G.R. No. 113375 May 5, 1994
KILOSBAYAN, INCORPORATED, JOVITO R. SALONGA, CIRILO A. RIGOS, ERME CAMBA, EMILIO C. CAPULONG, JR., JOSE T. APOLO, EPHRAIM TENDERO, FERNANDO SANTIAGO, JOSE ABCEDE, CHRISTINE TAN, FELIPE L. GOZON, RAFAEL G. FERNANDO, RAOUL V. VICTORINO, JOSE CUNANAN, QUINTIN S. DOROMAL, SEN. FREDDIE WEBB, SEN. WIGBERTO TAÑADA, and REP. JOKER P. ARROYO, petitioners, vs. TEOFISTO GUINGONA, JR., in his capacity as Executive Secretary, Office of the President; RENATO CORONA, in his capacity as Assistant Executive Secretary and Chairman of the Presidential review Committee on the Lotto, Office of the President; PHILIPPINE CHARITY SWEEPSTAKES OFFICE; and PHILIPPINE GAMING MANAGEMENT CORPORATION, respondents.

FACTS

Petitioners, including the organization Kilosbayan, Inc. and several individuals suing as taxpayers and concerned citizens, filed a special civil action for prohibition and injunction. They sought to prohibit the implementation of the “Contract of Lease” executed by the Philippine Charity Sweepstakes Office (PCSO) and the Philippine Gaming Management Corporation (PGMC) for an on-line lottery system (lotto). The PCSO, pursuant to its charter (R.A. No. 1169 as amended), decided to establish the system to increase revenue. The Berjaya Group Berhad, a Malaysian company with lottery experience, organized PGMC with Filipino investors to bid for the project. The PCSO issued a Request for Proposal (RFP) seeking a contractor to build and lease the necessary facilities, with the lease not exceeding 15 years, and requiring the lessor to be a domestic corporation with at least 60% Filipino ownership. PGMC submitted its bid. After evaluation and despite opposition from petitioners on moral and legal grounds, the Office of the President gave PGMC the go-signal. On December 17, 1993, PCSO and PGMC executed the Contract of Lease, which was approved by the President. The contract defined the “Facilities” leased by PCSO and the “Maintenance and Other Costs” to be borne by PGMC, and stipulated a rental fee for PGMC based on a percentage of quarterly gross receipts.

ISSUE

Whether the petitioners have legal standing (locus standi) to bring this suit.

RULING

Yes, the petitioners have legal standing. The Court ruled that the doctrine of “standing” is a procedural technicality which may be relaxed for nontraditional plaintiffs, such as citizen taxpayers, when the issue is of transcendental importance to the public. The Court held that the issues raised—involving the national lottery, a widespread activity affecting millions of people, and the constitutional provisions on national economy and patrimony—are of paramount public interest. The petitioners, as taxpayers and citizens, have a right to ensure that public funds are not misused and that laws are faithfully executed. The Court distinguished this case from previous rulings on taxpayer suits, emphasizing the greater and more direct interest of citizens in the operation of a national lottery compared to ordinary government contracts. The petition was given due course, and the Court proceeded to rule on the substantive issues (which are detailed in the full text but not included in the provided excerpt for this digest).