Jurisdictional Limits on the Office of Public Accountability in Debarment Matters:
Commentary on SH Enterprises, Inc. v. Territory of Guam, 2025 Guam 10
I. Introduction
The Supreme Court of Guam’s decision in SH Enterprises, Inc. v. Territory of Guam; General Services Agency; and the Office of Public Accountability, 2025 Guam 10, is a major procurement-law and administrative-law ruling. It draws sharp jurisdictional lines around the powers of the Office of Public Accountability (“OPA”) in debarment matters and clarifies the distinct statutory tracks for procurement protests and debarment proceedings.
At the core of the dispute is whether the OPA, in the context of a procurement protest appeal, may:
- Review a decision by the Chief Procurement Officer (“CPO”) not to debar a contractor; and
- On its own, initiate and impose a debarment where the CPO has declined to do so.
SH Enterprises, Inc. (“SH”), a contractor supplying food services to the Government of Guam, was debarred for one year by the OPA after a consolidated procurement protest proceeding initiated by its competitor, Basil Food Industrial Services Corporation (“Basil”). The OPA concluded that SH had violated procurement ethics provisions by donating temporary use of its Hakubotan building to house the Guam War Claims Processing Center – characterizing this as an impermissible gratuity.
SH appealed to the Superior Court, arguing that the OPA had exceeded its statutory jurisdiction and violated SH’s due process rights, and that its ethical violation finding lacked substantial evidence. The Superior Court affirmed the OPA, reasoning that the OPA’s de novo review of CPO decisions necessarily encompassed the power to debar.
On further appeal, the Supreme Court of Guam reversed. The Court held that:
- The OPA lacks statutory authority to review a decision not to debar or to debar a contractor in the course of a procurement protest appeal; and
- Because the OPA lacked subject-matter jurisdiction, SH’s other claims (due process, sufficiency of evidence, correctness of the ethics ruling) were moot.
This commentary examines the opinion’s reasoning, its use of statutory interpretation and precedent, and its broader implications for Guam’s procurement regime, administrative law, and contractors doing business with the government.
II. Summary of the Opinion
The Supreme Court’s decision turns almost entirely on statutory construction of Guam’s Procurement Law (Title 5 GCA Chapter 5) and the enabling provisions for OPA review (5 GCA §§ 5703, 5705).
Key holdings include:
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OPA’s jurisdiction over debarment is limited to reviewing actual debarments or suspensions under 5 GCA § 5426(c).
The Court held that OPA may only review a “debarment or suspension” when the CPO has issued a written decision to debar or suspend under § 5426(c). Section 5705(b) expressly ties OPA review to “a decision under Subsection (c) of § 5426.” -
OPA has no authority to review decisions not to debar, or written reports issued under § 5426(f).
When the CPO investigates a public petition to debar under § 5426(f) and decides not to debar, the resulting report of “findings of fact and action taken” is not subject to OPA review. Nor is any decision not to debar, however initiated. -
Section 5703’s broad language does not create implied OPA jurisdiction over non-debarment decisions.
The OPA’s general authority to “review and determine de novo any matter properly submitted” and to “promote the integrity of the procurement process” cannot expand its jurisdiction beyond what §§ 5426 and 5705 expressly allow. -
OPA cannot rely on “capable of repetition yet evading review” to create jurisdiction.
Mootness exceptions are prudential doctrines that govern courts’ exercise of jurisdiction; they cannot enlarge an administrative agency’s jurisdiction, which is strictly statutory. -
Procurement protests (§ 5425) and debarments (§ 5426) are distinct statutory mechanisms.
A protest seeking to overturn an award cannot be transformed into a debarment proceeding simply because the protester requests debarment as a remedy. They are governed by different statutory triggers, procedures, and remedies. - Because OPA lacked subject-matter jurisdiction to debar SH, the Court reversed without reaching the merits of SH’s due process claims or whether the Hakubotan building donation was an unlawful gratuity.
In short, the Court reinforces that the OPA is a “creature of statute” with limited, text-bound authority, and that only a debarred contractor, not a disappointed competitor or public petitioner, can access OPA review of debarment decisions.
