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G.R. No.

L-46930 June 10, 1988 On November 7, 1975, before the start of the grievance hearings, a-letter (Annex
DALE SANDERS, AND A.S. MOREAU, JR, petitioners, "B" of the complaint) purportedly corning from petitioner Moreau as the
vs. commanding general of the U.S. Naval Station in Subic Bay was sent to the Chief of
HON. REGINO T. VERIDIANO II, as Presiding Judge, Branch I, Court of First Instance Naval Personnel explaining the change of the private respondent's employment
of Zambales, Olongapo City, ANTHONY M. ROSSI and RALPH L. WYERS, status and requesting concurrence therewith. The letter did not carry his signature
respondents. but was signed by W.B. Moore, Jr. "by direction," presumably of Moreau.
On the basis of these antecedent facts, the private respondent filed in the Court of
CRUZ, J.: First Instance of Olongapo City a for damages against the herein petitioners on
The basic issue to be resolved in this case is whether or not the petitioners were November 8, 1976.8 The plaintiffs claimed that the letters contained libelous
performing their official duties when they did the acts for which they have been imputations that had exposed them to ridicule and caused them mental anguish
sued for damages by the private respondents. Once this question is decided, the and that the prejudgment of the grievance proceedings was an invasion of their
other answers will fall into place and this petition need not detain us any longer personal and proprietary rights.
than it already has. The private respondents made it clear that the petitioners were being sued in their
Petitioner Sanders was, at the time the incident in question occurred, the special private or personal capacity. However, in a motion to dismiss filed under a special
services director of the U.S. Naval Station (NAVSTA) in Olongapo City. 1 Petitioner appearance, the petitioners argued that the acts complained of were performed by
Moreau was the commanding officer of the Subic Naval Base, which includes the them in the discharge of their official duties and that, consequently, the court had
said station. 2 Private respondent Rossi is an American citizen with permanent no jurisdiction over them under the doctrine of state immunity.
residence in the Philippines,3 as so was private respondent Wyer, who died two After extensive written arguments between the parties, the motion was denied in
years ago. 4 They were both employed as gameroom attendants in the special an order dated March 8, 1977, 9on the main ground that the petitioners had not
services department of the NAVSTA, the former having been hired in 1971 and the presented any evidence that their acts were official in nature and not personal
latter in 1969. 5 torts, moreover, the allegation in the complaint was that the defendants had acted
On October 3, 1975, the private respondents were advised that their employment maliciously and in bad faith. The same order issued a writ of preliminary
had been converted from permanent full-time to permanent part-time, effective attachment, conditioned upon the filing of a P10,000.00 bond by the plaintiffs,
October 18, 1975. 6 Their reaction was to protest this conversion and to institute against the properties of petitioner Moreau, who allegedly was then about to leave
grievance proceedings conformably to the pertinent rules and regulations of the the Philippines. Subsequently, to make matters worse for the defendants,
U.S. Department of Defense. The result was a recommendation from the hearing petitioner Moreau was declared in a default by the trial court in its order dated
officer who conducted the proceedings for the reinstatement of the private August 9, 1977. The motion to lift the default order on the ground that Moreau's
respondents to permanent full-time status plus backwages. The report on the failure to appear at the pre-trial conference was the result of some
hearing contained the observation that "Special Services management practices an misunderstanding, and the motion for reconsideration of the denial of the motion
autocratic form of supervision." 7 to dismiss, which was filed by the petitioner's new lawyers, were denied by the
In a letter addressed to petitioner Moreau on May 17, 1976 (Annex "A" of the respondent court on September 7, 1977.
complaint), Sanders disagreed with the hearing officer's report and asked for the This petition for certiorari, prohibition and preliminary injunction was thereafter
rejection of the abovestated recommendation. The letter contained the statements filed before this Court, on the contention that the above-narrated acts of the
that: a ) "Mr. Rossi tends to alienate most co-workers and supervisors;" b) "Messrs. respondent court are tainted with grave abuse of discretion amounting to lack of
Rossi and Wyers have proven, according to their immediate supervisors, to be jurisdiction.
difficult employees to supervise;" and c) "even though the grievants were under We return now to the basic question of whether the petitioners were acting
oath not to discuss the case with anyone, (they) placed the records in public places officially or only in their private capacities when they did the acts for which the
where others not involved in the case could hear." private respondents have sued them for damages.
It is stressed at the outset that the mere allegation that a government functionary is It is abundantly clear in the present case that the acts for which the petitioners are
being sued in his personal capacity will not automatically remove him from the being called to account were performed by them in the discharge of their official
protection of the law of public officers and, if appropriate, the doctrine of state duties. Sanders, as director of the special services department of NAVSTA,
immunity. By the same token, the mere invocation of official character will not undoubtedly had supervision over its personnel, including the private respondents,
suffice to insulate him from suability and liability for an act imputed to him as a and had a hand in their employment, work assignments, discipline, dismissal and
personal tort committed without or in excess of his authority. These well-settled other related matters. It is not disputed that the letter he had written was in fact a
principles are applicable not only to the officers of the local state but also where reply to a request from his superior, the other petitioner, for more information
the person sued in its courts pertains to the government of a foreign state, as in the regarding the case of the private respondents. 14 Moreover, even in the absence of
present case. such request, he still was within his rights in reacting to the hearing officer's
The respondent judge, apparently finding that the complained acts were prima criticism—in effect a direct attack against him—-that Special Services was practicing
facie personal and tortious, decided to proceed to trial to determine inter alia their "an autocratic form of supervision."
precise character on the strength of the evidence to be submitted by the parties. As for Moreau,what he is claimed to have done was write the Chief of Naval
The petitioners have objected, arguing that no such evidence was needed to Personnel for concurrence with the conversion of the private respondents' type of
substantiate their claim of jurisdictional immunity. Pending resolution of this employment even before the grievance proceedings had even commenced.
question, we issued a temporary restraining order on September 26, 1977, that has Disregarding for the nonce the question of its timeliness, this act is clearly official in
since then suspended the proceedings in this case in the courta quo. nature, performed by Moreau as the immediate superior of Sanders and directly
In past cases, this Court has held that where the character of the act complained of answerable to Naval Personnel in matters involving the special services department
can be determined from the pleadings exchanged between the parties before the of NAVSTA In fact, the letter dealt with the financial and budgetary problems of the
trial, it is not necessary for the court to require them to belabor the point at a trial department and contained recommendations for their solution, including the re-
still to be conducted. Such a proceeding would be superfluous, not to say unfair to designation of the private respondents. There was nothing personal or private
the defendant who is subjected to unnecessary and avoidable inconvenience. about it.
Thus, in Baer v. Tizon, 10 we held that a motion to dismiss a complaint against the Given the official character of the above-described letters, we have to conclude that
commanding general of the Olongapo Naval Base should not have been denied the petitioners were, legally speaking, being sued as officers of the United States
because it had been sufficiently shown that the act for which he was being sued government. As they have acted on behalf of that government, and within the
was done in his official capacity on behalf of the American government. The United scope of their authority, it is that government, and not the petitioners personally,
States had not given its consent to be sued. It was the reverse situation in Syquia v. that is responsible for their acts. Assuming that the trial can proceed and it is
Almeda Lopez," where we sustained the order of the lower court granting a where proved that the claimants have a right to the payment of damages, such award will
we motion to dismiss a complaint against certain officers of the U.S. armed forces have to be satisfied not by the petitioners in their personal capacities but by the
also shown to be acting officially in the name of the American government. The United States government as their principal. This will require that government to
United States had also not waived its immunity from suit. Only three years ago, in perform an affirmative act to satisfy the judgment, viz, the appropriation of the
United States of America v. Ruiz, 12 we set aside the denial by the lower court of a necessary amount to cover the damages awarded, thus making the action a suit
motion to dismiss a complaint for damages filed against the United States and against that government without its consent.
several of its officials, it appearing that the act complained of was governmental There should be no question by now that such complaint cannot prosper unless the
rather than proprietary, and certainly not personal. In these and several other cases government sought to be held ultimately liable has given its consent to' be sued. So
13
the Court found it redundant to prolong the other case proceedings after it had we have ruled not only in Baer but in many other decisions where we upheld the
become clear that the suit could not prosper because the acts complained of were doctrine of state immunity as applicable not only to our own government but also
covered by the doctrine of state immunity. to foreign states sought to be subjected to the jurisdiction of our courts. 15
The practical justification for the doctrine, as Holmes put it, is that "there can be no The Court finds that, even under the law of public officers, the acts of the
legal right against the authority which makes the law on which the right depends. 16 petitioners are protected by the presumption of good faith, which has not been
In the case of foreign states, the rule is derived from the principle of the sovereign overturned by the private respondents. Even mistakes concededly committed by
equality of states which wisely admonishes that par in parem non habet imperium such public officers are not actionable as long as it is not shown that they were
and that a contrary attitude would "unduly vex the peace of nations." 17 Our motivated by malice or gross negligence amounting to bad faith. 24 This, to, is well
adherence to this precept is formally expressed in Article II, Section 2, of our settled .25 Furthermore, applying now our own penal laws, the letters come under
Constitution, where we reiterate from our previous charters that the Philippines the concept of privileged communications and are not punishable, 26 let alone the
"adopts the generally accepted principles of international law as part of the law of fact that the resented remarks are not defamatory by our standards. It seems the
the land. private respondents have overstated their case.
All this is not to say that in no case may a public officer be sued as such without the A final consideration is that since the questioned acts were done in the Olongapo
previous consent of the state. To be sure, there are a number of well-recognized Naval Base by the petitioners in the performance of their official duties and the
exceptions. It is clear that a public officer may be sued as such to compel him to do private respondents are themselves American citizens, it would seem only proper
an act required by law, as where, say, a register of deeds refuses to record a deed for the courts of this country to refrain from taking cognizance of this matter and to
of sale; 18or to restrain a Cabinet member, for example, from enforcing a law treat it as coming under the internal administration of the said base.
claimed to be unconstitutional; 19 or to compel the national treasurer to pay The petitioners' counsel have submitted a memorandum replete with citations of
damages from an already appropriated assurance fund; 20 or the commissioner of American cases, as if they were arguing before a court of the United States. The
internal revenue to refund tax over-payments from a fund already available for the Court is bemused by such attitude. While these decisions do have persuasive effect
purpose; 21 or, in general, to secure a judgment that the officer impleaded may upon us, they can at best be invoked only to support our own jurisprudence, which
satisfy by himself without the government itself having to do a positive act to assist we have developed and enriched on the basis of our own persuasions as a people,
him. We have also held that where the government itself has violated its own laws, particularly since we became independent in 1946.
the aggrieved party may directly implead the government even without first filing We appreciate the assistance foreign decisions offer us, and not only from the
his claim with the Commission on Audit as normally required, as the doctrine of United States but also from Spain and other countries from which we have derived
state immunity "cannot be used as an instrument for perpetrating an injustice." 22 some if not most of our own laws. But we should not place undue and fawning
This case must also be distinguished from such decisions as Festejo v. Fernando, 23 reliance upon them and regard them as indispensable mental crutches without
where the Court held that a bureau director could be sued for damages on a which we cannot come to our own decisions through the employment of our own
personal tort committed by him when he acted without or in excess of authority in endowments We live in a different ambience and must decide our own problems in
forcibly taking private property without paying just compensation therefor although the light of our own interests and needs, and of our qualities and even
he did convert it into a public irrigation canal. It was not necessary to secure the idiosyncrasies as a people, and always with our own concept of law and justice.
previous consent of the state, nor could it be validly impleaded as a party The private respondents must, if they are still sominded, pursue their claim against
defendant, as it was not responsible for the defendant's unauthorized act. the petitioners in accordance with the laws of the United States, of which they are
The case at bar, to repeat, comes under the rule and not under any of the all citizens and under whose jurisdiction the alleged offenses were committed. Even
recognized exceptions. The government of the United States has not given its assuming that our own laws are applicable, the United States government has not
consent to be sued for the official acts of the petitioners, who cannot satisfy any decided to give its consent to be sued in our courts, which therefore has not
judgment that may be rendered against them. As it is the American government acquired the competence to act on the said claim,.
itself that will have to perform the affirmative act of appropriating the amount that WHEREFORE, the petition is GRANTED. The challenged orders dated March 8,1977,
may be adjudged for the private respondents, the complaint must be dismissed for August 9,1977, and September 7, 1977, are SET ASIDE. The respondent court is
lack of jurisdiction. directed to DISMISS Civil Case No. 2077-O. Our Temporary restraining order of
September 26,1977, is made PERMANENT. No costs.
SO ORDERED. UMALI, REMIGIO MAHALIN, BONG MANLULO, ARMANDO MATIENZO, CARLO
MEDINA, LITO NOVENARIO, and ROSELLA ROBALE, respondents.
G.R. No. 84607 March 19, 1993 G.R. No. 84645 March 19, 1993
REPUBLIC OF THE PHILIPPINES, GEN. RAMON MONTANO, GEN. ALFREDO LIM, ERLINDA C. CAYLAO, ANATALIA ANGELES PEREZ, MYRNA BAUTISTA, CIPRIANA
GEN. ALEXANDER AGUIRRE, COL. EDGAR DULA TORRES, COL. CEZAR NAZARENO, EVANGELIO, ELMA GRAMPA, AMELIA GUTIERREZ, NEMESIO LAKINDANUM,
MAJ. FILEMON GASMEN, PAT. NICANOR ABANDO, PFC SERAFIN CEBU, JR., GEN. PURITA YUMUL, MIGUEL ARABE, TERESITA ARJONA, RONALDO CAMPOMANES
BRIGIDO PAREDES, COL. ROGELIO MONFORTE, PFC ANTONIO LUCERO, PAT. JOSE AND CARMENCITA ARDONI VDA. DE CAMPOMANES, ROGELIO DOMUNICO, in
MENDIOLA, PAT. NELSON TUASON, POLICE CORPORAL PANFILO ROGOS, POLICE their capacity as heirs of the deceased (ROBERTO C. CAYLAO, SONNY "BOY"
LT. JUAN B. BELTRAN, PAT. NOEL MANAGBAO, MARINE THIRD CLASS TRAINEE PEREZ, DIONESIO GRAMPA, ANGELITO GUTIERREZ, BERNABE LAKINDANUM,
(3CT) NOLITO NOGATO, 3CT ALEJANDRO B. NAGUIO, JR., EFREN ARCILLAS, 3CT ROBERTO YUMUL, LEOPOLDO ALONZO, ADELFA ARIBE, DANILO ARJONA, VICENTE
AGERICO LUNA, 3CT BASILIO BORJA, 3CT MANOLITO LUSPO, 3CT CRISTITUTO CAMPOMANES, RONILO DOMUNICO) respectively; and (names of sixty-two
GERVACIO, 3CT MANUEL DELA CRUZ, JR., MARINE (CDC) BN., (CIVIL DISTURBANCE injured victims) EDDIE AGUINALDO, FELICISIMO ALBASIA, NAPOLEON BAUTISTA,
CONTROL), MOBILE DISPERSAL TEAM (MDT), LT. ROMEO PAQUINTO, LT. DANILO CRUZ, EDDIE MENSOLA, ALBERT PITALBO, VICENTE ROSEL, RUBEN
LAONGLAANG GOCE, MAJ. DEMETRIO DE LA CRUZ, POLICE CAPTAIN RODOLFO CARRIEDO, JOY CRUZ, HONORIO LABAMBA, JR. EFREN MACARAIG, SOLOMON
NAVAL, JOHN DOE, RICHARD DOE, ROBERTO DOE AND OTHER DOES, petitioners, MANALOTO, ROMEO DURAN, NILO TAGUBAT, JUN CARSELLAR, JOEY CLEMENTE,
vs. GERARDO COYOCA, LUISITO DACO, BENJAMIN DELA CRUZ, ARTHUR FONTANILLA,
HON. EDILBERTO G. SANDOVAL, Regional Trial Court of Manila, Branch IX, WILSON GARCIA, CARLOS SIRAY, JOSE PERRAS TOMAS VALLOS, ARNOLD ENAJE,
ERLINDA C. CAYLAO, ANATALIA ANGELES PEREZ, MYRNA BAUTISTA, CIPRIANA MARIANITA DIMAPILIS, FRANCISCO ANGELES, MARCELO ESGUERRA, JOSE FERRER,
EVANGELIO, ELMA GRAMPA, AMELIA GUTIERREZ, NEMESIO LAKINDANUM, RODEL DE GUIA, ELVIS MENDOZA, VICTORINO QUIJANO, JOEY ADIME, RESIENO
PURITA YUMUL, MIGUEL ARABE, TERESITA ARJONA, RONALDO CAMPOMANES ADUL, ALBERTO TARSONA, CARLOS ALCANTARA, MAMERTO ALIAS, EMELITO
AND CARMENCITA ARDONI VDA. DE CAMPOMANES, ROGELIO DOMUNICO, in ALMONTE, BENILDA ALONUEVO, EMMA ABADILLO, REYNALDO CABALLES, JR.,
their capacity as heirs of the deceased (ROBERTO C. CAYLAO, SONNY "BOY" JAIME CALDETO, FABIAN CANTELEJO, RODRIGO CARABARA, ENRIQUE DELGADO,
PEREZ, DIONESIO BAUTISTA, DANTE EVANGELIO, ADELFA ARIBE, DANILO ARJONA, JUN DELOS SANTOS, MARIO DEMASACA, FRANCISCO GONZALES, ERNESTO
VICENTE CAMPOMANES, RONILO DOMUNICO) respectively; and (names of sixty- GONZALES, RAMIRO JAMIL, JUAN LUCENA, PERLITO SALAYSAY, JOHNNY SANTOS,
two injured victims) EDDIE AGUINALDO, FELICISIMO ALBASIA, NAPOLEON MARCELO SANTOS, EMIL SAYAO, BAYANI UMALI, REMIGIO MAHALIN, BONG
BAUTISTA, DANILO CRUZ, EDDIE MENSOLA, ALBERT PITALBO, VICENTE ROSEL, MANLULO, ARMANDO MATIENZO, CARLO MEDINA, LITO NOVENARIO, ROSELLA
RUBEN CARRIEDO, JOY CRUZ, HONORIO LABAMBA, JR., EFREN MACARAIG, ROBALE, petitioners,
SOLOMON MANALOTO, ROMEO DURAN, NILO TAGUBAT, JUN CARSELLAR, JOEY vs.
CLEMENTE, GERARDO COYOCA, LUISITO DACO, BENJAMIN DELA CRUZ, ARTHUR REPUBLIC OF THE PHILIPPINES, and HONORABLE EDILBERTO G. SANDOVAL,
FONTANILLA, WILSON GARCIA, CARLOS SIRAY, JOSE PERRAS, TOMAS VALLOS, Regional Trial Court of Manila, Branch 9, respondents.
ARNOLD ENAJE, MARIANITA DIMAPILIS, FRANCISCO ANGELES, MARCELO The Solicitor General for the Republic of the Philippines.
ESGUERRA, JOSE FERRER, RODEL DE GUIA, ELVIS MENDOZA, VICTORIANO Structural Alternative Legal Assistance for Grassroots for petitioners in 84645 &
QUIJANO, JOEY ADIME, RESIENO ADUL, ALBERTO TARSONA, CARLOS ALCANTARA, private respondents in 84607.
MAMERTO ALIAS, EMELITO ALMONTE, BENILDA ALONUEVO, EMMA ABADILLO,
REYNALDO CABALLES, JR., JAIME CALDETO, FABIAN CANTELEJO, RODRIGO CAMPOS, JR., J.:
CARABARA, ENRIQUE DELGADO, JUN DELOS SANTOS, MARIO DEMASACA, People may have already forgotten the tragedy that transpired on January 22,
FRANCISCO GONZALES, ERNESTO GONZALES, RAMIRO JAMIL, JUAN LUCENA, 1987. It is quite ironic that then, some journalists called it a Black Thursday, as a
PERLITO SALAYSAY, JOHNNY SANTOS, MARCELO SANTOS, EMIL SAYAO, BAYANI grim reminder to the nation of the misfortune that befell twelve (12) rallyists. But
for most Filipinos now, the Mendiola massacre may now just as well be a chapter The dialogue between the farmers and the MAR officials began on January 15,
in our history books. For those however, who have become widows and orphans, 1987. The two days that followed saw a marked increase in people at the
certainly they would not settle for just that. They seek retribution for the lives encampment. It was only on January 19, 1987 that Jaime Tadeo arrived to meet
taken that will never be brought back to life again. with then Minister Heherson Alvarez, only to be informed that the Minister can only
Hence, the heirs of the deceased, together with those injured (Caylao group), meet with him the following day. On January 20, 1987, the meeting was held at the
instituted this petition, docketed as G.R. No. 84645, under Section 1 of Rule 65 of MAR conference room. Tadeo demanded that the minimum comprehensive land
the Rules of Court, seeking the reversal and setting aside of the Orders of reform program be granted immediately. Minister Alvarez, for his part, can only
respondent Judge Sandoval,1 dated May 31 and August 8, 1988, dismissing the promise to do his best to bring the matter to the attention of then President
complaint for damages of herein petitioners against the Republic of the Philippines Aquino, during the cabinet meeting on January 21, 1987.
in Civil Case No. 88-43351. Tension mounted the following day. The farmers, now on their seventh day of
Petitioner, the Republic of the Philippines, through a similar remedy, docketed as encampment, barricaded the MAR premises and prevented the employees from
G.R. No. 84607, seeks to set aside the Order of respondent Judge dated May 31, going inside their offices. They hoisted the KMP flag together with the Philippine
1988, in Civil Case No. 88-43351 entitled "Erlinda Caylao, et al. vs. Republic of the flag.
Philippines, et al." At around 6:30 p.m. of the same day, Minister Alvarez, in a meeting with Tadeo and
The pertinent portion of the questioned Order2 dated May 31, 1988, reads as his leaders, advised the latter to instead wait for the ratification of the 1987
follows: Constitution and just allow the government to implement its comprehensive land
With respect however to the other defendants, the impleaded Military Officers, reform program. Tadeo, however, countered by saying that he did not believe in
since they are being charged in their personal and official capacity, and holding the Constitution and that a genuine land reform cannot be realized under a
them liable, if at all, would not result in financial responsibility of the government, landlord-controlled Congress. A heated discussion ensued between Tadeo and
the principle of immunity from suit can not conveniently and correspondingly be Minister Alvarez. This notwithstanding, Minister Alvarez suggested a negotiating
applied to them. panel from each side to meet again the following day.
WHEREFORE, the case as against the defendant Republic of the Philippines is On January 22, 1987, Tadeo's group instead decided to march to Malacañang to air
hereby dismissed. As against the rest of the defendants the motion to dismiss is their demands. Before the march started, Tadeo talked to the press and TV media.
denied. They are given a period of ten (10) days from receipt of this order within He uttered fiery words, the most telling of which were:
which to file their respective pleadings. ". . . inalis namin ang barikada bilang kahilingan ng ating Presidente, pero
On the other hand, the Order3 , dated August 8, 1988, denied the motions filed by kinakailangan alisin din niya ang barikada sa Mendiola sapagkat bubutasin din
both parties, for a reconsideration of the abovecited Order, respondent Judge namin iyon at dadanak ang dugo . . . ."4
finding no cogent reason to disturb the said order. The farmers then proceeded to march to Malacañang, from Quezon Memorial
The massacre was the culmination of eight days and seven nights of encampment Circle, at 10:00 a.m. They were later joined by members of other sectoral
by members of the militant Kilusang Magbubukid sa Pilipinas (KMP) at the then organizations such as the Kilusang Mayo Uno (KMU), Bagong Alyansang Makabayan
Ministry (now Department) of Agrarian Reform (MAR) at the Philippine Tobacco (BAYAN), League of Filipino Students (LFS) and Kongreso ng Pagkakaisa ng
Administration Building along Elliptical Road in Diliman, Quezon City. Maralitang Lungsod (KPML).
The farmers and their sympathizers presented their demands for what they called At around 1:00 p.m., the marchers reached Liwasang Bonifacio where they held a
"genuine agrarian reform". The KMP, led by its national president, Jaime Tadeo, brief program. It was at this point that some of the marchers entered the eastern
presented their problems and demands, among which were: (a) giving lands for free side of the Post Office Building, and removed the steel bars surrounding the garden.
to farmers; (b) zero retention of lands by landlords; and (c) stop amortizations of Thereafter, they joined the march to Malacañang. At about 4:30 p.m., they reached
land payments. C.M. Recto Avenue.
In anticipation of a civil disturbance, and acting upon reports received by the Capital side of the street and eight fire trucks, four trucks on each side of the street. The
Regional Command (CAPCOM) that the rallyists would proceed to Mendiola to eight fire trucks from Fire District I of Manila under Fire Superintendent Mario C.
break through the police lines and rush towards Malacañang, CAPCOM Commander Tanchanco, were to supply water to the two water cannons.
General Ramon E. Montaño inspected the preparations and adequacy of the Stationed farther behind the CDC forces were the two Mobile Dispersal Teams
government forces to quell impending attacks. (MDT) each composed of two tear gas grenadiers, two spotters, an assistant
OPLAN YELLOW (Revised) was put into effect. Task Force Nazareno under the grenadier, a driver and the team leader.
command of Col. Cesar Nazareno was deployed at the vicinity of Malacañang. The In front of the College of the Holy Spirit near Gate 4 of Malacañang stood the
civil disturbance control units of the Western Police District under Police Brigadier VOLVO Mobile Communications Van of the Commanding General of CAPCOM/INP,
General Alfredo S. Lim were also activated. General Ramon E. Montaño. At this command post, after General Montaño had
Intelligence reports were also received that the KMP was heavily infiltrated by conferred with TF Nazareno Commander, Colonel Cezar Nazareno, about the
CPP/NPA elements and that an insurrection was impending. The threat seemed adequacy and readiness of his forces, it was agreed that Police General Alfredo S.
grave as there were also reports that San Beda College and Centro Escolar Lim would designate Police Colonel Edgar Dula Torres and Police Major Conrado
University would be forcibly occupied. Francisco as negotiators with the marchers. Police General Lim then proceeded to
In its report, the Citizens' Mendiola Commission (a body specifically tasked to the WPD CDC elements already positioned at the foot of Mendiola bridge to relay
investigate the facts surrounding the incident, Commission for short) stated that to Police Colonel Torres and Police Major Francisco the instructions that the latter
the government anti-riot forces were assembled at Mendiola in a formation of would negotiate with the marchers.5 (Emphasis supplied)
three phalanges, in the following manner: The marchers, at around 4:30 p.m., numbered about 10,000 to 15,000. From C.M.
(1) The first line was composed of policemen from police stations Nos. 3, 4, 6, Recto Avenue, they proceeded toward the police lines. No dialogue took place
7, 8, 9 and 10 and the Chinatown detachment of the Western Police District. Police between the marchers and the anti-riot squad. It was at this moment that a clash
Colonel Edgar Dula Torres, Deputy Superintendent of the Western Police District, occurred and, borrowing the words of the Commission "pandemonium broke
was designated as ground commander of the CDC first line of defense. The WPD loose". The Commission stated in its findings, to wit:
CDC elements were positioned at the intersection of Mendiola and Legarda Streets . . . There was an explosion followed by throwing of pillboxes, stones and bottles.
after they were ordered to move forward from the top of Mendiola bridge. The Steel bars, wooden clubs and lead pipes were used against the police. The police
WPD forces were in khaki uniform and carried the standard CDC equipment — fought back with their shields and truncheons. The police line was breached.
aluminum shields, truncheons and gas masks. Suddenly shots were heard. The demonstrators disengaged from the government
(2) At the second line of defense about ten (10) yards behind the WPD forces and retreated towards C.M. Recto Avenue. But sporadic firing continued
policemen were the elements of the Integrated National Police (INP) Field Force from the government forces.
stationed at Fort Bonifacio from the 61st and 62nd INP Field Force, who carried also After the firing ceased, two MDTs headed by Lt. Romeo Paquinto and Lt. Laonglaan
the standard CDC equipment — truncheons, shields and gas masks. The INP Field Goce sped towards Legarda Street and lobbed tear gas at the remaining rallyist still
Force was under the command of Police Major Demetrio dela Cruz. grouped in the vicinity of Mendiola. After dispersing the crowd, the two MDTs,
(3) Forming the third line was the Marine Civil Disturbance Control Battalion together with the two WPD MDTs, proceeded to Liwasang Bonifacio upon order of
composed of the first and second companies of the Philippine Marines stationed at General Montaño to disperse the rallyists assembled thereat. Assisting the MDTs
Fort Bonifacio. The marines were all equipped with shields, truncheons and M-16 were a number of policemen from the WPD, attired in civilian clothes with white
rifles (armalites) slung at their backs, under the command of Major Felimon B. head bands, who were armed with long firearms. 6 (Emphasis ours)
Gasmin. The Marine CDC Battalion was positioned in line formation ten (10) yards After the clash, twelve (12) marchers were officially confirmed dead, although
farther behind the INP Field Force. according to Tadeo, there were thirteen (13) dead, but he was not able to give the
At the back of the marines were four (4) 6 x 6 army trucks, occupying the entire name and address of said victim. Thirty-nine (39) were wounded by gunshots and
width of Mendiola street, followed immediately by two water cannons, one on each twelve (12) sustained minor injuries, all belonging to the group of the marchers.
Of the police and military personnel, three (3) sustained gunshot wounds and (6) The KMP farmers broke off further negotiations with the MAR officials and
twenty (20) suffered minor physical injuries such as abrasions, contusions and the were determined to march to Malacañang, emboldened as they are, by the
like. inflammatory and incendiary utterances of their leader, Jaime Tadeo — "bubutasin
In the aftermath of the confrontation, then President Corazon C. Aquino issued namin ang barikada . . Dadanak and dugo . . . Ang nagugutom na magsasaka ay
Administrative Order No. 11,7(A.O. 11, for brevity) dated January 22, 1987, which gagawa ng sariling butas. . .
created the Citizens' Mendiola Commission. The body was composed of retired (7) There was no dialogue between the rallyists and the government forces.
Supreme Court Justice Vicente Abad Santos as Chairman, retired Supreme Court Upon approaching the intersections of Legarda and Mendiola, the marchers began
Justice Jose Y. Feria and Mr. Antonio U. Miranda, both as members. A.O. 11 stated pushing the police lines and penetrated and broke through the first line of the CDC
that the Commission was created precisely for the "purpose of conducting an contingent.
investigation of the disorder, deaths, and casualties that took place in the vicinity of (8) The police fought back with their truncheons and shields. They stood their
Mendiola Bridge and Mendiola Street and Claro M. Recto Avenue, Manila, in the ground but the CDC line was breached. There ensued gunfire from both sides. It is
afternoon of January 22, 1987". The Commission was expected to have submitted not clear who started the firing.
its findings not later than February 6, 1987. But it failed to do so. Consequently, the (9) At the onset of the disturbance and violence, the water cannons and tear
deadline was moved to February 16, 1987 by Administrative Order No. 13. Again, gas were not put into effective use to disperse the rioting crowd.
the Commission was unable to meet this deadline. Finally, on February 27, 1987, it (10) The water cannons and fire trucks were not put into operation because (a)
submitted its report, in accordance with Administrative Order No. 17, issued on there was no order to use them; (b) they were incorrectly prepositioned; and (c)
February 11, 1987. they were out of range of the marchers.
In its report, the Commission recapitulated its findings, to wit: (11) Tear gas was not used at the start of the disturbance to disperse the
(1) The march to Mendiola of the KMP led by Jaime Tadeo, together with the rioters. After the crowd had dispersed and the wounded and dead were being
other sectoral groups, was not covered by any permit as required under Batas carried away, the MDTs of the police and the military with their tear gas equipment
Pambansa Blg. 880, the Public Assembly Act of 1985, in violation of paragraph (a) and components conducted dispersal operations in the Mendiola area and
Section 13, punishable under paragraph (a), Section 14 of said law. proceeded to Liwasang Bonifacio to disperse the remnants of the marchers.
(2) The crowd dispersal control units of the police and the military were (12) No barbed wire barricade was used in Mendiola but no official reason was
armed with .38 and .45 caliber handguns, and M-16 armalites, which is a prohibited given for its absence.8
act under paragraph 4(g), Section 13, and punishable under paragraph (b), Section From the results of the probe, the Commission recommended 9 the criminal
14 of Batas Pambansa Blg. 880. prosecution of four unidentified, uniformed individuals, shown either on tape or in
(3) The security men assigned to protect the WPD, INP Field Force, the pictures, firing at the direction of the marchers. In connection with this, it was the
Marines and supporting military units, as well as the security officers of the police Commission's recommendation that the National Bureau of Investigation (NBI) be
and military commanders were in civilian attire in violation of paragraph (a), Section tasked to undertake investigations regarding the identities of those who actually
10, Batas Pambansa 880. fired their guns that resulted in the death of or injury to the victims of the incident.
(4) There was unnecessary firing by the police and military crowd dispersal The Commission also suggested that all the commissioned officers of both the
control units in dispersing the marchers, a prohibited act under paragraph (e), Western Police District and the INP Field Force, who were armed during the
Section 13, and punishable under paragraph (b), Section 14, Batas Pambansa Blg. incident, be prosecuted for violation of paragraph 4(g) of Section 13, Batas
880. Pambansa Blg. 880, the Public Assembly Act of 1985. The Commission's
(5) The carrying and use of steel bars, pillboxes, darts, lead pipe, wooden clubs recommendation also included the prosecution of the marchers, for carrying deadly
with spikes, and guns by the marchers as offensive weapons are prohibited acts or offensive weapons, but whose identities have yet to be established. As for Jaime
punishable under paragraph (g), Section 13, and punishable under paragraph (e), Tadeo, the Commission said that he should be prosecuted both for violation of
Section 14 of Batas Pambansa Blg. 880. paragraph (a), Section 13, Batas Pambansa Blg. 880 for holding the rally without a
permit and for violation of Article 142, as amended, of the Revised Penal Code for Having arisen from the same factual beginnings and raising practically identical
inciting to sedition. As for the following officers, namely: (1) Gen. Ramon E. issues, the two (2) petitions were consolidated and will therefore be jointly dealt
Montaño; (2) Police Gen. Alfredo S. Lim; (3) Police Gen. Edgar Dula Torres; (4) Police with and resolved in this Decision.
Maj. Demetrio dela Cruz; (5) Col. Cezar Nazareno; and (5) Maj. Felimon Gasmin, for The resolution of both petitions revolves around the main issue of whether or not
their failure to make effective use of their skill and experience in directing the the State has waived its immunity from suit.
dispersal operations in Mendiola, administrative sanctions were recommended to Petitioners (Caylao group) advance the argument that the State has impliedly
be imposed. waived its sovereign immunity from suit. It is their considered view that by the
The last and the most significant recommendation of the Commission was for the recommendation made by the Commission for the government to indemnify the
deceased and wounded victims of the Mendiola incident to be compensated by the heirs and victims of the Mendiola incident and by the public addresses made by
government. It was this portion that petitioners (Caylao group) invoke in their claim then President Aquino in the aftermath of the killings, the State has consented to
for damages from the government. be sued.
Notwithstanding such recommendation, no concrete form of compensation was Under our Constitution the principle of immunity of the government from suit is
received by the victims. Thus, on July 27, 1987, herein petitioners, (Caylao group) expressly provided in Article XVI, Section 3. The principle is based on the very
filed a formal letter of demand for compensation from the Government. 10 This essence of sovereignty, and on the practical ground that there can be no legal right
formal demand was indorsed by the office of the Executive Secretary to the as against the authority that makes the law on which the right depends. 12 It also
Department of Budget and Management (DBM) on August 13, 1987. The House rests on reasons of public policy — that public service would be hindered, and the
Committee on Human Rights, on February 10, 1988, recommended the expeditious public endangered, if the sovereign authority could be subjected to law suits at the
payment of compensation to the Mendiola victims. 11 instance of every citizen and consequently controlled in the uses and dispositions of
After almost a year, on January 20, 1988, petitioners (Caylao group) were the means required for the proper administration of the government. 13
constrained to institute an action for damages against the Republic of the This is not a suit against the State with its consent.
Philippines, together with the military officers, and personnel involved in the Firstly, the recommendation made by the Commission regarding indemnification of
Mendiola incident, before the trial court. The complaint was docketed as Civil Case the heirs of the deceased and the victims of the incident by the government does
No. 88-43351. not in any way mean that liability automatically attaches to the State. It is
On February 23, 1988, the Solicitor General filed a Motion to Dismiss on the ground important to note that A.O. 11 expressly states that the purpose of creating the
that the State cannot be sued without its consent. Petitioners opposed said motion Commission was to have a body that will conduct an "investigation of the disorder,
on March 16, 1988, maintaining that the State has waived its immunity from suit deaths and casualties that took place." 14 In the exercise of its functions, A.O. 11
and that the dismissal of the instant action is contrary to both the Constitution and provides guidelines, and what is relevant to Our discussion reads:
the International Law on Human Rights. 1 Its conclusions regarding the existence of probable cause for the
Respondent Judge Sandoval, in his first questioned Order, dismissed the complaint commission of any offense and of the persons probably guilty of the same shall be
as against the Republic of the Philippines on the ground that there was no waiver by sufficient compliance with the rules on preliminary investigation and the charges
the State. Petitioners (Caylao group) filed a Motion for Reconsideration therefrom, arising therefrom may be filed directly with the proper court. 15
but the same was denied by respondent judge in his Order dated August 8, 1988. In effect, whatever may be the findings of the Commission, the same shall only
Consequently, Caylao and her co-petitioners filed the instant petition. serve as the cause of action in the event that any party decides to litigate his/her
On the other hand, the Republic of the Philippines, together with the military claim. Therefore, the Commission is merely a preliminary venue. The Commission is
officers and personnel impleaded as defendants in the court below, filed its petition not the end in itself. Whatever recommendation it makes cannot in any way bind
for certiorari. the State immediately, such recommendation not having become final and,
executory. This is precisely the essence of it being a fact-finding body.
Secondly, whatever acts or utterances that then President Aquino may have done given its consent, it cannot be invoked by both the military officers to release them
or said, the same are not tantamount to the State having waived its immunity from from any liability, and by the heirs and victims to demand indemnification from the
suit. The President's act of joining the marchers, days after the incident, does not government. The principle of state immunity from suit does not apply, as in this
mean that there was an admission by the State of any liability. In fact to borrow the case, when the relief demanded by the suit requires no affirmative official action on
words of petitioners (Caylao group), "it was an act of solidarity by the government the part of the State nor the affirmative discharge of any obligation which belongs
with the people". Moreover, petitioners rely on President Aquino's speech to the State in its political capacity, even though the officers or agents who are
promising that the government would address the grievances of the rallyists. By this made defendants claim to hold or act only by virtue of a title of the state and as its
alone, it cannot be inferred that the State has admitted any liability, much less can agents and servants. 22 This Court has made it quite clear that even a "high position
it be inferred that it has consented to the suit. in the government does not confer a license to persecute or recklessly injure
Although consent to be sued may be given impliedly, still it cannot be maintained another." 23
that such consent was given considering the circumstances obtaining in the instant The inescapable conclusion is that the State cannot be held civilly liable for the
case. deaths that followed the incident. Instead, the liability should fall on the named
Thirdly, the case does not qualify as a suit against the State. defendants in the lower court. In line with the ruling of this court in Shauf vs. Court
Some instances when a suit against the State is proper are: 16 of Appeals, 24 herein public officials, having been found to have acted beyond the
(1) When the Republic is sued by name; scope of their authority, may be held liable for damages.
(2) When the suit is against an unincorporated government agency; WHEREFORE, finding no reversible error and no grave abuse of discretion
(3) When the, suit is on its face against a government officer but the case is committed by respondent Judge in issuing the questioned orders, the instant
such that ultimate liability will belong not to the officer but to the government. petitions are hereby DISMISSED.
While the Republic in this case is sued by name, the ultimate liability does not SO ORDERED.
pertain to the government. Although the military officers and personnel, then party
defendants, were discharging their official functions when the incident occurred, G.R. No. L-5156 March 11, 1954
their functions ceased to be official the moment they exceeded their authority. CARMEN FESTEJO, demandante-apelante,
Based on the Commission findings, there was lack of justification by the vs.
government forces in the use of firearms. 17 Moreover, the members of the police ISAIAS FERNANDO, Director de Obras Publicas, demandado-apelado.
and military crowd dispersal units committed a prohibited act under B.P. Blg. 880 18 D. Eloy B. Bello en representacion de la apelante.
as there was unnecessary firing by them in dispersing the marchers. 19 El Procurador General Sr. Pompeyo Diaz y el Procurador Sr. Antonio A. Torres en
As early as 1954, this Court has pronounced that an officer cannot shelter himself representacion del apelado.
by the plea that he is a public agent acting under the color of his office when his DIOKNO, J.:
acts are wholly without authority. 20 Until recently in 1991, 21 this doctrine still Carmen Festejo, dueña de unos terrenos azucareros, de un total de unas 9
found application, this Court saying that immunity from suit cannot institutionalize hectareas y media de superfice, demando a "Isaias Fernando Director, Bureau of
irresponsibility and non-accountability nor grant a privileged status not claimed by public Works, que como tal Director de Obras Publicas tiene a su cargo los sistemas
any other official of the Republic. The military and police forces were deployed to y proyectos de irrigacion y es el funcionario responsable de la construccion de los
ensure that the rally would be peaceful and orderly as well as to guarantee the sistemas de irrigacion en el pais," alegando que —
safety of the very people that they are duty-bound to protect. However, the facts as The defendant, as Director of the Bureau of Public Works, without authority
found by the trial court showed that they fired at the unruly crowd to disperse the obtained first from the Court of First Instance of Ilocos Sur, without obtaining first a
latter. right of way, and without the consent and knowledge of the plaintiff, and against
While it is true that nothing is better settled than the general rule that a sovereign her express objection unlawfully took possession of portions of the three parcels of
state and its political subdivisions cannot be sued in the courts except when it has land described above, and caused an irrigation canal to be constructed on the
portion of the three parcels of land on or about the month of February 1951 the held to have designedly departed from the duties imposed on him by law. There
aggregate area being 24,179 square meters to the damage and prejudice of the can be no claim that he thus invaded plaintiff's land southeasterly of the right of
plaintiff. ----- R. on A., p. 3. way innocently. Surveys clearly marked the limits of the land appropriated for the
causando a ella variados daños y perjuicios. Pidio, en su consecuencia, sentencia right of way of this trunk highway before construction began. . . .
condenando el demandado: "Ratification may be equivalent to command, and cooperation may be inferred
. . . to return or cause to be returned the possession of the portions of land from acquiescence where there is power to restrain." It is unnecessary to consider
unlawfully occupied and appropriated in the aggregate area of 24,179 square other cases cited, . . ., for as before suggested, the jury could find or infer that, in so
meters and to return the land to its former condition under the expenses of the far as there was actual trespass by appropriation of plaintiff's land as a dumping
defendant. . . . place for the rock to be removed from the additional appropriated right of way,
In the remote event that the portions of land unlawfully occupied and appropriated defendant planned, approved, and ratified what was done by his subordinates. —
can not be returned to the plaintiff, then to order the defendant to pay to the Nelson vs. Bobcock, 90 A.L.R., 1472, 1476, 1477.
plaintiff the sum of P19,343.20 as value of the portions totalling an area of 24,179 La doctrina sobre la responsabilidad civil de los funcionarios en casos parecidos se
square meters; ---- R. on A., p. 5. resume como sigue:
y ademas a pagar P9,756.19 de daños y P5,000 de honorarios de abogado, con las Ordinarily the officer or employee committing the tort is personally liable therefor,
costas R. on A., pp. 5-6. and may be sued as any other citizen and held answerable for whatever injury or
El demandado, por medio del Procurador General, presento mocion de damage results from his tortious act. — 49 Am. Jur. 289.
sobreseimiento de la demanda por el fundamento de que el Juzgado no tiene . . . If an officer, even while acting under color of his office, exceeds the power
jurisdiccion para dictar sentencia valida contra el, toda vez que judicialmente la conferred on him by law, he cannot shelter himself under the plea that he is a
reclamacion es contra la Republica de Filipinas, y esta no ha presentado su public agent. — 43 Am. Jur. 86.
consentimiento a la demanda. El Juzgado inferior estimo la mocion y sobreseyo la It is a general rule that an officer-executive, administrative quasi-judicial,
demanda sin perjuicio y sin costas. ministerial, or otherwise who acts outside the scope of his jurisdiction and without
En apelacion, la demandante sostiene que fue un error considerar la demanda authorization of law may thereby render himself amenable to personal liability in a
como una contra la Republica y sobreseer en su virtud la demanda. civil suit. If he exceed the power conferred on him by law, he cannot shelter himself
La mocion contra "Isaias Fernando, Director de Obras Publicas, encargado y by the plea that he is a public agent acting under the color of his office, and not
