Kilosbayan vs.

Morato 246 SCRA 540 (1995)

Facts: In January 25, 1995, PCSO and PGMC signed an Equipment Lease Agreement (ELA) wherein PGMC
leased online lottery equipment and accessories to PCSO. (Rental of 4.3% of the gross amount of ticket
or at least P35,000 per terminal annually). 30% of the net receipts is allotted to charity. Term of lease is
for 8 years. PCSO is to employ its own personnel and responsible for the facilities. Upon the expiration of
lease, PCSO may purchase the equipment for P25 million. Feb. 21, 1995. A petition was filed to declare
ELA invalid because it is the same as the Contract of Lease Petitioner's Contention: ELA was same to the
Contract of Lease. It is still violative of PCSO's charter. It is violative of the law regarding public bidding. It
violates Sec. 2(2) of Art. 9-D of the 1987 Constitution. Standing can no longer be questioned because it
has become the law of the case Respondent's reply: ELA is different from the Contract of Lease. There is
no bidding required. The power to determine if ELA is advantageous is vested in the Board of Directors of
PCSO. PCSO does not have funds. Petitioners seek to further their moral crusade. Petitioners do not have
a legal standing because they were not parties to the contract.

Issue: Whether or not petitioner possesses legal standing to file the instant suit

Ruling: Petitioners do not have a legal standing to sue. Stare Decisis is not applicable since the previous
ruling sustaining the standing of the petitioners is a departure from the settled rulings on real parties in
interest because no constitutional issues were involved. Law of the Case is also not applicable Since the
present case is not the same one litigated by the parties before in Kilosbayan vs. Guingona, Jr., the ruling
cannot be in any sense be regarded as “the law of this case”. The parties are the same but the cases are
not. An issue actually and directly passed upon and determine in a former suit cannot again be drawn in
question in any future action between the same parties involving a different cause of action. But the rule
does not apply to issues of law at least when substantially unrelated claims are involved. When the second
proceeding involves an instrument or transaction identical with, but in a form separable from the one
dealt with in the first proceeding, the Court is free in the second proceeding to make an independent
examination of the legal matters at issue. Since ELA is a different contract, the previous decision does not
preclude determination of the petitioner’s standing. Standing is a concept in constitutional law and here
no constitutional question is involved. The more appropriate issue is whether the petitioners are ‘real
parties of interest’.