G.R. No. 194962 - CAGAYAN ECONOMIC ZONE AUTHORITY, VS. MERIDIEN VISTA GAMING CORPORATION.D E C I S I O N - Supreme Court E-Library

Ruling

Accordingly, respondent Meridien Vista Gaming Corporation (MVGC) applied with CEZA for registration as licensed/authorized operator of gaming, sports betting and tourism-related activities such as jai alai, cock fighting, virtual gaming, bingo, horse racing, dog racing, sports betting, internet gaming, and land based casinos. [7] CEZA granted the application of MVGC to engage in gaming operations within the Freeport Zone and subsequently issued several certifications attesting that MVGC was licensed to conduct gaming operations within the zone and to set up betting stations in any place as may be allowed by law. [8] On January 5, 2009, MVGC informed CEZA that its virtual games software had been alpha tested and was ready for actual field testing as of December 29, 2008. MVGC also proposed to conduct a real market environment testing starting on January 15, 2009 and to utilize an offsite gaming station in the provinces of Isabela, Camarines Sur and Nueva Viscaya subject to the requisite local government permits. [9] On March 31, 2009, the OGCC issued Opinion No. 67, series of 2009, [10] clarifying its earlier opinion regarding the authority of CEZA to grant a franchise to operate jai alai. In effect, the said opinion stated that CEZA could not grant a franchise to operate jai alai in the absence of an express legislative franchise. Consequently, CEZA issued a letter, [11] dated April 1, 2009, directing MVGC to stop all its gaming operations including the testing of softwares and telecommunication infrastructure relative thereto. Its interest being affected, MVGC filed a petition [12] for mandamus and damages with application for the issuance of a temporary restraining order and/or writ of preliminary mandatory injunction before the RTC. In its petition, MVGC prayed that it be allowed to continue with its gaming operations including the testing of softwares and relative telecommunication infrastructures. The case was referred by CEZA to the OGCC, which assigned Atty. Edgardo Baniaga (Atty. Baniaga) to handle the case. Thus, all notices, orders and legal processes in connection with the case were forwarded to him for appropriate action. CEZA, in its Answer, [13] admitted issuing a license agreement in favor of MVGC to operate jai alai. It, however, denied allowing the latter to manage virtual gaming operations. CEZA argued that MVGC had no legal right to compel it, by way of mandamus, to allow the operation of its virtual gaming. CEZA cited four (4) laws to bolster its argument that the granting of franchise to operate jai alai must be clearly prescribed by law; namely: (1) Executive Order (E.O.) No. 392, transferring the authority to regulate jai alai from the Local Government to the Games and Amusement Board; (2) Republic Act (R.A.) No. 954, or an act prohibiting certain activities in connection with horse races and basque pelota games (jai alai); (3) Presidential Decree (P.D.) No. 771 revoking all powers and authority of the Local Government to g