Consolidated Reply-Aff (Fb)

7/31/2019 Consolidated Reply-Aff (Fb)

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Affidavit is not properly verified or subscribed under oath in

accordance with law.

1.1 The Counter-Affidavit of private respondent

Gapangada contains a verification but the

verification is patently defective. It does not comply

with the requirement of the rule on verification

because it does not contain the required attestation

that allegations therein are true and correct of his

personal knowledge or based on authentic records.

The body of the Counter-Affidavit of private

respondent Gapangada is also completely bereft of

any allegation attesting that the allegations therein

are true and correct of his personal knowledge.

Neither is there any statement in the body of his

Counter-Affidavit attesting to the veracity of the

contents of his Counter-Affidavit.

1.2 Section 4 of Rule 7 of the 1997 Rules of Civil

procedure explicitly provides for the rule on

verification, to quote:

Section 4 of Rule 7 of the 1997 Rules of Civil

Procedure provides:

SEC. 4. Verification. Except whenotherwise specifically required by law or rule,


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pleadings need not be under oath, verified or

accompanied by affidavit.

A pleading is verified by an affidavit that

the affiant has read the pleadings and that theallegations therein are true and correct of

his personal knowledge or based on authentic

records.

A pleading required to be verified which

contains a verification based on information

and belief or upon knowledge, information

and belief or lacks a proper verification,

shall be treated as an unsigned pleading.(Emphasis ours)

1.3 In Negros Oriental Planters Association, Inc. vs.

Hon. Presiding Judge of RTC-Negros Occidental,

Branch 52, Bacolod City,1 the Supreme Court

declared that A pleading, therefore, wherein the

Verification is merely based on the partys

knowledge and beliefproduces no legal effect xxx.

1.4 Obedience to the requirements of procedural rules

is needed if we are to expect fair results therefrom,

and utter disregard of the rules cannot justly be

rationalized by harking on the policy of liberal

construction. Time and again, this Court has

strictly enforced the requirement of verification

and certification of non-forum shopping under the

1G.R. No. 179878, December 24, 2008.


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Rules of Court. This case is no exception.

Verification is required to secure an assurance that

the allegations of the petition have been made in

good faith, or are true and correct and not merely

speculative.2 (Emphasis ours)

1.5 We would not have objected to the defective

verification of the Counter-Affidavit of private

respondent Gapangada if only the body of his

Counter-Affidavit contains a statement or allegation

attesting to the veracity of the contents of his

Counter-Affidavit but, as mentioned above, this

attestation is also manifestly wanting in his Counter-

Affidavit.

1.6 Without the allegation in the verification that the

allegations in his Counter-Affidavit are true and

correct of his personal knowledge or based on

authentic records, or without any statement in the

body of his Counter-Affidavit attesting to the

veracity of the contents thereof, then there is no

assurance that the allegations in the Counter-

2 Clavecilla vs. Quitain, G.R. No. 147989, February 20, 2006, citing Mariveles Shipyard Corp. v. Court of

Appeals, G.R. No. 144134, November 11, 2003, 415 SCRA 573, 584; Pagtalunan v. Manlapig, G.R. No.

155738, August 9, 2005; Torres v. Specialized Packaging Development Corp., G.R. No. 149634, July 6,

2004, 433 SCRA 455, 464.


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Affidavit of private respondent Gapangada have

been made in good faith, or are true and correct and

not merely speculation. In other words, there is no

assurance that the contents of the Counter-

Affidavit of respondent Gapangada are not false

and purely speculative. Thus, it is only proper that

the Counter-Affidavit of private respondent

Gapangada should be treated as unsigned pleading

which produces no legal effect.

2. Private respondent Gapangada contends in his Counter-

Affidavit that a private individual, like himself, cannot be held

criminally liable for violation of Section 3 (g) of R.A. No. 3019,

otherwise known as the Anti-Graft and Corrupt Practices Act, by

citing the ruling of the Supreme Court in the case of Go vs.

Sandiganbayan, G.R. No. 172602 in its Resolution dated September

3, 2007. This contention of private respondent Gapangada is quite

misleading and it distorted the final ruling of the Supreme Court in the

said case of Go vs. Sandiganbayan.

2.1 In its subsequent Resolutiondated April 16, 2009,

the Supreme Court had overturned/reversed its

Resolution dated September 3, 2007 in Go vs.

Sandiganbayan when it ruled that private


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individuals may be charged in conspiracy with

public officer for violating Section 3(g) and if

found guilty, be held liable therefore, to quote:

We maintain that to be indicted of the

offense under Section 3(g) of R.A. No.3019, the following elements must be

present: (1) that the accused is a public

officer; (2) that he entered into a contract

or transaction on behalf of the

government; and (3) that such contract or

transaction is grossly and manifestlydisadvantageous to the government.

However, if there is an allegation ofconspiracy, a private person may be held

liable together with the public officer, in

consonance with the avowed policy of

the Anti-Graft and Corrupt Practices Act

which is to repress certain acts of public

officers and private persons alike which

may constitute graft or corrupt practicesor which may lead thereto.3

2.2 In a later case of Santillano vs. Court of Appeals, 4

the Supreme Court reiterated its ruling in the

Resolution dated April 16, 2009 in Go vs.

Sandiganbayan5 where it was ruled that the fact

that one of the elements of Section 3(g) of RA 3019

is that the accused is a public officer does not

necessarily preclude its application to private

persons who, like petitioner Go, are being charged

3 Go vs. Sandiganbayan, G.R. No. 172602, April 16, 2009.4 G.R. Nos. 175045-46, March 3, 2010.5 G.R. No. 172602, April 13, 2007, 521 SCRA 270.


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with conspiring with public officers in the

commission of the offense thereunder. The

appellants assertion was at odds with the policy and

spirit behind RA 3019, which was to repress certain

acts of public officers and private persons alike

which constitute graft or corrupt practices or which

may lead thereto.6

3. The instant criminal case for violation of Section 3(g) of

the Anti-Graft and Corrupt Practices Act and the corresponding

administrative complaint are founded on two (2) legal grounds (a) that

the respondents have conspired and confederated with one another in

entering into the three (3) water contracts subject matter of the

complaint, which contracts are manifestly and grossly

disadvantageous to the Municipality of Majayjay, Laguna (Majayjay

for short) because they were entered into by respondents in gross

violation of (i) Republic Act No. 6957, as amended by Republic Act

No. 7718, otherwise known as the Built-Operate and Transfer Law

(BOT Law for short), (ii) Republic Act No. 9184, otherwise known as

the Procurement Reform Act, (iii) and the Local Government Code of

1991, and (b) that the subject three (3) water contracts by

themselves [ and by going from the body of the contract itself] will

6 Santillano vs. Court of Appeals, G.R. Nos. 175045-46, March 3, 2010.


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indubitably show that they are manifestly and grossly

disadvantageous to Majayjay.

