REMEDIAL LAW REVIEW
Rule 1 to Rule 5
FACTS
Osmeña v. Abaya Doctrine
13 January 2016 | In private suits, legal standing is governed
by the “real-parties-in interest rule” as
J. Villarama, Jr.
contained in Rule 3, Section 2 of the Rules
of Court. In other words, plaintiff's standing is
Petitioner: Osmeña based on his own right to the relief sought.
and BMP
Respondent: DOTC, In public suits, the plaintiff must pass the direct
represented by Sec. injury test. However, in cases involving
Abaya, and PBAC transcendental interest, an assertion by the
plaintiff of a public right as a representative of
the general public is enough.
Recit Summary:
Facts: Osmeña and BMP filed a petition to restrain DOTC from awarding
GMR and Megawide the MCIA project. GMR and Megawide countered
that the petitioners have no standing as they are not real parties of
interest and will not suffer grave and irreparable injury from the
continuation of the award.
Issues: W/N the petitioners are real parties in interest / has standing –
YES, the SC granted them standing in view of "the serious legal
questions involved and their impact on public interest.” In private
suits, Rule 3, Sec. 2 applies in interpreting what “real parties in interest”
are. In said rule, “real-party-in interest” is "the party who stands to be
benefited or injured by the judgment in the suit or the party entitled to
the avails of the suit." However, the rule is relaxed in public suits, where
locus standi may be asserted by the plaintiff by proving a public right as a
representative of the general public.
Ruling: SC granted them standing, adding that the Court, in line with its
duty to determine whether the other branches of government have kept
themselves within the limits of the Constitution, may brush aside technical
rules of procedure in light of public interest.
Pertinent Provisions:
Rule 3, Section 2. Parties in interest. – A real party in interest is
the party who stands to be benefited or injured by the
judgment in the suit, or the party entitled to the avails of the
suit. Unless otherwise authorized by law or these Rules, every
action must be prosecuted or defended in the name of the real
party in interest.
● The case involves two consolidated petitions for certiorari
and injunction to restrain private respondents DOTC and
PBAC from awarding the Mactan-Cebu International Airport
(MCIA) Project to private respondents GMR Infrastructure
and Megawide Construction.
● GMR and Megawide won the public bidding for the MCIA
project.
● However, petitioner Osmeña filed a petition praying that the
Supreme Court immediately issue a restraining order and
declare private respondents as unqualified bidder.
● Osmena claims to be suing as a legislator, taxpayer and
citizen asserting a public right in the stringent application of
the bidding rules on the qualifications of private respondents.
He asserts that:
○ [1] The GMR-Megawide Consortium should have
been disqualified because it violated the conflict of
interest rule when it failed to disclose that Mr. Tan
Shri Bashir Ahmad bin Abdul Majid, the director of
GMR-Megawide Consortium, is also the Managing
Director of Malaysia Airport Holdings Berhad
(MAHB), which joined the bidding for MCIA Project;
○ [2] The above-rule is mala prohibita; hence, it does
not matter whether the violation was intentional
or not, and the penalty of disqualification should be
imposed.
○ [3] GMR-Megawide's violation disadvantaged the
other bidders as they were restricted from entering
into similar arrangements, and thus deprived them of
an even playing field or a fair and competitive
bidding.
● Business for Progress Movement similarly filed a petition
for injunction, stating that it stands to suffer great and
irreparable damage and injury once the GMR-Megawide
Consortium takes over. It asserts that:
○ Its members, who are frequent travelers to Cebu and
Mactan, will be personally injured by the increased
terminal fees imposed by the private respondents.
● Respondents GMR and Megawide contend, among others,
that the petition should be dismissed as:
LAW 159B SURNAME, First Name
REMEDIAL LAW REVIEW
Rule 1 to Rule 5
○ [1] petitioner failed to show that he or even the other
bidders, the public and the State, will suffer grave
and irreparable injury from the continuation of
the Award. On the contrary, it is the government
and the public who will suffer irreparable injury if an
injunction is issued that will further delay the project
for the expansion and development of an
international airport in the Province of Cebu; and
○ [2] A direct resort to the Supreme Court is premature
under the doctrine of hierarchy of courts.
ISSUES + HELD
[1] W/N the petitioners are real parties in interest / has standing
- YES
● Applying Agan v. PIATCO, which also involved a controversy
in the qualifications of the winning bidder for the construction
and operation of NAIA, the SC granted standing to the
petitioners and considered them real parties in interest
in view of "the serious legal questions involved and their
impact on public interest."
● In determining standing, the general rule is: legal
standing or locus standi refers to a personal and substantial
interest in a case such that the party has sustained or will
sustain direct injury because of the challenged
governmental act. Thus, a party will be allowed to litigate
only when:
○ [1] he can show that he has personally suffered
some actual or threatened injury because of the
allegedly illegal conduct of the government;
○ [2] the injury is fairly traceable to the challenged
action; and
○ [3] the injury is likely to be redressed by a
favorable action.
● However, the Court considers the application of the rules on
standing in private suits different from public suits.
● In private suits, as cited in David v. Macapagal-Arroyo,
legal standing is governed by the “real-parties-in interest
rule” as contained in Rule 3, Section 2 of the 1997 Rules
of Civil Procedure which provides that:
○ "Every action must be prosecuted or defended in the
name of the real party in interest."
○ Accordingly, the “real-party-in interest” is "the party
who stands to be benefited or injured by the
judgment in the suit or the party entitled to the avails
of the suit."
○ In other words, plaintiff's standing is based on his
own right to the relief sought.
● In public suits, the plaintiff has to assert a public right as a
representative of the general public.
○ He may be a person who is affected no differently
from any other person. He could be suing as a
"stranger," or in the category of a "citizen," or
"taxpayer."
○ However, to prevent just about any person from
seeking judicial interference, the SC adopted the
“direct injury test” from US case law.
■ In People v. Vera, SC held that the person
who impugns the validity of a statute must
have "a personal and substantial interest in
the case such that he has sustained, or
will sustain direct injury as a result."
● Therefore, the current rules for public suits standing are:
○ For a citizen, they must allege that [1] they have
been or are about to be denied some right or
privilege they are lawfully entitled or [2] they are
about to be subjected to some penalties by reason
of the statute or act complained of.
○ For a taxpayer, one is allowed to sue when [1] there
is an assertion that public funds are illegally
disbursed or deflected to an illegal purpose, or [2]
there is a wastage of public funds through the
enforcement of an invalid or unconstitutional law.
○ For a legislator, an act of the Executive that injures
the institution of Congress causes a derivative but
nonetheless substantial injury that can be
questioned by legislators.
○ For an organization, it must assert the rights of its
members. But the mere invocation by the IBP or any
member of the legal profession of the duty to
LAW 159B SURNAME, First Name
REMEDIAL LAW REVIEW
Rule 1 to Rule 5