III. Detailed Analysis
A. Statutory and Institutional Background
1. Guam’s adoption of the Model Procurement Code
Guam’s Procurement Law (Title 5 GCA Chapter 5) is largely based on the 1979 American Bar Association Model Procurement Code (“MPC”). The Court reiterates the principle, previously recognized in Data Management Resources, LLC v. Office of Public Accountability (“DMR”), 2013 Guam 27, that:
- Guam adopted the MPC’s provisions and official comments, which therefore constitute part of Guam’s legislative history; and
- When Guam adopts a uniform/model act without material change, courts may generally presume it adopted the drafters’ intended meaning.
This MPC backdrop is crucial: the MPC is designed with a centralized debarment authority (typically the state attorney general or a chief procurement officer) and does not contemplate administrative review of decisions not to debar.
2. Key actors: CPO, OPA, OAG, and Procurement Policy Office
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Chief Procurement Officer (CPO) – 5 GCA § 5426
The CPO is vested with primary authority to:- Resolve protests over solicitations and awards (§ 5425);
- Debar or suspend contractors for cause, “after consultation with the using agency and the Attorney General” (§ 5426(a)); and
- Resolve contract and breach of contract controversies (§ 5427).
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Office of Public Accountability (OPA) / Public Auditor – 5 GCA §§ 5703, 5705
The OPA:- Reviews procurement protests and certain other procurement controversies de novo; and
- Has a specific review function regarding debarment/suspension decisions under § 5426(c) as provided in § 5705.
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Office of the Attorney General (OAG) – consultative and enforcement role
Under § 5426(a), the CPO must consult the OAG before initiating debarment. The Court stresses that this consultation requirement also applies where a public petition to debar is filed and the CPO chooses not to debar – ensuring that OAG can independently investigate and pursue remedies if it disagrees. -
Procurement Policy Office (PPO) – limited supplementary debarment authority
The MPC commentary (adopted as Guam legislative history) makes clear that:- The CPO has primary power to debar or suspend.
- The PPO’s debarment authority is “supplementary,” meant for exceptional cases where an “outside, independent agency” intervention is desirable.
The Court places the OPA within this scheme as a reviewing body of limited jurisdiction, not as a parallel debarment authority.
B. Textual Construction of 5 GCA §§ 5426, 5703, and 5705
1. Structure of § 5426: Debarment and public petitions
Section 5426 organizes debarment authority and procedures as follows:
- § 5426(a) – The CPO (and, in some instances, other specified officials) may debar or suspend a contractor for cause, “after consultation with the using agency and the Attorney General.”
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§ 5426(c) – When the CPO debars or suspends, the CPO “shall issue a written decision to debar or suspend” that:
- States the reasons for the action; and
- Informs the debarred/suspended person of its rights to judicial or administrative review.
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§ 5426(e) – A “decision under Subsections (c) or (f) of this Section shall be final and conclusive, unless fraudulent, or an appeal is taken to the Public Auditor in accordance with § 5705 of this Chapter.”
(The Court notes a scrivener’s error referencing § 5706; the correct cross-reference is § 5705.) -
§ 5426(f) – Guam’s key deviation from the MPC. “Any member of the public may petition the Chief Procurement Officer . . . to take action to debar or suspend.” The CPO must:
- “Conduct promptly” an investigation; and
- Prepare “a written report” of findings of fact and action taken.
The Court’s analysis hinges on the difference between:
- A “written decision to debar or suspend” under § 5426(c); and
- A “written report” under § 5426(f) of “findings of fact and action taken” following a public petition.
Only the former – a decision that actually debars or suspends – is a proper predicate for OPA review.
2. Section 5705: The explicit scope of OPA review in debarment matters
Section 5705 is the OPA’s debarment-review provision. The key language:
- § 5705(b): “The aggrieved person shall file his/her appeal with the Public Auditor within sixty (60) days of the receipt of a decision under Subsection (c) of § 5426 of this Chapter.” (emphasis added)
- § 5705(c): “The Public Auditor shall decide whether, or the extent to which, the debarment or suspension was in accordance with the statutes, regulations and the best interest of the government . . . , and was fair.” (emphasis added)
From this, the Court draws several unambiguous conclusions:
- Only a person “aggrieved” by a decision under § 5426(c) – i.e., a contractor who has in fact been debarred or suspended – may appeal to the OPA.