responsable de la construccion de los sistemas de irrigacion en Filipinas" es una personally. In the eye of the law, his acts then are wholly without authority. — 43
dirigida personalmente contra el, por actos que asumio ejecutar en su concepto Am. Jur. 89-90.
oficial. La ley no le exime de responsabilidad por las extralimitaciones que cometa o El articulo 32 del Codigo Civil dice a su vez:
haga cometer en el desempeño de sus funciones oficiales. Un caso semejante es el ART. 32. Any public officer or emplyee, or any private individual, who directly or
de Nelson vs. Bobcock (1933) 18 minn. 584, NW 49, 90 ALR 1472. Alli el indirectly obstructs, defeats, violates or in any manner impedes or impairs any of
Comisionado de Carreteras, al mejorar un trozo de la carretera ocupo o se apropio the following rights and liberties of another person shall be liable to the latter for
de terrenos contiguos al derecho de paso. El Tribunal Supremo del Estado declaro damages:
que espersonalmente responsable al dueño de los daños causados. Declaro ademas xxx xxx xxx
que la ratificacion de lo que hicieron sus subordinados era equivalente a una orden (6) The right against deprivation of property without due process of law;
a los mismos. He aqui lo dijo el Tribunal. xxx xxx xxx
We think the evidence and conceded facts permitted the jury in finding that in the In any of the cases referred to this article, whether or not the defendant's acts or
trespass on plaintiff's land defendant committed acts outside the scope of his omission constitutes a criminal offense, the aggrieved party has a right ot
authority. When he went outside the boundaries of the right of way upon plaintiff's commence an entirely separate and distinct civil action for damages, and for other
land and damaged it or destroyed its former condition an dusefulness, he must be
relief. Such civil action shall proceed independently of any criminal prosecution (if 24,179 square meters and to return the land to its former condition under the
the latter be instituted), and may be proved by a preponderance of evidence. expense of the defendant. (Paragraph a, of the complaint).
The inmdemnity shall include moral damages Exemplary damages may also be We take judicial notice of the fact that the irrigation projects and system reffered to
adjudicated. in the complaint — of which the defendant, Isaias Fernando, according to the same
Veanse tambien Lung vs. Aldanese, 45 Phil., 784; Syquia vs. Almeda, No. L-1648, pleading, is "in charge" and for which he is "responsible" as Director of the Bureau
Agosto 17, 1947; Marquez vs. Nelson, No. L-2412, Septiembre 1950. of Public Works — are established and operated with public funds, which pursuant
Se revoca la orden apelada y se ordena la continuacion de la tramitacion de la to the Constitution, must be appropriated by law. Irrespective of the manner in
demanda conforme proveen los reglamentos. Sin especial pronunciamiento en which the construction may have been undertaken by the Bureau of Public Works,
cuanto a las costas. Asi se ordena. the system or canal is, therefore, a property of the Government. Consequently, in
Padilla, Reyes, Jugo, Bautista Angelo and Labrador, MM., estan conformes. praying that possession of the portions of land occupied by the irrigation canal
involved in the present case be returned to plaintiff therein, and that said land be
Separate Opinions restored to its former condition, plaintiff seeks to divest the Government of its
CONCEPCION, J., dissenting: possession of said irrigation canal, and, what is worse, to cause said property of the
To my mind, the allegations of the complaint lead to no other conclusion than that Government to be removed or destroyed. As held in Syquia vs. Lopez (47 Off. Gaz.,
appellee Isaias Fernando is a party in this case, not in his personal capacity, but as 665), the Government is, accordingly, "the real party in interest as defendant" in
an officer of the Government. According to said pleading the defendant is "Isaias the case at bar. In other words, the same partakes of the nature of a suit against the
Fernando, Director, Bureau of Public Works." Moreover, in paragraphs 4 and 5 of state and may not be maintained without its consent.
the complaint, it is alleged: Hence I am constrained to dissent.
4. That the defendant as Director of the Bureau of Public Works, is in charge of Bengzon, J., concurs.
irrigation projects and systems, and the official responsible for the construction of
irrigation system in the Philippines; G.R. No. 76607 February 26, 1990
5. That the defendant, as Director of the Bureau of Public Works, without authority UNITED STATES OF AMERICA, FREDERICK M. SMOUSE AND YVONNE REEVES,
obtained first from the Court of First Instance of Ilocos Sur, without obtaining first a petitioners,
right of way, and without the consent and knowledge of the plaintiff, and against vs.
her express objection, unlawfully took possession of portions of the three parcels of HON. ELIODORO B. GUINTO, Presiding Judge, Branch LVII, Regional Trial Court,
land described above, and caused an irrigation canal to be constructed on the Angeles City, ROBERTO T. VALENCIA, EMERENCIANA C. TANGLAO, AND PABLO C.
portion of the three parcels of land on or about the month of February 1951 the DEL PILAR, respondents.
aggregate area being 24,179 square meters to the damage and prejudice of the G.R. No. 79470 February 26, 1990
plaintiff. (Emphasis supplied.) UNITED STATES OF AMERICA, ANTHONY LAMACHIA, T/SGT. USAF, WILFREDO
The emphasis thus placed upon the allegation that the acts complained of were BELSA, PETER ORASCION AND ROSE CARTALLA, petitioners,
performed by said defendant "as Director of the Bureau of Public Works," clearly vs.
shows that the designation of his office was included in the title of the case to HON. RODOLFO D. RODRIGO, as Presiding Judge of Branch 7, Regional Trial Court
indicate that he was being sued in his official capacity. This conclusion is bolstered (BAGUIO CITY), La Trinidad, Benguet and FABIAN GENOVE, respondents.
up by the fact that, among other things, plaintiff prays, in the complaint, for a G.R. No. 80018 February 26, 1990
judgment UNITED STATES OF AMERICA, TOMI J. KINGI, DARREL D. DYE and STEVEN F.
Ordering the defendant to return or caused to be returned the possession of the BOSTICK, petitioners,
portions of land unlawfully occupied and appropriated in the aggregate area of vs.
HON. JOSEFINA D. CEBALLOS, As Presiding Judge, Regional Trial Court, Branch 66, 1986. They further explained that the solicitation of the CE barbershop would be
Capas, Tarlac, and LUIS BAUTISTA, respondents. available only by the end of June and the private respondents would be notified.
G.R. No. 80258 February 26, 1990 On June 30, 1986, the private respondents filed a complaint in the court below to
UNITED STATES OF AMERICA, MAJOR GENERAL MICHAEL P. C. CARNS, AIC ERNEST compel PHAX and the individual petitioners to cancel the award to defendant
E. RIVENBURGH, AIC ROBIN BLEVINS, SGT. NOEL A. GONZALES, SGT. THOMAS Dizon, to conduct a rebidding for the barbershop concessions and to allow the
MITCHELL, SGT. WAYNE L. BENJAMIN, ET AL., petitioners, private respondents by a writ of preliminary injunction to continue operating the
vs. concessions pending litigation. 1
HON. CONCEPCION S. ALARCON VERGARA, as Presiding Judge, Branch 62 Upon the filing of the complaint, the respondent court issued an ex parte order
REGIONAL TRIAL COURT, Angeles City, and RICKY SANCHEZ, FREDDIE SANCHEZ directing the individual petitioners to maintain the status quo.
AKA FREDDIE RIVERA, EDWIN MARIANO, AKA JESSIE DOLORES SANGALANG, ET On July 22, 1986, the petitioners filed a motion to dismiss and opposition to the
AL., respondents. petition for preliminary injunction on the ground that the action was in effect a
Luna, Sison & Manas Law Office for petitioners. suit against the United States of America, which had not waived its non-suability.
The individual defendants, as official employees of the U.S. Air Force, were also
CRUZ, J.: immune from suit.
These cases have been consolidated because they all involve the doctrine of state On the same date, July 22, 1986, the trial court denied the application for a writ of
immunity. The United States of America was not impleaded in the complaints preliminary injunction.
below but has moved to dismiss on the ground that they are in effect suits against On October 10, 1988, the trial court denied the petitioners' motion to dismiss,
it to which it has not consented. It is now contesting the denial of its motions by holding in part as follows:
the respondent judges. From the pleadings thus far presented to this Court by the parties, the Court's
In G.R. No. 76607, the private respondents are suing several officers of the U.S. attention is called by the relationship between the plaintiffs as well as the
Air Force stationed in Clark Air Base in connection with the bidding conducted by defendants, including the US Government, in that prior to the bidding or
them for contracts for barber services in the said base. solicitation in question, there was a binding contract between the plaintiffs as
On February 24, 1986, the Western Pacific Contracting Office, Okinawa Area well as the defendants, including the US Government. By virtue of said contract of
Exchange, U.S. Air Force, solicited bids for such contracts through its contracting concession it is the Court's understanding that neither the US Government nor the
officer, James F. Shaw. Among those who submitted their bids were private herein principal defendants would become the employer/s of the plaintiffs but
respondents Roberto T. Valencia, Emerenciana C. Tanglao, and Pablo C. del Pilar. that the latter are the employers themselves of the barbers, etc. with the
Valencia had been a concessionaire inside Clark for 34 years; del Pilar for 12 years; employer, the plaintiffs herein, remitting the stipulated percentage of
and Tanglao for 50 years. commissions to the Philippine Area Exchange. The same circumstance would
The bidding was won by Ramon Dizon, over the objection of the private become in effect when the Philippine Area Exchange opened for bidding or
respondents, who claimed that he had made a bid for four facilities, including the solicitation the questioned barber shop concessions. To this extent, therefore,
Civil Engineering Area, which was not included in the invitation to bid. indeed a commercial transaction has been entered, and for purposes of the said
The private respondents complained to the Philippine Area Exchange (PHAX). The solicitation, would necessarily be entered between the plaintiffs as well as the
latter, through its representatives, petitioners Yvonne Reeves and Frederic M. defendants.
Smouse explained that the Civil Engineering concession had not been awarded to The Court, further, is of the view that Article XVIII of the RP-US Bases Agreement
Dizon as a result of the February 24, 1986 solicitation. Dizon was already does not cover such kind of services falling under the concessionaireship, such as
operating this concession, then known as the NCO club concession, and the a barber shop concession. 2
expiration of the contract had been extended from June 30, 1986 to August 31,
On December 11, 1986, following the filing of the herein petition for certiorari and made by them, an information for violation of R.A. 6425, otherwise known as the
prohibition with preliminary injunction, we issued a temporary restraining order Dangerous Drugs Act, was filed against Bautista in the Regional Trial Court of Tarlac.
against further proceedings in the court below. 3 The above-named officers testified against him at his trial. As a result of the filing of
In G.R. No. 79470, Fabian Genove filed a complaint for damages against petitioners the charge, Bautista was dismissed from his employment. He then filed a complaint
Anthony Lamachia, Wilfredo Belsa, Rose Cartalla and Peter Orascion for his for damages against the individual petitioners herein claiming that it was because of
dismissal as cook in the U.S. Air Force Recreation Center at the John Hay Air Station their acts that he was removed. 6
in Baguio City. It had been ascertained after investigation, from the testimony of During the period for filing of the answer, Mariano Y. Navarro a special counsel
Belsa Cartalla and Orascion, that Genove had poured urine into the soup stock used assigned to the International Law Division, Office of the Staff Judge Advocate of
in cooking the vegetables served to the club customers. Lamachia, as club manager, Clark Air Base, entered a special appearance for the defendants and moved for an
suspended him and thereafter referred the case to a board of arbitrators extension within which to file an "answer and/or other pleadings." His reason was
conformably to the collective bargaining agreement between the Center and its that the Attorney General of the United States had not yet designated counsel to
employees. The board unanimously found him guilty and recommended his represent the defendants, who were being sued for their official acts. Within the
dismissal. This was effected on March 5, 1986, by Col. David C. Kimball, Commander extended period, the defendants, without the assistance of counsel or authority
of the 3rd Combat Support Group, PACAF Clark Air Force Base. Genove's reaction from the U.S. Department of Justice, filed their answer. They alleged therein as
was to file Ms complaint in the Regional Trial Court of Baguio City against the affirmative defenses that they had only done their duty in the enforcement of the
individual petitioners. 4 laws of the Philippines inside the American bases pursuant to the RP-US Military
On March 13, 1987, the defendants, joined by the United States of America, moved Bases Agreement.
to dismiss the complaint, alleging that Lamachia, as an officer of the U.S. Air Force On May 7, 1987, the law firm of Luna, Sison and Manas, having been retained to
stationed at John Hay Air Station, was immune from suit for the acts done by him in represent the defendants, filed with leave of court a motion to withdraw the
his official capacity. They argued that the suit was in effect against the United answer and dismiss the complaint. The ground invoked was that the defendants
States, which had not given its consent to be sued. were acting in their official capacity when they did the acts complained of and that
This motion was denied by the respondent judge on June 4, 1987, in an order which the complaint against them was in effect a suit against the United States without its
read in part: consent.
It is the understanding of the Court, based on the allegations of the complaint — The motion was denied by the respondent judge in his order dated September 11,
which have been hypothetically admitted by defendants upon the filing of their 1987, which held that the claimed immunity under the Military Bases Agreement
motion to dismiss — that although defendants acted initially in their official covered only criminal and not civil cases. Moreover, the defendants had come
capacities, their going beyond what their functions called for brought them out of under the jurisdiction of the court when they submitted their answer. 7
the protective mantle of whatever immunities they may have had in the beginning. Following the filing of the herein petition for certiorari and prohibition with
Thus, the allegation that the acts complained of were illegal, done. with extreme preliminary injunction, we issued on October 14, 1987, a temporary restraining
bad faith and with pre-conceived sinister plan to harass and finally dismiss the order. 8
plaintiff, gains significance. 5 In G.R. No. 80258, a complaint for damages was filed by the private respondents
The petitioners then came to this Court seeking certiorari and prohibition with against the herein petitioners (except the United States of America), for injuries
preliminary injunction. allegedly sustained by the plaintiffs as a result of the acts of the defendants. 9 There
In G.R. No. 80018, Luis Bautista, who was employed as a barracks boy in Camp O' is a conflict of factual allegations here. According to the plaintiffs, the defendants
Donnell, an extension of Clark Air Base, was arrested following a buy-bust operation beat them up, handcuffed them and unleashed dogs on them which bit them in
conducted by the individual petitioners herein, namely, Tomi J. King, Darrel D. Dye several parts of their bodies and caused extensive injuries to them. The defendants
and Stephen F. Bostick, officers of the U.S. Air Force and special agents of the Air deny this and claim the plaintiffs were arrested for theft and were bitten by the
Force Office of Special Investigators (AFOSI). On the basis of the sworn statements dogs because they were struggling and resisting arrest, The defendants stress that
the dogs were called off and the plaintiffs were immediately taken to the medical As applied to the local state, the doctrine of state immunity is based on the
center for treatment of their wounds. justification given by Justice Holmes that "there can be no legal right against the
In a motion to dismiss the complaint, the United States of America and the authority which makes the law on which the right depends." 12 There are other
individually named defendants argued that the suit was in effect a suit against the practical reasons for the enforcement of the doctrine. In the case of the foreign
United States, which had not given its consent to be sued. The defendants were state sought to be impleaded in the local jurisdiction, the added inhibition is
also immune from suit under the RP-US Bases Treaty for acts done by them in the expressed in the maxim par in parem, non habet imperium. All states are sovereign
performance of their official functions. equals and cannot assert jurisdiction over one another. A contrary disposition
The motion to dismiss was denied by the trial court in its order dated August 10, would, in the language of a celebrated case, "unduly vex the peace of nations." 13
1987, reading in part as follows: While the doctrine appears to prohibit only suits against the state without its
The defendants certainly cannot correctly argue that they are immune from suit. consent, it is also applicable to complaints filed against officials of the state for acts
The allegations, of the complaint which is sought to be dismissed, had to be allegedly performed by them in the discharge of their duties. The rule is that if the
hypothetically admitted and whatever ground the defendants may have, had to be judgment against such officials will require the state itself to perform an affirmative
ventilated during the trial of the case on the merits. The complaint alleged criminal act to satisfy the same, such as the appropriation of the amount needed to pay the
acts against the individually-named defendants and from the nature of said acts it damages awarded against them, the suit must be regarded as against the state
could not be said that they are Acts of State, for which immunity should be invoked. itself although it has not been formally impleaded. 14 In such a situation, the state
If the Filipinos themselves are duty bound to respect, obey and submit themselves may move to dismiss the complaint on the ground that it has been filed without its
to the laws of the country, with more reason, the members of the United States consent.
Armed Forces who are being treated as guests of this country should respect, obey The doctrine is sometimes derisively called "the royal prerogative of dishonesty"
and submit themselves to its laws. 10 because of the privilege it grants the state to defeat any legitimate claim against it
and so was the motion for reconsideration. The defendants submitted their answer by simply invoking its non-suability. That is hardly fair, at least in democratic
as required but subsequently filed their petition for certiorari and prohibition with societies, for the state is not an unfeeling tyrant unmoved by the valid claims of its
preliminary injunction with this Court. We issued a temporary restraining order on citizens. In fact, the doctrine is not absolute and does not say the state may not be
October 27, 1987. 11 sued under any circumstance. On the contrary, the rule says that the state may not
II be sued without its consent, which clearly imports that it may be sued if it consents.
The rule that a state may not be sued without its consent, now expressed in Article The consent of the state to be sued may be manifested expressly or impliedly.
XVI, Section 3, of the 1987 Constitution, is one of the generally accepted principles Express consent may be embodied in a general law or a special law. Consent is
of international law that we have adopted as part of the law of our land under implied when the state enters into a contract or it itself commences litigation.
Article II, Section 2. This latter provision merely reiterates a policy earlier embodied The general law waiving the immunity of the state from suit is found in Act No.
in the 1935 and 1973 Constitutions and also intended to manifest our resolve to 3083, under which the Philippine government "consents and submits to be sued
abide by the rules of the international community. upon any moneyed claim involving liability arising from contract, express or implied,
Even without such affirmation, we would still be bound by the generally accepted which could serve as a basis of civil action between private parties." In Merritt v.
principles of international law under the doctrine of incorporation. Under this Government of the Philippine Islands, 15 a special law was passed to enable a person
doctrine, as accepted by the majority of states, such principles are deemed to sue the government for an alleged tort. When the government enters into a
incorporated in the law of every civilized state as a condition and consequence of its contract, it is deemed to have descended to the level of the other contracting party
membership in the society of nations. Upon its admission to such society, the state and divested of its sovereign immunity from suit with its implied consent. 16 Waiver
is automatically obligated to comply with these principles in its relations with other is also implied when the government files a complaint, thus opening itself to a
states. counterclaim. 17
The above rules are subject to qualification. Express consent is effected only by the dismiss on the ground of non-suability was filed and upheld by respondent Judge.
will of the legislature through the medium of a duly enacted statute. 18 We have The matter was taken to this Court in a mandamus proceeding. It failed. It was the
held that not all contracts entered into by the government will operate as a waiver ruling that respondent Judge acted correctly considering that the 4 action must be
of its non-suability; distinction must be made between its sovereign and proprietary considered as one against the U.S. Government. The opinion of Justice Montemayor
acts. 19 As for the filing of a complaint by the government, suability will result only continued: 'It is clear that the courts of the Philippines including the Municipal
where the government is claiming affirmative relief from the defendant. 20 Court of Manila have no jurisdiction over the present case for unlawful detainer.
In the case of the United States of America, the customary rule of international law The question of lack of jurisdiction was raised and interposed at the very beginning
on state immunity is expressed with more specificity in the RP-US Bases Treaty. of the action. The U.S. Government has not given its consent to the filing of this suit
Article III thereof provides as follows: which is essentially against her, though not in name. Moreover, this is not only a
It is mutually agreed that the United States shall have the rights, power and case of a citizen filing a suit against his own Government without the latter's
authority within the bases which are necessary for the establishment, use, consent but it is of a citizen firing an action against a foreign government without
operation and defense thereof or appropriate for the control thereof and all the said government's consent, which renders more obvious the lack of jurisdiction of
rights, power and authority within the limits of the territorial waters and air space the courts of his country. The principles of law behind this rule are so elementary
adjacent to, or in the vicinity of, the bases which are necessary to provide access to and of such general acceptance that we deem it unnecessary to cite authorities in
them or appropriate for their control. support thereof then came Marvel Building Corporation v. Philippine War Damage
The petitioners also rely heavily on Baer v. Tizon, 21 along with several other Commission, where respondent, a United States Agency established to compensate
decisions, to support their position that they are not suable in the cases below, the damages suffered by the Philippines during World War II was held as falling within
United States not having waived its sovereign immunity from suit. It is emphasized the above doctrine as the suit against it would eventually be a charge against or
that in Baer, the Court held: financial liability of the United States Government because ... , the Commission has
The invocation of the doctrine of immunity from suit of a foreign state without its no funds of its own for the purpose of paying money judgments.' The Syquia ruling
consent is appropriate. More specifically, insofar as alien armed forces is was again explicitly relied upon in Marquez Lim v. Nelson, involving a complaint for
concerned, the starting point isRaquiza v. Bradford, a 1945 decision. In dismissing a the recovery of a motor launch, plus damages, the special defense interposed being
habeas corpus petition for the release of petitioners confined by American army 'that the vessel belonged to the United States Government, that the defendants
authorities, Justice Hilado speaking for the Court, cited Coleman v. Tennessee, merely acted as agents of said Government, and that the United States Government
where it was explicitly declared: 'It is well settled that a foreign army, permitted to is therefore the real party in interest.' So it was in Philippine Alien Property
march through a friendly country or to be stationed in it, by permission of its Administration v. Castelo, where it was held that a suit against Alien Property
government or sovereign, is exempt from the civil and criminal jurisdiction of the Custodian and the Attorney General of the United States involving vested property
place.' Two years later, in Tubb and Tedrow v. Griess, this Court relied on the ruling under the Trading with the Enemy Act is in substance a suit against the United
in Raquiza v. Bradford and cited in support thereof excerpts from the works of the States. To the same effect is Parreno v. McGranery, as the following excerpt from
following authoritative writers: Vattel, Wheaton, Hall, Lawrence, Oppenheim, the opinion of justice Tuazon clearly shows: 'It is a widely accepted principle of
Westlake, Hyde, and McNair and Lauterpacht. Accuracy demands the clarification international law, which is made a part of the law of the land (Article II, Section 3 of
that after the conclusion of the Philippine-American Military Bases Agreement, the the Constitution), that a foreign state may not be brought to suit before the courts
treaty provisions should control on such matter, the assumption being that there of another state or its own courts without its consent.' Finally, there is Johnson v.
was a manifestation of the submission to jurisdiction on the part of the foreign Turner, an appeal by the defendant, then Commanding General, Philippine
power whenever appropriate. More to the point is Syquia v. Almeda Lopez, where Command (Air Force, with office at Clark Field) from a decision ordering the return
plaintiffs as lessors sued the Commanding General of the United States Army in the to plaintiff of the confiscated military payment certificates known as scrip money. In
Philippines, seeking the restoration to them of the apartment buildings they owned reversing the lower court decision, this Tribunal, through Justice Montemayor,
leased to the United States armed forces stationed in the Manila area. A motion to relied on Syquia v. Almeda Lopez, explaining why it could not be sustained.
It bears stressing at this point that the above observations do not confer on the summarily dismissed on their mere assertion that their acts are imputable to the
United States of America a blanket immunity for all acts done by it or its agents in United States of America, which has not given its consent to be sued. In fact, the
the Philippines. Neither may the other petitioners claim that they are also insulated defendants are sought to be held answerable for personal torts in which the United
from suit in this country merely because they have acted as agents of the United States itself is not involved. If found liable, they and they alone must satisfy the
States in the discharge of their official functions. judgment.
There is no question that the United States of America, like any other state, will be In Festejo v. Fernando, 23 a bureau director, acting without any authority
deemed to have impliedly waived its non-suability if it has entered into a contract in whatsoever, appropriated private land and converted it into public irrigation
its proprietary or private capacity. It is only when the contract involves its sovereign ditches. Sued for the value of the lots invalidly taken by him, he moved to dismiss
or governmental capacity that no such waiver may be implied. This was our ruling in the complaint on the ground that the suit was in effect against the Philippine
United States of America v. Ruiz, 22 where the transaction in question dealt with the government, which had not given its consent to be sued. This Court sustained the
improvement of the wharves in the naval installation at Subic Bay. As this was a denial of the motion and held that the doctrine of state immunity was not
clearly governmental function, we held that the contract did not operate to divest applicable. The director was being sued in his private capacity for a personal tort.
the United States of its sovereign immunity from suit. In the words of Justice With these considerations in mind, we now proceed to resolve the cases at hand.
Vicente Abad Santos: III
The traditional rule of immunity exempts a State from being sued in the courts of It is clear from a study of the records of G.R. No. 80018 that the individually-named
another State without its consent or waiver. This rule is a necessary consequence of petitioners therein were acting in the exercise of their official functions when they
the principles of independence and equality of States. However, the rules of conducted the buy-bust operation against the complainant and thereafter testified
International Law are not petrified; they are constantly developing and evolving. against him at his trial. The said petitioners were in fact connected with the Air
And because the activities of states have multiplied, it has been necessary to Force Office of Special Investigators and were charged precisely with the function of
distinguish them — between sovereign and governmental acts (jure imperii) and preventing the distribution, possession and use of prohibited drugs and prosecuting
private, commercial and proprietary acts (jure gestionis). The result is that State those guilty of such acts. It cannot for a moment be imagined that they were acting
immunity now extends only to acts jure imperii The restrictive application of State in their private or unofficial capacity when they apprehended and later testified
immunity is now the rule in the United States, the United kingdom and other states against the complainant. It follows that for discharging their duties as agents of the
in Western Europe. United States, they cannot be directly impleaded for acts imputable to their
xxx xxx xxx principal, which has not given its consent to be sued. As we observed in Sanders v.
The restrictive application of State immunity is proper only when the proceedings Veridiano: 24
arise out of commercial transactions of the foreign sovereign, its commercial Given the official character of the above-described letters, we have to conclude that
activities or economic affairs. Stated differently, a State may be said to have the petitioners were, legally speaking, being sued as officers of the United States
descended to the level of an individual and can thus be deemed to have tacitly government. As they have acted on behalf of that government, and within the
given its consent to be sued only when it enters into business contracts. It does not scope of their authority, it is that government, and not the petitioners personally,
apply where the contract relates to the exercise of its sovereign functions. In this that is responsible for their acts.
case the projects are an integral part of the naval base which is devoted to the The private respondent invokes Article 2180 of the Civil Code which holds the
defense of both the United States and the Philippines, indisputably a function of the government liable if it acts through a special agent. The argument, it would seem, is
government of the highest order; they are not utilized for nor dedicated to premised on the ground that since the officers are designated "special agents," the
commercial or business purposes. United States government should be liable for their torts.
The other petitioners in the cases before us all aver they have acted in the There seems to be a failure to distinguish between suability and liability and a
discharge of their official functions as officers or agents of the United States. misconception that the two terms are synonymous. Suability depends on the
However, this is a matter of evidence. The charges against them may not be consent of the state to be sued, liability on the applicable law and the established
facts. The circumstance that a state is suable does not necessarily mean that it is administrative office, and a decentralized warehouse which maintains a stock level
liable; on the other hand, it can never be held liable if it does not first consent to be of $200,000.00 per month in resale items. He supervises 167 employees, one of
sued. Liability is not conceded by the mere fact that the state has allowed itself to whom was Genove, with whom the United States government has concluded a
be sued. When the state does waive its sovereign immunity, it is only giving the collective bargaining agreement.
plaintiff the chance to prove, if it can, that the defendant is liable. From these circumstances, the Court can assume that the restaurant services
The said article establishes a rule of liability, not suability. The government may be offered at the John Hay Air Station partake of the nature of a business enterprise
held liable under this rule only if it first allows itself to be sued through any of the undertaken by the United States government in its proprietary capacity. Such
accepted forms of consent. services are not extended to the American servicemen for free as a perquisite of
Moreover, the agent performing his regular functions is not a special agent even if membership in the Armed Forces of the United States. Neither does it appear that
he is so denominated, as in the case at bar. No less important, the said provision they are exclusively offered to these servicemen; on the contrary, it is well known
appears to regulate only the relations of the local state with its inhabitants and, that they are available to the general public as well, including the tourists in Baguio
hence, applies only to the Philippine government and not to foreign governments City, many of whom make it a point to visit John Hay for this reason. All persons
impleaded in our courts. availing themselves of this facility pay for the privilege like all other customers as in
We reject the conclusion of the trial court that the answer filed by the special ordinary restaurants. Although the prices are concededly reasonable and relatively
counsel of the Office of the Sheriff Judge Advocate of Clark Air Base was a low, such services are undoubtedly operated for profit, as a commercial and not a
submission by the United States government to its jurisdiction. As we noted in governmental activity.
Republic v. Purisima, 25 express waiver of immunity cannot be made by a mere The consequence of this finding is that the petitioners cannot invoke the doctrine of
counsel of the government but must be effected through a duly-enacted statute. state immunity to justify the dismissal of the damage suit against them by Genove.
Neither does such answer come under the implied forms of consent as earlier Such defense will not prosper even if it be established that they were acting as
discussed. agents of the United States when they investigated and later dismissed Genove. For
But even as we are certain that the individual petitioners in G.R. No. 80018 were that matter, not even the United States government itself can claim such immunity.
acting in the discharge of their official functions, we hesitate to make the same The reason is that by entering into the employment contract with Genove in the
conclusion in G.R. No. 80258. The contradictory factual allegations in this case discharge of its proprietary functions, it impliedly divested itself of its sovereign
deserve in our view a closer study of what actually happened to the plaintiffs. The immunity from suit.
record is too meager to indicate if the defendants were really discharging their But these considerations notwithstanding, we hold that the complaint against the
official duties or had actually exceeded their authority when the incident in petitioners in the court below must still be dismissed. While suable, the petitioners
question occurred. Lacking this information, this Court cannot directly decide this are nevertheless not liable. It is obvious that the claim for damages cannot be
case. The needed inquiry must first be made by the lower court so it may assess and allowed on the strength of the evidence before us, which we have carefully
resolve the conflicting claims of the parties on the basis of the evidence that has yet examined.
to be presented at the trial. Only after it shall have determined in what capacity the The dismissal of the private respondent was decided upon only after a thorough
petitioners were acting at the time of the incident in question will this Court investigation where it was established beyond doubt that he had polluted the soup
determine, if still necessary, if the doctrine of state immunity is applicable. stock with urine. The investigation, in fact, did not stop there. Despite the definitive
In G.R. No. 79470, private respondent Genove was employed as a cook in the Main finding of Genove's guilt, the case was still referred to the board of arbitrators
Club located at the U.S. Air Force Recreation Center, also known as the Open Mess provided for in the collective bargaining agreement. This board unanimously
Complex, at John Hay Air Station. As manager of this complex, petitioner Lamachia affirmed the findings of the investigators and recommended Genove's dismissal.
is responsible for eleven diversified activities generating an annual income of $2 There was nothing arbitrary about the proceedings. The petitioners acted quite
million. Under his executive management are three service restaurants, a cafeteria, properly in terminating the private respondent's employment for his unbelievably
a bakery, a Class VI store, a coffee and pantry shop, a main cashier cage, an
nauseating act. It is surprising that he should still have the temerity to file his 1. In G.R. No. 76607, the petition is DISMISSED and the respondent judge is
complaint for damages after committing his utterly disgusting offense. directed to proceed with the hearing and decision of Civil Case No. 4772. The
Concerning G.R. No. 76607, we also find that the barbershops subject of the temporary restraining order dated December 11, 1986, is LIFTED.
concessions granted by the United States government are commercial enterprises 2. In G.R. No. 79470, the petition is GRANTED and Civil Case No. 829-R(298) is
operated by private person's. They are not agencies of the United States Armed DISMISSED.
Forces nor are their facilities demandable as a matter of right by the American 3. In G.R. No. 80018, the petition is GRANTED and Civil Case No. 115-C-87 is
servicemen. These establishments provide for the grooming needs of their DISMISSED. The temporary restraining order dated October 14, 1987, is made
customers and offer not only the basic haircut and shave (as required in most permanent.
military organizations) but such other amenities as shampoo, massage, manicure 4. In G.R. No. 80258, the petition is DISMISSED and the respondent court is
and other similar indulgences. And all for a fee. Interestingly, one of the directed to proceed with the hearing and decision of Civil Case No. 4996. The
concessionaires, private respondent Valencia, was even sent abroad to improve his temporary restraining order dated October 27, 1987, is LIFTED.
tonsorial business, presumably for the benefit of his customers. No less All without any pronouncement as to costs.
significantly, if not more so, all the barbershop concessionaires are under the terms SO ORDERED
of their contracts, required to remit to the United States government fixed
commissions in consideration of the exclusive concessions granted to them in their [G.R. No. 91359. September 25, 1992.]
respective areas.
This being the case, the petitioners cannot plead any immunity from the complaint VETERANS MANPOWER AND PROTECTIVE SERVICES, INC., Petitioner, v. THE
filed by the private respondents in the court below. The contracts in question being COURT OF APPEALS, THE CHIEF OF PHILIPPINE CONSTABULARY and PHILIPPINE
decidedly commercial, the conclusion reached in the United States of America v. CONSTABULARY SUPERVISORY UNIT FOR SECURITY AND INVESTIGATION
Ruiz case cannot be applied here. AGENCIES (PC-SUSIA), Respondents.
The Court would have directly resolved the claims against the defendants as we
have done in G.R. No. 79470, except for the paucity of the record in the case at Franciso A. Lava, Jr. and Andresito X. Fornier for Petitioner.
hand. The evidence of the alleged irregularity in the grant of the barbershop
concessions is not before us. This means that, as in G.R. No. 80258, the respondent
court will have to receive that evidence first, so it can later determine on the basis SYLLABUS
thereof if the plaintiffs are entitled to the relief they seek. Accordingly, this case
must also be remanded to the court below for further proceedings.
IV 1. POLITICAL LAW; IMMUNITY FROM SUIT; THE PHILIPPINE CONSTABULARY
There are a number of other cases now pending before us which also involve the CHIEF AND THE PC-SUSIA MAY NOT BE SUED WITHOUT THE CONSENT OF THE
question of the immunity of the United States from the jurisdiction of the STATE. — The State may not be sued without its consent (Article XVI, Section 3, of
Philippines. This is cause for regret, indeed, as they mar the traditional friendship the 1987 Constitution). Invoking this rule, the PC Chief and PC-SUSIA contend that,
between two countries long allied in the cause of democracy. It is hoped that the being instrumentalities of the national government exercising a primarily
so-called "irritants" in their relations will be resolved in a spirit of mutual governmental function of regulating the organization and operation of private
accommodation and respect, without the inconvenience and asperity of litigation detective, watchmen, or security guard agencies, said official (the PC Chief) and
and always with justice to both parties. agency (PC-SUSIA) may not be sued without the Government’s consent, especially
WHEREFORE, after considering all the above premises, the Court hereby renders in this case because VMPSI’s complaint seeks not only to compel the public
judgment as follows: respondents to act in a certain way, but worse, because VMPSI seeks actual and
compensatory damages in the sum of P1,000,000.00, exemplary damages in the
same amount, and P200,000.00 as attorney’s fees from said public respondents. This is a petition for review on certiorari of the decision dated August 11, 1989, of
Even if its action prospers, the payment of its monetary claims may not be enforced the Court of Appeals in CA-G.R. SP No. 15990, entitled "The Chief of Philippine
because the State did not consent to appropriate the necessary funds for that Constabulary (PC) and Philippine Constabulary Supervisor Unit for Security and
purpose. Investigation Agencies (PC-SUSIA) v. Hon. Omar U. Amin and Veterans Manpower
and Protective Services, Inc. (VMPSI)," lifting the writ of preliminary injunction
2. ID.; ID.; PUBLIC OFFICIAL MAY BE SUED IN HIS PERSONAL CAPACITY IF HE which the Regional Trial Court had issued to the PC-SUSIA enjoining them from
ACTS, AMONG OTHERS BEYOND THE SCOPE OF HIS AUTHORITY; CASE AT BAR. — A committing acts that would result in the cancellation or non-renewal of the license
public official may sometimes be held liable in his personal or private capacity if he of VMPSI to operate as a security agency.chanrobles virtual lawlibrary
acts in bad faith, or beyond the scope of his authority or jurisdiction (Shauf v. Court
of Appeals, supra), however, since the acts for which the PC Chief and PC-SUSIA are On March 28, 1988, VMPSI filed a complaint in the Regional Trial Court at Makati,
being called to account in this case, were performed by them as part of their official Metro Manila, praying the court to:jgc:chanrobles.com.ph
duties, without malice, gross negligence, or bad faith, no recovery may be had
against them in their private capacities. "A. Forthwith issue a temporary restraining order to preserve the status quo,
enjoining the defendants, or any one acting in their place or stead, to refrain from
3. ID.; ID.; CONSENT TO BE SUED MUST EMANATE FROM A LEGISLATIVE ACT. committing acts that would result in the cancellation or non-renewal of VMPSI’s
— Waiver of the State’s immunity from suit, being a derogation of sovereignty, will license;
not be lightly inferred, but must be construed strictissimi juris (Republic v. Feliciano,
148 SCRA 424). The consent of the State to be sued must emanate from statutory "B. In due time, issue a writ of preliminary injunction to the same effect;
authority, hence, from a legislative act, not from a mere memorandum. Without
such consent, the trial court did not acquire jurisdiction over the public "C. Render decision and judgment declaring null and void the amendment of
respondents. Section 4 of R.A. No. 5487, by PD No. 11 exempting organizations like PADPAO from
the prohibition that no person shall organize or have an interest in more than one
4. ID.; ID.; REASONS BEHIND. — The state immunity doctrine rests upon agency, declaring PADPAO as an illegal organization existing in violation of said
reasons of public policy and the inconvenience and danger which would flow from a prohibition, without the illegal exemption provided in PD No. 11; declaring null and
different rule. "It is obvious that public service would be hindered, and public safety void Section 17 of R.A. No. 5487 which provides for the issuance of rules and
endangered, if the supreme authority could be subjected to suits at the instance of regulations in consultation with PADPAO, declaring null and void the February 1,
every citizen, and, consequently, controlled in the use and disposition of the means 1982 directive of Col. Sabas V. Edadas, in the name of the then PC Chief, requiring
required for the proper administration of the government" (Siren v. U.S. Wall, 152, all private security agencies/security forces such as VMPSI to join PADPAO as a
19 L. ed. 129, as cited in 78 SCRA 477). prerequisite to secure/renew their licenses, declaring that VMPSI did not engage in
‘cut-throat competition’ in its contract with MWSS, ordering defendants PC Chief
and PC-SUSIA to renew the license of VMPSI; ordering the defendants to refrain
DECISION from further harassing VMPSI and from threatening VMPSI with cancellations or
non-renewal of license, without legal and justifiable cause; ordering the defendants
to pay to VMPSI the sum of P1,000,000.00 as actual and compensatory damages,
GRIÑO-AQUINO, J.: P1,000,000.00 as exemplary damages, and P200,000.00 as attorney’s fees and
expenses of litigation; and granting such further or other reliefs to VMPSI as may be
deemed lawful, equitable and just." (pp. 55-56, Rollo.)
The constitutionality of the following provisions of R.A. 5487 (otherwise known as hours of security service per day at P2,255.00 within Metro Manila and P2,215.00
the "Private Security Agency Law"), as amended, is questioned by VMPSI in its outside of Metro Manila (Annex B, Petition).
complaint:chanrobles.com.ph : virtual law library
On June 29, 1987, Odin Security Agency (Odin) filed a complaint with PADPAO
"SECTION 4. Who may Organize a Security or Watchman Agency. — Any accusing VMPSI of cut-throat competition by undercutting its contract rate for
Filipino citizen or a corporation, partnership, or association, with a minimum capital security services rendered to the Metropolitan Waterworks and Sewerage System
of five thousand pesos, one hundred per cent of which is owned and controlled by (MWSS), charging said customer lower than the standard minimum rates provided
Filipino citizens may organize a security or watchman agency: Provided, That no in the Memorandum of Agreement dated May 12, 1986.
person shall organize or have an interest in, more than one such agency except
those which are already existing at the promulgation of this Decree: . . ." (As PADPAO found VMPSI guilty of cut-throat competition, hence, the PADPAO
amended by P.D. Nos. 11 and 100.) Committee on Discipline recommended the expulsion of VMPSI from PADPAO and
the cancellation of its license to operate a security agency (Annex D, Petition).
"SECTION 17. Rules and Regulations by Chief, Philippine Constabulary. — The
Chief of the Philippine Constabulary, in consultation with the Philippine Association The PC-SUSIA made similar findings and likewise recommended the cancellation of
of Detective and Protective Agency Operators, Inc. and subject to the provision of VMPSI’s license (Annex E, Petition).
existing laws, is hereby authorized to issue the rules and regulations necessary to
carry out the purpose of this Act."cralaw virtua1aw library As a result, PADPAO refused to issue a clearance/certificate of membership to
VMPSI when it requested one.
VMPSI alleges that the above provisions of R.A. No. 5487 violate the provisions of
the 1987 Constitution against monopolies, unfair competition and combinations in VMPSI wrote the PC Chief on March 10, 1988, requesting him to set aside or
restraint of trade, and tend to favor and institutionalize the Philippine Association disregard the findings of PADPAO and consider VMPSI’s application for renewal of
of Detective and Protective Agency Operators, Inc. (PADPAO) which is monopolistic its license, even without a certificate of membership from PADPAO (Annex F,
because it has an interest in more than one security agency. Petition).

