TOPIC Preliminary Injunction

CASE NO. G.R. No. 167057

CASE NAME Nerwin v. PNOC
MEMBER Kara

DOCTRINE
Section 3 of RA 8975 states in no uncertain terms, thus:
• Prohibition on the Issuance of temporary Restraining Order, Preliminary Injunctions and
Preliminary Mandatory Injunctions. – No court, except the Supreme Court, shall issue any
temporary restraining order, preliminary injunction or preliminary mandatory injunction against
the government, or any of its subdivisions, officials, or any person or entity, whether public or
private, acting under the government’s direction, to restrain, prohibit or compel the following
acts:
• (b) Bidding or awarding of contract/project of the national government as defined under Section 2
hereof;
• This prohibition shall apply in all cases, disputes or controversies instituted by a private party,
including but not limited to cases filed by bidders or those claiming to have rights through such
bidders involving such contract/project. This prohibition shall not apply when the matter is of
extreme urgency involving a constitutional issue, such that unless a temporary restraining order is
issued, grave injustice and irreparable injury will arise.
Section 4 of RA 8975. Nullity of Writs and Orders. - Any temporary restraining order, preliminary
injunction or preliminary mandatory injunction issued in violation of Section 3 hereof is void and of
no force and effect.

RECIT-READY DIGEST
NEA published an invitation to pre-qualify and to bid for a contract, otherwise known as IPB No. 80, for
the supply and delivery of about sixty thousand (60,000) pieces of woodpoles and twenty thousand
(20,000) pieces of crossarms needed in the country’s Rural Electrification Project. NEA administrator
recommended to NEA’s BOD that the contract be awarded to Nerwin. However, NEA’s BOD reduced by
50% the material requirements to be awarded to Nerwin. Then, PNOC-Energy Development Corporation
issued an invitation to pre-qualify and to bid for wooden poles needed for its O-ILAW Project. Nerwin
filed a civil action in the RTC in Manila, alleging that O-ILAW Project was an attempt to subject a
portion of the items covered by IPB No. 80 to another bidding; and praying that a TRO issue to enjoin
respondents’ proposed bidding for the wooden poles. RTC Granted. CA reversed. Respondent Judge
gravely abused his discretion in entertaining an application for TRO/preliminary injunction, and worse, in
issuing a preliminary injunction through the assailed order enjoining petitioners’ sought bidding for its O-
ILAW Project. The same is a palpable violation of RA 8975. Respondent Judge did not even endeavor,
although expectedly, to show that the instant case falls under the single exception where the said
proscription may not apply, i.e., when the matter is of extreme urgency involving a constitutional issue,
such that unless a temporary restraining order is issued, grave injustice and irreparable injury will arise.
(Check doctrine)

FACTS
• In 1999, the National Electrification Administration ("NEA") published an invitation to pre-
qualify and to bid for a contract, otherwise known as IPB No. 80, for the supply and delivery of
about sixty thousand (60,000) pieces of woodpoles and twenty thousand (20,000) pieces of
crossarms needed in the country’s Rural Electrification Project. The said contract consisted of

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 four (4) components, namely: PIA, PIB and PIC or woodpoles and P3 or crossarms, necessary for
NEA’s projected allocation for Luzon, Visayas and Mindanao.
• In the Recommendation of Award for Schedules PIA, PIB, PIC and P3 - IBP No. 80 [for the]
Supply and Delivery of Woodpoles and Crossarms dated October 4, 2000, NEA administrator
Conrado M. Estrella III recommended to NEA’s Board of Directors the approval of award to
private respondent [Nerwin] of all schedules for IBP No. 80
• However, on December 19, 2000, NEA’s Board of Directors passed Resolution No. 32 reducing
by 50% the material requirements for IBP No. 80 "given the time limitations for the delivery of
the materials, xxx, and with the loan closing date of October 2001 fast approaching". In turn, it
resolved to award the four (4) schedules of IBP No. 80 at a reduced number to private respondent
[Nerwin]. Private respondent [Nerwin] protested the said 50% reduction, alleging that the same
was a ploy to accommodate a losing bidder.
• On the other hand, the losing bidders Tri State and Pacific Synnergy appeared to have filed a
complaint, citing alleged false or falsified documents submitted during the pre-qualification stage
which led to the award of the IBP-80 project to private respondent [Nerwin].
• NEA officials sought the opinion of the Government Corporate Counsel who, among others,
upheld the eligibility and qualification of private respondent [Nerwin].
• NEA allegedly held negotiations with other bidders relative to the IPB-80 contract, prompting
private respondent [Nerwin] to file a complaint for specific performance with prayer for the
issuance of an injunction, which injunctive application was granted by Branch 36 of RTC-Manila
in Civil Case No. 01102000.
• In the interim, PNOC-Energy Development Corporation purporting to be under the Department
of Energy, issued Requisition No. FGJ 30904R1 or an invitation to pre-qualify and to bid for
wooden poles needed for its Samar Rural Electrification Project ("O-ILAW project").
• Upon learning of the issuance of Requisition No. FGJ 30904R1 for the O-ILAW Project, Nerwin
filed a civil action in the RTC in Manila, docketed as Civil Case No. 03106921 entitled Nerwin
Industries Corporation v. PNOC-Energy Development Corporation and Ester R. Guerzon, as
Chairman, Bids and Awards Committee, alleging that Requisition No. FGJ 30904R1 was an
attempt to subject a portion of the items covered by IPB No. 80 to another bidding; and praying
that a TRO issue to enjoin respondents’ proposed bidding for the wooden poles.
• Respondents sought the dismissal of Civil Case No. 03106921, stating that the complaint averred
no cause of action, violated the rule that government infrastructure projects were not to be
subjected to TROs, contravened the mandatory prohibition against non-forum shopping, and the
corporate president had no authority to sign and file the complaint.
• the RTC granted a TRO in Civil Case No. 03106921. Accordingly, let a writ of preliminary
injunction issue enjoining the defendant PNOC-EDC and its Chairman of Bids and Awards
Committee Esther R. Guerzon from continuing the holding of the subject bidding upon the
plaintiffs filing of a bond in the amount of ₱200,000.00 to answer for any damage or damages
which the defendants may suffer should it be finally adjudged that petitioner is not entitled
thereto, until final determination of the issue in this case by this Court.
• CA reversed.

