CASE DIGEST
METRO LAUNDRY SERVICES
V. THE COMMISSION PROPER
G.R. No. 252411
(Resolution), [February 15, 2022]
EN BANC, LOPEZ, M.V
Money Claim against
COA; Government acquired service under Void Contract; Payment based on Quantum
Meruit
Nullity of contract do not preclude
payment of government liability based on quantum meruit. The Court partially
granted Metro Laundry's petition, setting aside the COA's decision, and
directed the COA to determine the reasonable amount for payment to Metro
Laundry Services. It also emphasized that this ruling did not preclude any
civil, criminal, or administrative actions against the officials responsible
for the contract's irregularities.
Metro Laundry Services won a public bidding to provide laundry services to Ospital ng Maynila Medical Center (OMMC) for the third and fourth quarters of 2010. The contract ended on December 31, 2010, but OMMC extended the services from January 1, 2011, to December 2011 without a written contract due to lack of funds. Metro Laundry's claim for payment was included in the City of Manila's budget for 2013, but remained unsettled despite various justifications and endorsements affirming the debt. The Commission on Audit (COA) eventually denied Metro Laundry's claim due to the irregularities in the extended contract.
Whether the COA properly denied Metro
Laundry's money claim due to the irregularities in the extended contract for
laundry services provided to OMMC.
NO. Here, Supreme Court acknowledged the
irregularities in the contract, which violated procurement laws. However, it
emphasized that the government, represented by OMMC and the City of Manila,
acknowledged Metro Laundry's entitlement to payment for the services rendered
despite the contract's invalidity.
Various jurisprudence held where
compensation was granted to contractors even with void contracts based on
quantum meruit. Quantum meruit refers to the reasonable value of services
rendered, irrespective of the agreement's value. The Court held that Metro
Laundry fulfilled its services without evidence of bad faith or collusion, and
the government had benefitted from these services. While acknowledging the
contract's nullity, the Court directed the COA to determine the reasonable
value of the services provided by Metro Laundry. This determination would be
based on evidence presented, considering the conflicting claims regarding the amount
owed. The decision remanded the case to the COA for a post-audit to ascertain
the precise amount Metro Laundry should receive. But this ruling did not
preclude any civil, criminal, or administrative actions against the officials
responsible for the contract's irregularities.
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