- The OPA’s task is to review a “debarment or suspension” – not to review non-debarment decisions or public-petition reports under § 5426(f).
- Section 5705 does not mention any right to appeal a decision not to debar, or any right of public petitioners or competitors to seek OPA review of the CPO’s refusal to debar.
This is the textual core of the Court’s jurisdictional holding.
3. Section 5703: General OPA authority and its limits
Section 5703(a) states that the Public Auditor has:
“the power to review and determine de novo any matter properly submitted to her or him.”
The OPA relied heavily on this broad language, coupled with its general mandate to “promote the integrity of the procurement process,” to argue that:
- Any procurement-related issue implicating ethics and integrity is within its remit; and
- Therefore, decisions not to debar are “matters properly submitted” whenever they arise in a protest appeal.
The Court firmly rejects this reading. The phrase “properly submitted” is not an open-ended invitation; it presupposes:
- That some other statute (such as § 5425, § 5426, or § 5427) authorizes submission of that matter to the OPA; and
- That the statutory preconditions (e.g., a written debarment decision under § 5426(c)) have been met.
In other words, § 5703 is about how the OPA reviews once jurisdiction exists (de novo), not what can be reviewed in the first place.
C. No Express or Implied Authority to Review Decisions Not to Debar
1. No express authority
The Court’s express-authority analysis is straightforward:
- Section 5705 expressly ties OPA jurisdiction in debarment matters to “a decision under Subsection (c) of § 5426,” i.e., an actual debarment/suspension decision.
- Section 5426(f) – the public petition provision – is silent on any right to administrative or judicial review for the petitioner.
- By contrast, other provisions (e.g., § 5425(e) regarding protests) expressly give the OPA authority to review a “decision” on a protest.
The juxtaposition of these provisions demonstrates legislative intent to:
- Allow review of protest “decisions” but limit debarment-review to actual debarments or suspensions; and
- Leave public-petition outcomes (§ 5426(f)) and decisions not to debar outside OPA’s review jurisdiction.
2. No implied authority – distinguishing DMR
The OPA also argued that it possessed implied authority to review decisions not to debar, analogizing to the Court’s earlier recognition of implied powers in Data Management Resources, LLC v. OPA, 2013 Guam 27.
In DMR, the Court held that OPA could appeal to the Superior Court as an “aggrieved party” under 7 GCA § 25104, even though OPA was not expressly named, because:
- Any “aggrieved party” could appeal; and
- OPA fit comfortably within that statutory phrase when its decisions were overturned.
Here, however:
- There is no parallel “aggrieved party” provision that covers people upset with a decision not to debar.
- Section 5705(b) contains a precise, limiting reference to a “decision under Subsection (c) of § 5426” – not decisions generally, and not reports under § 5426(f).
The Court therefore concludes that:
Authority to hear an appeal after a written decision to debar is issued under subsection (c) does not imply authority to hear an appeal in the absence of such a decision.
The OPA’s earlier administrative decision in In re Teleguam Holdings, L.L.C., OPA-PA-13-016 (2014), is noted: there, OPA itself had recognized that its authority was limited to debarments, not to decisions not to debar.
D. Debarment Review vs. Constitutional Mootness: OPA’s Misuse of “Capable of Repetition Yet Evading Review”
1. Courts vs. agencies: different foundations of authority
A central conceptual contribution of the opinion is its sharp distinction between:
- Judicial justiciability doctrines (mootness, standing, “capable of repetition yet evading review”), which are prudential or constitutional limits courts impose on how they exercise jurisdiction they already have; and
- Administrative agencies’ statutory jurisdiction, which is entirely a matter of legislative grant – agencies “have no powers except those mentioned in the statute.”
Citing cases such as:
- Carlson v. Guam Telephone Authority, 2002 Guam 15 (agencies are creatures of statute);
- Kleen Energy Systems, LLC v. Commissioner of Energy & Environmental Protection, 125 A.3d 905 (Conn. 2015); and
- American Federation of Government Employees Nat’l Office v. D.C. Public Employee Relations Board, 237 A.3d 81 (D.C. 2020),
the Court emphasizes that:
“[N]o matter how the term [jurisdiction] is used, the question ‘is always whether the agency has gone beyond what [the legislature] has permitted it to do.’”