ISSUE/S and HELD

1. Whether or not the CA erred in dismissing the case on the basis of Rep. Act 8975 prohibiting the
issuance of temporary restraining orders and preliminary injunctions, except if issued by the
Supreme Court, on government projects. - NO

RATIO
• Respondent Judge gravely abused his discretion in entertaining an application for
TRO/preliminary injunction, and worse, in issuing a preliminary injunction through the assailed

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 order enjoining petitioners’ sought bidding for its O-ILAW Project. The same is a palpable
violation of RA 8975 which was approved on November 7, 2000, thus, already existing at the
time respondent Judge issued the assailed Orders dated July 20 and December 29, 2003.
• Section 3 of RA 8975 states in no uncertain terms, thus:
o Prohibition on the Issuance of temporary Restraining Order, Preliminary Injunctions and
Preliminary Mandatory Injunctions. – No court, except the Supreme Court, shall issue
any temporary restraining order, preliminary injunction or preliminary mandatory
injunction against the government, or any of its subdivisions, officials, or any person or
entity, whether public or private, acting under the government’s direction, to restrain,
prohibit or compel the following acts:
o (b) Bidding or awarding of contract/project of the national government as defined under
Section 2 hereof;
o This prohibition shall apply in all cases, disputes or controversies instituted by a private
party, including but not limited to cases filed by bidders or those claiming to have rights
through such bidders involving such contract/project. This prohibition shall not apply
when the matter is of extreme urgency involving a constitutional issue, such that unless a
temporary restraining order is issued, grave injustice and irreparable injury will arise.
Xxx
• Respondent Judge did not even endeavor, although expectedly, to show that the instant case falls
under the single exception where the said proscription may not apply, i.e., when the matter is of
extreme urgency involving a constitutional issue, such that unless a temporary restraining order is
issued, grave injustice and irreparable injury will arise.
• Section 4 of RA 8975. Nullity of Writs and Orders. - Any temporary restraining order,
preliminary injunction or preliminary mandatory injunction issued in violation of Section 3 hereof
is void and of no force and effect.
• The text and tenor of the provisions being clear and unambiguous, nothing was left for the RTC
to do except to enforce them and to exact upon Nerwin obedience to them. The RTC could not
have been unaware of the prohibition under Republic Act No. 8975 considering that the Court
had itself instructed all judges and justices of the lower courts, through Administrative Circular
No. 11-2000, to comply with and respect the prohibition against the issuance of TROs or writs of
preliminary prohibitory or mandatory injunction involving contracts and projects of the
Government.
• A preliminary injunction is an order granted at any stage of an action or proceeding prior to the
judgment or final order, requiring a party or a court, agency or person, to refrain from a particular act
or acts. It is an ancillary or preventive remedy resorted to by a litigant to protect or preserve his
rights or interests during the pendency of the case. As such, it is issued only when it is established
that:
a) The applicant is entitled to the relief demanded, and the whole or part of such relief consists in
restraining the commission or continuance of the act or acts complained of, or in requiring the
performance of an act or acts, either for a limited period or perpetually; or
b) The commission, continuance or non-performance of the act or acts complained of during the
litigation would probably work injustice to the applicant; or
c) A party, court, agency or a person is doing, threatening, or is attempting to do, or is procuring or
suffering to be done, some act or acts probably in violation of the rights of the applicant
respecting the subject of the action or proceeding, and tending to render the judgment ineffectual.
• An injunction will not issue to protect a right not in esse, or a right which is merely contingent and
may never arise; or to restrain an act which does not give rise to a cause of action; or to prevent the
perpetration of an act prohibited by statute. Indeed, a right, to be protected by injunction, means a
right clearly founded on or granted by law or is enforceable as a matter of law.

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 • for the court to act, there must be an existing basis of facts affording a present right which is directly
threatened by an act sought to be enjoined. And while a clear showing of the right claimed is
necessary, its existence need not be conclusively established.

DISPOSTIVE PORTION
WHEREFORE, the Court AFFIRMS the decision of the Court of Appeals

NOTES::