INFORMATION TECHNOLOGY OF THE PHILIPPINES V COMELEC

PLAINTIFF & APPELLEES: Information technology Foundation of the Philippines, et al.

DEFENDANT & APPELLLANT: Commission on Elections, Mega Pacific eSolutions, Inc.,
Mega Pacific Consortium
DATE: January 13, 2004
PONENTE: Panganiban, J.
SUMMARY:
This Petition seeks
(1) to declare null and void Resolution No.
6074 of COMELEC, which awarded Phase
II of the Modernization Project of the
Commission to Mega Pacific Consortium
(MPC);
(2) to enjoin the implementation of any
further contract between Comelec and Mega
Pacific Consortium and/or Mega Pacific
eSolutions, Inc. (MPEI);
(3) to compel Comelec to conduct a rebidding of the project.

allocating P2.5 billion for the AES. An

additional P500 million was released later.

FACTS:

Of the 57 bidders, the BAC found Total

Information Management Corporation (TIMC)
and the Mega Pacific Consortium (MPC)
eligible. Said entities were referred to the
BACs Technical Working Group (TWG) and
the Department of Science and Technology
(DOST) for technical evaluation.

- June 7, 1995: Congress passed RA 8046

authorizing COMELEC to do a demo of
Automated Elections and do the pilot test in
ARMM in the March 1996 elections
- December 22, 1997: Congress enacted R.A.
8436 authorizing the COMELEC to use an
automated election system (AES) in the May
11, 1998 national or local elections and in
subsequent national and local electoral
exercises, providing funds therefore and for
other purposes.
- October 2002: COMELEC adopted
Resolution 02-0170 to modernize the 2004
elections, to conduct biddings for three phases:
I. voter registration and validation
II. automated counting
III. canvassing, and electronic transmission.

- January 2003: COMELEC issued an

invitation to bid for said program
- February 17, 2003: COMELEC released the
Request for Proposal (RFP) to procure the
election automation machines. The Bids and
Awards (BAC) committee convened a pre-bid
conference on February 18, 2003, and gave
prospective bidders until March 10, 2003 to
submit their bids.

In its report on Phase II proposals, the DOST

said both entities obtained a number of failed
marks in said evaluation. Nevertheless,
COMELEC en banc promulgated Resolution
No. 6074 awarding the project to MPC on
April 15, 2003. Said body publicized this on
May 16, 2003.

- May 29, 2003: Five individuals and entities

including petitioners ITFP, represented by its
President, Alfredo M. Torres, and Ma. Corazon
Akol wrote a letter protesting the award of the
contract.
- June 6, 2003: COMELEC chairman speaking
- January 24, 2003: President Gloria
through his legal representative rejected the
Macapagal-Arroyo issued Executive Order 172 protest.

ISSUES:
1. WON petitioners have Locus standi
2. WON the instant petition is premature
3. WON COMELEC committed grave abuse of
discretion in the bidding process and the
awarding of the contract to MPC.
HELD:
1. Petitioners have standing as taxpayers.
They have interest in seeing that the funds are
lawfully used. Other circumstances qualifying
for taxpayers standing:
a. Illegal disbursement of public funds
b. Funds employed for any improper purpose
c. Wasting public funds by enforcing an
invalid law
Petitioners also have standing as
voters/citizens. Bidding process has direct
impact on electoral process. Thus case at bar is
of transcendental importance and of paramount
public concern.
2. Not premature. Administrative remedy
invoked by respondent cannot be exercised by
the petitioners. COMELEC awarded the
contract to MPC (April 16) before the Bids and
Awards Committee released its report (April
21).
Moreover, petitioners letter to Abalos
(May 29) to protest the award is sufficient
compliance with the administrative remedy
prescribed in Section 55, RA 9184. Also,
absent the protest letter, petitioners are still
excused from exercising all administrative
remedies as illustrated in Paat vs. CA
(instances when rule on exhaustion of
administrative remedies may be disregarded)
3. COMELEC committed a grave abuse of
discretion throughout the entire process.
a) MPC was not a valid bidder.
i. MPC was not the bidder, but Mega
Pacific eSolutions, Inc.. No proof was
shown that MPEI was pre-authorized by