Respondent VMPSI likewise questions the validity of paragraph 3, subparagraph (g) As the PC Chief did not reply, and VMPSI’s license was expiring on March 31, 1988,
of the Modifying Regulations on the Issuance of License to Operate and Private VMPSI filed Civil Case No. 88-471 in the RTC-Makati, Branch 135, on March 28, 1988
Security Licenses and Specifying Regulations for the Operation of PADPAO issued by against the PC Chief and PC-SUSIA. On the same date, the court issued a restraining
then PC Chief Lt. Gen. Fidel V. Ramos, through Col. Sabas V. Edades, requiring that order enjoining the PC Chief and PC-SUSIA "from committing acts that would result
"all private security agencies/company security forces must register as members of in the cancellation or non-renewal of VMPSI’s license" (Annex G, Petition).
any PADPAO Chapter organized within the Region where their main offices are
located . . ." (pp. 5-6, Complaint in Civil Case No. 88-471). As such membership The PC chief and PC-SUSIA filed a "Motion to Dismiss, Opposition to the Issuance of
requirement in PADPAO is compulsory in nature, it allegedly violates legal and Writ of Preliminary Injunction, and Motion to Quash the Temporary Restraining
constitutional provisions against monopolies, unfair competition and combinations Order," on the grounds that the case is against the State which had not given
in restraint of trade.chanrobles.com : virtual law library consent thereto and that VMPSI’s license already expired on March 31, 1988,
hence, the restraining order or preliminary injunction would not serve any purpose
On May 12, 1986, a Memorandum of Agreement was executed by PADPAO and the because there was no more license to be cancelled (Annex H, Petition). Respondent
PC Chief, which fixed the minimum monthly contract rate per guard for eight (8) VMPSI opposed the motion.
On April 18, 1988, the lower court denied VMPSI’s application for a writ of The State may not be sued without its consent (Article XVI, Section 3, of the 1987
preliminary injunction for being premature because it "has up to May 31, 1988 Constitution). Invoking this rule, the PC Chief and PC-SUSIA contend that, being
within which to file its application for renewal pursuant to Section 2 (e) of instrumentalities of the national government exercising a primarily governmental
Presidential Decree No. 199, . . ." (p. 140, Rollo.).chanrobles.com : virtual law library function of regulating the organization and operation of private detective,
watchmen, or security guard agencies, said official (the PC Chief) and agency (PC-
On May 23, 1988, VMPSI reiterated its application for the issuance of a writ of SUSIA) may not be sued without the Government’s consent, especially in this case
preliminary injunction because PC-SUSIA had rejected payment of the penalty for because VMPSI’s complaint seeks not only to compel the public respondents to act
its failure to submit its application for renewal of its license and the requirements in a certain way, but worse, because VMPSI seeks actual and compensatory
therefor within the prescribed period in Section 2(e) of the Revised Rules and damages in the sum of P1,000,000.00, exemplary damages in the same amount,
Regulations Implementing R.A. 5487, as amended by P.D. 1919 (Annex M, Petition). and P200,000.00 as attorney’s fees from said public respondents. Even if its action
prospers, the payment of its monetary claims may not be enforced because the
On June 10, 1998, the RTC-Makati issued a writ of preliminary injunction upon a State did not consent to appropriate the necessary funds for that
bond of P100,000.00, restraining the defendants, or any one acting in their behalf, purpose.chanroblesvirtualawlibrary
from cancelling or denying renewal of VMPSI’s license, until further orders from the
court. Thus did we hold in Shauf v. Court of Appeals, 191 SCRA 713:jgc:chanrobles.com.ph