preserve the rule of law does not suffice to clothe it RULING: With regard to the procedural issues of the case, the
with standing. petition was not dismissed (the Court allowed them to proceed to the
○ For an LGU, it can seek relief in order to protect or substantive matters).
vindicate its and of the other LGUs’ interest.
● In this case, BPM asserts a direct personal injury for its
members while Osmeña claims to be suing as a legislator,
taxpayer and citizen asserting a public right in the stringent
application of the bidding rules.
● SC proceeded to grant them standing, adding that the Court,
in line with its duty to determine whether the other branches
of government have kept themselves within the limits of the
Constitution, may brush aside technical rules of procedure in
light of public interest.

[2] [Relevant to CivPro, but not to current topic] W/N the petition
disregarded the principle of hierarchy of courts - NO
● The general rule is that the Supreme Court will not entertain
direct resort to it by reason of practicality.
○ Under the principle of hierarchy of courts,
recourse must first be made to the lower-ranked
court exercising concurrent jurisdiction with a higher
court.
● However, a direct invocation of the Supreme Court's
jurisdiction is allowed when there are special and important
reasons clearly and especially set out in the petition.
○ Examples are cases of national interest and of
serious implications which justify the availment of the
extraordinary remedy of writ of certiorari, calling for
the exercise of the SC’s primary jurisdiction.
● In this case, there is no dispute that this is of paramount
national interest for it raises serious questions on the
evaluation of bids by the public respondents.
○ Firstly, the MCIA is the second busiest airport in the
country after NAIA handling millions of passengers
and thousands of aircraft movements every year.
○ Secondly, the multi-billion expansion and
development project for MCIA is being implemented
through the PPP program.

LAW 159B SURNAME, First Name