4. Contrary to the claim of pubic respondents-members of

the Sangguniang Bayan (SB for short), the lack of proper bidding and

posting of the required performance security as well as the lack of

compliance with either the BOT Law, Executive Order (E.O.) No.

423 dated April 30, 2005, Procurement Reform Act or the Local

Government Code of 1991 are relevant and material to the instant

case to show that respondents have conspired with one another to

enter into a manifestly and gross disadvantageous contract to

Majayjay and that public respondents committed grave misconduct

and gross negligence in the discharge of their duties.

5. The aforestated laws were enacted by the legislature to

protect the government and its agencies or instrumentalities, including

the LGUs, from onerous and grossly disadvantageous contracts. Since

the respondents did not follow those laws in the execution of the

subject three (3) water contracts, then the respondents have in effect

placed Majayjay in a very onerous and disadvantageous position.

6. In other words, the public respondents committed grave

misconduct and gross negligence in the discharge of their duties when

they conspired with one another to authorize the execution of the

subject three (3) water contracts without due observance of the


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provisions of those laws. The public respondents should not have

authorized the execution of the subject three (3) water contracts

without due compliance with the provisions of those laws. In acting

otherwise, public respondents should be held not only criminally

liable but also administratively liable for grave misconduct and gross

negligence in the discharge of their duties.

7. On the fact that the subject BULK WATER CONTRACT

between Majayjay and Israel Builders and Development Corporation

(IBDC) is manifestly and grossly disadvantageous to Majayjay

because it violated the BOT Law, the Counter-Affidavit of the

respondents will show that they did not dispute and disprove the

allegations and proof presented in our Affidavit-Complaint dated June

14, 2012 that the subject BULK WATER CONTRACT has grossly

violated the BOT Law. The respondents merely made the lame

excuse that the BOT Law is not applicable to the subject BULK

WATER CONTRACT. This lame excuse of respondents cannot

prevail over the undisputed fact that the subject BULK WATER

CONTRACT involved an unsolicited proposal from IBDC involving

important and priority project of Majayjay.

7.1 As an unsolicited proposal from IBDC, the subject BULK

WATER CONTRACT clearly falls within the coverage of the BOT

Law but the same was entered into by respondents without the


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required publication and approval as provided under Sections 4, 5 and

6 of R.A. No. 7718 or the BOT Law.

7.2 More importantly, the term of the said BULK WATER

CONTRACT is contrary to the provision of Section 8 of R.A. No.

7718 which provides that the maximum term of a BOT contract shall

not exceed fifty (50) years. But the BULK WATER CONTRACT

provides for a mind boggling term of 100 years, inclusive of the 50

years automatic extension.

7.3 Therefore, the subject BULK WATER CONTRACT is

manifestly and grossly disadvantageous to Majayjay because it was

entered into by respondents in gross violation of the BOT Law.

8. Private respondent Gapangada and public respondent

Guera contend that the BOT Law will not apply to the subject BULK

WATER CONTRACT and they both cited that the applicable law is

the GUIDELINES on Joint Venture (JV) pursuant to Section 8 of

Executive Order (E.O.) No. 423 dated April 30, 2005. Public

respondent Guera has even the temerity to claim that even the

Procurement Reform Act is also not applicable to the subject BULK

WATER CONTRACT.

9. Assuming arguendo without in any way conceding that

the GUIDELINES on JV provided under Section 8 of E.O. 423 dated

April 30, 2005 is the applicable law to the subject BULK WATER


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CONTRACT, still there is a patent violation of the aforestated

GUIDELINES because Section 4.0 of E.O. No. 423, sub-paragraph

4.1, explicitly provides that Local Government Units (LGU) are

not covered by these Guidelines.

9.1 On the other hand, Section 12 of E.O. No. 423 dated April 30,

2005 explicitly provides that Procurement contracts of local

government units, regardless of the source of funds, shall be

subject to the provisions of Republic Act No. 9184 and its

Implementing Rules and Regulations.

9.2 Since Section 12 of E.O. No. 423 clearly provides that

procurement contracts of LGU, regardless of the source of funds, is

subject to the Procurement Reform Act, it follows, therefore, that the

subject BULK WATER CONTRACT is subject to the procedures on

competitive bidding as provided under the Procurement Reform Act.

9.3 Sad to say, however, respondents entered into and executed the

BULK WATER CONTRACT without complying with the

requirements/procedures on competitive bidding as provided in

Procurement Reform Act. Republic Act No. 9184 requires preparation

of bidding documents f

ollowing the standard forms and manuals

prescribed by the GPPB,7 pre-procurement conference,8 advertising of

7 Section 17, Republic Act No. 9184.8 Section 20, Republic Act No. 9184.


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invitation to bid,9 pre-bid conference,10 eligibility requirements of a

prospective bidder shall be made under oath,11 submission of Bids

shall have technical and financial components,12

all Bids shall be

accompanied by Bid security,13 opening of all the Bids publicly at a

specified date, time and place,14Bid evaluation,15 post qualification,16notice of Award,17 and performing security.18

9.4 The respondents Counter-Affidavits are completely bereft of

any allegation and proof showing that the award of the subject BULK

WATER CONTRACT to IBDC had complied with the above-

enumerated requirements and procedures on competitive bidding as

provided under the Procurement Reform Act. The BULK WATER

CONTRACT is neither a negotiated procurement as it does not fall to

any of the thirteen (13) types of a negotiated procurement applicable

in specific and distinct situation enumerated under the Revised

Implementing Rules and Regulation of Republic Act No. 9184. Thus,

for having been awarded to IBDC in gross violation of Republic Act

No. 9184, the BULK WATER CONTRACT is obviously manifestly

and grossly disadvantageous to Majayjay.

9 Section 21, Republic Act No. 9184.10 Section 22, Republic Act No. 9184.11 Section 23, Republic Act No. 9184.12 Section 25, Republic Act No. 9184.

13 Section 27, Republic Act No. 9184.14 Section 28, Republic Act No. 9184.15 Article IX, Republic Act No. 9184.16 Article X, Republic Act No. 9184.17 Section 37, Republic Act No. 9184.18 Section 39, Republic Act No. 9184.


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10. On the fact that the subject BULK WATER

CONTRACT is contrary to the Local Government Code of 1991,

the respondent did not dispute the fact that the 10% share of

Majayjay under the BULK WATER CONTRACT is a public fund.

Neither is there a denial from respondents that the BULK WATER

CONTRACT provides in Section 7 (b) of its Article IV that the price

of water for the first ten (10) cubic meters charged against the

concessionaires of Majayjay shall not exceed P30.00 and that the

difference between P30.00 and the total of the actual production,

distribution and the other operating and maintenance costs plus the

agreed rate of return shall be subsidized by the 10% share of

Majayjay from the bulk water sales.

