Administrative issuances duly promulgated pursuant to delegated rule-making power, such as the NEDA JV Guidelines issued under presidential directives (EO 109, EO 109-A, EO 423), have the force and effect of law and are binding on the government agencies covered, which cannot unilaterally deviate from the mandatory procedures therein, like the competitive challenge process following successful negotiation of an unsolicited proposal.

The dispute originated from an unsolicited proposal submitted by SMLI to BCDA for the development of the Bonifacio South Property through a joint venture. After negotiations, BCDA accepted the proposal's terms and conditions and issued a Certification of Successful Negotiations (CSN), agreeing to subject SMLI's proposal to a competitive challenge (Swiss Challenge) as outlined in the NEDA JV Guidelines and the agreed Terms of Reference (TOR). Subsequently, BCDA unilaterally cancelled the competitive challenge process, intending to subject the property to public bidding instead, prompting SMLI to file a petition.

• SMLI submitted an unsolicited proposal to BCDA on December 14, 2009, for the development of the Bonifacio South Property.
• BCDA entered into negotiations with SMLI and eventually accepted the terms of SMLI's final unsolicited proposal.
• On August 6, 2010, BCDA and SMLI executed a notarized Certification of Successful Negotiations (CSN), reflecting their agreement on the terms for the JV development, which would become the terms for the Competitive Challenge pursuant to Annex C of the NEDA JV Guidelines.
• The CSN stated BCDA's agreement to subject SMLI's Original Proposal to Competitive Challenge immediately following the Terms of Reference (TOR), with activities for soliciting comparative proposals to commence on August 10, 2010.
• BCDA subsequently issued TOR Volumes 1 and 2 for the competitive challenge.
• Later, BCDA unilaterally cancelled the competitive challenge process, stating its intent to subject the property to straight public bidding instead, claiming this was in the public interest and more advantageous.
• BCDA initially argued (in a Nov 2010 Memo) that competitive challenge was more advantageous than straight bidding but later (in a Feb 2012 Memo to the President) took the opposite stance, recommending termination of the competitive challenge.

• (Reflected in the Court's affirmation of the original Decision) A perfected contract exists between SMLI and BCDA, embodied in the CSN, giving SMLI the right to have its proposal subjected to a competitive challenge.
• The NEDA JV Guidelines, having the force and effect of law, mandate the competitive challenge process after successful negotiations for an unsolicited proposal.
• BCDA's unilateral cancellation of the perfected contract and the mandated process constitutes grave abuse of discretion.
• BCDA is bound by the principle of estoppel, having given SMLI assurances and causing it to incur expenses in reliance on the agreement to proceed with the competitive challenge.
• The TOR provisions cited by BCDA for cancellation apply only to Private Sector Entities (PSEs) participating in the challenge, not to SMLI as the Original Proponent.
• The alleged economic disadvantage to the government is speculative, as SMLI's offer is merely a floor price subject to increase during the competitive challenge.

• No perfected contract exists between BCDA and SMLI that obligates BCDA to proceed with the competitive challenge.
• Assuming a contract exists, it can be terminated for reasons of public interest, specifically because straight bidding is allegedly more advantageous to the government.
• The NEDA JV Guidelines are merely guidelines and do not have the force of law, thus BCDA is not strictly bound by them.
• The Terms of Reference (TOR) contain clauses granting BCDA the right to amend procedures or call off the disposition process at any time.
• The State is not barred by estoppel due to mistakes or errors of its officials, especially concerning allegedly questionable transactions entered into by the previous administration.
• Proceeding with the competitive challenge based on SMLI's allegedly low floor price (P38,500/sqm vs. appraised values up to P100,000/sqm) would cause significant financial loss (approx. P13 billion) to the government.
• There were procedural irregularities in the acceptance of SMLI's proposal and the decision to use competitive challenge over public bidding.

• Whether a perfected contract existed between SMLI and BCDA obligating BCDA to subject SMLI's unsolicited proposal to a competitive challenge.
• Whether the NEDA JV Guidelines have the force and effect of law, binding BCDA to the procedures outlined therein.
• Whether BCDA could unilaterally cancel the competitive challenge based on alleged public interest or provisions in the TOR.
• Whether the doctrine of estoppel applies against BCDA.
• Whether the potential economic disadvantage to the government justifies the cancellation of the competitive challenge.

• The Supreme Court denied the Motion for Reconsideration and affirmed its previous Decision.
• A perfected contract existed between SMLI and BCDA, embodied in the Certification of Successful Negotiations (CSN), as all essential requisites (consent, object, cause) were present. The CSN explicitly stated the agreement to subject SMLI's proposal to a competitive challenge.
• The NEDA JV Guidelines, promulgated pursuant to valid delegation of authority under Executive Orders, have the force and effect of law and mandatorily govern the joint venture process, including the requirement for a competitive challenge after successful negotiation of an unsolicited proposal. BCDA cannot validly deviate from these mandatory procedures.
• BCDA's unilateral cancellation of the competitive challenge, after the perfection of the contract (CSN) and the commencement of Stage Three under the Guidelines, was tainted with grave abuse of discretion. The TOR clauses allowing cancellation apply only to participating Private Sector Entities (PSEs), not to the Original Proponent (SMLI).
• The doctrine of estoppel applies against BCDA. Despite the general rule that the State is not estopped by the mistakes of its agents, the exception applies when the government deals dishonorably or capriciously with its citizens. BCDA's assurances to SMLI, followed by its abrupt reversal after SMLI incurred expenses, constituted such capricious action.
• The alleged P13 billion loss to the government is speculative. SMLI's proposal merely sets the floor price for the competitive challenge, which could potentially yield offers higher than the initial proposal, even surpassing market value. Public interest cannot be arbitrarily invoked to breach contractual obligations based on speculation.

