ABAYA vs. EBDANE

Facts:

The Government of Japan and the Philippines, through their respective representatives, namely, Mr. Yoshihisa Ara, Ambassador Extraordinary and Plenipotentiary of Japan to the Republic of the Philippines, and Secretary of Foreign Affairs, Domingo L. Siazon, had reached an understanding concerning Japanese loans to be extended to the Philippines. These loans were aimed to promote our country’s economic stabilization and development efforts.

The assailed resolution recommended the award to private respondent China Road & Bridge Corporation of the contract for the implementation of civil works for Contract Package No. I (CP I), which consists of the improvement/rehabilitation of the San Andres (Codon)-Virac-Jct. Bago-Viga road, with the length of 79.818 kilometers, in the island province of Catanduanes.The DPWH caused the publication of the “Invitation to Prequalify and to Bid” for the implementation of the CP I project, in two leading national newspapers, namely, the Manila Times and Manila Standard on November 22 and 29, and December 5, 2002.

The bid goes to private respondent China Road & Bridge Corporation was corrected from the original P993,183,904.98 (with variance of 34.45% from the ABC) to P952,564,821.71 (with variance of 28.95% from the ABC) based on their letter clarification dated April 21, 2004.

The petitioners anchor the instant petition on the contention that the award of the contract to private respondent China Road & Bridge Corporation violates RA 9184, particularly Section 31.

The petitioners insist that Loan Agreement is neither an international nor an executive agreement that would bar the application of RA 9184. They point out that to be considered a treaty, an international or an executive agreement, the parties must be two sovereigns or States whereas in the case of Loan Agreement No. PH-P204, the parties are the Philippine Government and the JBIC, a banking agency of Japan, which has a separate juridical personality from the Japanese Government.

Issue :

Whether or not the the loan agreement violates RA 9184.

Ruling:

The court ruled in favor of the respondents.

Significantly, an exchange of notes is considered a form of an executive agreement, which becomes binding through executive action without the need of a vote by the Senate or Congress. executive agreements, They sometimes take the form of exchange of notes and at other times that of more formal documents denominated “agreements” or “protocols”.