The PC Chief and PC-SUSIA filed a Motion for Reconsideration of the above order, "While the doctrine appears to prohibit only suits against the state without its
but it was denied by the court in its Order of August 10, 1988 (Annex R, Petition). consent, it is also applicable to complaints filed against officials of the state for acts
allegedly performed by them in the discharge of their duties. The rule is that if the
On November 3, 1988, the PC Chief and PC-SUSIA sought relief by a petition for judgment against such officials will require the state itself to perform an affirmative
certiorari in the Court of Appeals. act to satisfy the same, such as the appropriation of the amount needed to pay the
damages awarded against them, the suit must be regarded as against the state
On August 11, 1989, the Court of Appeals granted the petition. The dispositive itself although it has not been formally impleaded." (Emphasis supplied.)
portion of its decision reads:jgc:chanrobles.com.ph
A public official may sometimes be held liable in his personal or private capacity if
"WHEREFORE, the petition for certiorari filed by petitioners PC Chief and PC-SUSIA he acts in bad faith, or beyond the scope of his authority or jurisdiction (Shauf v.
is hereby GRANTED, and the RTC-Makati, Branch 135, is ordered to dismiss the Court of Appeals, supra), however, since the acts for which the PC Chief and PC-
complaint filed by respondent VMPSI in Civil Case No. 88-471, insofar as petitioners SUSIA are being called to account in this case, were performed by them as part of
PC Chief and PC-SUSIA are concerned, for lack of jurisdiction. The writ of their official duties, without malice, gross negligence, or bad faith, no recovery may
preliminary injunction issued on June 10, 1988, is dissolved." (pp. 295-296, Rollo.) be had against them in their private capacities.

