G.R. No. 270564 (2024) - Kho

G.R. No. 270564, April 16, 2024,

♦ Decision,

Marquez, [J]

♦ Separate Concurring Opinion,

Kho, [J]

EN BANC

[ G.R. No. 270564, April 16, 2024 ]

SMARTMATIC TIM CORPORATION AND SMARTMATIC PHILIPPINES, INC., PETITIONERS, VS. COMMISSION ON ELECTIONS EN BANC, ELISEO MIJARES RIO, JR., AUGUSTO CADELIÑA LAGMAN, FRANKLIN FAYLOGA YSAAC, AND LEONARDO OLIVERA ODOÑO, RESPONDENTS.

SEPARATE CONCURRING OPINION

KHO, JR.,

J.:

The move to disqualify petitioners Smartmatic TIM Corporation and Smartmatic Philippines, Inc. (collectively, Smartmatic) in participating in our elections as the automated election system provider started when private respondents Eliseo Mijares Rio, Jr., Augusto Cadeliña Lagman, Franklin Fayloga Ysaac, and Leonardo Olivera Odoño (respondents) filed a petition, supplemental petition, and second supplemental petition with the Commission on Elections (COMELEC). The respondents prayed that the COMELEC review the qualifications of Smartmatic as a prospective bidder for the bidding of the 2025 Automated Election System (AES) for the 2025 National and Local Elections (NLE) and thereafter, disqualify Smartmatic for the latter's failure to comply with minimum system capabilities for the 2022 NLE that resulted in serious and grave irregularities in the transmission and receipt of election returns.

1

In its Resolution dated November 29, 2023 disqualifying Smartmatic, the COMELEC nevertheless debunked the allegations of respondents that there were irregularities in the conduct of the 2022 NLE attributable to the 2022 AES provided by Smartmatic. In fact, the COMELEC, apparently confident with the performance of the 2022 AES, challenged respondents that, upon proper motion, it may authorize a recount of the votes by opening the ballot boxes of every region of the country utilizing for said purpose either the physical ballot, or the ballot images which are the functional equivalent of the physical ballot, at no cost to respondents.

2

I laud the COMELEC for this declaration, as it is consistent to the right of the public to be informed on all matters concerning elections.

In addition, the COMELEC admitted in its Resolution that the procurement process for the 2025 AES has yet to commence and that the Special Bids and Awards Committee for the 2025 AES does not have yet the authority to decide on the qualification or disqualification of the prospective bidders;

3

thus, the COMELEC, as head of the procuring entity, cannot pass upon judgment on the disqualification of Smartmatic,

4

as what respondents prayed for.

Nevertheless, the COMELEC, invoking its administrative power to decide all matters affecting elections, resolved to disqualify and disallow Smartmatic to participate in any public bidding process for elections due to the grounds not cited or raised by respondents, explaining as follows:

As early as October 2022, the Commission (

En Banc

), through the Department of Justice[,] received requests for official documents relative to an ongoing investigation from the United States government against former COMELEC Chairman Juan Andres D. Bautista (Bautista) and other individuals and entities for violation of US criminal laws.

5

….

Pursuant to the treaty between the Government of the Philippines and the Government of the United States on Mutual Legal Assistance in Criminal Matter (PH-US MLAT), an investigation was conducted for the alleged violation of U.S. criminal laws, including the Foreign Corrupt Practices Act, conspiracy, wire fraud, and money laundering. The U.S. prosecutor sought assistance in obtaining official records from the Commission as part of the efforts to establish a case.

The evidence requested is deemed crucial for tracking the flow of suspected bribe payments and identifying other individuals involved in the alleged scheme. It is noteworthy that Bautista, who served as the Chairman of the Commission, was formally charged in September 2023, in connection with allegations of receiving bribes in exchange for awarding a contract for election machines to Smartmatic Corp. Bautista and others are alleged to have laundered the bribe money through multiple entities. It was revealed that Bautista established a foreign shell company, which was used to receive bribe payments from Smartmatic. The charges against Smartmatic and former Chairman Bautista are of public knowledge and tend to cause speculation and distrust in integrity of the election process.

