked is still inapplicable since what being sold is only 51% of shares, not
the hotel building nor the land upon which it stands. Certainly, 51% cannot be considered
national patrimony. Moreover, petitioner should have questioned it right from the beginning
and not after it had lost in the bidding.

ISSUE/S:

Whether or not Sec 10 Art 12 is self executing or not.

Whether or not 51% share and MHC considered as National Patrimony by Sec 10. Art 12 of the
1987 Constitution
RULING:

The Constitution should be considered self-executing, therefore the provisions of the Consti
should be considered self-executing. Sec 10. Art 12 of the Consti is a mandatory, positive
command which is complete in itself.

As regards with our national patrimony, it is explained that patrimony of the nation should be
conserved and developed not only to our rich natural resources but also to the cultural heritage
of our race. Therefore, we should develop not only our lands but also the mental ability or
faculty of our people.

It should also be stressed that while the Malaysian firm offered the higher bid it is not yet the
winning bidder. The bidding rules expressly provide that the highest bidder shall only be
declared the winning bidder after it has negotiated and executed the necessary contracts, and
secured the requisite approvals. Since the Filipino First Policy provision of the Constitution
bestows preference on qualified Filipinos the mere tending of the highest bid is not an
assurance that the highest bidder will be declared the winning bidder. Resultantly, respondents
are not bound to make the award yet, nor are they under obligation to enter into one with the
highest bidder.