FACTS: (On
December 10, 2010) Petitioners Miguel “Lucky” Guillermo (Guillermo) and AV
Manila Creative Production Co. (AV Manila) filed a Complaint for a sum of money
and damages before the Regional Trial Court of Marikina City, against
Respondents Philippine Information Agency (PIA) and Department of Public Works and
Highway (DPWH) for the “Joyride” project, and advocacy campaign the purpose of
which was to counteract the public’s negative perception of the performance of
the outgoing Arroyo Administration. It turned out that after all the
deliverables had been delivered by the Petitioners under the said Project, and
despite several demands made by them, no payments were made by the PIA unto
which Guillermo was instructed to send the billings directly.
The Complaint attempted to lay down the elements of a
contract between the petitioners on one hand, and respondents on the other, on
which to enforce the claim. Thus, it alleged a series of communications,
meetings, and memoranda, all tending to show that petitioners agreed to
complete and deliver the “Joyride” project, and that respondents agreed to pay
P25,000,000.00 as consideration.
The Office of the Solicitor General moved to dismiss the
Complaint for failure to state a cause of action (and for failure to exhaust
administrative remedies). Then, the RTC of Marikina granted the Office of the
Solicitor General’s Motion to Dismiss, finding that, although a contract
existed between petitioners and Acting Secretary Domingo of the DPWH, this
contract was not binding on the government of the Philippines. Because of
absence of legal requirements for entering into a contract with the government,
petitioners could not file a complaint for specific performance against the
government. Petitioners moved for reconsideration, but the same was
denied.
Petitioners
appealed to the Court of Appeals which affirmed the RTC’s Order dismissing
petitioners’ Complaint. Petitioners moved for reconsideration, but the same was
denied.
ISSUE: Whether
the Complaint was properly dismissed for failure to state a cause of
action.
HELD: In
Zuñiga-Santos v. Santos-Gran, 738 SCRA 33 (2014):
A complaint states a cause of action if it sufficiently
avers the existence of the three (3) essential elements of a cause of action,
namely: (a) a right in favor of the plaintiff by whatever means and under
whatever law it arises or is created; (b) an obligation on the part of the
named defendant to respect or not to violate such right; and (c) an act or
omission on the part of the named defendant violative of the right of the
plaintiff or constituting a breach of the obligation of defendant to the plaintiff
for which the latter may maintain an action for recovery of damages. If the
allegations of the complaint do not state the concurrence of these elements,
the complaint becomes vulnerable to a motion to dismiss on the ground of
failure to state a cause of action.
It is well to point out that the plaintiff’s cause of
action should not merely be “stated” but, importantly, the statement thereof
should be “sufficient.” This is why the elementary test in a motion to dismiss
on such ground is whether or not the complaint alleges facts which if true would justify the relief demanded. As a
corollary, it has been held that only ultimate facts and not legal conclusions
or evidentiary facts are considered for purposes of applying the test. This is
consistent with Section 1, Rule 8 of the Rules of Court which states that the
complaint need only allege the ultimate facts or the essential facts
constituting the plaintiff’s cause of action. A fact is essential if they
cannot be stricken out without leaving the statement of the cause of action
inadequate. Since the inquiry is into the sufficiency, not the veracity, of the
material allegations, it follows that the analysis should be confined to the four
corners of the complaint, and no other.
Thus, to determine the sufficiency of a cause of action in
a motion to dismiss, only the facts alleged in the complaint should be
considered, in relation to whether its prayer may be granted. In Heirs of Maramag
v. Maramag, 588 SCRA 774 (2009):
When a motion to dismiss is premised on this ground, the
ruling thereon should be based only on the facts alleged in the complaint. The
court must resolve the issue on the strength of such allegations, assuming them
to be true. The test of sufficiency of a cause of action rests on whether,
hypothetically admitting the facts alleged in the complaint to be true, the
court can render a valid judgment upon the same, in accordance with the prayer
in the complaint. This is the general rule.
To sufficiently state a cause of action, the Complaint
should have alleged facts showing that the trial court could grant its prayer
based on the strength of its factual allegations.
In here, to support the Complaint for a sum of money and
damages, the Complaint attempted to lay down the elements of a contract between
the petitioners on one hand, and respondents on the other alleging a series of
communications, meetings, and memoranda, all tending to show that petitioners
agreed to complete and deliver the “Joyride” project, and that respondents
agreed to pay P25,000,000.00 as consideration. Assuming they are true, the same
were not sufficient to establish that the RTC could grant its prayer. The
Complaint attempts to establish a contract that involves expenditure of public
funds. As pointed out by respondents, contracts involving the expenditure of
public funds have additional requisites to be valid. Sections 46, 47, and 48 of
Book V, Title I, Subtitle B, Chapter 8 of the Administrative Code provides for
essential requisites for the validity of contracts.
The Administrative Code of 1987 expressly prohibits the
entering into contracts involving the expenditure of public funds unless two
prior requirements are satisfied. First, there must be an appropriation law
authorizing the expenditure required in the contract. Second, there must be
attached to the contract a certification by the proper accounting official and
auditor that funds have been appropriated by law and such funds are available.
Failure to comply with any of these two requirements renders the contract
void.
The Complaint, however, completely ignored the foregoing
requisites for the validity of contracts involving expenditure of public funds.
Thus, the Regional Trial Court could not order the enforcement of the alleged
contract on the basis of the Complaint, and the Complaint was properly
dismissed for failure to state a cause of action.
Comments
Post a Comment