10.1 In other words, there is no denial from respondents

that said 10% share of Majayjay, which is a public

fund, shall be used to subsidize the water

concessionaires of Majayjay or the same shall be

used to pay for the obligation of private

individuals.

10.2 Since the 10% share of Majayjay is a public fund, the

same cannot be used without appropriations

ordinance or law. Section 305 (a and b), Chapter I,

Title Five of the Local Government Code provides


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that No money shall be paid out of the local

treasury except in pursuance of an appropriations

ordinance or law and that Local government

funds and monies shall be spent solely for public

purposes.

10.3 The Local Government Code further mandates that

No public money or property shall be

appropriated or applied for religious or private

purposes.19 Thus, the said 10% share of Majayjay

cannot be used to subsidize the water concessionaires

of Majayjay or to pay the water bills of private

individuals. If only the respondents have any intention

to protect the interest of Majayjay, respondents should

have stipulated in the BULK WATER CONTRACT

that the subsidy to water concessionaires of Majayjay

should be chargeable against the 90% share of IBDC

from the proceeds of the sale of bulk water. But it

appears that respondents have no concern at all for the

interest of Majayjay as they have conspired and

confederated with one another to charge the said

subsidy to the meager 10% share of Majayjay.

19 Section 335, Chapter 4, Title Five of the Local Government Code.


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10.4 By allowing and authorizing the stipulation in the

BULK WATER CONTRACT that the 10% share of

Majayjay shall be used to subsidize the water

concessionaires of Majayjay, respondents have in

effect allowed and authorized the use of public funds

without appropriations ordinance or law and for

private purposes and the same constitutes plain and

simple crime of malversation of public funds. Simply

put, by authorizing the use of public funds without

appropriations ordinance or law and for private

purposes, respondents have in effect authorized or

abetted the commission of the crime of malversation

of public funds.

10.5 It is manifestly and grossly disadvantageous and

prejudicial to Majayjay for respondents to allow

and authorize under the BULK WATER

CONTRACT the use of public funds [10% share of

Majayjay] without appropriations ordinance or law

and for private purposes.

11. Granting arguendo that the subject three (3) water

contracts are not contrary to the BOT Law, Procurement Reform Act

and the Local Government Code of 1991, still the same will not


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exonerate the respondents from the offense charged of violating

Section 3(g) of the Anti-Graft and Corrupt Practices Act. This is

because the validity of the contract is not indispensable for the

prosecution and conviction under Section 3(g) of the Anti-Graft and

Corrupt Practices Act. As held by the Supreme Court in the case of

Luciano vs. Estrella20, to require conviction under Section 3(g) of the

R.A. 3019 that the validity of the contract or transaction be first

proved would be to enervate, if not defeat the intention of the law. For

what would prevent the officials from entering into those kinds of

transactions against which R.A. 3019 is directed, and then deliberated

omit the observance of certain formalities just to provide a convenient

leeway to avoid the clutches of the law in the event of discovery and

consequent prosecution?

12. For the prosecution and conviction under Section 3(g) of

the Anti-Graft and Corrupt Practices Act, it will be enough to show

that the contract itself subject of the criminal action is manifestly and

grossly disadvantageous to the government. Such is the situation

obtaining in the case at hand. The three (3) water contracts subject

matter of the instant case are manifestly and grossly disadvantageous

to Majayjay.

20 34 SCRA 769


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13. On the subject BULK WATER CONTRACT, the same

is manifestly and grossly disadvantageous to Majayjay because:

13.1 The subject BULK WATER CONTRACT does not

provide/indicate any specific PROJECT COST for

the project. In fact, the respondents did not deny that

there is no PROJECT COST indicated in the subject

BULK WATER CONTRACT.

13.2 Without the PROJECT COST, it cannot be

determined the correct amount of performance

security that should be posted by IBDC as required

under Section 37 of the Procurement Reform Act.

13.3 Without the PROJECT COST, the posting of the

required performance security will depend on the

whims and caprices of IBDC.

13.4 Without the correct performance security, there is no

assurance that IBDC will complete the project.

13.5 Without the correct performance security, there is no

assurance that Majayjay would be compensated for

damages in the event of default or delay by IBDC in

the performance of its contractual obligations under

the subject BULK WATER CONTRACT.


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13.9 Without the PROJECT COST, it cannot be determined if

the term of the subject BULK WATER CONTRACT for

50 years or 100 years is reasonable.

13.10 Without the PROJECT COST, there is unnecessary risk

exposure to Majayjay as there is no clear provision in the

subject BULK WATER CONTRACT on the adjustment

of the water rate. Respondents public officers have, in a

way, given full authority and discretion to IBDC to

compute and determine any adjustments on water

rate. In other words, any adjustments on water rate

will solely depend upon the whims and caprices of

IBDC which is greatly prejudicial and

disadvantageous not only to Majayjay but, more

importantly, to the people of Majayjay.

13.11 The subject BULK WATER CONTRACT exposes

Majayjay to unnecessary risks as there is no provision

in the subject BULK WATER CONTRACT on the

amount to be shouldered as subsidy by Majayjay. In

the Bulk Water Contract, respondents public officers

agreed that the difference between the P30.00 charged

for every household of concessionaire of Majayjay

and the total of actual production, distribution and


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other operating and maintenance cost plus the agreed

rate of return shall be subsidized by the Majayjay.21

The subject Bulk Water Contract did not even

provide for the ceiling amount that can be subsidized

by Majayjay.

13.12 More importantly, the subject Bulk Water Contract

does not specify who or what entity is the regulator.

It is not an acceptable practice that one and the same

entity operates and regulates the supply of basic

utilities such as water in this case. In the instant case,

it appears that IBDC has the sole authority to operate

and even regulate the supply of water. There will be

no checks and balances to ensure that the operator

does not over-charge and perform its obligation to its

clients. Respondent public officers allowed IBDC to

exercise such sole authority at the expense of and to

the great disadvantage of Majayjay.

13.13 The subject BULK WATER CONTRACT provides

for a term of 100 years, inclusive of the 50 years

automatic extension, at the revenue sharing of90%

in favor of IBDC and 10% in favor of Majayjay.

21 Section 7 (b), Article IV of the Contract for the Supply of Bulk Water dated August 1, 2011.


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13.14 The fifty (50) years automatic extension of the

contract is not subject to any condition. It is

automatically effective as the wording of the contract

connotes. The words provided under Section 4 of the

subject BULK WATER CONTRACT that - unless

terminated pursuant to the provisions provided

herein is not a condition for the effectivity of the 50

years automatic extension of the contract but the

same merely provided for a ground for the

termination of the 50 years automatic extension of

the contract.