the Consortium members to represent

them collectively as MPC.
ii. Despite the existence of several
memoranda of agreement between MPEI,
SK &C and WeSolv (as joint
undertakings), and Election.com and
ePLDT (as subcontractors), the terms of
the agreements did not specify the
investments that each entity was to make,
nor the scopes and limitations of their
duties to MPEI.
iii. The Commissioners themselves had
no proof that there was a consortium.
b) The ACM machines did not pass the
technical tests of the DOST.
i. Both bidders machines failed the
DOSTs tests, yet the TWG noted that
MPCs machines failed due to software
errors which could be corrected by
reprogramming; such corrections would
mean that the machines tested would still
be different from the ones that would be
ordered for an election.
ii. Comelec cited that the standard used
was unrealistic.
iii. The softwares failure to detect
previously-downloaded data was also a
cause for concern, as this could lead to
cheating during the elections.
iv. The inability to print the audit trail
was not met by the software, and this was
mandated by Sec. 7 of RA 8436 itself.
v. Comelec let MPC present a trial
version of the software, still subject to
revisions, a luxury not afforded the other
bidders.
c) COMELEC disclosed that three types of
software were to be used in the undertaking:
i. for evaluation of technical bids
ii. testing and acceptance procedures
iii. Election Day use
In effect, different software would be used at
every stage, constituting different purchases,
which defeated the purpose of public bidding,
by allowing the winner to alter what should
have been the final product immediately.

RULING:
Petition granted. The award of the contract to
MPC was declared null and void. The Contract
executed between COMELEC and MPEI was

declared null and void. The COMELEC was

ordered to refrain from implementing any other
contract or agreement with regard to the
project.

RATIO
Respondents Contention
Petitioners do not possess locus standi because
they are not challenging the validity or
constitutionality of RA 8436.

Petitioners acted prematurely.

Supreme Court
No law has been actually violated by
awarding the Contract. Respondents added
that the petitioners will be injured or
prejudiced on account of the award.
Petitioners have standing as taxpayers. They
have interest in seeing that the funds are
lawfully used.
Petitioners had no opportunity to avail of
administrative remedies, as the COMELEC
awarded the project on the same day that the
BAC allegedly gave a verbal report, and six
days before the publication of the results.
Letter-protest was sufficient compliance,
however unnecessary, citing points from Paat
v. Court of Appeals (1997), that administrative
remedies may be disregarded, when exhaustion
of said remedies are unreasonable, rule does
not provide plain, speedy, and adequate
remedy, and the urgency of judicial
intervention.

DISSENT: Tinga, J.
no constitutional provision or letter of a statute was alleged to have been violated. The Court
nullified the contract for an automated election system (AES) simply on the ground that in
making the award the COMELEC has allegedly violated its bidding rules and an unfounded
apprehension that the counting machines would not work on Election Day. On the other hand,
not one of the losing bidders has joined the petition; neither did the petitioners question the
fairness of the price tag for the machines.
In deciding the instant case, the Court shall consider only the undisputed or admitted facts and
resolve only the specific questions raised by the parties. The Court is not a repository of remedies
or a super-legal-aid bureau. We cannot grant relief for every perceived violation of the law or
worse, on the basis of prophetic wisdom.
It is not the Courts function to actively ensure that the automation is successfully implemented
or that the elections are made free of fraud, violence, terrorism and other threats to the sanctity of
the ballot. This duty lies primarily with the COMELEC.

 The Court has constantly underscored the importance of giving the COMELEC considerable
latitude in adopting means and methods that will insure the accomplishment of the objective for
which it was created to promote free, orderly, honest, peaceful and credible elections.
As correctly pointed out by the respondents, at no time during the entire bidding process did the
petitioners question the determination of the COMELEC Bids and Awards Committee (BAC)
finding Mega Pacific Consortium (MPC) eligible to bid. Under R.A. 9184, decisions of the BAC
should be appealed to the COMELEC en banc. Consequently, the determination of the BAC that
MPC was eligible to bid, adopted subsequently by the COMELEC, became final.
Considering the circumstances, the premature invocation of this Courts judicial power is fatal
to the petitioners cause of action.
Whatever perceived deficiencies there are in the supplementary contracts entered into by MPEI
and the other members of the consortium as regards their joint and several undertaking were
cured, or better still prevented from arising, by the above-quoted provisions from which it can be
immediately established that each of the members of MPC is solidarily liable with the lead
company, MPEI, albeit only for the particular contract or aspect of the joint venture of which it is
in charge.
The paper requirements should yield to the reality that, collectively, the members of the
consortium have furnished the COMELEC with sufficient information to enable it to judiciously
gauge MPCs eligibility and qualifications. The strict and inflexible adherence to the bidding
requirements by each and every component of the consortium advanced by the petitioners would
negate the salutary purpose of R.A. 8436 and frustrate the long-anticipated modernization of the
electoral system.
Reckoned from the standpoint of the established legal presumptions of validity of official acts
and regularity in the performance of official duty, it is unjustified to speculate, as the ponencia
does, on the good or bad motives that impelled the COMELEC to award the Contract to MPC.