2. Why “capable of repetition yet evading review” cannot create OPA jurisdiction
The OPA argued – and the Superior Court accepted – that to avoid insulating decisions not to debar from any review, OPA could treat such issues as “administrative errors capable of repetition yet evading review,” analogizing to the court-created mootness exception used by appellate courts.
The Supreme Court rejected this as a category mistake:
- The “capable of repetition yet evading review” doctrine allows courts to decide technically moot cases when they fall within that exception, but only when the court otherwise has jurisdiction over that class of cases.
- An administrative agency, by contrast, has no inherent jurisdiction. It cannot bypass statutory limits by importing judicial prudential doctrines.
- Even if a case is functionally justiciable and would satisfy a mootness exception, OPA cannot act unless the legislature has empowered it to adjudicate that type of dispute.
To apply a mootness exception to “create” OPA jurisdiction would invert the hierarchy of authority: a self-imposed judicial doctrine would effectively override statutory jurisdictional limits imposed by the legislature.
E. Protests vs. Debarments: Distinct Statutory Tracks
1. The two tracks under Guam Procurement Law
The Court devotes a section to explaining the structural and procedural differences between:
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Procurement protests – § 5425
- Who may file: any “actual or prospective bidder, offeror, or contractor who may be aggrieved” by the method of source selection, solicitation, or award.
- Objective: challenge particular solicitations or awards (e.g., asking that a contract not be awarded to a competitor or be re-bid).
- Procedure: CPO issues a written decision; that decision is appealable to OPA under § 5425(e).
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Debarment proceedings – § 5426
- Who initiates: primarily CPO (in consultation with OAG), or “any member of the public” via petition under § 5426(f).
- Objective: exclude a contractor from bidding on any government contracts for up to two years, on specified grounds (e.g., criminal conduct, ethics violations).
- Procedure:
- If CPO decides to debar/suspend, it must issue a written decision under § 5426(c), which is then appealable to OPA (§ 5705) and the Superior Court (§ 5480).
- If a public petition under § 5426(f) leads to no debarment, only a written investigative report is required – which is not appealable.
2. Basil’s filings: protests, not a debarment petition
The administrative record showed:
- Basil’s first protest challenged the award to SH based on alleged non-disclosure of a “C” rating and contract termination; it made no mention of debarment.
- Basil’s second protest raised the alleged gratuity (Hakubotan building donation) and requested debarment or suspension as part of its prayer for relief, but did not clearly invoke § 5426(f) or identify itself as a petition to debar.
The Court notes its general principle that to preserve an issue, a party must “unequivocally put its position” before the deciding body “at a point and in a manner that permits the court [or agency] to consider its merits.” A mere passing request for debarment in the prayer of a protest, without invoking § 5426(f) or triggering its procedures, is insufficient to:
- Constitute a proper petition to debar; or
- Require the CPO (and, eventually, OPA) to treat the matter as a § 5426 proceeding.
The Court does not need to decide whether a single document could simultaneously function as both a protest and a debarment petition if drafted properly. It holds only that Basil’s filings did not do so, and that:
“Requesting debarment as a remedy cannot suddenly convert [a] Section 5425 protest of award into a Section 5426 petition to debar.”
3. Why “substance over form” does not rescue OPA jurisdiction here
In DMR and Town House Department Stores, Inc. v. Department of Education, 2012 Guam 25, the Court adopted a “substance over form” approach to procedural defects (e.g., mislabeling a judicial filing) where:
- The statutory concern (such as notice to the adverse party) was satisfied; and
- The defect was formal and curable without undermining legislative design.
The Court draws an important distinction:
- In DMR, courts refashioned a “petition for judicial review” into a proper civil action – a judicially created vehicle within the judiciary’s inherent procedural authority.
- Here, by contrast, the OPA sought to:
- Re-characterize a protest (§ 5425) into a debarment petition (§ 5426(f));
- Then treat the CPO’s refusal to debar as reviewable; and
- Ultimately impose its own debarment order.