13.15 However, the subject BULK WATER CONTRACT

does not have a TERMINATION CLAUSE. Section

29 of the subject BULK WATER CONTRACT has

nothing to do with the TERMINATION CLAUSE as

it does not provide for a ground for the termination of

the contract. Thus, the 50 years automatic extension

of the contract is absolute and unconditional which

makes the term of the contract effective for 100

years.

13.16 The subject BULK WATER CONTRACTs term of

100 years, inclusive of the 50 years automatic


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extension, is not only illegal but it is also

unconscionable and contrary to moral and public

policy especially considering the subject BULK

WATER CONTRACT does not provide for the

PROJECT COST or the investments to infused by

IBDC for the project.

13.17 It is obviously grossly and manifestly

disadvantageous to Majayjay to give IBDC a term of

100 years under the subject BULK WATER

CONTRACT as the same virtually lock up for 100

years in favor of IBDC the right to extract and enjoy

the abundant water resources of Majayjay to the great

disadvantage and prejudice of Majayjay and its

inhabitants.

13.18 The sharing arrangement in the revenue to be

generated from the sale of bulk water is in the

proportion of ninety percent (90%) in favor of

IBDC and ten percent (10%) in favor of Majayjay22.

This revenue sharing arrangement is not only

disadvantageous to Majayjay but the same is

unconscionable especially considering the

22 Section 22, Article XIV of the Contract for the Supply of Bulk Water dated August 1, 2011.


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respondents have likewise agreed for the allowable

25%23 rate of return in favor of IBDC. These 10%

share of Majayjay and the agreed 25% allowable rate

of return to IBDC are obviously greatly

disadvantageous to Majayjay.

13.19 The agreed 25% allowable rate of return is

unreasonable and unconscionable. It is also contrary

to the long established ruling of the Supreme Court

that the reasonable rate of return for company

engaged in public utility business is only 12%.24

13.20 The said 10% share of Majayjay is disadvantageous

and unconscionable because this ten percent (10%)

share of Majayjay is still subject to deduction25 on the

difference between the P30.00 charged for every

household of concessionaire of Majayjay and the total

of actual production, distribution and other operating

and maintenance costs plus the 25% agreed rate in

return.

13.21 In other words, the 10% share of Majayjay from the

proceeds of the sale of bulk water is subject to various

deductions but the ninety percent (90%) share of

23 Section 16 paragraph 5, Article XI of the Contract for the Supply of Bulk Water dated August 1, 2011.24 Meralco vs. Public Service Commission, 18 SCRA 651; and Republic vs. Meralco, 391 SCRA 700, 70925 Section 7 (b), Article IV of the Contract for the Supply of Bulk Water dated August 1, 2011.


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IBDC is not subject to any deduction, except for the

2% intended for tree planting which shall equally be

borne by IBDC and Majayjay. Stated otherwise, after

charging the said deductions from the 10% share of

Majayjay, it is most likely that nothing would be left

to Majayjay. Better yet, Majayjay will be holding

nothing but empty bag.

13.22 The BULK WATER CONTRACT grants sole and

exclusive authority to IBDC to extract water from

Mangulila, Patak-Patak, Sinabak Spring, Gundala

Springs and the surface water of Dalitiwan River26.

On top of it, the Water Contract granted IBDC the

right to extract water from all water sources of

Majayjay under the principle of right of first

refusal27. In other words, by virtue of the Water

Contract, IBDC has the sole and absolute control

over all water resources of Majayjay, Laguna for

the next 100 years or until 2111.

13.23 Stated differently, on account of the subject BULK

WATER CONTRACT, Majayjay and its residents/

inhabitants would be deprived of the rights to use and

26 Section 6 (f), Article IV of the Contract for the Supply of Bulk Water dated August 1, 2011.27 Section 7 (g), Article IV of the Contract for the Supply of Bulk Water dated August 1, 2011.


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enjoy all water sources of Majayjay for the next 100

years or until 2111 in favor of IBDC without need of

public bidding.

13.24 IBDC was granted the right to extract water from all

water sources of Majayjay without payment of any

compensation/consideration for the grant of such

water right. This is obviously manifestly and grossly

prejudicial to Majayjay.

13.25 At this point, it is significant to take note that

Majayjay has abundant sources of water as it is

situated at the foot of Mt. Banahaw. As we have

pointed out in our Affidavit-Complaint dated June 14,

2012, the real purpose of the subject BULK WATER

CONTRACT is not to rehabilitate the water system of

Majayjay but to exploit the abundant water resources

in favor of IBDC with practically no cost for IBDC

for a period of 100 years at the sharing arrangement

of 90% in favor IBDC and only 10% in favor of

Majayjay.

13.26 To illustrate the enormous water resources of

Majayjay, pursuant to BULK WATER CONTRACT,

IBDC filed an application for issuance of water


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permit before the Laguna Lake Development

Authority (LLDA) over the Mangulila Spring located

at Brgy. Piit, Majayjay, Laguna. A copy of the

application for water permit filed by IBDC before the

LLDA is hereto attached for ready reference as

Annex A.

13.27 Under the subject BULK WATER CONTRACT, the

right to apply for water permit for the various water

resources of Majayjay was granted to Majayjay but

respondent public officials allowed IBDC to apply

water permit on Mangulila Spring as well as on two

(2) other springs in Majayjay, to wit: (i) Sinabak

Spring and (ii) Patak-Patak Spring. Copies of the

applications for water permit by IBDC over Sinabak

Spring and Patak-Patak Spring are enclosed hereto as

Annexes B and C, respectively.

13.28 In the application for water permit alone of IBDC

over Mangulila Spring, IBDC has applied to extract

water from Magulila Spring for diversion to the

Municipalities of Magdalena, Sta. Cruz and Lumban

at the rate of900 Liters Per Second (LPS) or 54,000

Liters Per Min. or 3,240,000 Liters Per Hour or


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77,760,000 Liters Per Day. In other words, from

Mangulila Spring alone, IBDC will extract water for

sale as bulk water at the rate of 77,760,000 Liters

Per Day. Thus, from Mangulila Spring alone, IBDC

will get and be able to sell bulk water to the

neighboring towns at the rate of 77,760,000 Liters

Per Day.

13.29 It is obviously manifestly and grossly

disadvantageous to Majayjay and its people for

respondent public officials to authorize IBDC to

extract water from Mangulila Spring and sell the

same as bulk water to neighboring towns at the rate of

77,760,000 Liters Per Day.

