DILG OPINION NO. 62 S.

1999

May 17, 1999

HON. FRANKLIN M. QUIJANO

City Mayor
City Hall, Iligan City
Re:
Request for clarification of directive on the complaint of
Fernando Sopot, President of the Principal Management Group, Inc.
(PMGI).
1. Can PMGI be paid even if the SP already passed Res. Nos. 99-186
and 99-420 recalling their conformity to the project and the P14
million pesos allocated therefor?
2. Can the affected tenants and all other legitimate claimants relative
to the project be paid also?
3. In the affirmative, what is the liability of the SP members who
passed the above-mentioned resolutions, if any?
Dear Mayor Quijano:
In reply thereto, you state that the apparent import of our
directive dated April 15, 1999 is that there is no more need for a
sanggunian resolution to effect payment to PMGI, contractor of Phase I
of the Sports Complex Project thereat, because it is a purely executive
function. You are, however, apprehensive to effect payment because
the Sangguniang Panlungsod thereat passed two resolutions, namely:
(1) Resolution No. 99-168, February 11, 1999 - Recalling Resolution
Nos. 1050, 1051 and 1052, all series of 1998, which earlier authorized
you to, among others, open a Letter of Credit with Land Bank in
accordance with the Memorandum of Agreement of the construction of
the sports complex; and (2) Resolution No. 99-420, March 23, 1999 Returning Current Account No. 0321-1129-51 classified as ICG HYSA
Sports Complex xxx to where the P14 Million was originally
appropriated xxx.
Please be informed that, as a general rule, while a sanggunian
can always recall any resolution it earlier passed, it cannot, however,
by way of exception, properly recall a resolution where vested rights

have already attached to a third person by reason thereof. In one

case, the Supreme Court held that a contract validly entered into by a
municipality is protected by the Constitution and cannot, therefore, be
impaired by a subsequent resolution which sets it aside (Manantan vs.
Municipality of Luna, 82 Phil. 844).

-2Consequently, any vagueness attending the passage of

Resolution Nos. 1050, 1051 and 1052 could be properly clarified and
reformed should the need therefor arises, only by invoking the aid of
the court and not by the unilateral act of the sanggunian in recalling
the same as vested rights of third persons may be impaired thereby.
Corollary thereto, the Supreme Court likewise held that a
municipality may become obligated upon an implied contract to pay
the reasonable value of the benefits accepted or appropriated by it as
to which it has the general power to contract (Province of Cebu vs. IAC,
147 SCRA 447). As borne by the records, the city officials never
interposed their objections to the on-going project (78.27% complete)
at the earliest opportune time when the contractor could not have yet
invested much money in the project. Such silence may then be
construed as implied acquiescence of the contractors work.
Hence, going now to your aforestated queries, since the recall of
Resolution Nos. 1050, 1051 and 1052, all series of 1998, would run
counter to the doctrinal pronouncement of the Honorable Supreme
Court in the aforecited Manantan Case, we are of the view that PMGI's
legal claim appears to find support from law and jurisprudence. With
regard to the affected tenants, should their right to receive payment
be likewise established, we are of the view that the City is likewise
bound thereby. On the issue as to the liability of the sanggunian
members who passed the recall resolutions, please be advised that the
matter is properly cognizable by the Office of the President pursuant to
Section 61 (a) of the Local Government Code.
Please be guided accordingly.

Very truly yours,

JESUS I.
INGENIERO
Assistant Secretary
LS:43/La
cc:

The Sangguniang Panlungsod

Thru: The Presiding Officer
City Hall, Iligan City
The City Director
DILG City Field Office
Iligan City