GR 25712; (October, 1976) (Digest)
G.R. No. L-25712 October 29, 1976
Municipality of Paombong, Bulacan, petitioner-appellant, vs. Luis San Juan, respondent-appellee.
FACTS
The Municipality of Paombong, owner of a large fishpond, leased it to Luis San Juan for five years (1961-1965) following a public bidding. In 1961, a typhoon severely damaged the fishpond. San Juan proposed a five-year extension of the lease (1966-1970) to recoup his losses, offering to fund repairs and develop another lot. The Municipal Council, with subsequent approval from the Provincial Board and Governor, enacted resolutions authorizing this “Extension of Lease Agreement,” which was executed in July 1962.
After a new municipal administration assumed office in 1964, it passed a resolution declaring the extension agreement null and void for being contrary to law and public policy, arguing it was granted without a new public bidding. The Provincial Fiscal opined the agreement was valid and its revocation would impair contractual obligations. The municipality then filed a petition for declaratory relief seeking to nullify the extension contract.
ISSUE
Whether the “Extension of Lease Agreement” executed without a new public bidding is valid and enforceable.
RULING
The Supreme Court dismissed the appeal as moot and academic. The core legal issue pertained to the necessity of a public bidding for extending a municipal property lease. The Court noted that the stipulated extension period in the contested agreement was from January 1, 1966, to December 31, 1970. By the time the Court reviewed the case in 1976, this period had already fully expired. Consequently, the contract had, by its own terms, ceased to be effective and no longer presented a live controversy requiring judicial resolution. The Court therefore refrained from making a definitive ruling on the substantive question of law regarding the validity of the extension absent a public bidding, as any decision on the matter would have no practical legal effect. The dismissal was based on the principle that courts do not adjudicate moot cases.