13.30 Worse, while IBDC was allowed by respondent

public officials to extract water from Mangulila

Spring and divert it for sale as bulk water to

neighboring towns at the rate of 77,760,000 Liters

Per Day, the water to be diverted to Majayjay for

distribution to its people is only 5,184,000 Liters Per

Day, as shown in IBDCs applications for water

permit for Sinabak Spring and Patak-Patak Spring. In

these two (2) applications for water permits, IBDC


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will extract water from Sinabak Spring for diversion

to Majayjay at the rate of 30 Liters Per Second (LPS)

or 1, 800 Liters Per Minute or 108,000 Liters Per

Hour or2,592,000 Liters Per Day, while the water to

be extracted from Patak-Patak Spring for diversion to

Majayjay will also be at the same rate as the water

coming from Sinabak Spring or the combined volume

of water coming from Sinabak Spring and Patak-

Patak Spring for diversion to Majayjay will be

5,184,000 Liters Per Day.

13.31 So, the combined volume of water that will come

from Sinabak Spring and Patak-Patak Spring for

diversion to Majayjay is only 5,184,000 Liters Per

Day, while the volume of water that will come from

Mangulila Spring for diversion to the neighboring

towns will be 77,760,000 Liters Per Day.

13.32 In other words, the volume of water that will be

diverted for distribution to the people of Majayjay is

much smaller than the volume of water to be

diverted for sale as bulk water to neighboring towns.

This goes to show that the real purpose of subject

BULK WATER CONTRACT is not the rehabilitation


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of the water system of Majayjay but to exploit the

abundant water resources of Majayjay for sale as bulk

water to neighboring towns.

13.33 Simply put, the supposed rehabilitation of the water

system of Majayjay is merely a devious scheme

employed by respondents to be able to exploit [at

practically no cost on the part of IBDC] the abundant

water resources of Majayjay for sale as bulk water to

neighboring towns. In employing such devious

scheme, the respondents have obviously acted in

concert to the great prejudice and disadvantage of

Majayjay and its people.

13.34 Aside from Mangulila Spring, Sinabak Spring and

Patak-Patak Spring, there are other equally abundant

water sources in Majayjay which have been placed

under the control of IBDC for the next 100 years due

to the provision in the subject BULK WATER

CONTRACT which provides that IBDC has been

granted the right to extract water from all water

sources of Majayjay. This provision in the subject

BULK WATER CONTRACT is not only grossly


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show that the same is not accompanied by the

required Certification from Insurance Commissioner

with the contents that (i) the bond is for the stated

project; (ii) the amount of the bond and (iii) the bond

is callable on demand. This Certification is necessary

for the validity and effectivity of the surety bond, as

shown in the Non Policy Matter (NPM) No. 017-2012

issued by Government Procurement Policy Board

(GPPB) hereto attached as Annex D.

13.37 Accordingly, since the alleged surety bond posted by

IBDC is not accompanied by the aforesaid required

Certification from the Insurance Commissioner, then

the said bond is not valid and effective. Necessarily,

the subject BULK WATER CONTRACT is without

the required performance security which renders it

manifestly and grossly disadvantageous to Majayjay.

14. On the Water Supply Contract28 between Majayjay and

the Municipality of Lumban, Laguna and the Water Supply

Contract29 between Majayjay and the Municipality of Sta. Cruz,

Laguna, the said two (2) Water Supply Contracts are also

manifestly and grossly disadvantageous to Majayjay because:

28 Annex L of the Affidavit-Complaint dated June 14, 2012.29 Annex M of the Affidavit-Complaint dated June 14, 2012.


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14.1 Under the BULK WATER CONTRACT, it is

expressly provided that IBDC shall have the sole

right and authority to supply bulk water to Majayjay

and the neighboring towns30, including but not

limited to Lumban and Sta. Cruz. Since the right and

authority to supply bulk water under the BULK

WATER CONTRACT belongs to IBDC, then it is

only proper that IBDC should be the one to act as the

Water Supplier to Lumban and Sta. Cruz but

obviously it was not done so as to enable IBDC to

evade any and all obligations arising under the

subject two (2) Water Supply Contracts.

Respondents have acted in concert to make

Majayjay as the Water Supplier and not IBDC.

14.2 As such Water Supplier, Majayjay assumed all the

obligations and responsibilities for the supply of bulk

water to Lumban and Sta. Cruz, including but not

limited to the payment of penalties in the event of

default or delay and the posting of the required

performance security such as the (i) cash bond

equivalent to 5% of the total contract price, (ii) bank

30 Section 7 (a), Article IV of the Contract for the Supply of Bulk Water dated August 1, 2012.


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guarantee equivalent to 10% of the total annual

contract price and (iii) surety bond equivalent to 30%

total annual contract price. The purpose of this cash

bond, bank guarantee and surety bond is to guarantee

the faithful performance by Majayjay of its

obligations under the Water Contracts.

14.3 As provided in Section 2 of Article IV of the Water

Contract-Lumban31, Majayjay will post for Lumban

the performance security equal to the annual contract

price. Under the contract, Majayjay shall supply

potable water to Lumban at the volume of at least

5,000 cubic meters per day or 150,000 cubic meters

per month or 1,825,000 cubic meters for 365 days or

one (1) year at the price of P11.00 per cubic meter.

14.4 At the price of P11.00 per cubic meter, the total

annual contract price of 1,825,000 cubic meters of

water per year is P20,075,000.00. Thus, Majayjay will

have to post performance security in favor of Lumban

as follows: (i) cash bond of 5% equivalent to the sum

of P1,003,750.00, (ii) bank guarantee of 10%

equivalent to the sum of P2,007,500.00 and (iii)

31 Annex L of the Affidavit-Complaint dated June 14, 2012.


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P2,555,000.00, (ii) bank guarantee of 10% equivalent

to the sum of P5,110,000.00 and (iii) surety bond of

30% equivalent to the sum of P15,330,000.00. Simply

put, Majayjay will have to post performance security

in favor of Sta. Cruz in the total sum of

P22,995,000.00.

14.7 In resume, Majayjay will have to post performance

security in favor of Lumban equivalent to the total

sum ofP9,033,750.00, while for Sta. Cruz, Majayjay

will post performance security equivalent to the total

sum of P22,995,000.00 or Majayjay will post

performance security in favor of Lumban and Sta.

Cruz in the amount equivalent to the grand total of

P32,028,750.00.

14.8 Considering IBDC is not the Water Supplier under

the subject two (2) Water Supply Contracts but

Majayjay, then IBDC was effectively relieved and

released from the obligation to post performance

security in favor or Lumban and Sta. Cruz in the

amount equivalent to the total sum of P9,033,750.00

and the total sum of P22,995,000.00, respectively.


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14.9 Respondent Guera claims that the right and

obligations of Majayjay under the subject two (2)

Water Supply Contracts will be eventually assigned

to IBDC. But the fact remains that to this date

Majayjay is the contractual obligor under the subject

two (2) Water Supply Contracts.

14.10 In any event, this claim of respondent Guera that the

rights and obligations of Majayjay will be eventually

assigned to IBDC is a confirmation of the fact that the

subject two (2) Water Supply Contracts were

purposely entered into by Majayjay with Sta. Cruz

and Lumban so as to do away with the required

public bidding if IBDC will be the one to act as water

supplier.