• Contract Perfection (NCC Art. 1318): Defined as requiring consent, object certain, and cause. Applied here to determine that the Certification of Successful Negotiations, reflecting the meeting of minds on the JV terms and the competitive challenge process, constituted a perfected contract binding on both SMLI and BCDA.
• Obligatory Force of Contracts (NCC Art. 1159): States that obligations arising from contracts have the force of law between the parties and must be complied with in good faith. Invoked to stress BCDA's duty to honor its contractual commitment under the CSN to proceed with the competitive challenge.
• Force and Effect of Administrative Issuances: Defined as rules issued by administrative agencies pursuant to delegated legislative power having the force and effect of law. Applied to establish that the NEDA JV Guidelines, issued under EOs 109, 109-A, and 423, are legally binding and BCDA could not disregard the mandatory competitive challenge procedure therein.
• Contract Interpretation (NCC Art. 1373): Provides that if a stipulation admits of several meanings, the interpretation that renders it effectual shall be adopted. Used to interpret the TOR clauses, holding that BCDA's interpretation (allowing it to cancel the entire Swiss Challenge) would improperly negate the NEDA JV Guidelines and must be rejected in favor of an interpretation harmonizing the TOR with the Guidelines (clauses apply only to PSEs, not the Original Proponent).
• Estoppel Against the Government: Defined as generally not applicable, but admits exceptions where gross injustice would occur, or the government deals dishonorably or capriciously. Applied exceptionally against BCDA due to its conflicting positions and reneging on its explicit agreement and assurances to SMLI after the latter relied on them.
• Distinction between Original Proponent and Private Sector Entity (PSE): Clarified that under the NEDA JV Guidelines and the TOR for a Swiss Challenge, the Original Proponent (SMLI) has distinct rights (like the right to a competitive challenge and to match offers) separate from the participating PSEs (potential rival bidders). This distinction was crucial in ruling that TOR cancellation clauses aimed at PSEs did not apply to SMLI.

• "In the case at bar, there is, between BCDA and SMLI, a perfected contract—a source of rights and reciprocal obligations on the part of both parties. Consequently, a breach thereof may give rise to a cause of action against the erring party."
• "[A]dministrative issuances, such as the NEDA JV Guidelines, duly promulgated pursuant to the rule-making power granted by statute, have the force and effect of law."
• "Being an issuance in compliance with an executive edict, the NEDA JV Guidelines, therefore, has the same binding effect as if it were issued by the President himself... As such, no agency or instrumentality covered by the JV Guidelines can validly deviate from the mandatory procedures set forth therein..."
• "[T]he government must not be allowed to deal dishonorably or capriciously with its citizens, and must not play an ignoble part or do a shabby thing; and subject to limitations . . ., the doctrine of equitable estoppel may be invoked against public authorities as well as against private individuals."
• "SMLI's offer, which was duly accepted by the BCDA, only serves as the floor price and does not foreclose better offers that can even surpass the property's current market value."

• Republic v. Court of Appeals, G.R. No. 116111 (1999): Cited for the principle of estoppel against the government, establishing the exception applied in this case where the government's actions are dishonorable or capricious.
• Eslao v. COA, G.R. No. 108310 (1994) (cited in Atlas Consolidated Mining v. CIR): Referenced to support the doctrine that administrative issuances promulgated pursuant to statutory authority have the force and effect of law.
• Basic Books [Phils.], Inc. v. Lopez, L-20753 (1966): Cited for the definition of 'cause' in a contract.
• Abakada Guro Partylist v. Purisima, G.R. No. 166715 (2008) / Biraogo v. Philippine Truth Commission, G.R. Nos. 192935 & 193036 (2010): Referenced (in footnotes via Carpio concurrence/main decision) regarding the President's ordinance power and duty to faithfully execute laws, underpinning the validity of EOs delegating rule-making power for procurement.

• New Civil Code: Art. 1159 (Obligations arising from contracts), Art. 1305 (Definition of contract), Art. 1318 (Essential requisites of contracts), Art. 1319 (Consent), Art. 1350 (Cause in onerous contracts), Art. 1373 (Interpretation of contracts).
• Administrative Code of 1987 (EO 292): Book III, Title I, Chapter 2, Section 2 (Executive Orders) - Basis for presidential issuances.
• Executive Order No. 109 (2002), EO 109-A (2003), EO 423 (2005): Presidential directives streamlining government procurement and mandating NEDA to issue Joint Venture Guidelines. Section 8 of EO 423 explicitly mentioned.
• NEDA Joint Venture (JV) Guidelines (specifically Annex C): The administrative rules governing the JV process, particularly the three-stage framework for unsolicited proposals including negotiation and competitive challenge, held to have the force of law.
• Terms of Reference (TOR) for the Competitive Challenge: Specific provisions (Art. III(4) on Amendment, Art. VIII(3) on Cancellation) were analyzed and interpreted in relation to the NEDA JV Guidelines.
• Republic Act No. 7227 (Bases Conversion and Development Act of 1992): Section 8 mentioned in the Dissent regarding allocation of revenues from privatization. Section 2 on policy mentioned in Dissent.
• Republic Act No. 9184 (Government Procurement Reform Act): Mentioned as the context for amendments to procurement EOs.
• 1987 Constitution: Art. VII, Sec. 17 (President's control power and duty to execute laws), Art. XI, Sec. 1 (Public office is a public trust) - Referenced in the Dissenting Opinion.