The Supreme Court (SC) decision on ousted Chief Justice Maria Lourdes Sereno’s appeal on her ouster through a quo warranto action is expected to be handed down this month, Acting Chief Justice Antonio Carpio said.

The Court of Appeals (CA) reinstated a lower court ruling declaring as illegal the cost of arbitration proceedings on a case filed by Philippine International Air Terminals Co. Inc. (Piatco) before the International Chamber of Commerce (ICC).

The arbitration cost included Sereno’s attorney’s fees as part of the government’s legal team which was a key component of the impeachment case against her which, in turn, triggered the quo warranto petition of Solicitor General Jose Calida that removed her from the SC post last May 11.

Piatco was builder of the Ninoy Aquino International Airport (NAIA) Terminal 3 which the government expropriated during the term of former President Gloria Arroyo.

In a decision written by Associate Justice Ramon Bato Jr., the CA reinstated the ruling of the Mandaluyong City Regional Trial Court (RTC) which denied the government’s plea to allow a $6 million cost for the arbitration proceedings.

These costs, described as “five times more than that of Piatco,” included Sereno’s legal fees from 2003 to 2009, amounting to $275,973.21 after the government deducted 15 percent.

The $6 million constituted 25 percent of government’s total arbitration cost of $24 million, which the ICC International Court of Arbitration ordered Piatco to pay. Carpio said the SC wanted to issue a decision “with finality” on the ouster of Sereno “because we want to move on also.”

The SC voted 8-6 to grant Calida’s “quo warranto” plea to nullify her appointment in 2012.

The ruling cited her failure to file the required number of Statements of Assets, Liabilities and Networth (SALN), including those from her time as University of the Philippines law professor.

Sereno recently appealed her ouster from the high court, insisting that the decision to remove her was “null and void.”

“The SC decides and we must follow. We are governed by the rule of the majority, that’s how democracy works,” Carpio said.

Carpio said the SC is “functioning normally” despite not having a Chief Justice for now.

“We have been deciding cases normally, we will be holding oral arguments normally. We are doing our work normally… because we are still 14 in the Supreme Court. We have a quorum in all our cases,” he said.

The Mandaluyong RTC handed down a decision on August 29, 2014 that denied the government’s plea for recognition and enforcement of the foreign arbitral award dated May 10, 2011.

It said the “recognition and enforcement of the Final Award is contrary to Philippine law and public policy” for being “in violation of the Philippines’ public policy mandating public bidding and its long-standing policy against the incurrence of irregular, unnecessary, excessive, extravagant, or unconscionable expenditures or use of funds and property of the government.”

The CA reversed the decision, dated January 20, of the 17th Division. The 17th Division recognized the award of arbitration cost as it ruled that “no public policy is transgressed when the government is the one receiving the money duly awarded by an Arbitral Tribunal.”

Piatco then filed a motion for reconsideration which the RTC granted and the CA’s 11th division upheld.

“[T]his is because the arbitration costs and expenses were incurred in ‘violation of the Constitution, relevant statutes, and other rules governing government expenditures’ of public funds,” the CA amended decision read.

The CA sided with Mandaluyong RTC Branch 213 Presiding Judge Carlos Valenzuela was correct in ruling that the arbitration costs and expenses were in violation of government’s “long-standing policy against the incurrence of irregular, unnecessary, excessive, extravagant, or unconscionable expenditures or use of funds and property by the government.”

The high court explained that Republic Act (RA) 9184, also known as the Government Procurement Reform Act, “undoubtedly applies to all the component costs listed by [government] as comprising its arbitration expenses.”

The CA ruling also cited the Commission on Audit (COA) findings on the arbitration proceedings, which state that OSG’s hiring of consultants White and Chase; retired SC Associate Justice Florentino Feliciano; then Prof. Maria Lourdes Sereno; Allen Gledhill; Justice Vicente Mendoza; Sycip Salazar, Hernandez and Gatmaitan; and Follosco Moralos and Herce, “constitute unlawful expenditure.”

The OSG, in hiring Sereno and the other lawyers, should have secured first “the concurrence of COA as required under COA Circular No. 98-002,” but did not.

“In summation, as exhaustively discussed by the RTC and bolstered by the findings of the COA (Commission on Audit) Special Audit Team, in the hiring of local and foreign lawyers, the petitioners (Government of the Philippines, represented by the Department of Transportation and Communications and the Manila International Airport Authority) violated the fundamental public policy on the use of public funds,” the amended decision explained.

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