14.11 Since the two (2) Water Supply Contracts are

Negotiated Agency to Agency-Procurement, then the

same does not need public bidding. This is the precise

contention of private respondent Gapangada. In other

words, respondents have made it appear that the

subject two (2) Water Supply Contracts is a

Negotiated Agency to Agency-Procurement so as to

enable IBDC to evade the requirement for public


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bidding as well as to evade the obligation of posting

the required performance security. This kind of

irregular and anomalous transaction has placed

Majayjay at a grossly disadvantageous situation.

15. The revision and amendment of the subject BULK

WATER CONTRACT is the best evidence that the same is

manifestly and grossly disadvantageous to Majayjay and that

respondents have acted in bad faith and in conspiracy with one

another to give legal color and justification to a manifestly and

grossly disadvantageous contract.

15.1 Respondents contend that the subject BULK

WATER CONTRACT is not manifestly and grossly

disadvantageous to Majayjay as it was already

revised and amended to make as contracting party to

it a certain AAA Water Corporation (AAA Water for

short). Respondent Guera attached to his Counter-

Affidavit the Memorandum of Agreement between

IBDC and AAA Water in order to bolster his claim

that there will be a big funder for the subject BULK

WATER CONTRACT as AAA Water is supposedly

a big company.


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15.2 Respondents/members of SB, on the other hand,

passed a Resolution Blg. 114 T. 2012 dated June 25,

201233

to confirm and ratify the Memorandum of

Agreement between IBDC and AAA Water.

15.3 On the same date of June 25, 2012, respondents SB

members passed a Resolution Blg. 115 T. 201234 to

authorize the revision and amendment of the subject

BULK WATER CONTRACT to make part of it

AAA Water.

15.4 Consequently, respondent Guera attached to his

Counter-Affidavit an alleged Addendum and

Revision to the Contract for the Supply of Bulk

Water dated August 1, 201235 where supposed to be

IBDC, AAA Water and Majayjay agreed for the

revision of the subject BULK WATER CONTRACT.

The name of AAA Water was indicated in the said

Addendum and Revision but an examination of the

body of the same will show that AAA Water did

not sign or give its consent to the said Addendum

and Revision. Thus, it is a big lie for respondents to

33 Annex T of the Counter-Affidavit of Public Respondent Guera..34 Annex U of the Counter-Affidavit of Public Respondent Guera..35 Annex W of the Counter-Affidavit of Public Respondent Guera.


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15.8 Respondents were all duly furnished with copy of our

Affidavit-Complaint by registered mail as shown in

our Ex-Parte Motion dated June 26, 2012.

Respondents public officials received copy of our

said Affidavit-Complaint on June 25, 2012, as shown

in the photocopies of the Registry return card

attached to our Ex-Parte Motion dated June 26, 2012.

15.9 The Resolution Blg. 114 T-2012 and Resolution Blg.

115 T-2012 were both passed and approved on June

25, 2012 by respondent pubic officials while the

aforestated Addendum and Revision to the Contract

for the Supply of Bulk Water was executed and

signed by IBDC and Majayjay on August 1, 2012.

15.10 From the foregoing, it is quite clear that at the time of

the passage by respondents public officials of said

Resolution Blg. 114 T-2012 and Resolution Blg. 115

T-2012 as well as at the time of the execution of the

said Addendum and Revision, the respondents have

already an actual notice and knowledge of our

Affidavit-Complaint dated June 14, 2012.

15.11 In other words, respondents have already an actual

notice and knowledge of the defects and legal flaws


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of the subject BULK WATER CONTRACT at the

time of the passage of said Resolution Blg. 114 T-

2012 and Resolution Blg. 115 T-2012. This is

apparently the reason why respondents public

officials passed the said Resolution Blg. 114 T-2012

and Resolution Blg. 115 T-2012 and authorized the

execution of the said Addendum and Revision to cure

the legal flaws and defects in the subject BULK

WATER CONTRACT.

15.12 Clearly then, respondents acted in bad faith and in

conspiracy with one another in their futile attempt to

amend and revise an anomalous and void contract by

making it appear that AAA Water is part of it when

in truth and in fact AAA Water did not give its

conformity to the contract as shown by the fact that

AAA Water is not a signatory to the said Addendum

and Revision.

16. The subject BULK WATER CONTRACT cannot be

amended and modified as the same is null and void from the

beginning.

16.1 Assuming for the sake of argument that AAA Water has

signed the said Addendum and Revision, still the same


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will not ratify and render valid the subject BULK

WATER CONTRACT.

16.2

Since the subject BULK WATER CONTRACT is

contrary to law, morals or public policy as discussed

above, then the same is an inexistent and void

contract from the beginning and thus, the same cannot

be ratified, amended or modified. The aforesaid

Addendum and Revision cannot amend, modify and

ratify the subject BULK WATER CONTRACT as the

same is null and void from the beginning. Article 1409

of the Civil Code mandates that:

Art. 1409. The following contracts areinexistent and void from the beginning:

1. Those whose cause, object or purpose is contrary to law,

morals, good customs, public order or public policy;

2. Those which are absolutely simulated or fictitious;

x x x x x x x x x

4. Those whose object is outside the commerce

of men.

x x x x x x x x x

These contracts cannot be ratified. Neithercan the right to set up the defense of

illegality be waived.

16.3 Being null and void, the subject contract confers no

rights nor does not impose any duty. It neither

binds nor bars any one.38

38 Caro v. CA, 158 SCRA 270


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16.4 A void or inexistent contract is equivalent to

nothing; it is absolutely wanting in civil effects.39

16.5 The action or defense for the declaration of the

inexistent of a contract does not prescribe.40 Mere

lapse of time cannot give effect to contracts that are

null and void.41

17. Respondent members of the Sangguniang Bayan cannot

set up the defense of good faith and presumption of regularity in the

performance of duty because they have actively conspired and

confederated with public respondent Guera and private respondent

Gapangada to revise and amend the subject BULK WATER

CONTRACT despite prior notice to them that the same is unlawful

and void from the beginning:

17.1 As shown in our Affidavit-Complaint dated June 14,

2012, we have sent a letter dated April 14, 201242 to

public respondent Guerra informing him about

illegality of the subject BULK WATER CONTRACTto the effect that the same is null and void for being

contrary to laws, morals and public policy. On

account of which, we demanded from private

respondent Guerra to stop the implementation of the

subject BULK WATER CONTRACT.