VMPSI came to us with this petition for review. We agree with the observation of the Court of Appeals that the Memorandum of
Agreement dated May 12, 1986 does not constitute an implied consent by the State
The primary issue in this case is whether or not VMPSI’s complaint against the PC to be sued:jgc:chanrobles.com.ph
Chief and PC-SUSIA is a suit against the State without its consent.
"The Memorandum of Agreement dated May 12, 1986 was entered into by the PC
The answer is yes. Chief in relation to the exercise of a function sovereign in nature. The correct test
for the application of state immunity is not the conclusion of a contract by the State
but the legal nature of the act. This was clearly enunciated in the case of United the loss of governmental efficiency and the obstacle to the performance of its
States of America v. Ruiz where the Hon. Supreme Court multifarious functions are far greater if such a fundamental principle were
held:jgc:chanrobles.com.ph abandoned and the availability of judicial remedy were not thus restricted. With the
well known propensity on the part of our people to go to court, at the least
"‘The restrictive application of State immunity is proper only when the proceedings provocation, the loss of time and energy required to defend against law suits, in the
arise out of commercial transactions of the foreign sovereign, its commercial absence of such a basic principle that constitutes such an effective obstacles, could
activities or economic affairs. Stated differently, a State may be said to have very well be imagined." (citing Providence Washington Insurance Co. v. Republic, 29
descended to the level of an individual and can thus be deemed to have tacitly SCRA 598.)cralawnad
given its consent to be sued only when it enters into a business contract. It does not
apply where the contract relates to the exercise of its functions.’ (136 SCRA 487, WHEREFORE, the petition for review is DENIED and the judgment appealed from is
492.) AFFIRMED in toto. No costs.

