Kilosbayan vs Guingona GR No. 113375, May 5, 1994
Pursuant to Section 1 of the charter of the PCSO (R.A. No. 1169, as amended by B.P. B!. "#$ %hich !rants it the authority to hod and conduct &charity s%ee'staes races, otteries and other simiar acti)ities,* the PCSO decided to estabish an on+ine ottery system for the 'ur'ose of increasin! its re)enue base and di)ersifyin! its sources of funds. he Phii''ine Phii''ine -amin! -amin! ana!e ana!ement ment Cor'ora Cor'oration tion (P-C$ (P-C$ %hich %hich is or!ani or!ani/ed /ed by Berhad Berhad !rou', a muti mutinat natio iona na com' com'any any and and one one of the ten ar!e ar!est st 'ubi 'ubic c com' com'ani anies es in aaysia, %as !ranted to 'ro)ide 'ro)ide the technica technica and mana!ement mana!ement ser)ices ser)ices for the needed needed for 'ro0ect in the form of a ease contract a''ro)ed by the President. 23O 23OSB SBA4 A4AN AN se sent nt an o'en o'en ett etter er to Pres Presid iden entt 5ide 5ide . Ra Ramo mos s stro stron! n!y y o''osin! the settin! u' of the on+ine ottery system on the basis of serious mora and ethica considerations. he 'rotest %as denied by the Office of the President, President, contem'atin! contem'atin! that &ony a court in0unction can sto' aaca7an!* . 8ence, this 'etition arise. ISSUES: 1. hether or not the 'etitioners ha)e ocus standi. #. hether or not the Contract of 3ease in the i!ht of Section 1 of R.A. No. 1169, as amended by B.P. B!. "#, %hich 'rohibits the PCSO from hodin! and conductin! otteries &in coaboration, association or 0oint )enture %ith any 'erson, association, com'any or entity, %hether domestic or forei!n.* is e!a and )aid. HE!: 1. he Court Court rued that 'etition 'etitioners ers ha)e e!a standin standin! ! considerin considerin! ! that the ramifications of such issues immeasuraby affectin! the socia, economic, and mora %e+bein! of the 'eo'e e)en in the remotest baran!ays of the coun countr try y and and the the coun counte ter+ r+'r 'rod oduc ucti ti)e )e and and retr retro! o!re ress ssi) i)e e effe effect cts s of the the en)isioned on+ine ottery system are as sta!!erin! as the biions in 'esos it
is e:'ected to raise. he e!a standin! then of the 'etitioners deser)es reco!nition, settin! aside its 'rocedura technicaity. #. Section 1 of R.A. No. 1169, as amended by B.P. B!. "#, 'rohibits the PCSO from hodin! and conductin! otteries &in coaboration, association or 0oint )enture %ith any 'erson, association, com'any or entity, %hether domestic or forei!n.* here is undoubtedy a coaboration bet%een PCSO and P-C and not merey a contract of ease. he reations bet%een PCSO and P-C cannot be defined sim'y by the desi!nation they used, i.e., a contract of ease. he contract;s nature can be understood to form the intent of the 'arties as e)ident in the 'ro)isions of the contract. Artice 1<=1 of the CC 'ro)ides that the intent of contractin! 'arties are determined in 'art throu!h their acts. he ony contribution PCSO %i be !i)in! is the authority to o'erate. PCSO bears no ris and a it does is to 'ro)ide its franchise. Pursuant to the %ordin!s of their a!reement, P-C at its o%n e:'ense sha buid, o'erate, and mana!e the net%or system incudin! its faciities needed to o'erate a nation%ide onine ottery system. 2ndeed, PCSO cannot share the franchise in any %ay. Ceary, the chaen!ed Contract of 3ease )ioates the e:ce'tion 'ro)ided for in 'ara!ra'h B, Section 1 of R.A. No. 1169, as amended by B.P. B!. "#, and is, therefore, in)aid for bein! contrary to a%.