6

….

Given the gravity of allegations related to bribery and compromised procurement processes, as independently determined by foreign bodies, the Commission recognizes the imminent threat to the strength and integrity of our democratic processes. In light of these findings, the Commission acknowledges the imminent peril to the integrity and robustness of our democratic institutions.

These allegations, not only undermine and cast a shadow over the procurement protocols but also threaten to erode the public's confidence in the electoral system. Consequently, pursuant to administrative powers which covers all aspects of election, the Commission is compelled to take decisive action to disallow Smartmatic from participating in the procurement process forthwith.

(awÞhi(

7

In this connection, I agree with the

ponencia

that the COMELEC gravely abused its discretion when it totally disregarded the provisions of the Government Procurement Reform Act (GPRA) and its Implementing Rules and Regulations (IRR) in disqualifying and disallowing Smartmatic from participating in any public bidding process for elections.

8

As eloquently explained by the

ponencia,

the GPRA and its IRR essentially provide that a prospective bidder must first be allowed to submit its bidding documents; and that it is only upon evaluation thereof that the procuring entity may determine said bidder's eligibility. Here, the COMELEC erroneously disregarded the GPRA and its IRR when it issued the aforesaid Resolution

even before

Smartmatic had the opportunity to submit its bidding documents.

9

Clearly, the assailed act of the COMELEC constitutes grave abuse of discretion.

In addition to the foregoing discussion, I opine that even assuming

arguendo

that the COMELEC allows Smartmatic to submit its bidding documents and thereafter, scrutinizes the same, there is still,

at least for the time being,

no sufficient ground to disqualify and disallow Smartmatic from participating in any public bidding process for elections.

I expound.

The ground cited by the COMELEC in disqualifying and disallowing Smartmatic from participating in any public bidding process for elections is the ongoing criminal investigation by the United States Department of Justice (US DOJ) of former COMELEC Chairperson Juan Andres D. Bautista (Bautista) concerning the latter's act of receiving bribes in exchange for awarding a contract for election machines to Smartmatic.

10

This investigation led to the US DOJ unsealing the complaint against Bautista, which states that

"there is probable cause to issue a criminal complaint and arrest warrant charging [Bautista] with conspiring to launder monetary instruments and conspiring to engage in monetary transactions in property derived from specified unlawful activity"

11

in connection with Bautista's purported receipt of several payments from a group of related unnamed corporations to secure the award of the AES contract for the 2016 NLE.

12

While it appears that the US DOJ had completed its investigation as evinced by the unsealing of the complaint against Bautista, it however bears stressing that the findings of such investigation and the allegations in the complaint are, at best,

merely preliminary,

and in due course, would still undergo scrutiny by the US courts through a criminal trial—where, like in the Philippines, an accused is accorded the presumption of innocence.

13

Furthermore, should there be definitive findings against Smartmatic and/or Bautista in the proceedings before the US, it is opined that said adverse findings have, at best, persuasive effect only in our jurisdiction.

Lest it be misunderstood, like the

ponencia,

this disquisition

"does not weigh, much less resolve, the merit of the charges against Bautista and Smartmatic's alleged involvement in these charges."

14

Such matter may, in due time, be resolved by an appropriate forum in our country. In the meantime, this disquisition seeks to highlight that, absent any definitive findings regarding Smartmatic's purported complicity in the accusations thrown against Bautista, it is premature to use this as a ground for the COMELEC to disqualify and disallow Smartmatic from participating in any public bidding process for elections.

As a former COMELEC Commissioner, I know that the Chairperson, Commissioners, officers, and employees of the COMELEC are zealous in their task of ensuring electoral integrity and maintaining public confidence in the elections. However, disqualifying and disallowing Smartmatic to participate in our electoral processes on the basis of mere allegations of bribery, money laundering, etc., while admittedly are grave and serious charges, are not sufficient grounds to disqualify Smartmatic at this stage of the process. In fact, the COMELEC was very adamant in its Resolution that no irregularities attended the conduct of the 2022 NLE where the 2022 AES of Smartmatic was used.

