SURIGAO MINERAL RESER­VATION BOARD AND THE EXECUTIVE SECRETARY, PETITIONERS, VS. HON. GAUDENCIO CLORIBEL, AS JUDGE OF THE COURT OF FIRST INSTANCE OF MANILA, AND MAC-ARTHUR INTER…

Original action for certiorari and prohibition, with preliminary
injunction, to restrain the Honorable Gaudencio Cloribel, as Judge of the Court of First Instance of
Manila, from continuing with the hearing of Civil Case No. 67400 of said Court,
and from enforcing a restraining order issued therein on November 16, 1966, as
well as to annul an order of respondent Judge, in the same case, dated December
9, 1966.

It appears that, on or about December 2, 1964, the Surigao Mineral Reservations Board – hereinafter referred
to as the Board – issued an Invitation to Bid, on May 12, 1965, for the explo­ration
and development of mineral deposits in a portion of the Surigao
Mineral Reservation, in the province of Surigao, more
particularly described in said Invitation to Bid; that, in response thereto,
two (2) bids were filed, namely, one (1) by the Mac-Arthur International
Minerals Co. – hereinafter referred to as the Company – and the other by Benguet Consolidated, Inc.; that, these two (2) bids were
referred by the Board to an Evaluation Committee created therefor;
that both bids were later rejected by the Board, upon consideration of the
report thereon of said Committee; and that, a reconsideration, sought by the
Company, of the action thus taken by the Board was, thereafter denied by the
latter.

Thereupon, or on September 1, 1966, the Company filed, with the
Court of First Instance of Manila, the petition in said Case No. 67400, against
the Board and the Executive Secretary – as the officer “responsible for
the approval and authorization of public biddings and the acceptance, handling
and processing of all bids” – seemingly to annul the proceedings before
said Board leading to the rejection of the bid of the Company and to prevent
the Board, the Evaluation Committee and the Executive Secretary from taking
such steps as may impair the rights that the Company claims to have acquired in
consequence of its bid.

After requiring petitioners herein, as respondents in said Case
No. 67400, to answer the petition therein, or on November 16, 1966, respondent Judge issued a restraining
order directing petitioners’ herein, their agents and/or representatives, to
refrain from exe­cuting the acts adverted to above.  On December
1, 1966, petitioners herein filed their answer to said Case No.
67400, with a motion to dismiss and an opposition to the writ of preliminary
injunction prayed for by the Company. 
Acting on said motion, on December
9, 1966, respondent Judge denied the same and set the case for hearing.

Presently, or on January
14, 1967, petitioners herein commenced the present action against
respondent Judge and the Company, for the purpose indicated at the beginning of
this decision.  On January 19, 1967, this Court required respondents
herein to file their answer, not a motion to dismiss, as well as issued the
writ of preliminary injunct­ion prayed for by the petitioners.  Subsequently, respondents filed their answer
and later moved to dissolve or amend said writ of preliminary injunction; but we
denied the motion.

The main issue in this case is whether or not respondent Judge
had committed a grave abuse of discretion, amounting to excess of jurisdiction,
in issuing the restraining order dated November
16, 1966.  This question, in
turn, hinges on whether or not the records of said Case No. 67400 disclose that
the Company has no cause of action against petitioners herein.

 In this connection, it
should be noted that the petition in said case is predicated – like the answer
in the case at bar – upon the theory that the Invitation to Bid issued by the
Board constitutes an “offer”, which was unqualifiedly accepted by the
bid submitted by the Company, thereby resulting – according to the latter’s
contention in both cases – into a perfected contract, which is binding upon the
Board, thereby imposing upon the same the obligation to implement said alleged
contract and to refrain from entering into negotiations or doing anything
tending to defeat or impair the supposed rights of the Company under said contract.

This theory is, however, absolutely untenable.  An Invitation to Bid, is not an
“offer”, which, if accepted, matures into a contract.  In the language of Article 1326 of our Civil
Code, “advertise­ments for bidders are simply invitations to make proposals
and the advertiser is not bound to accept the highest or lowest bidder,
unless the contrary appears.^[1]
The Company does not even allege that “the contrary appears.”

Worse, still, the Invitation to Bid, issued by the Board,
provided, inter alia, that “the
Government reserves the right to reject any and all bids, waive
any defect of form or accept such bid as may be deemed most advantageous to
it.”  ln other
words, acceptance by the Board of a given bid is necessary for contract to
exist between the Board or the Government and any bidder, regardless of the
terms and conditions of his bid.  This
reservation of the “right” of the Board “to reject any
and all bids, ” is one of the terms and conditions of the
Invitation to Bid which the Company has accepted and, hence, binds the same.^[2]
As a consequence, it is now in stoppel to object to
or assail the exercise of said “right” by the Board.^[3]

Then, contrary to the conclusions made in the pleadings of the
Company, the same has not, in fact, adhered faithfully to the terms, and
conditions of said Invitation to Bid. 
Indeed, the latter explicitly declares that “bids not accompanied
by bid bonds will be rejected.” Admittedly, the bid of the Company
had been submitted without the requisite bond.

It is thus manifest, from the records of said Case No. 67400,
that the Company had no cause of action against petitioners herein and that,
accordingly, respondent Judge committed a grave abuse of discretion, amounting
to excess of jurisdiction, in issuing its restraining order of November 16,
1966, and its order of December 9, 1966, refusing, in effect, to set aside said
order of November 16, 1966.^[4]

WHEREFORE, said orders of respondent Judge dated November
16, and December 9, 1966, are hereby annulled and the writ of preliminary injunction
issued in the present case made permanent, with cost against respondent,
Mac-Arthur International Minerals Company. 
Writ granted.

IT IS SO ORDERED.

Reyes, JBL, Dizon, Makalintal, Zaldivar, Sanchez, Ruiz
Castro, Angeles, and Fernando, JJ., concur.

^[1]
Underscoring ours.

^[2] Leonquinco v. Postal Savings Bank, 47 Phil. 772; Borromeo v. City of Manila,
62 Phil. 512.

^[3]
Gutierrez v. Insular Life, 102 Phil. 524; De Lara v. Secre­tary
of Public Works, L-13460, November 28, 1958; Jalandoni
v. National Settlement, L-15198, May 30, 1960; De Ocampo
v. Munici­pal Council, L-9293, May 31, 1957; Esguerra
v. Aytona, L-18751, April 28, 1962.

^[4] Alemany v. Sweeney, 2 Phil. 654; La Insular v. Jao
Oge, 42 Phil. 367; De los
Santos v. Provincial Sheriff, 64 Phil. 193; Alzua
v. Johnson, 21 Phil. 308, 349-350, 366; North Negros
Sugar Co. v. Hidalgo, 63 Phil. 664, 671; Ayo v.
Ilao, L-23293, Jan. 16, 1968; Commissioner of Customs
v. Cloribel, L-20266, Jan. 31, 1967; Vivo v.
Arca, L-21728, Dec. 27, 1963.