NPM 084-2004

Requesting Entity: Department of Budget and Management – Regional Office IV

Issues Concern: Required Authority from the Sangguniang Bayan before the Municipal Mayor may enter into Contracts in the Procurement of Goods, Infrastructure Projects and Consulting Services



Whether or not it is required that the Municipal Mayor be given an authority from the Sangguniang Bayan before entering into contracts in the procurement of goods, infrastructure projects or consulting services under Republic Act No. 9184 (R.A. 9184) and its Implementing Rules and Regulations Part A (IRR-A).

Based on the foregoing citations (Sec. 22(c), Chapter 2, Title I, Book I and Sec. 444(b)(vi), Chapter 3, Title II, Book III, R.A. 7160), it is clear that the authorization from the Sangguniang Bayan is an indispensable requirement before the Municipal Mayor may enter into and sign all contracts and obligations in behalf of the Municipality. It may also be worthwhile to note that it is an explicit rule that “Contracts in behalf of the political subdivisions and corporate agencies or instrumentalities shall be approved by their respective governing boards or councils and executed by their respective executive heads.”

As such, it cannot be denied that it has always been the intention of our laws that no contract shall be entered into by the local chief executive (LCE) in behalf of the concerned LGU without any kind of participation from its sanggunian, which can either be in the form of “authorization” as required under the aforequoted provisions of R.A. 7160; or in the form of “ratification or approval” as required in the aforecited rule under the Revised Administrative Code of 1987 (RAC).

Moreover, although it may have been observed that under Section 37 of Rule XI of the IRR-A, specifically in Sections 37.2.3 - 37.3 thereof, prior authorization from the sangguniang bayan was not expressly required as a condition precedent for the approval of the contract by the LCE and the signing of the contract in behalf of the procuring entity, there was also no categorical mention that the same may be dispensed with.

Considering that only Title Six, Book Two, which covers Sections 355 to 383 and Chapter Five, Title One, Book One, which covers Sections 37 and 38 of R.A. 7160 are repealed by R.A. 9184, Sections 22 and 444 of R.A. 7160 as well as Section 51 of the RAC remain and continue to be operative and applicable. Hence, we are of the opinion that upon authorization by the Sangguniang Bayan, the Municipal Mayor shall represent the municipality in all its business transactions and sign on its behalf, all contracts for its procurement activities, whether goods, infrastructure projects or consulting services.