The OPA, unlike a court shaping its own procedures, cannot alter the legislatively prescribed substantive pathways and jurisdictional triggers of the Procurement Law. Section 5426 is not a flexible judicial device; it is a statute defining when and how debarment proceedings may be initiated and reviewed.
F. Comparative and Supporting Authorities
1. Other MPC-based jurisdictions
The Court bolsters its interpretation by surveying states that have adopted the MPC:
- Some states allow a debarred or suspended business to proceed directly to judicial review, with no intermediate administrative review (e.g., New Mexico).
- Others provide administrative review but limit it to debarred “prospective bidders or proposers” (e.g., Oregon), or permit certain governmental bodies to appeal debarment decisions (e.g., Hawaii).
The Court notes that it has found no jurisdiction – and OPA cited none – that has recognized an implied administrative power to review a decision not to debar under an MPC-based statutory scheme.
2. Mankato Aglime & Rock Co. v. City of Mankato
The Court finds particularly persuasive the Minnesota Court of Appeals decision in Mankato Aglime & Rock Co. v. City of Mankato, 434 N.W.2d 490 (Minn. Ct. App. 1989). There:
- Another bidder attempted to compel Minnesota DOT to hold a debarment hearing against a competitor.
- Even though Minnesota rules stated DOT “must” debar if grounds are established, the court found that competing businesses lacked standing to enforce those debarment provisions.
- The court reasoned that debarment procedures protect the due process rights of the would-be debarred contractor, not the interests of competitors.
Guam’s Supreme Court extends this logic:
- Section 5426(f) gives the public the right to petition for debarment but does not give petitioners a right to appeal the outcome to the OPA.
- Section 5705 protects debarred contractors by allowing them to challenge erroneous debarments – it is not a vehicle for third parties to challenge a decision not to debar.
G. The Attorney General as Safeguard Against Non-Debarment
The OPA argued that if it lacked jurisdiction to review refusals to debar, executive agencies and contractors would be effectively insulated from meaningful oversight on ethics violations.
The Court answers this concern by emphasizing the role of the Attorney General under § 5426(a):
- CPO must consult the OAG whenever debarment is considered, including where:
- A public petition to debar has been filed; and
- The CPO is inclined not to debar.
- This consultation “puts the OAG on notice” of potential wrongdoing.
- The OAG has independent authority to investigate and seek appropriate remedies (e.g., civil enforcement, criminal prosecution, other administrative or contractual sanctions).
Thus, the Court views the OAG’s role as the intentional statutory safeguard against under-enforcement of debarment, rather than an expansion of OPA jurisdiction beyond the plain text.
H. Practical Impact and Future Consequences
1. For contractors and bidders
- Debarment risk remains real – the CPO and, in some cases, the PPO or OAG can still debar/suspend contractors for ethics violations or performance failures.
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But only debarred/suspended entities can invoke OPA review – contractors aggrieved by a debarment under § 5426(c) continue to have:
- OPA review under § 5705; and
- Judicial review in the Superior Court under § 5480.
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Competitors and members of the public cannot force debarment through OPA – they may:
- File protests to challenge particular awards under § 5425; and
- File petitions to debar under § 5426(f), triggering investigation and consultation with OAG.
2. For the OPA
The decision significantly cabins the OPA’s role in debarment:
- OPA cannot transform a protest appeal into a debarment proceeding simply because ethical issues surface.
- OPA cannot debar a contractor on its own authority; it may only review debarments that already exist under § 5426(c).
- OPA cannot use mootness doctrines or broad “integrity of procurement” language in § 5703 to override jurisdictional constraints in §§ 5426 and 5705.
3. For the Legislature and future reform efforts
The opinion explicitly references prior legislative efforts (Bill 224-32 and Bill 20-33) to expand OPA’s jurisdiction over procurement matters, both vetoed by the Governor. This signals:
- The Court will not supply, via interpretation, what the political branches have declined to enact;
- If expanded OPA authority over non-debarment decisions is desirable, it must come from:
- Amending § 5426, § 5703, and/or § 5705 to:
- Expressly allow appeal of decisions not to debar; and/or
- Give public petitioners or governmental bodies specific rights of review; or
- Creating new mechanisms for independent ethics enforcement outside the procurement review structure.