"In the instant case, the Memorandum of Agreement entered into by the PC Chief SO ORDERED.
and PADPAO was intended to professionalize the industry and to standardize the
salaries of security guards as well as the current rates of security services, clearly, a G.R. No. L-11154 March 21, 1916
governmental function. The execution of the said agreement is incidental to the E. MERRITT, plaintiff-appellant,
purpose of R.A. 5487, as amended, which is to regulate the organization and vs.
operation of private detective, watchmen or security guard agencies. (Emphasis GOVERNMENT OF THE PHILIPPINE ISLANDS, defendant-appellant.
ours.)" (pp. 258-259, Rollo.) Crossfield and O'Brien for plaintiff.
Attorney-General Avanceña for defendant..
Waiver of the State’s immunity from suit, being a derogation of sovereignty, will not TRENT, J.:
be lightly inferred, but must be construed strictissimi juris (Republic v. Feliciano, This is an appeal by both parties from a judgment of the Court of First Instance of
148 SCRA 424). The consent of the State to be sued must emanate from statutory the city of Manila in favor of the plaintiff for the sum of P14,741, together with the
authority, hence, from a legislative act, not from a mere memorandum. Without costs of the cause.
such consent, the trial court did not acquire jurisdiction over the public Counsel for the plaintiff insist that the trial court erred (1) "in limiting the general
respondents. damages which the plaintiff suffered to P5,000, instead of P25,000 as claimed in the
complaint," and (2) "in limiting the time when plaintiff was entirely disabled to two
The state immunity doctrine rests upon reasons of public policy and the months and twenty-one days and fixing the damage accordingly in the sum of
inconvenience and danger which would flow from a different rule. "It is obvious P2,666, instead of P6,000 as claimed by plaintiff in his complaint."
that public service would be hindered, and public safety endangered, if the The Attorney-General on behalf of the defendant urges that the trial court erred:
supreme authority could be subjected to suits at the instance of every citizen, and, (a) in finding that the collision between the plaintiff's motorcycle and the
consequently, controlled in the use and disposition of the means required for the ambulance of the General Hospital was due to the negligence of the chauffeur; (b)
proper administration of the government" (Siren v. U.S. Wall, 152, 19 L. ed. 129, as in holding that the Government of the Philippine Islands is liable for the damages
cited in 78 SCRA 477). In the same vein, this Court in Republic v. Purisima (78 SCRA sustained by the plaintiff as a result of the collision, even if it be true that the
470, 473) rationalized:jgc:chanrobles.com.ph collision was due to the negligence of the chauffeur; and (c) in rendering judgment
against the defendant for the sum of P14,741.
"Nonetheless, a continued adherence to the doctrine of nonsuability is not to be The trial court's findings of fact, which are fully supported by the record, are as
deplored for as against the inconvenience that may be cause [by] private parties, follows:
It is a fact not disputed by counsel for the defendant that when the plaintiff, riding efficiency. As a contractor, he could no longer, as he had before done, climb up
on a motorcycle, was going toward the western part of Calle Padre Faura, passing ladders and scaffoldings to reach the highest parts of the building.
along the west side thereof at a speed of ten to twelve miles an hour, upon crossing As a consequence of the loss the plaintiff suffered in the efficiency of his work as a
Taft Avenue and when he was ten feet from the southwestern intersection of said contractor, he had to dissolved the partnership he had formed with the engineer.
streets, the General Hospital ambulance, upon reaching said avenue, instead of Wilson, because he was incapacitated from making mathematical calculations on
turning toward the south, after passing the center thereof, so that it would be on account of the condition of his leg and of his mental faculties, and he had to give up
the left side of said avenue, as is prescribed by the ordinance and the Motor Vehicle a contract he had for the construction of the Uy Chaco building."
Act, turned suddenly and unexpectedly and long before reaching the center of the We may say at the outset that we are in full accord with the trial court to the effect
street, into the right side of Taft Avenue, without having sounded any whistle or that the collision between the plaintiff's motorcycle and the ambulance of the
horn, by which movement it struck the plaintiff, who was already six feet from the General Hospital was due solely to the negligence of the chauffeur.
southwestern point or from the post place there. The two items which constitute a part of the P14,741 and which are drawn in
By reason of the resulting collision, the plaintiff was so severely injured that, question by the plaintiff are (a) P5,000, the award awarded for permanent injuries,
according to Dr. Saleeby, who examined him on the very same day that he was and (b) the P2,666, the amount allowed for the loss of wages during the time the
taken to the General Hospital, he was suffering from a depression in the left plaintiff was incapacitated from pursuing his occupation. We find nothing in the
parietal region, a would in the same place and in the back part of his head, while record which would justify us in increasing the amount of the first. As to the
blood issued from his nose and he was entirely unconscious. second, the record shows, and the trial court so found, that the plaintiff's services
The marks revealed that he had one or more fractures of the skull and that the grey as a contractor were worth P1,000 per month. The court, however, limited the time
matter and brain was had suffered material injury. At ten o'clock of the night in to two months and twenty-one days, which the plaintiff was actually confined in the
question, which was the time set for performing the operation, his pulse was so hospital. In this we think there was error, because it was clearly established that the
weak and so irregular that, in his opinion, there was little hope that he would live. plaintiff was wholly incapacitated for a period of six months. The mere fact that he
His right leg was broken in such a way that the fracture extended to the outer skin remained in the hospital only two months and twenty-one days while the
in such manner that it might be regarded as double and the would be exposed to remainder of the six months was spent in his home, would not prevent recovery for
infection, for which reason it was of the most serious nature. the whole time. We, therefore, find that the amount of damages sustained by the
At another examination six days before the day of the trial, Dr. Saleeby noticed that plaintiff, without any fault on his part, is P18,075.
the plaintiff's leg showed a contraction of an inch and a half and a curvature that As the negligence which caused the collision is a tort committed by an agent or
made his leg very weak and painful at the point of the fracture. Examination of his employee of the Government, the inquiry at once arises whether the Government is
head revealed a notable readjustment of the functions of the brain and nerves. The legally-liable for the damages resulting therefrom.
patient apparently was slightly deaf, had a light weakness in his eyes and in his Act No. 2457, effective February 3, 1915, reads:
mental condition. This latter weakness was always noticed when the plaintiff had to An Act authorizing E. Merritt to bring suit against the Government of the Philippine
do any difficult mental labor, especially when he attempted to use his money for Islands and authorizing the Attorney-General of said Islands to appear in said suit.
mathematical calculations. Whereas a claim has been filed against the Government of the Philippine Islands by
According to the various merchants who testified as witnesses, the plaintiff's Mr. E. Merritt, of Manila, for damages resulting from a collision between his
mental and physical condition prior to the accident was excellent, and that after motorcycle and the ambulance of the General Hospital on March twenty-fifth,
having received the injuries that have been discussed, his physical condition had nineteen hundred and thirteen;
undergone a noticeable depreciation, for he had lost the agility, energy, and ability Whereas it is not known who is responsible for the accident nor is it possible to
that he had constantly displayed before the accident as one of the best determine the amount of damages, if any, to which the claimant is entitled; and
constructors of wooden buildings and he could not now earn even a half of the Whereas the Director of Public Works and the Attorney-General recommended that
income that he had secured for his work because he had lost 50 per cent of his an Act be passed by the Legislature authorizing Mr. E. Merritt to bring suit in the
courts against the Government, in order that said questions may be decided: Now, In the United States the rule that the state is not liable for the torts committed by
therefore, its officers or agents whom it employs, except when expressly made so by
By authority of the United States, be it enacted by the Philippine Legislature, that: legislative enactment, is well settled. "The Government," says Justice Story, "does
SECTION 1. E. Merritt is hereby authorized to bring suit in the Court of First not undertake to guarantee to any person the fidelity of the officers or agents
Instance of the city of Manila against the Government of the Philippine Islands in whom it employs, since that would involve it in all its operations in endless
order to fix the responsibility for the collision between his motorcycle and the embarrassments, difficulties and losses, which would be subversive of the public
ambulance of the General Hospital, and to determine the amount of the damages, interest." (Claussen vs. City of Luverne, 103 Minn., 491, citing U. S. vs. Kirkpatrick, 9
if any, to which Mr. E. Merritt is entitled on account of said collision, and the Wheat, 720; 6 L. Ed., 199; and Beers vs. States, 20 How., 527; 15 L. Ed., 991.)
Attorney-General of the Philippine Islands is hereby authorized and directed to In the case of Melvin vs. State (121 Cal., 16), the plaintiff sought to recover damages
appear at the trial on the behalf of the Government of said Islands, to defendant from the state for personal injuries received on account of the negligence of the
said Government at the same. state officers at the state fair, a state institution created by the legislature for the
SEC. 2. This Act shall take effect on its passage. purpose of improving agricultural and kindred industries; to disseminate
Enacted, February 3, 1915. information calculated to educate and benefit the industrial classes; and to advance
Did the defendant, in enacting the above quoted Act, simply waive its immunity by such means the material interests of the state, being objects similar to those
from suit or did it also concede its liability to the plaintiff? If only the former, then it sought by the public school system. In passing upon the question of the state's
cannot be held that the Act created any new cause of action in favor of the plaintiff liability for the negligent acts of its officers or agents, the court said:
or extended the defendant's liability to any case not previously recognized. No claim arises against any government is favor of an individual, by reason of the
All admit that the Insular Government (the defendant) cannot be sued by an misfeasance, laches, or unauthorized exercise of powers by its officers or agents.
individual without its consent. It is also admitted that the instant case is one against (Citing Gibbons vs. U. S., 8 Wall., 269; Clodfelter vs. State, 86 N. C., 51, 53; 41 Am.
the Government. As the consent of the Government to be sued by the plaintiff was Rep., 440; Chapman vs. State, 104 Cal., 690; 43 Am. St. Rep., 158; Green vs. State,
entirely voluntary on its part, it is our duty to look carefully into the terms of the 73 Cal., 29; Bourn vs. Hart, 93 Cal., 321; 27 Am. St. Rep., 203; Story on Agency, sec.
consent, and render judgment accordingly. 319.)
The plaintiff was authorized to bring this action against the Government "in order As to the scope of legislative enactments permitting individuals to sue the state
to fix the responsibility for the collision between his motorcycle and the ambulance where the cause of action arises out of either fort or contract, the rule is stated in
of the General Hospital and to determine the amount of the damages, if any, to 36 Cyc., 915, thus:
which Mr. E. Merritt is entitled on account of said collision, . . . ." These were the By consenting to be sued a state simply waives its immunity from suit. It does not
two questions submitted to the court for determination. The Act was passed "in thereby concede its liability to plaintiff, or create any cause of action in his favor, or
order that said questions may be decided." We have "decided" that the accident extend its liability to any cause not previously recognized. It merely gives a remedy
was due solely to the negligence of the chauffeur, who was at the time an to enforce a preexisting liability and submits itself to the jurisdiction of the court,
employee of the defendant, and we have also fixed the amount of damages subject to its right to interpose any lawful defense.
sustained by the plaintiff as a result of the collision. Does the Act authorize us to In Apfelbacher vs. State (152 N. W., 144, advanced sheets), decided April 16, 1915,
hold that the Government is legally liable for that amount? If not, we must look the Act of 1913, which authorized the bringing of this suit, read:
elsewhere for such authority, if it exists. SECTION 1. Authority is hereby given to George Apfelbacher, of the town of
The Government of the Philippine Islands having been "modeled after the Federal Summit, Waukesha County, Wisconsin, to bring suit in such court or courts and in
and State Governments in the United States," we may look to the decisions of the such form or forms as he may be advised for the purpose of settling and
high courts of that country for aid in determining the purpose and scope of Act No. determining all controversies which he may now have with the State of Wisconsin,
2457. or its duly authorized officers and agents, relative to the mill property of said
George Apfelbacher, the fish hatchery of the State of Wisconsin on the Bark River,
and the mill property of Evan Humphrey at the lower end of Nagawicka Lake, and The statute we are discussing disclose no intention to create against the state a new
relative to the use of the waters of said Bark River and Nagawicka Lake, all in the and heretofore unrecognized class of liabilities, but only an intention to provide a
county of Waukesha, Wisconsin. judicial tribunal where well recognized existing liabilities can be adjudicated.
In determining the scope of this act, the court said: In Sipple vs. State (99 N. Y., 284), where the board of the canal claims had, by the
Plaintiff claims that by the enactment of this law the legislature admitted liability on terms of the statute of New York, jurisdiction of claims for damages for injuries in
the part of the state for the acts of its officers, and that the suit now stands just as it the management of the canals such as the plaintiff had sustained, Chief Justice
would stand between private parties. It is difficult to see how the act does, or was Ruger remarks: "It must be conceded that the state can be made liable for injuries
intended to do, more than remove the state's immunity from suit. It simply gives arising from the negligence of its agents or servants, only by force of some positive
authority to commence suit for the purpose of settling plaintiff's controversies with statute assuming such liability."
the estate. Nowhere in the act is there a whisper or suggestion that the court or It being quite clear that Act No. 2457 does not operate to extend the Government's
courts in the disposition of the suit shall depart from well established principles of liability to any cause not previously recognized, we will now examine the
law, or that the amount of damages is the only question to be settled. The act substantive law touching the defendant's liability for the negligent acts of its
opened the door of the court to the plaintiff. It did not pass upon the question of officers, agents, and employees. Paragraph 5 of article 1903 of the Civil Code reads:
liability, but left the suit just where it would be in the absence of the state's The state is liable in this sense when it acts through a special agent, but not when
immunity from suit. If the Legislature had intended to change the rule that obtained the damage should have been caused by the official to whom properly it pertained
in this state so long and to declare liability on the part of the state, it would not to do the act performed, in which case the provisions of the preceding article shall
have left so important a matter to mere inference, but would have done so in be applicable.
express terms. (Murdock Grate Co. vs. Commonwealth, 152 Mass., 28; 24 N.E., 854; The supreme court of Spain in defining the scope of this paragraph said:
8 L. R. A., 399.) That the obligation to indemnify for damages which a third person causes to
In Denning vs. State (123 Cal., 316), the provisions of the Act of 1893, relied upon another by his fault or negligence is based, as is evidenced by the same Law 3, Title
and considered, are as follows: 15, Partida 7, on that the person obligated, by his own fault or negligence, takes
All persons who have, or shall hereafter have, claims on contract or for negligence part in the act or omission of the third party who caused the damage. It follows
against the state not allowed by the state board of examiners, are hereby therefrom that the state, by virtue of such provisions of law, is not responsible for
authorized, on the terms and conditions herein contained, to bring suit thereon the damages suffered by private individuals in consequence of acts performed by its
against the state in any of the courts of this state of competent jurisdiction, and employees in the discharge of the functions pertaining to their office, because
prosecute the same to final judgment. The rules of practice in civil cases shall apply neither fault nor even negligence can be presumed on the part of the state in the
to such suits, except as herein otherwise provided. organization of branches of public service and in the appointment of its agents; on
And the court said: the contrary, we must presuppose all foresight humanly possible on its part in order
This statute has been considered by this court in at least two cases, arising under that each branch of service serves the general weal an that of private persons
different facts, and in both it was held that said statute did not create any liability interested in its operation. Between these latter and the state, therefore, no
or cause of action against the state where none existed before, but merely gave an relations of a private nature governed by the civil law can arise except in a case
additional remedy to enforce such liability as would have existed if the statute had where the state acts as a judicial person capable of acquiring rights and contracting
not been enacted. (Chapman vs. State, 104 Cal., 690; 43 Am. St. Rep., 158; Melvin obligations. (Supreme Court of Spain, January 7, 1898; 83 Jur. Civ., 24.)
vs. State, 121 Cal., 16.) That the Civil Code in chapter 2, title 16, book 4, regulates the obligations which
A statute of Massachusetts enacted in 1887 gave to the superior court "jurisdiction arise out of fault or negligence; and whereas in the first article thereof. No. 1902,
of all claims against the commonwealth, whether at law or in equity," with an where the general principle is laid down that where a person who by an act or
exception not necessary to be here mentioned. In construing this statute the court, omission causes damage to another through fault or negligence, shall be obliged to
in Murdock Grate Co. vs. Commonwealth (152 Mass., 28), said: repair the damage so done, reference is made to acts or omissions of the persons
who directly or indirectly cause the damage, the following articles refers to this claim is based on acts or omissions imputable to a public official charged with some
persons and imposes an identical obligation upon those who maintain fixed administrative or technical office who can be held to the proper responsibility in the
relations of authority and superiority over the authors of the damage, because the manner laid down by the law of civil responsibility. Consequently, the trial court in
law presumes that in consequence of such relations the evil caused by their own not so deciding and in sentencing the said entity to the payment of damages,
fault or negligence is imputable to them. This legal presumption gives way to proof, caused by an official of the second class referred to, has by erroneous
however, because, as held in the last paragraph of article 1903, responsibility for interpretation infringed the provisions of articles 1902 and 1903 of the Civil Code.
acts of third persons ceases when the persons mentioned in said article prove that (Supreme Court of Spain, July 30, 1911; 122 Jur. Civ., 146.)
they employed all the diligence of a good father of a family to avoid the damage, It is, therefore, evidence that the State (the Government of the Philippine Islands) is
and among these persons, called upon to answer in a direct and not a subsidiary only liable, according to the above quoted decisions of the Supreme Court of Spain,
manner, are found, in addition to the mother or the father in a proper case, for the acts of its agents, officers and employees when they act as special agents
guardians and owners or directors of an establishment or enterprise, the state, but within the meaning of paragraph 5 of article 1903, supra, and that the chauffeur of
not always, except when it acts through the agency of a special agent, doubtless the ambulance of the General Hospital was not such an agent.
because and only in this case, the fault or negligence, which is the original basis of For the foregoing reasons, the judgment appealed from must be reversed, without
this kind of objections, must be presumed to lie with the state. costs in this instance. Whether the Government intends to make itself legally liable
That although in some cases the state might by virtue of the general principle set for the amount of damages above set forth, which the plaintiff has sustained by
forth in article 1902 respond for all the damage that is occasioned to private parties reason of the negligent acts of one of its employees, by legislative enactment and
by orders or resolutions which by fault or negligence are made by branches of the by appropriating sufficient funds therefor, we are not called upon to determine.
central administration acting in the name and representation of the state itself and This matter rests solely with the Legislature and not with the courts.
as an external expression of its sovereignty in the exercise of its executive powers,
yet said article is not applicable in the case of damages said to have been G.R. No. L-26400 February 29, 1972
occasioned to the petitioners by an executive official, acting in the exercise of his VICTORIA AMIGABLE, plaintiff-appellant,
powers, in proceedings to enforce the collections of certain property taxes owing by vs.
the owner of the property which they hold in sublease. NICOLAS CUENCA, as Commissioner of Public Highways and REPUBLIC OF THE
That the responsibility of the state is limited by article 1903 to the case wherein it PHILIPPINES, defendants-appellees.
acts through a special agent (and a special agent, in the sense in which these words
are employed, is one who receives a definite and fixed order or commission, foreign MAKALINTAL, J.:p
to the exercise of the duties of his office if he is a special official) so that in This is an appeal from the decision of the Court of First Instance of Cebu in its Civil
representation of the state and being bound to act as an agent thereof, he executes Case No. R-5977, dismissing the plaintiff's complaint.
the trust confided to him. This concept does not apply to any executive agent who Victoria Amigable, the appellant herein, is the registered owner of Lot No. 639 of
is an employee of the acting administration and who on his own responsibility the Banilad Estate in Cebu City as shown by Transfer Certificate of Title No. T-18060,
performs the functions which are inherent in and naturally pertain to his office and which superseded Transfer Certificate of Title No. RT-3272 (T-3435) issued to her by
which are regulated by law and the regulations." (Supreme Court of Spain, May 18, the Register of Deeds of Cebu on February 1, 1924. No annotation in favor of the
1904; 98 Jur. Civ., 389, 390.) government of any right or interest in the property appears at the back of the
That according to paragraph 5 of article 1903 of the Civil Code and the principle laid certificate. Without prior expropriation or negotiated sale, the government used a
down in a decision, among others, of the 18th of May, 1904, in a damage case, the portion of said lot, with an area of 6,167 square meters, for the construction of the
responsibility of the state is limited to that which it contracts through a special Mango and Gorordo Avenues.
agent, duly empowered by a definite order or commission to perform some act or It appears that said avenues were already existing in 1921 although "they were in
charged with some definite purpose which gives rise to the claim, and not where the bad condition and very narrow, unlike the wide and beautiful avenues that they are
now," and "that the tracing of said roads was begun in 1924, and the formal reconsideration, the plaintiff appealed to the Court of Appeals, which subsequently
construction in certified the case to Us, there being no question of fact involved.
1925." * The issue here is whether or not the appellant may properly sue the government
On March 27, 1958 Amigable's counsel wrote the President of the Philippines, under the facts of the case.
requesting payment of the portion of her lot which had been appropriated by the In the case of Ministerio vs. Court of First Instance of Cebu,1 involving a claim for
government. The claim was indorsed to the Auditor General, who disallowed it in payment of the value of a portion of land used for the widening of the Gorordo
his 9th Indorsement dated December 9, 1958. A copy of said indorsement was Avenue in Cebu City, this Court, through Mr. Justice Enrique M. Fernando, held that
transmitted to Amigable's counsel by the Office of the President on January 7, 1959. where the government takes away property from a private landowner for public
On February 6, 1959 Amigable filed in the court a quo a complaint, which was later use without going through the legal process of expropriation or negotiated sale, the
amended on April 17, 1959 upon motion of the defendants, against the Republic of aggrieved party may properly maintain a suit against the government without
the Philippines and Nicolas Cuenca, in his capacity as Commissioner of Public thereby violating the doctrine of governmental immunity from suit without its
Highways for the recovery of ownership and possession of the 6,167 square meters consent. We there said: .
of land traversed by the Mango and Gorordo Avenues. She also sought the payment ... . If the constitutional mandate that the owner be compensated for property
of compensatory damages in the sum of P50,000.00 for the illegal occupation of her taken for public use were to be respected, as it should, then a suit of this character
land, moral damages in the sum of P25,000.00, attorney's fees in the sum of should not be summarily dismissed. The doctrine of governmental immunity from
P5,000.00 and the costs of the suit. suit cannot serve as an instrument for perpetrating an injustice on a citizen. Had the
Within the reglementary period the defendants filed a joint answer denying the government followed the procedure indicated by the governing law at the time, a
material allegations of the complaint and interposing the following affirmative complaint would have been filed by it, and only upon payment of the compensation
defenses, to wit: (1) that the action was premature, the claim not having been filed fixed by the judgment, or after tender to the party entitled to such payment of the
first with the Office of the Auditor General; (2) that the right of action for the amount fixed, may it "have the right to enter in and upon the land so condemned,
recovery of any amount which might be due the plaintiff, if any, had already to appropriate the same to the public use defined in the judgment." If there were
prescribed; (3) that the action being a suit against the Government, the claim for an observance of procedural regularity, petitioners would not be in the sad plaint
moral damages, attorney's fees and costs had no valid basis since as to these items they are now. It is unthinkable then that precisely because there was a failure to
the Government had not given its consent to be sued; and (4) that inasmuch as it abide by what the law requires, the government would stand to benefit. It is just as
was the province of Cebu that appropriated and used the area involved in the important, if not more so, that there be fidelity to legal norms on the part of
construction of Mango Avenue, plaintiff had no cause of action against the officialdom if the rule of law were to be maintained. It is not too much to say that
defendants. when the government takes any property for public use, which is conditioned upon
During the scheduled hearings nobody appeared for the defendants the payment of just compensation, to be judicially ascertained, it makes manifest
notwithstanding due notice, so the trial court proceeded to receive the plaintiff's that it submits to the jurisdiction of a court. There is no thought then that the
evidence ex parte. On July 29, 1959 said court rendered its decision holding that it doctrine of immunity from suit could still be appropriately invoked.
had no jurisdiction over the plaintiff's cause of action for the recovery of possession Considering that no annotation in favor of the government appears at the back of
and ownership of the portion of her lot in question on the ground that the her certificate of title and that she has not executed any deed of conveyance of any
government cannot be sued without its consent; that it had neither original nor portion of her lot to the government, the appellant remains the owner of the whole
appellate jurisdiction to hear, try and decide plaintiff's claim for compensatory lot. As registered owner, she could bring an action to recover possession of the
damages in the sum of P50,000.00, the same being a money claim against the portion of land in question at anytime because possession is one of the attributes of
government; and that the claim for moral damages had long prescribed, nor did it ownership. However, since restoration of possession of said portion by the
have jurisdiction over said claim because the government had not given its consent government is neither convenient nor feasible at this time because it is now and has
to be sued. Accordingly, the complaint was dismissed. Unable to secure a been used for road purposes, the only relief available is for the government to
make due compensation which it could and should have done years ago. To expedite proceedings and accommodate the defendants, gave the PCGG forty-five
determine the due compensation for the land, the basis should be the price or (45) days to expand its complaint to make more specific certain allegations. 4
value thereof at the time of the taking.2 Tantoco and Santiago then presented a "motion for leave to file interrogatories under Rule 25 of the Rules of Court" dated

February 1, 1988, and "Interrogatories under Rule 25." 5


As regards the claim for damages, the plaintiff is entitled thereto in the form of Basically, they sought an answer to the
legal interest on the price of the land from the time it was taken up to the time that question: "Who were the Commissioners of the PCGG (aside from its Chairman, Hon.
payment is made by the government. 3 In addition, the government should pay for Ramon Diaz, who verified the complaint) who approved or authorized the inclusion
attorney's fees, the amount of which should be fixed by the trial court after hearing. of Messrs. Bienvenido R. Tantoco, Jr. and Dominador R. Santiago as defendants in
WHEREFORE, the decision appealed from is hereby set aside and the case the . . case?" 6 The PCGG responded by filing a motion dated February 9, 1988 to
remanded to the court a quo for the determination of compensation, including strike out said motion and interrogatories as being impertinent, "queer," "weird,"
attorney's fees, to which the appellant is entitled as above indicated. No or "procedurally bizarre as the purpose thereof lacks merit as it is improper,
pronouncement as to costs. impertinent and irrelevant under any
Concepcion, C.J., Reyes, J.B.L., Zaldivar, Castro, Fernando, Teehankee, Barredo, guise." 7
On March 18, 1988, in compliance with the Order of January 29, 1988, the PCGG filed an Expanded Complaint. 8
Villamor and Makasiar JJ., concur. As this
expanded complaint, Tantoco and Santiago reiterated their motion for bill of
G.R. No. 90478 November 21, 1991 particulars, through a Manifestation dated April 11, 1988. 9
Afterwards, by Resolution dated July 4, 1988, 10
REPUBLIC OF THE PHILIPPINES (PRESIDENTIAL COMMISSION ON GOOD the Sandiganbayan denied the motion to strike out,
GOVERNMENT), petitioner, for bill of particulars, and for leave to file interrogatories, holding them to be
vs. without legal and factual basis. Also denied was the PCGG's motion to strike out
SANDIGANBAYAN, BIENVENIDO R. TANTOCO, JR. and DOMINADOR R. SANTIAGO, impertinent pleading dated February 9, 1988. The Sandiganbayan declared inter
respondents. alia the complaint to be "sufficiently definite and clear enough," there are adequate
Dominador R. Santiago for and in his own behalf and as counsel for respondent allegations . . which clearly portray the supposed involvement and/or alleged
Tantoco, Jr. participation of defendants-movants in the transactions described in detail in said
Complaint," and "the other matters sought for particularization are evidentiary in
NARVASA, J.: nature which should be ventilated in the pre-trial or trial proper . ." It also opined
Private respondents Bienvenido R. Tantoco, Jr. and Dominador R. Santiago — that "(s)ervice of interrogatories before joinder of issue and without leave of court
together with Ferdinand E. Marcos, Imelda R. Marcos, Bienvenido R. Tantoco, Sr., is premature . . (absent) any special or extraordinary circumstances . . which would
Gliceria R. Tantoco, and Maria Lourdes Tantoco-Pineda-are defendants in Civil Case justify . . (the same)."
No. 0008 of the Sandiganbayan. The case was commenced on July 21, 1987 by the Tantoco and Santiago then filed an Answer with Compulsory Counterclaim under
Presidential Commission on Good Government (PCGG) in behalf of the Republic of date of July 18, 1988. 11 In response, the PCGG presented a "Reply to Answer with
the Philippines. The complaint which initiated the action was denominated one "for Motion to Dismiss Compulsory Counterclaim " 12
The case was set for pre-trial on July 31, 1989. 13
reconveyance, reversion, accounting, restitution and damages," and was avowedly On July 25, 1989, the PCGG submitted its PRE-
14
filed pursuant to Executive Order No. 14 of President Corazon C. Aquino. TRIAL. The pre-trial was however reset to September 11, 1989, and all other
After having been served with summons, Tantoco, Jr. and Santiago, instead of filing parties were required to submit pre-trial briefs on or before that date. 15
On July 27, 1989 Tantoco and Santiago filed with the Sandiganbayan a pleading denominated "Interrogatories to Plaintiff," 16
their answer, jointly filed a "MOTION TO STRIKE OUT SOME PORTIONS OF THE
17
COMPLAINT AND FOR BILL OF PARTICULARS OF OTHER PORTIONS" dated Nov. 3, and on August 2, 1989, an "Amended Interrogatories to Plaintiff"' as well as a
1987. 1 The PCGG filed an opposition thereto, 2 and the movants, a reply to the Motion for Production and Inspection of Documents. 18
opposition. 3 By order dated January 29, 1988, the Sandiganbayan, in order to The amended interrogatories chiefly sought factual details relative to specific averments of PCGG's amended complaint, through

