9. Petitioner conducted a public bidding for the acquisition of a generator.

The bid of the lower

qualified bidder was exclusive of customs duties and taxes. Petitioner submitted the documents
to the auditor for pre-audit, and the auditor found that the recommendation to award the contract
to the lower bidder was in order. A new auditor conducted a post-audit and disallowed the
reimbursement for the customs duties and taxes. Petitioner argued that since the contract had
been approved during the pre-audit, it could no longer be submitted to a post-audit. Is Petitioner
correct? Explain.

No. Article IX (D), Sec. 2 (1) of the Constitution expressly grants COA the power to conduct a
post-audit.

Regardless of the result of the pre-audit, it cannot be denied that COA is so empowered to
conduct a post-audit.

It is thus erroneous for petitioner to claim that respondent is estopped from questioning, in the
process of post-audit, the previous acts of its officials. Further, well-settled is the principle that
estoppel does not lie against the government, more so if they are erroneous, let alone irregular.
(DBP vs. COA - 1994)

10. The National Telecommunications Commission granted petitioner provisional authority to

operate a cellular mobile system. Respondent opposed on the ground that there was no need for
the service, since it and other operators were adequate to meet the market demand. Is respondent
correct? Explain.

No. Neither Congress nor the National Telecommunications Commission can grant an exclusive
"franchise, certificate, of any other form of authorization" to operate a public utility. The
Constitution is quite emphatic that the operation of a public utility shall not be exclusive.
(Republic vs. Express Telecommunications Co.)

Even PILTEL’s franchise (case at bar), Republic Act No. 6030, expressly declares that
PILTEL’s right to provide telecommunications services is not exclusive.

Moreover, Section 1 of R.A. No. 6030 expressly states that the grant of a franchise to PITEL is
"subject to the conditions established xxx in the Constitution." Consequently, PILTEL does not
enjoy any exclusive right to operate telecommunications services in the areas covered by its
Provisional Authority. (Pilipino Telephone Corporation vs. NTC)

11. The Philippine Ports Authority integrated the stevedoring and arrastre service in Cebu City
by allowing one contractor. Respondents argued that the policy violated the constitutional
prohibition against monopolies. Are respondents correct? Decide.

No. Private monopolies are not necessarily prohibited by the Constitution. They may be allowed
to exist but under State regulation. A determination must first be made whether public interest
requires that the State should regulate or prohibit private monopolies. A distinction prevails as
regards combinations in restraint of trade and unfair competition which are prohibited outright
by the Constitution.
By their very nature, certain public services or public utilities such those which supply water,
electricity, transportation, telephone, telegraph, etc. must me given exclusive franchises if public
interest is to be served. Such exclusive franchises are not violative of the law against
monopolies. (Anglo-Fil Trading vs. Lazaro)

12. Upon finality of a decision against the Philippine Virginia Tobacco Administration, its funds
deposited with the Philippine National Bank were garnished to satisfy the judgment. The bank
objected on the ground that the funds were public and exempt from execution. Is PNB correct?
Decide.

No. The funds held by PNB are subject for garnishment. Funds of public corporations which can
sue and be sued are not exempt from garnishment. Thus, the writ of execution should be imposed
immediately. (PNB vs. Pabalan)