- Amending § 5426, § 5703, and/or § 5705 to:
4. For procurement practice on Guam
Going forward:
- Lawyers and vendors must keep protests (§ 5425) and debarment petitions (§ 5426(f)) analytically and procedurally distinct in their filings.
- If a party seeks debarment of a competitor:
- It should file a separate, clear § 5426(f) petition; and
- Understand that it will not have a right to OPA review of any non-debarment outcome.
- OPA proceedings will refocus on:
- Classic bid protests;
- Review of actual debarment/suspension decisions; and
- Other procurement disputes expressly assigned by statute.
IV. Explanation of Key Legal Concepts
A. Debarment
Debarment is a powerful, quasi-penal administrative sanction that:
- Excludes a contractor from bidding on or receiving public contracts for a specified period (in Guam, up to two years under § 5426); and
- Is used to protect the integrity of public contracting, typically based on serious misconduct (fraud, criminal convictions, repeated contract failures, significant ethics violations).
Because debarment affects a contractor’s livelihood and reputation, due process protections and clear procedural rules are critical. That is why § 5426(c) requires:
- A written decision; and
- Notice of the right to administrative and judicial review.
B. Administrative jurisdiction vs. judicial justiciability
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Administrative jurisdiction
Agencies like the OPA exist only because statutes create them. They can:- Hear only the types of disputes and appeals the statutes assign to them; and
- Exercise only the remedies the statutes authorize.
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Judicial justiciability
Courts, by contrast, often have broad jurisdiction to hear “cases” or “controversies,” but self-limit through doctrines such as standing, ripeness, and mootness. The “capable of repetition yet evading review” doctrine is a classic example – it allows a court to hear a technically moot case when:- The challenged action is too short-lived to be fully litigated before cessation; and
- There is a reasonable expectation that the same party will be subjected to the same action again.
C. De novo review vs. jurisdiction
“De novo review” means the reviewing body:
- Does not defer to the factual or legal conclusions of the decision-maker below; and
- Re-decides the issue as if hearing it for the first time.
However, as the Court stresses:
- Having de novo review power does not itself confer jurisdiction;
- An agency must still be lawfully seized of the matter under a jurisdiction-granting statute; and
- Only then does the standard of review (e.g., de novo vs. deferential) come into play.
D. Public petition to debar (§ 5426(f))
Section 5426(f) is unusual in U.S. procurement law in that it allows:
- “Any member of the public” to petition the CPO to take action to debar or suspend a contractor.
However:
- This is a right to initiate an investigation, not a right to a particular outcome.
- The CPO must investigate and issue a report, but is not mandated to debar even if some violation is found (debarment is discretionary, within statutory criteria).
- The statute does not give petitioners a right to appeal the CPO’s decision – only debarred contractors have review rights under § 5705.
V. Conclusion
SH Enterprises, Inc. v. Territory of Guam is now a leading case on the jurisdictional limits of Guam’s Office of Public Accountability in debarment matters. Its key contributions are:
- Clarifying that OPA’s debarment-review authority is strictly limited to reviewing actual debarments/suspensions under § 5426(c), as expressly authorized by § 5705.
- Holding that OPA has no authority to review decisions not to debar or CPO investigative reports issued under § 5426(f), nor to convert a protest into a debarment proceeding by its own initiative.
- Reinforcing that administrative agencies cannot expand their own jurisdiction by importing judicial doctrines like “capable of repetition yet evading review,” or by appealing to broadly worded policy goals in their enabling statutes.
- Drawing a firm doctrinal line between procurement protests and debarment proceedings, insisting that they follow their distinct statutory pathways, triggers, and remedial structures.
- Emphasizing the Attorney General’s statutory role as the primary safeguard when the CPO declines to debar despite alleged ethical violations.
In doing so, the Court protects the due process rights of contractors, preserves legislative primacy over the design of Guam’s procurement and ethics-enforcement system, and sends a clear message that jurisdictional statutes will be strictly construed. Any expansion of OPA’s role in policing ethical misconduct through debarment must come from the Legislature, not from judicial or administrative improvisation.
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