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And the Loan Agreement likewise requires that: 11 “This Agreement shall be governed by and construed in accordance with the laws of the People’s Republic of China.” Hence, neither constitutes an agreement governed by international law within the purview of the Vienna Convention. None of the agreements is an executive agreement 38. None of the agreements can be considered an executive agreement either, which is defined in Executive Order No. 459 (dated November 25, 1997), Providing for the Guidelines in the Negotiation of International Agreements and its Ratification, as “similar to treaties except that they do not require legislative concurrence.” Said definition only relaxes the requirement of Senate concurrence which is required by the Constitution, but leaves in place the requirement that it be an international agreement entered into by the Philippines, i.e., that it be concluded between states in written form and governed by international law, as defined by the Vienna Convention. II. THE NORTHRAIL CONTRACT IS VOID FOR FAILURE TO COMPLY WITH THE PROVISIONS OF THE GOVERNMENT AUDITING CODE AND THE ADMINISTRATIVE CODE OF 1987; 39. Both the Government Auditing Code of the Philippines (Presidential Decree No. 1445) and the Administrative Code of 1987 (Executive Order No. 292) specifically proscribe the making of any contract by any government agency involving the expenditure of public 11 Please see Section 15.1. 18
funds unless there is an appropriation therefor and a proper certification thereof by the proper accounting official which should be attached to the proposed contract. A proposed government contract involving the expenditure of public funds that is unsupported by a certificate as to the existence of appropriation and the availability of the necessary funds, which is to be attached as an integral part of the proposed contract, is fatally defective and in the words of the Supreme Court, “suffers the vice of nullity.” Indeed, “fund availability is, as it has always been, an indispensable prerequisite to the execution of any government contract involving the expenditure of public funds by all government agencies at all levels.” 12 40. From an examination of the records, it is also obvious that the Northrail Contract was executed prior to the execution of the Loan Agreement. The conclusion to be drawn, therefore, is that the Contract was perfected while it was still unfunded, thus it is contrary to the above-discussed law. 41. As the Northrail Contract is not supported by the required certificate as to the availability of funds, and because it appears to have been executed with no funds to support it, it is illegal and void from the beginning. III. THE NORTHRAIL CONTRACT IS VOID FOR CNMEC’S FAILURE TO COMPLY WITH R.A. NO. 4566 OR THE “CONTRACTOR’S LICENSE LAW.” 12 Osmeña vs. CA 230 SCRA 585. 19
Page 1 and 2: REPUBLIC OF THE PHILIPPINES SUPREME
Page 3 and 4: Butuyan Law Offices, of which they
Page 5 and 6: 10. Public Respondent National Econ
Page 7 and 8: 16. The Northrail Contract and the
Page 9 and 10: from the University of the Philippi
Page 11 and 12: improper purpose, or that there is
Page 13 and 14: II. THE NORTHRAIL CONTRACT IS VOID
Page 15 and 16: is a defective contention because n
Page 17: which also has its own juridical pe
Page 21 and 22: 44. CNMEC cannot therefore engage a
Page 23 and 24: terms of lost homes, livelihoods an
Page 25 and 26: 57. A failure to stop the implement
Page 27 and 28: 2) AN ORDER DECLARING NULL AND VOID
Page 29 and 30: COPY FURNISHED: Honorable Eduardo E

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