GR 159245; (August, 2006) (Digest)
G.R. No. 159245 , August 31, 2006
GV DIVERSIFIED INTERNATIONAL, INC., Petitioner, vs. COURT OF APPEALS, CITY OF CAGAYAN DE ORO, and MAYOR VICENTE Y. EMANO, Respondents.
FACTS
Petitioner GV Diversified International, Inc. entered into a Build and Transfer Contract with respondent City of Cagayan de Oro in March 1998 for the construction of the South Diversion Road and PCDG Cargo Bridge Project. The contract was later amended in December 2000. Petitioner subsequently assigned its rights and obligations to White Horse Trading Development and Construction, which the City confirmed via ordinance. When White Horse failed to comply with the terms of the assignment, petitioner rescinded the deed of assignment. However, Mayor Vicente Emano refused to recognize the rescission and instead rescinded the amended contract with petitioner. The City then published an invitation for public bidding for the same project.
Petitioner filed a Complaint for specific performance, injunction, and damages with the Regional Trial Court (RTC) of Cagayan de Oro, arguing the City’s rescission was unlawful. The RTC issued a Writ of Preliminary Injunction to enjoin the City from opening the sealed bids for the project. The City elevated the matter to the Court of Appeals via a petition for certiorari, contending that the injunction violated Presidential Decree No. 1818, which prohibits courts from issuing restraining orders or injunctions in cases involving government infrastructure projects.
ISSUE
Whether the Court of Appeals committed grave abuse of discretion in lifting the preliminary injunction issued by the RTC.
RULING
The Supreme Court ruled that the Court of Appeals did not commit grave abuse of discretion. The legal logic centers on the application of Republic Act No. 8975 , which superseded P.D. No. 1818. R.A. No. 8975 explicitly prohibits courts, except the Supreme Court, from issuing temporary restraining orders, preliminary injunctions, or preliminary mandatory injunctions against the implementation or execution of government infrastructure projects. The law aims to prevent costly delays in public infrastructure development.
The Court found that the subject project—a road and bridge construction—is unequivocally a government infrastructure project. Therefore, the RTC’s issuance of the preliminary injunction was void ab initio under the clear mandate of R.A. No. 8975 . The Court of Appeals correctly lifted the injunction to allow the public bidding and continuation of the project without undue delay. Any contrary ruling would undermine legislative intent to expedite government infrastructure projects for public benefit and avoid increased costs from procedural delays. The petition was dismissed.