39 Civil Code of the Philippines annotated by Arturo M. Tolentino, Vol. IV, Page 629, 1991 edition40 Article 1410, Civil Code of the Philippines41 Civil Code of the Philippines Annotated by Edgardo M. Paras Vol IV, Page 809, 1994+ Edition.42 Annex N" of Affidavit-Complaint dated June 14, 2012


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17.2 We sent a letter dated April 27, 201243 to respondents

members of SB advising them about the illegality of

the subject BULK WATER CONTRACT to the

effect that it is inexistent and void from the beginning

because it is contrary to laws, moral and public policy

and thus, we demanded from them to pass a

resolution stopping the implementation of the subject


17.3 However, despite due notice and demand to stop the

implementation of the subject BULK WATER

CONTRACT, respondent public officials made a

futile attempt to revise and modify the subject BULK

WATER CONTRACT so as to cure the defect of it.

As mentioned above, respondent public officials

made an attempt to revise and modify the subject

BULK WATER CONTRACT only after they have

received on June 25, 2012 a copy each of our

Affidavit-Complaint dated June 14, 2012.

17.4 By their action, respondent public officials have

shown their malicious intention to justify and ratify

the execution of an unlawful and void contract. Stated

otherwise, respondent public officials have shown

that they are acting in conspiracy with one another in

the execution and implementation of the subject


18. Private Respondent IBDC Gapangada claims that IBDC

has already spent P22,655,000.00 for the subject BULK WATER

43 Annex O Affidavit-Complaint dated June 14, 2012.


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CONTRACT as allegedly shown in "Annex 10" of his Counter-

Affidavit. This claim of Private respondent Gapangada is a big lie.

18.1 An examination of the said "Annex 10" will show

that the same is a mere Appraiser Report prepared

by Cuervo Appraisers, Inc. Worse, the said Appraiser

Report is not signed and authorized by the authorized

appraiser/representative Appraiser of Cuervo

Appraisers, Inc. Thus, the same is nothing but a mere

scrap of paper which does not have any probative

value.

19. On the other hand, public respondent Guerra is claiming

that he coordinated with the Public-Private Partnership (PPP) Center

and the National Economic Development Authority (NEDA) for the

preparation and execution of the subject BULK WATER

CONTRACT, so as to apparently show that the contract was executed

in accordance with law. This claim of private respondent Guerra is

another big lie, as shown in the Certification dated May 16, 2012

issued by the PPP Center attached to our Affidavit-Complaint as

"Annex K".

19.1 The Certification dated March 16, 2012 of the Public-

Private Partnership (PPP) Center explicitly provides

that the PPP Center has no further involvement in


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the processing of the said project. It has not

participated in the preparation of bid documents,

drafting of the contract and in the selection of

Israel Builders and Development Corporation

(IBDC) as the winning private proponent. Further,

it has not received any copy of the contract with

IBDC and other project-related documents.

19.2 Also, the National Economic Development Authority

has issued two (2) Certifications, both dated July 11,

2012, to the effect NEDA had no prior information

nor participation on the proposed Bulk Water

Supply Project of the Municipality of Majayjay,

Laguna. This further attests that no project contract

and other documents have been submitted to this

Office for review and evaluation by the proponent or

project contractor. A copy of the said Certifications of

NEDA are hereto attached as Annexes E and F,

respectively.

20. Public respondent SB members argue that vested rights have

already been created by the subject water contracts. Further, they argue

that Article III, Section 3 of the 1987 Philippine Constitution effectuate and


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The prohibition [against impairment of the

obligation of contracts] is aligned with the

general principle that laws newly enacted

have only aprospective operation, and cannot

affect acts or contracts already perfected;

however, as to laws already in existence, their

provisions are read into contracts and deemed

a part thereof. Thus, the non-impairment

clause under Section 10, Article II [of the

Constitution] is limited in application to

laws about to be enacted that would in any

way derogate from existing acts or

contracts by enlarging, abridging or in any

manner changing the intention of the

parties thereto.47

20.3 Hence, public respondent SB members cannot hide

under the non-impairment clause of our Constitution

as the subject water contracts were executed after the

enactment of Republic Act No. 9184. And the subject

water contracts are violative of existing laws and

regulations.

21. Public respondents SB members allege that they acted in good

faith and due to the honest belief that that public respondent Guera in

negotiating and signing the subject water contracts with private respondent

and other LGUs concerned would give paramount consideration to the

interest, rights and welfare of the people of Majayjay as the Local Chief

Executive of Majayjay who has the discretion and prerogative with

respect to the detail, legal requisites and processes as well as the proper and

legal procedures that the subject water contracts should undergo shall lacks

merit.

47 Hacienda Luisita Incorporated vs. Presidential Agrarian Reform Council, G.R. No. 171101, July 5,

2011.


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21.1 By merely relying and believing that public respondent

Guera would give paramount consideration to the

interest, rights and welfare of the people of Majayjay and

would follow the legal requisites and procedures for the

implementation of the subject water contract is

tantamount to gross negligence on the part of public

respondents SB members.

21.2 By giving full authority to public respondent Guera to

deal with the subject water contracts shall also be

considered gross negligence on the part of public

respondents SB members.

21.3 Subject to existing laws, [the Sangguniang Bayan] shall

provide for the establishment, operation, maintenance,

and repair of an efficient waterworks system to supply

water for the inhabitants; regulate the construction,

maintenance, repair and use of hydrants, pumps, cisterns

and reservoirs; protect the purity and quantity of the

water supply of the municipality xxx.48

21.4 The afore-cited provisions under R.A. No. 7160 would

show that the allegation of public respondents SB

members that the implementation of the subject water

contracts is not within the domain of their powers is

erroneous.

48 Republic Act No. 7160, Section 447 (4) (vii).


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21.5 In fact, public respondents SB members have the power,

duty and function to prescribe terms and conditions under

which a a waterworks system shall be operated; to

provide for the establishment, operation and maintenance

of waterworks system; to regulate the construction,

maintenance and repair and use of pumps, hydrants and

reservoir; and to protect the purity and quantity of water

supply in the municipality.

21.6 Accordingly, public respondent SB members cannot just

give full authority to public respondent Guera to deal

with the subject water contracts and by doing so, public

respondent members of Sanggunian are guilty of gross

misconduct and gross negligence.

21.7 In the recent cases of Ambil vs. Sandiganbayan49 and

Apelado vs. People of the Philippines,50 the Supreme

Court reiterated the definition of gross negligence. Gross

negligence has been so defined as negligence

characterized by the want of even slight care, acting or

omitting to act in a situation where there is a duty to act,

not inadvertently but wilfully and intentionally with a

conscious indifference to consequences in so far as other

persons may be affected. It is the omission of that care

49 G.R. No. 175457, July 6, 2011.50 G.R. No. 175482, July 6, 2011.


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which even inattentive and thoughtless men never fail

to take on their own property.51

21.8 It worth stressing that public respondents and private

respondent have conspired and confederated with one

another to enter into and/or authorize the execution of the

subject water contracts, which contracts are manifestly

and grossly disadvantageous to Majayjay. According to

the Supreme Court, An accepted badge of conspiracy is

when the accused by their acts aimed at the same object,

one performing one part of and another performing

another so as to complete it with a view to the attainment

of the same object, and their acts although apparently

independent were in fact concerted and cooperative,

indicating closeness of personal association, concerted

action and concurrence of sentiments.52

22. Public respondent Guera would like to make it appear in

his Counter-Affidavit that the subject BULK WATER CONTRACT

is already accepted by the people of Majayjay when he alleged that

almost 2,500 households have applied for water supply for the

project. However, public respondent Guera failed to present proof of

the alleged application for water system made by almost 2,500

households in Majayjay.