While the Court found that the COMELEC have acted with grave abuse of discretion in disqualifying Smartmatic that would necessarily annul and set aside the award of the 2025 Full Automation System with Transparency Audit/Count (FASTrAC) Contract to Miru Systems Co. Ltd., Integrated Computer Systems, St. Timothy Construction Corporation, and Centerpoint Solution Technologies, Inc. (Miru Systems), and would require the COMELEC to conduct another procurement process for the 2025 AES where Smartmatic may participate, I agree with the

ponencia

that for reason of practicality, the

"nullification of the SBAC's proceedings and the 2025 FASTrAC Contract would gravely undermine the COMELEC's preparation for the 2025 NLE."

15

Thus, I agree with the

ponencia

that this situation calls for the application of the operative fact doctrine,

16

citing as its jurisprudential support, among others, my

ponencia

in

Macalintal v. Commission on Elections,

17

and to make the effects of the Court's Decision herein prospective in application.

18

However, speaking as a former COMELEC Commissioner, I wish to urge the COMELEC to not unduly constrain itself with severely rigid and constricted timetables in preparing for the elections. This is the second time in recent memory that the doctrine of operative act was applied affecting the conduct of elections, the first one being the recently conducted barangay elections, pursuant to

Macalintal.

In this connection, the COMELEC should seriously consider scheduling an earlier date for the filing of the certificates of candidacy that would allow it to arrange with enough legroom its timetable for all the activities related to elections, including the bidding processes for the procurement of election systems, equipment, materials and supplies, approval of the ballot face for all elective positions, printing of ballots and election forms, training of teachers and election personnel, accreditation of party-list groups, resolution of disqualification cases of candidates and other cases, and other varied election activities that need the undivided attention of the COMELEC.

As the Constitutional body created primarily to ensure the conduct of free and fair elections, the COMELEC should adequately plan for any contingencies that could result in the hampering of its preparations for the elections—such as what happened in this case. As noted by the

ponencia,

if not for the application of the operative fact doctrine, the preparations for and ultimately, the very conduct of the 2025 NLE could have been severely jeopardized.

19

However, the repeated application of the operative fact doctrine should not be the norm in the conduct of elections. Thus, in its preparation for future elections, the COMELEC should be more flexible in its timetables so as to avoid instances such as this to happen again.

As a final note of the

ponencia,

it stated, to which I also agree, that

"[t]he Court's ruling in this case is without prejudice to the outcome of any disqualification or blacklisting procedure that the COMELEC or any other procuring entity might see fit to initiate against Smartmatic in the future, in accordance with the procedure prescribed by the GPRA and its IRR."

20

I would like to further add that the application of the operative fact doctrine in this case that would in effect allow the use of the AES provided by Miru Systems for the 2025 NLE is also without prejudice to any appropriate petition that may be filed that would directly challenge the award of the 2025 AES to Miru Systems.

ACCORDINGLY, I VOTE

to

GRANT

the instant Petition.

Footnotes

1

Ponencia, pp. 2–3.

2

Id.

at 3–5.

3

Id.

at 4.

4

Id.

at 3.

5

Petition, p. 25.

6

Ponencia, pp. 4–5.

7

Petition, p. 37.

8

Ponencia, pp. 20–21.

9

Id.

at 19–26.

10

Id.

at 4–5.

11

Id.

at 9; emphasis supplied.

12

Id.

at 9.

13

See

Taylor v. Kentucky,

436 U.S. 478 (1978) [United States of America]. See also CONST., art. III, sec. 14(1).

14

Ponencia, p. 33; emphasis supplied.

15

Id.

at 28; emphasis supplied.

16

Id.

at 30–33.

17

G.R. Nos. 263590 and 263673, June 27, 2023 [Per J. Kho,

En Banc

].

18

Ponencia, p. 33.

19

Id.

at 30.

20

Id.

at 34.

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