such questions, for instance, as—


1. In connection with the allegations . . in paragraph 1 . ., what specific property or properties does the plaintiff claim it
1) the interrogatories "are not specific and do not name the person to whom
has the right to recover from defendants Tantoco, Jr. and Santiago for being ill-gotten?
they are propounded . .," or "who in the PCGG, in particular, . . (should) answer the
3. In connection with the allegations . . in paragraph 10 (a) . . what specific act or acts . . were committed by
interrogatories;"
defendants Tantoco, Jr. and Santiago in "concert with" defendant Ferdinand Marcos and in furtherance or pursuit, of the alleged
2) the interrogatories delve into "factual matters which had already been
systematic plan of said defendant Marcos to accumulate ill-gotten wealth?"
decreed . . as part of the proof of the Complaint upon trial . .;"
5. In connection with . . paragraph 13 . ., what specific act or acts of the defendants Tantoco, Jr. and Santiago . . were
3) the interrogatories "are frivolous" since they inquire about "matters of fact
committed by said defendants as part, or in furtherance, of the alleged plan to conceal assets of defendants Ferdinand and
. . which defendants . . sought to . . (extract) through their aborted Motion for Bill of
Imelda Marcos?
Particulars;"
7. In connection with . . paragraph 15(c) . . is it plaintiff's position or theory of the case that Tourist Duty Free Shops,
4) the interrogatories "are really in the nature of a deposition, which is
Inc., including all the assets of said corporation, are beneficially owned by either or both defendants Ferdinand and Imelda
prematurely filed and irregularly utilized . . (since) the order of trial calls for plaintiff
Marcos and that the defendants Tantoco, Jr. and Santiago, as well as, the other stockholders of record of the same corporation
to first present its evidence."
are mere "dummies" of said defendants Ferdinand and /or Imelda R. Marcos?
Tantoco and Santiago filed a reply and opposition on September 18, 1989.
On the other hand, the motion for production and inspection of documents prayed for examination and copying of—
After hearing, the Sandiganbayan promulgated two (2) Resolutions on September
1) the "official records and other evidence" on the basis of which the verification of the Amended Complaint asserted
29, 1989, the first, denying reconsideration (of the Resolution allowing production
that the allegations thereof are "true and correct;"
of documents), and the second, reiterating by implication the permission to serve
2) the documents listed in PCGG's Pre-Trial Brief as those "intended to be presented and . . marked as exhibits for the
the amended interrogatories on the plaintiff (PCGG). 20
plaintiff;" and Hence, this petition for certiorari.

3) "the minutes of the meeting of the PCGG which chronicles the discussion (if any) and the decision (of the Chairman The PCGG contends that said orders, both dated September 29, 1989, should be nullified because rendered with grave abuse of

and members) to file the complaint" in the case at bar. discretion amounting to excess of jurisdiction. More particularly, it claims —

By Resolutions dated August 21, 1989 and August 25, 1989, the Sandiganbayan admitted the Amended Interrogatories and a) as regards the order allowing the amended interrogatories to the plaintiff PCGG:

granted the motion for production and inspection of documents (production being scheduled on September 14 and 15, 1989), 1) that said interrogatories are not specific and do not name the particular individuals to whom they are propounded,

respectively. being addressed only to the PCGG;

On September 1, 1989, the PCGG filed a Motion for Reconsideration of the Resolution of August 25, 1989 (allowing production 2) that the interrogatories deal with factual matters which the Sandiganbayan (in denying the movants' motion for bill

and inspection of documents). It argued that of particulars) had already declared to be part of the PCGG's proof upon trial; and

1) since the documents subject thereof would be marked as exhibits during the pre-trial on September 11, 1989 3) that the interrogatories would make PCGG Commissioners and officers witnesses, in contravention of Executive

anyway, the order for "their production and inspection on September 14 and 15, are purposeless and unnecessary;" Order No. 14 and related issuances; and

2) movants already know of the existence and contents of the document which "are clearly described . . (in) plaintiff's b) as regards the order granting the motion for production of documents:

Pre-Trial Brief;" 1) that movants had not shown any good cause therefor;

3) the documents are "privileged in character" since they are intended to be used against the PCGG and/or its 2) that some documents sought to be produced and inspected had already been presented in Court and marked

Commissioners in violation of Section 4, Executive Order No. 1, viz.: preliminarily as PCGG's exhibits, and the movants had viewed, scrutinized and even offered objections thereto and made

(a) No civil action shall lie against the Commission or any member thereof for anything done or omitted in the discharge of the comments thereon; and

task contemplated by this Order. 3) that the other documents sought to be produced are either —

(b) No member or staff of the Commission shall be required to testify or produce evidence in any judicial, legislative, or (a) privileged in character or confidential in nature and their use is proscribed by the immunity provisions of Executive

administrative proceeding concerning matters within its official cognizance. Order No. 1, or

It also filed on September 4, 1989 an opposition to the Amended Interrogatories, 19 (b) non-existent, or mere products of the movants' suspicion and fear.
which the Sandiganbayan
This Court issued a temporary restraining order on October 27, 1989, directing the Sandiganbayan to desist from enforcing its
treated as a motion for reconsideration of the Resolution of August 21, 1989
questioned resolutions of September 29, 1989 in Civil Case No. 0008. 21
(admitting the Amended Interrogatories). The opposition alleged that —
After the issues were delineated and argued at no little length by the parties, the Solicitor General withdrew "as counsel for Seventy-one years ago, in Alonso v. Villamor, 30
this Court described the nature and object of
plaintiff . . with the reservation, however, conformably with Presidential Decree No. 478, the provisions of Executive Order No.
litigation and in the process laid down the standards by which judicial contests are
292, as well as the decisional law of 'Orbos v. Civil Service Commission, et al.,' (G.R. No. 92561, September 12, 1990) 22
to to be conducted in this jurisdiction. It said:
submit his comment/observation on incidents/matters pending with this . . Court if A litigation is not a game of technicalities in which one, more deeply schooled and
called for by circumstances in the interest of the Government or if he is so required skilled in the subtle art of movement and position, entraps and destroys the other.
by the Court." 23 This, the Court allowed by Resolution dated January 21, 1991. 24 It is, rather a contest in which each contending party fully and fairly lays before the
Subsequently, PCGG Commissioner Maximo A. Maceren advised the Court that the cases from which the Solicitor General had
court the facts in issue and then brushing aside as wholly trivial and indecisive all
withdrawn would henceforth be under his (Maceren's) charge "and/or any of the following private attorneys: Eliseo B. Alampay,
imperfections of form and technicalities of procedure, asks that justice be done on
Jr., Mario E. Ongkiko, Mario Jalandoni and such other attorneys as it may later authorize." 25
the merits. Lawsuits, unlike duels, are not to be won by a rapier's thrust.
The facts not being in dispute, and it appearing that the parties have fully ventilated their respective positions, the Court now
Technicality, when it deserts its proper office as an aid to justice and becomes its
proceeds to decide the case.
great hindrance and chief enemy, deserves scant consideration from courts. There
Involved in the present proceedings are two of the modes of discovery provided in the Rules of Court: interrogatories to parties ,
should be no vested right in technicalities. . . .
26
and production and inspection of documents and things. 27 Now, it appears to the The message is plain. It is the duty of each contending party to lay before the court
Court that among far too many lawyers (and not a few judges), there is, if not a the facts in issue-fully and fairly; i.e., to present to the court all the material and
regrettable unfamiliarity and even outright ignorance about the nature, purposes relevant facts known to him, suppressing or concealing nothing, nor preventing
and operation of the modes of discovery, at least a strong yet unreasoned and another party, by clever and adroit manipulation of the technical rules of pleading
unreasonable disinclination to resort to them — which is a great pity for the and evidence, from also presenting all the facts within his knowledge.
intelligent and adequate use of the deposition-discovery mechanism, coupled with Initially, that undertaking of laying the facts before the court is accomplished by the
pre-trial procedure, could, as the experience of other jurisdictions convincingly pleadings filed by the parties; but that, only in a very general way. Only "ultimate
demonstrates, effectively shorten the period of litigation and speed up facts" are set forth in the pleadings; hence, only the barest outline of the facfual
adjudication. 28 Hence, a few words about these remedies is not at all basis of a party's claims or defenses is limned in his pleadings. The law says that
inappropriate. every pleading "shall contain in a methodical and logical form, a plain, concise and
The resolution of controversies is, as everyone knows, the raison d'etre of courts. direct statement of the ultimate facts on which the party pleading relies for his
This essential function is accomplished by first, the ascertainment of all the material claim or defense, as the case may be, omitting the statement of mere evidentiary
and relevant facts from the pleadings and from the evidence adduced by the facts." 31
Parenthetically, if this requirement is not observed, i.e., the ultimate facts are alleged too generally or "not averred with
parties, and second, after that determination of the facts has been completed, by
sufficient definiteness or particularity to enable . . (an adverse party) properly to prepare his responsive pleading or to prepare
the application of the law thereto to the end that the controversy may be settled
for trial," a bill of particulars seeking a "more definite statement" may be ordered by the court on motion of a party. The office of
authoritatively, definitely and finally.
a bill of particulars is, however, limited to making more particular or definite the ultimate facts in a pleading It is not its office to
It is for this reason that a substantial part of the adjective law in this jurisdiction is
supply evidentiary matters. And the common perception is that said evidentiary details are made known to the parties and the
occupied with assuring that all the facts are indeed presented to the Court; for
court only during the trial, when proof is adduced on the issues of fact arising from the pleadings.
obviously, to the extent that adjudication is made on the basis of incomplete facts,
The truth is that "evidentiary matters" may be inquired into and learned by the parties before the trial. Indeed, it is the purpose
to that extent there is faultiness in the approximation of objective justice. It is thus
and policy of the law that the parties — before the trial if not indeed even before the pre-trial — should discover or inform
the obligation of lawyers no less than of judges to see that this objective is attained;
themselves of all the facts relevant to the action, not only those known to them individually, but also those known to
that is to say, that there no suppression, obscuration, misrepresentation or
adversaries; in other words, the desideratum is that civil trials should not be carried on in the dark; and the Rules of Court make
distortion of the facts; and that no party be unaware of any fact material a relevant
this ideal possible through the deposition-discovery mechanism set forth in Rules 24 to 29. The experience in other jurisdictions
to the action, or surprised by any factual detail suddenly brought to his attention
during the trial. 29 has been that ample discovery before trial, under proper regulation, accomplished one of the most necessary of modern
procedure: it not only eliminates unessential issue from trials thereby shortening them considerably, but also requires parties to
after jurisdiction has been obtained over the defendant or property subject of the
play the game with the cards on the table so that the possibility of fair settlement before trial is measurably increased. . ." 32
action) that prior leave of court is needed to avail of these modes of discovery, the
As just intimated, the deposition-discovery procedure was designed to remedy the conceded inadequacy and cumbersomeness
reason being that at that time the issues are not yet joined and the disputed facts
of the pre-trial functions of notice-giving, issue-formulation and fact revelation theretofore performed primarily by the pleadings.
are not clear. 37
The various modes or instruments of discovery are meant to serve (1) as a device, along with the pre-trial hearing under Rule 20, On the other hand, leave of court is required as regards discovery by (a) production or inspection of documents or things in

to narrow and clarify the basic issues between the parties, and (2) as a device for ascertaining the facts relative to those issues. accordance with Rule 27, or (b) physical and mental examination of persons under Rule 28, which may be granted upon due

The evident purpose is, to repeat, to enable parties, consistent with recognized privileges, to obtain the fullest possible application and a showing of due cause.

knowledge of the issues and facts before trials and thus prevent that said trials are carried on in the dark.33 To ensure that availment of the modes of discovery is otherwise untrammeled and efficacious, the law imposes serious sanctions

To this end, the field of inquiry that may be covered by depositions or interrogatories is as broad as when the interrogated party on the party who refuses to make discovery, such as dismissing the action or proceeding or part thereof, or rendering judgment

is called as a witness to testify orally at trial. The inquiry extends to all facts which are relevant, whether they be ultimate or by default against the disobedient party; contempt of court, or arrest of the party or agent of the party; payment of the amount

evidentiary, excepting only those matters which are privileged. The objective is as much to give every party the fullest possible of reasonable expenses incurred in obtaining a court order to compel discovery; taking the matters inquired into as established in

information of all the relevant facts before the trial as to obtain evidence for use upon said trial. The principle is reflected in accordance with the claim of the party seeking discovery; refusal to allow the disobedient party support or oppose designated

Section 2, Rule 24 (governing depositions) 34 claims or defenses; striking out pleadings or parts thereof; staying further proceedings. 38
which generally allows the examination of a deponent
Of course, there are limitations to discovery, even when permitted to be undertaken without leave and without judicial