51 Sison vs. People, G.R. Nos. 170339, 170398-403, March 9, 2010, 614 SCRA 680.52 Ambil vs. Sandiganbayan, G.R. No. 175457 and Apelado vs. People, G.R. No. 175482, July 6, 2011,

citng People v. Serrano, G.R. No. 179038, May 6, 2010, 620 SCRA 327, 336-337.


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23. Contrary to the claim of public respondent Guera, the

people of Majayjay were forced by respondents to apply for water

connection to the supposed new water system installed by IBDC by

cutting off the old water system in Majayjay over the objection of the

people of Majayjay, as shown in the Affidavit dated October 18, 2012

of Mrs. Simplicia V. Rosel (Mrs. Rosel for short) hereto attached as

Annex G.

24. As stated in the said Affidavit of Mrs. Rosel, she was

forced to apply for water connection because the water supply in her

house was disconnected. However, she was made to execute a water

connection contract not with IBDC but with a certain company by

the name of Majayjay Waters. She subsequently found out that

Majayjay Waters is a fictitious company as it is not registered with

the Department of Trade and Industry (DTI), Security and Exchange

Commission (SEC) and Local Water Utilities Administration

(LWUA). This shows that respondents will do anything [even to the

extent of misleading the people] to be able to implement the subject


25. The fact that the people of Majayjay is against the subject

BULK WATER CONTRACT as well as in the intended operation by

IBDC of the water system of Majayjay is shown from the fact that

more than 2,000 people of Majayjay signed a manifesto asking the


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Honorable Ombudsman to place under preventive suspension the

respondent public officials as they continue to implement the subject

water contract to their great prejudice and damages. A copy of the

Sinumpaang Salaysay of Henry Gruezo, Roberto Urcia and

Gaudencio Clado dated October 17, 2012, together with the several

manifestos of more than 2,000 people of Majayjay, is hereto attached

as Annex H.

26. Unless they are placed under preventive suspension,

respondent public officials pose great threat to the lives and properties

of the people of Majayjay as they have threatened and will continue to

threat the people of Majayjay who will oppose the implementation of

the subject BULK WATER CONTRACT.

27. As attested by Mrs. Rosel in her Affidavit dated October

18, 2012, the water connection in her house was disconnected for

more than one (1) month already because she is one of the main

oppositors to the execution and implementation of the subject BULK

WATER CONTRACT.

28. It is only proper to place respondent pubic officials under

preventive suspension pending adjudication of this case to protect the

people of Majayjay from their threat to cut off water connection to the

house of any person who will oppose/object the implementation of the

subject BULK WATER CONTRACT.


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29. As shown above, there exists strong evidence of the guilt

of respondent public officials which necessitate to place them under

preventive suspension to protect the people of Majayjay from their

abusive conducts which tend to put in clear and present danger the

lives and properties of the people of Majayjay.

30. It is a pure speculation for respondents to claim that this

case against them is a political harassment. Complainant Froilan

Gruezo did not file a certification of candidacy to run for any elective

office in Majayjay for the 2013 Election. The instant case is based

upon of good legal grounds that respondents have conspired with one

another to execute the three (3) Water Contract subject matter of the

instant case.

31. Contrary to respondents claim, PPP is a legitimate and

bonafide non-stock and non-profit organization with one of its

mandates the promotion of good governance, transparency and

accountability in government service. PPP filed the instant case to

promote good governance and accountability of public officials in

Majayjay so as others will not follow the unlawful conduct and/or

gross misconduct committed by respondent public officials in the

discharge of their duties.

32. In causing the execution of the subject of three (3) Water

Contract in gross violation of the laws and/or and entering into a


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manifestly and grossly disadvantageous contract to Majayjay,

respondents public officials committed gross misconduct and gross

negligence in the performance of their duties.

33. The Code of Conduct and Ethical Standards for Public

Officials and Employees enunciates the state policy to promote a high

standard of ethics in public service, and enjoins public officials and

employees to discharge their duties with utmost responsibility,

integrity and competence. Section 4 of the Code lays down the norms

of conduct which every public official and employee shall observe in

the discharge and execution of their official duties, specifically

providing that they shall at all times respect the rights of others,

and refrain from doing acts contrary to law, good morals, good

customs, public policy, public order, and public interest. Thus, any

conduct contrary to these standards would qualify as conduct

unbecoming of a government employee.53

34. A long line of cases has defined misconduct as a

transgression of some established and definite rule of action, more

particularly, unlawful behavior or gross negligence by the public

officer.54 Jurisprudence has likewise firmly established that the

misconduct is grave if it involves any of the additional elements of

53Government Service Insurance System vs. Mayordomo, G.R. No. 191218, May 31, 2011, underscoring

supplied.54Salvador O. Echano, Jr. v. Liberty Toledo, G.R. No. 173930, September 15, 2010, 630 SCRA 532,

citingBureau of Internal Revenue v. Organo, 468 Phil. 111, 118 (2004).


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corruption, willful intent to violate the law or to disregard established

rules, which must be proved by substantial evidence.55

35. The respondent is reminded that the Constitution stresses

that a public office is a public trust and public officers must at all

times be accountable to the people, serve them with utmost

responsibility, integrity, loyalty, and efficiency, act with patriotism

and justice, and lead modest lives. These constitutionally-enshrined

principles, oft-repeated in our case law, are not mere rhetorical

flourishes or idealistic sentiments. They should be taken as working

standards by all in the public service.56

36. This Reply-Affidavit is being executed to the attest

veracity of the foregoing statements and to prove that respondents are

criminally liable for three (3) counts of violation of Section 3(g) of

the R.A. 3019, as amended, otherwise known as the Anti-Graft and

Corrupt Practices Act and to further prove that respondent public

officials are guilty of gross misconduct and gross negligence in the

performance of their duties amounting to betrayal of public trust and

to also prove that there exists strong evidence of the guilt of

respondent public officials to warrant their preventive suspension

pending adjudication of the instant complaint.

55Civil Service Commission v. Lucas, 361 Phil. 486 (1999).56 Id.


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Consolidated Reply-Aff (Fb)

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