MMDA vs. D.M. CONSUNJI, INC. AND R-II BUILDERS, INC.

G.R. No. 222423

February 20, 2019

Facts
MMDA and the Metro Manila mayors agreed to choose the interim waste disposal site for a
period of two (2) years. The program was endorsed and approved by then President Joseph E.
Estrada. The project was then opened for public bidding and was awarded to respondents as
winning joint bidders. Meanwhile, two TROs were issued by the RTC Antique placing the
operation on hold. Pending hearing on the prayer for the issuance of a writ of injunction, then
President Estrada resigned from office. Since the project is on hold due to TROs, respondents
sought to recover their alleged incurred expenses under the contract, respondents formally
demanded from the MMDA the reasonable reimbursement they spent, based on the principle of
quantum meruit. MMDA Chairman Bayani Fernando rejected the same. Respondents filed a
complaint with the trial court for sum of money with damages against MMDA. The trial court
rendered judgment in favor of the plaintiff and against the defendant ordering the latter to pay
the plaintiff representing the expenses which the plaintiffs incurred for the partial execution of
the Project, with 6% legal interest from the date of extrajudicial demand until fully paid.

The respondents filed a Motion for Partial Reconsideration on the ground of failure by the trial
court to award litigation expenses in their favor. On the other hand, MMDA filed a Notice of
Appeal and argues that direct enforcement of liability against them would violate the law
because (1) disbursement of public funds must be covered by a corresponding appropriation as
required by law; and (2) the present case is a suit against the State which has not given its
consent to be sued. (3) The remedy of the respondents is allegedly to file their money claim with
the Commission on Audit (COA) as prescribed under Act No. 3083 and Commonwealth Act No.
327.

The motion and notice of appeal were both denied. Respondents then filed their Notice of
Partial Appeal. The Court of Appeals denied said motion and affirmed the trial court’s decision,
holding that judgment on the pleadings is proper. It also found that respondents are entitled to
reimbursement. It ruled that they have the right to be compensated for the partial execution of
the project applying the principle of quantum meruit. The Court of Appeals rejected the defense
of state immunity from suit. The CA likewise ruled that respondents are not entitled to litigation
expenses.

Issue
1. Whether the COA has primary jurisdiction over the present case.

Ruling
Since what is involved is a specific money claim against a government agency, it is clearly within
the jurisdiction of the COA.
Under Commonwealth Act No. 327, as amended by Section 26 of Presidential Decree No.
1445, it is the COA which has primary jurisdiction over money claims against government
agencies and instrumentalities.

Pursuant to its rule-making authority conferred by the 1987 Constitution and existing laws, the
COA promulgated the 2009 Revised Rules of Procedure of the Commission on Audit. Section 1
of Rule II specifically enumerated those matters falling under COA's exclusive jurisdiction, which
include "money claims due from or owing to any government agency."

Therefore, the petitioners are correct in contending that COA has the primary jurisdiction over
the money claims filed by respondents.