intervention. "As indicated by (the) Rules . . ., limitations inevitably arise when it can be shown that the examination is being
1) "regarding any matter, not privileged, which is relevant to the subject of
conducted in bad faith or in such a manner as to annoy, embarass, or oppress the person subject to the inquiry. 39
the pending action, whether relating to the claim or defense of any other party;" And . . .
2) as well as: further limitations come into existence when the inquiry touches upon the
(a) "the existence, description, nature, custody, condition and location of any irrelevant or encroaches upon the recognized domains of privilege." 40
In fine, the liberty of a party to make discovery is well nigh unrestricted if the matters inquired into are otherwise relevant and
books, documents, or other tangible things" and
not privileged, and the inquiry is made in good faith and within the bounds of the law.
(b) "the identity and location of persons having knowledge of relevant facts."
It is in light of these broad principles underlying the deposition-discovery mechanism, in relation of course to the particular rules
What is chiefly contemplated is the discovery of every bit of information which may
directly involved, that the issues in this case will now be resolved.
be useful in the preparation for trial, such as the identity and location of persons
The petitioner's objections to the interrogatories served on it in accordance with Rule 25 of the Rules of Court cannot be
having knowledge of relevant facts; those relevant facts themselves; and the
sustained.
existence, description, nature, custody, condition, and location of any books,
It should initially be pointed out — as regards the private respondents "Motion for Leave to File Interrogatories" dated February
documents, or other tangible things. Hence, "the deposition-discovery rules are to
1, 1988 41
be accorded a broad and liberal treatment. No longer can the time-honored cry of — that it was correct for them to seek leave to serve interrogatories,
"fishing expedition" serve to preclude a party from inquiring into the facts because discovery was being availed of before an answer had been served. In such a
underlying his opponent's case. Mutual knowledge of all the relevant facts gathered situation, i.e., "after jurisdiction has been obtained over any defendant or over
by both parties is essential to proper litigation. To that end, either party may property subject of the action" but before answer, Section 1 of Rule 24 (treating of
compel the other to disgorge whatever facts he has in his possession. The depositions), in relation to Section 1 of Rule 25 (dealing with interrogatories to
deposition-discovery procedure simply advances the stage at which the disclosure parties) explicitly requires "leave of court." 42But there was no need for the private
can be compelled from the time of trial to the period preceding it, thus reducing the respondents to seek such leave to serve their "Amended Interrogatories to Plaintiff"
possibility, of surprise, . . . 35 (dated August 2, 1989 43) after they had filed their answer to the PCGG's complaint,
In line with this principle of according liberal treatment to the deposition-discovery mechanism, such modes of discovery as (a)
just as there was no need for the Sandiganbayan to act thereon.
depositions (whether by oral examination or written interrogatories) under Rule 24, (b) interrogatories to parties under Rule 25,
1. The petitioner's first contention — that the interrogatories in question are
and (c) requests for admissions under Rule 26, may be availed of without leave of court, and generally, without court
defective because they (a) do not name the particular individuals to whom they are
intervention. The Rules of Court explicitly provide that leave of court is not necessary to avail of said modes of discovery after an
propounded, being addressed only to the PCGG, and (b) are "fundamentally the
answer to the complaint has been served. 36
It is only when an answer has not yet been filed (but
same matters . . (private respondents) sought to be clarified through their aborted interrogate him by leading questions and contradict and impeach him in all respects
Motion . . for Bill of Particulars" — are untenable and quickly disposed of. as if he had been called by the adverse party, and the witness thus called may be
The first part of petitioner's submission is adequately confuted by Section 1, Rule 25 contradicted and impeached by or on behalf of the adverse party also, and may be
which states that if the party served with interrogatories is a juridical entity such as cross-examined by the adverse party only upon the subject-matter of his
"a public or private corporation or a partnership or association," the same shall be examination in chief.
"answered . . by any officer thereof competent to testify in its behalf." There is The PCGG insinuates that the private respondents are engaged on a "fishing
absolutely no reason why this proposition should not be applied by analogy to the expedition," apart from the fact that the information sought is immaterial since
interrogatories served on the PCGG. That the interrogatories are addressed only to they are evidently meant to establish a claim against PCGG officers who are not
the PCGG, without naming any specific commissioner o officer thereof, is utterly of parties to the action. It suffices to point out that "fishing expeditions" are precisely
no consequence, and may not be invoked as a reason to refuse to answer. As the permitted through the modes of discovery. 47 Moreover, a defendant who files a
rule states, the interrogatories shall be answered "by any officer thereof competent counterclaim against the plaintiff is allowed by the Rules to implead persons
to testify in its behalf." (therefore strangers to the action) as additional defendants on said counterclaim.
That the matters on which discovery is desired are the same matters subject of a This may be done pursuant to Section 14, Rule 6 of the Rules, to wit:
prior motion for bill of particulars addressed to the PCGG's amended complaint — Sec. 14. Bringing new parties. — When the presence of parties other than those to
and denied for lack of merit — is beside the point. Indeed, as already pointed out the original action is required for the granting of complete relief in the
above, a bill of particulars may elicit only ultimate facts, not so-called evidentiary determination of a counterclaim or cross-claim, the court shall order them to be
facts. The latter are without doubt proper subject of discovery. 44 brought in as defendants, if jurisdiction over them can be obtained."
Neither may it be validly argued that the amended interrogatories lack specificity. The merest glance at them disproves the
The PCGG's assertion that it or its members are not amenable to any civil action
argument. The interrogatories are made to relate to individual paragraphs of the PCGG's expanded complaint and inquire about
"for anything done or omitted in the discharge of the task contemplated by . .
details of the ultimate facts therein alleged. What the PCGG may properly do is to object to specific items of the interrogatories,
(Executive) Order (No. 1)," is not a ground to refuse to answer the interrogatories.
on the ground of lack of relevancy, or privilege, or that the inquiries are being made in bad faith, or simply to embarass or
The disclosure of facto relevant to the action and which are not self-incriminatory
oppress it. 45
But until such an objection is presented and sustained, the obligation to or otherwise privileged is one thing; the matter of whether or not liability may arise
answer subsists. from the facts disclosed in light of Executive Order
2. That the interrogatories deal with factual matters which will be part of the No. 1, is another. No doubt, the latter proposition may properly be set up by way of
PCGG's proof upon trial, is not ground for suppressing them either. As already defense in the action.
pointed out, it is the precise purpose of discovery to ensure mutual knowledge of all The apprehension has been expressed that the answers to the interrogatories may
the relevant facts on the part of all parties even before trial, this being deemed be utilized as foundation for a counterclaim against the PCGG or its members and
essential to proper litigation. This is why either party may compel the other to officers. They will be. The private respondents have made no secret that this is in
disgorge whatever facts he has in his possession; and the stage at which disclosure fact their intention. Withal, the Court is unable to uphold the proposition that while
of evidence is made is advanced from the time of trial to the period preceding it. the PCGG obviously feels itself at liberty to bring actions on the basis of its study
3. Also unmeritorious is the objection that the interrogatories would make and appreciation of the evidence in its possession, the parties sued should not be
PCGG Commissioners and officers witnesses, in contravention of Executive Order free to file counterclaims in the same actions against the PCGG or its officers for
No. 14 and related issuances. In the first place, there is nothing at all wrong in a gross neglect or ignorance, if not downright bad faith or malice in the
party's making his adversary his witness . 46 This is expressly allowed by Section 6, commencement or initiation of such judicial proceedings, or that in the actions that
Rule 132 of the Rules of Court, viz.: it may bring, the PCGG may opt not to be bound by rule applicable to the parties it
Sec. 6. Direct examination of unwilling or hostile witnesses. — A party may . . . call has sued, e.g., the rules of discovery.
an adverse party or an officer, director, or managing agent of a public or private So, too, the PCGG's postulation that none of its members may be "required to
corporation or of a partnership or association which is an adverse party, and testify or produce evidence in any judicial . . proceeding concerning matters within
The PCGG says that some of the documents are non-existent. This it can allege in response to the corresponding question in the
its official cognizance," has no application to a judicial proceeding it has itself
interrogatories, and it will incur no sanction for doing so unless it is subsequently established that the denial is false.
initiated. As just suggested, the act of bringing suit must entail a waiver of the
The claim that use of the documents is proscribed by Executive Order No. 1 has already been dealt with. The PCGG is however at
exemption from giving evidence; by bringing suit it brings itself within the operation
liberty to allege and prove that said documents fall within some other privilege, constitutional or statutory.
and scope of all the rules governing civil actions, including the rights and duties
The Court finally finds that, contrary to the petitioner's theory, there is good cause for the production and inspection of the
under the rules of discovery. Otherwise, the absurd would have to be conceded,
documents subject of the motion dated August 3, 1989. 53
that while the parties it has impleaded as defendants may be required to "disgorge Some of the documents are, according to the
all the facts" within their knowledge and in their possession, it may not itself be verification of the amended complaint, the basis of several of the material
subject to a like compulsion. allegations of said complaint. Others, admittedly, are to be used in evidence by the
The State is, of course, immune from suit in the sense that it cannot, as a rule, be plaintiff. It is matters such as these into which inquiry is precisely allowed by the
sued without its consent. But it is axiomatic that in filing an action, it divests itself of rules of discovery, to the end that the parties may adequately prepare for pre-trial
its sovereign character and sheds its immunity from suit, descending to the level of and trial. The only other documents sought to be produced are needed in relation
an ordinary litigant. The PCGG cannot claim a superior or preferred status to the to the allegations of the counterclaim. Their relevance is indisputable; their
State, even while assuming to represent or act for the State. 48 disclosure may not be opposed.
The suggestion 49
that the State makes no implied waiver of immunity by filing suit except One last word. Due no doubt to the deplorable unfamiliarity respecting the nature,
when in so doing it acts in, or in matters concerning, its proprietary or non- purposes and operation of the modes of discovery earlier
governmental capacity, is unacceptable; it attempts a distinction without support in mentioned, 54 there also appears to be a widely entertained idea that application of
principle or precedent. On the contrary — said modes is a complicated matter, unduly expensive and dilatory. Nothing could
The consent of the State to be sued may be given expressly or impliedly. Express be farther from the truth. For example, as will already have been noted from the
consent may be manifested either through a general law or a special law. Implied preceding discussion, all that is entailed to activate or put in motion the process of
consent is given when the State itself commences litigation or when it enters into a discovery by interrogatories to parties under Rule 25 of the Rules of Court, is simply
contract. 50 the delivery directly to a party of a letter setting forth a list of least questions with
The immunity of the State from suits does not deprive it of the right to sue private parties in its own courts. The state as plaintiff
the request that they be answered individually. 55 That is all. The service of such a
may avail itself of the different forms of actions open to private litigants. In short, by taking the initiative in an action against the
communication on the party has the effect of imposing on him the obligation of
private parties, the state surrenders its privileged position and comes down to the level of the defendant. The latter
answering the questions "separately and fully in writing underoath," and serving "a
automatically acquires, within certain limits, the right to set up whatever claims and other defenses he might have against the
copy of the answers on the party submitting the interrogatories within fifteen (15)
state. . . . (Sinco, Philippine Political Law, Tenth E., pp. 36-37, citing U.S. vs. Ringgold, 8 Pet. 150, 8 L. ed. 899)" 51
days after service of the interrogatories . . ." 56 The sanctions for refusing to make
It can hardly be doubted that in exercising the right of eminent domain, the State exercises its jus imperii, as distinguished from
discovery have already been mentioned. 57 So, too, discovery under Rule 26 is
its proprietary rights or jus gestionis. Yet, even in that area, it has been held that where private property has been taken in
begun by nothing more complex than the service on a party of a letter or other
expropriation without just compensation being paid, the defense of immunity from suit cannot be set up by the State against an
written communication containing a request that specific facts therein set forth
action for payment by the owner. 52
and/or particular documents copies of which are thereto appended, be admitted in
The Court also finds itself unable to sustain the PCGG's other principal contention, of the nullity of the Sandiganbayan's Order for
writing. 58 That is all. Again, the receipt of such a communication by the party has
the production and inspection of specified documents and things allegedly in its possession.
the effect of imposing on him the obligation of serving the party requesting
The Court gives short shrift to the argument that some documents sought to be produced and inspected had already been
admission with "a sworn statement either denying specifically the matters of which
presented in Court and marked preliminarily as PCGG's exhibits, the movants having in fact viewed, scrutinized and even offered
an admission is requested or setting forth in detail the reasons why he cannot
objections thereto and made comments thereon. Obviously, there is nothing secret or confidential about these documents. No
truthfully either admit or deny those matters," failing in which "(e)ach of the
serious objection can therefore be presented to the desire of the private respondents to have copies of those documents in
matters of which admission is requested shall be deemed admitted." 59 The taking
order to study them some more or otherwise use them during the trial for any purpose allowed by law.
of depositions in accordance with Rule 24 (either on oral examination or by written
interrogatories) while somewhat less simple, is nonetheless by no means as Administration (NARRA), a tract of land situated in the Municipalities of Tinambac
complicated as seems to be the lamentably extensive notion. and Siruma, Camarines Sur, after which the NARRA and its successor agency, the
WHEREFORE, the petition is DENIED, without pronouncement as to costs. The Land Authority, started sub-dividing and distributing the land to the settlers; that
temporary restraining order issued on October 27, 1989 is hereby LIFTED AND SET the property in question, while located within the reservation established under
ASIDE. Proclamation No. 90, was the private property of plaintiff and should therefore be
SO ORDERED. excluded therefrom. Plaintiff prayed that he be declared the rightful and true
Fernan, C.J., Gutierrez, Jr., Paras, Feliciano, Padilla, Bidin, Griño-Aquino, Medialdea, owner of the property in question consisting of 1,364.4177 hectares; that his title of
Regalado and Davide, Jr., JJ., concur. ownership based on informacion posesoria of his predecessor-in-interest be
Melencio-Herrera, J., I also join Justice Cruz's concurrence. declared legal valid and subsisting and that defendant be ordered to cancel and
Romero, J., took no part. nullify all awards to the settlers.
The defendant, represented by the Land Authority, filed an answer, raising by way
G.R. No. 70853 March 12, 1987 of affirmative defenses lack of sufficient cause of action and prescription.
REPUBLIC OF THE PHILIPPINES, petitioner-appellee, On August 29, 1970, the trial court, through Judge Rafael S. Sison, rendered a
vs. decision declaring Lot No. 1, with an area of 701.9064 hectares, to be the private
PABLO FELICIANO and INTERMEDIATE APPELLATE COURT, respondents-appellants. property of the plaintiff, "being covered by a possessory information title in the
name of his predecessor-in-interest" and declaring said lot excluded from the
YAP, J.: NARRA settlement reservation. The court declared the rest of the property claimed
Petitioner seeks the review of the decision of the Intermediate Appellate Court by plaintiff, i.e. Lots 2, 3 and 4, reverted to the public domain.
dated April 30, 1985 reversing the order of the Court of First Instance of Camarines A motion to intervene and to set aside the decision of August 29, 1970 was filed by
Sur, Branch VI, dated August 21, 1980, which dismissed the complaint of eighty-six (86) settlers, together with the barrio council of Pag-asay, alleging among
respondent Pablo Feliciano for recovery of ownership and possession of a parcel of other things that intervenors had been in possession of the land in question for
land on the ground of non-suability of the State. more than twenty (20) years under claim of ownership.
The background of the present controversy may be briefly summarized as follows: On January 25, 1971, the court a quo reconsidered its decision, reopened the case
On January 22, 1970, respondent Feliciano filed a complaint with the then Court of and directed the intervenors to file their corresponding pleadings and present their
First Instance of Camarines Sur against the Republic of the Philippines, represented evidence; all evidence already presented were to remain but plaintiff, as well as the
by the Land Authority, for the recovery of ownership and possession of a parcel of Republic of the Philippines, could present additional evidence if they so desire. The
land, consisting of four (4) lots with an aggregate area of 1,364.4177 hectares, plaintiff presented additional evidence on July 30, 1971, and the case was set for
situated in the Barrio of Salvacion, Municipality of Tinambac, Camarines Sur. hearing for the reception of intervenors' evidence on August 30 and August 31,
Plaintiff alleged that he bought the property in question from Victor Gardiola by 1971.
virtue of a Contract of Sale dated May 31, 1952, followed by a Deed of Absolute On August 30, 1971, the date set for the presentation of the evidence for
Sale on October 30, 1954; that Gardiola had acquired the property by purchase intervenors, the latter did not appear but submitted a motion for postponement
from the heirs of Francisco Abrazado whose title to the said property was and resetting of the hearing on the next day, August 31, 1971. The trial court denied
evidenced by an informacion posesoria that upon plaintiff's purchase of the the motion for postponement and allowed plaintiff to offer his evidence "en
property, he took actual possession of the same, introduced various improvements ausencia," after which the case would be deemed submitted for decision. On the
therein and caused it to be surveyed in July 1952, which survey was approved by following day, August 31, 1971, Judge Sison rendered a decision reiterating his
the Director of Lands on October 24, 1954; that on November 1, 1954, President decision of August 29, 1970.
Ramon Magsaysay issued Proclamation No. 90 reserving for settlement purposes, A motion for reconsideration was immediately filed by the intervenors. But before
under the administration of the National Resettlement and Rehabilitation this motion was acted upon, plaintiff filed a motion for execution, dated November
18, 1971. On December 10, 1971, the lower court, this time through Judge Miguel showing that the State has consented to be sued, either expressly or by implication
Navarro, issued an order denying the motion for execution and setting aside the through the use of statutory language too plain to be misinterpreted. 2 There is no
order denying intervenors' motion for postponement. The case was reopened to such showing in the instant case. Worse, the complaint itself fails to allege the
allow intervenors to present their evidence. Unable to secure a reconsideration of existence of such consent. This is a fatal defect, 3and on this basis alone, the
Judge Navarro's order, the plaintiff went to the Intermediate Appellate Court on a complaint should have been dismissed.
petition for certiorari. Said petition was, however, denied by the Intermediate The failure of the petitioner to assert the defense of immunity from suit when the
Appellate Court, and petitioners brought the matter to this Court in G.R. No. 36163, case was tried before the court a quo, as alleged by private respondent, is not fatal.
which was denied on May 3, 1973 Consequently, the case was remanded to the It is now settled that such defense "may be invoked by the courts sua sponte at any
court a quo for further proceedings. stage of the proceedings." 4
On August 31, 1970, intervenors filed a motion to dismiss, principally on the ground Private respondent contends that the consent of petitioner may be read from the
that the Republic of the Philippines cannot be sued without its consent and hence Proclamation itself, when it established the reservation " subject to private rights, if
the action cannot prosper. The motion was opposed by the plaintiff. any there be. " We do not agree. No such consent can be drawn from the language
On August 21, 1980, the trial court, through Judge Esteban Lising, issued the of the Proclamation. The exclusion of existing private rights from the reservation
questioned order dismissing the case for lack of jurisdiction. Respondent moved for established by Proclamation No. 90 can not be construed as a waiver of the
reconsideration, while the Solicitor General, on behalf of the Republic of the immunity of the State from suit. Waiver of immunity, being a derogation of
Philippines filed its opposition thereto, maintaining that the dismissal was proper sovereignty, will not be inferred lightly. but must be construed in strictissimi juris. 5
on the ground of non-suability of the State and also on the ground that the Moreover, the Proclamation is not a legislative act. The consent of the State to be
existence and/or authenticity of the purported possessory information title of the sued must emanate from statutory authority. Waiver of State immunity can only be
respondents' predecessor-in-interest had not been demonstrated and that at any made by an act of the legislative body.
rate, the same is not evidence of title, or if it is, its efficacy has been lost by Neither is there merit in respondent's submission, which the respondent appellate
prescription and laches. court sustained, on the basis of our decision in the Begosa case, 6 that the present
Upon denial of the motion for reconsideration, plaintiff again went to the action is not a suit against the State within the rule of State immunity from suit,
Intermediate Appellate Court on petition for certiorari. On April 30, 1985, the because plaintiff does not seek to divest the Government of any of its lands or its
respondent appellate court rendered its decision reversing the order of Judge Lising funds. It is contended that the complaint involves land not owned by the State, but
and remanding the case to the court a quo for further proceedings. Hence this private land belonging to the plaintiff, hence the Government is not being divested
petition. of any of its properties. There is some sophistry involved in this argument, since the
We find the petition meritorious. The doctrine of non-suability of the State has character of the land sought to be recovered still remains to be established, and the
proper application in this case. The plaintiff has impleaded the Republic of the plaintiff's action is directed against the State precisely to compel the latter to
Philippines as defendant in an action for recovery of ownership and possession of a litigate the ownership and possession of the property. In other words, the plaintiff
parcel of land, bringing the State to court just like any private person who is claimed is out to establish that he is the owner of the land in question based, incidentally,
to be usurping a piece of property. A suit for the recovery of property is not an on an informacion posesoria of dubious value, and he seeks to establish his claim of
action in rem, but an action in personam.1 It is an action directed against a specific ownership by suing the Republic of the Philippines in an action in personam.
party or parties, and any judgment therein binds only such party or parties. The The inscription in the property registry of an informacion posesoria under the
complaint filed by plaintiff, the private respondent herein, is directed against the Spanish Mortgage Law was a means provided by the law then in force in the
Republic of the Philippines, represented by the Land Authority, a governmental Philippines prior to the transfer of sovereignty from Spain to the United States of
agency created by Republic Act No. 3844. America, to record a claimant's actual possession of a piece of land, established
By its caption and its allegation and prayer, the complaint is clearly a suit against through an ex parte proceeding conducted in accordance with prescribed rules. 7
the State, which under settled jurisprudence is not permitted, except upon a Such inscription merely furnishes, at best, prima facie evidence of the fact that at
the time the proceeding was held, the claimant was in possession of the land under vs.
a claim of right as set forth in his application. 8 The possessory information could HON. V. M. RUIZ, Presiding Judge of Branch XV, Court of First Instance of Rizal and
ripen into a record of ownership after the lapse of 20 years (later reduced to 10 ELIGIO DE GUZMAN & CO., INC., respondents.
years), upon the fulfillment of the requisites prescribed in Article 393 of the Spanish Sycip, Salazar, Luna & Manalo & Feliciano Law for petitioners.
Mortgage Law. Albert, Vergara, Benares, Perias & Dominguez Law Office for respondents.
There is no showing in the case at bar that the informacion posesoria held by the
respondent had been converted into a record of ownership. Such possessory ABAD SANTOS, J.:
information, therefore, remained at best mere prima facie evidence of possession. This is a petition to review, set aside certain orders and restrain the respondent
Using this possessory information, the respondent could have applied for judicial judge from trying Civil Case No. 779M of the defunct Court of First Instance of Rizal.
confirmation of imperfect title under the Public Land Act, which is an action in rem. The factual background is as follows:
However, having failed to do so, it is rather late for him to pursue this avenue at At times material to this case, the United States of America had a naval base in
this time. Respondent must also contend, as the records disclose, with the fact Subic, Zambales. The base was one of those provided in the Military Bases
admitted by him and stated in the decision of the Court a quo that settlers have Agreement between the Philippines and the United States.
been occupying and cultivating the land in question since even before the outbreak Sometime in May, 1972, the United States invited the submission of bids for the
of the war, which puts in grave doubt his own claim of possession. following projects
Worthy of note is the fact, as pointed out by the Solicitor General, that the 1. Repair offender system, Alava Wharf at the U.S. Naval Station Subic Bay,
informacion posesoria registered in the Office of the Register of Deed of Camarines Philippines.
Sur on September 23, 1952 was a "reconstituted" possessory information; it was 2. Repair typhoon damage to NAS Cubi shoreline; repair typhoon damage to
"reconstituted from the duplicate presented to this office (Register of Deeds) by Dr. shoreline revetment, NAVBASE Subic; and repair to Leyte Wharf approach,
Pablo Feliciano," without the submission of proof that the alleged duplicate was NAVBASE Subic Bay, Philippines.
authentic or that the original thereof was lost. Reconstitution can be validly made Eligio de Guzman & Co., Inc. responded to the invitation and submitted bids.
only in case of loss of the original. 10 These circumstances raise grave doubts as to Subsequent thereto, the company received from the United States two telegrams
the authenticity and validity of the "informacion posesoria" relied upon by requesting it to confirm its price proposals and for the name of its bonding
respondent Feliciano. Adding to the dubiousness of said document is the fact that company. The company complied with the requests. [In its complaint, the company
"possessory information calls for an area of only 100 hectares," 11 whereas the land alleges that the United States had accepted its bids because "A request to confirm a
claimed by respondent Feliciano comprises 1,364.4177 hectares, later reduced to price proposal confirms the acceptance of a bid pursuant to defendant United
701-9064 hectares. Courts should be wary in accepting "possessory information States' bidding practices." (Rollo, p. 30.) The truth of this allegation has not been
documents, as well as other purportedly old Spanish titles, as proof of alleged tested because the case has not reached the trial stage.]
ownership of lands. In June, 1972, the company received a letter which was signed by Wilham I. Collins,
WHEREFORE, judgment is hereby rendered reversing and setting aside the appealed Director, Contracts Division, Naval Facilities Engineering Command, Southwest
decision of the Intermediate Appellate Court, dated April 30, 1985, and affirming Pacific, Department of the Navy of the United States, who is one of the petitioners
the order of the court a quo, dated August 21, 1980, dismissing the complaint filed herein. The letter said that the company did not qualify to receive an award for the
by respondent Pablo Feliciano against the Republic of the Philippines. No costs. projects because of its previous unsatisfactory performance rating on a repair
SO ORDERED. contract for the sea wall at the boat landings of the U.S. Naval Station in Subic Bay.
The letter further said that the projects had been awarded to third parties. In the
G.R. No. L-35645 May 22, 1985 abovementioned Civil Case No. 779-M, the company sued the United States of
UNITED STATES OF AMERICA, CAPT. JAMES E. GALLOWAY, WILLIAM I. COLLINS America and Messrs. James E. Galloway, William I. Collins and Robert Gohier all
and ROBERT GOHIER, petitioners, members of the Engineering Command of the U.S. Navy. The complaint is to order
the defendants to allow the plaintiff to perform the work on the projects and, in the It is however contended that when a sovereign state enters into a contract with a
event that specific performance was no longer possible, to order the defendants to private person, the state can be sued upon the theory that it has descended to the
pay damages. The company also asked for the issuance of a writ of preliminary level of an individual from which it can be implied that it has given its consent to be
injunction to restrain the defendants from entering into contracts with third parties sued under the contract. ...
for work on the projects. xxx xxx xxx
The defendants entered their special appearance for the purpose only of We agree to the above contention, and considering that the United States
questioning the jurisdiction of this court over the subject matter of the complaint government, through its agency at Subic Bay, entered into a contract with appellant
and the persons of defendants, the subject matter of the complaint being acts and for stevedoring and miscellaneous labor services within the Subic Bay Area, a U.S.
omissions of the individual defendants as agents of defendant United States of Naval Reservation, it is evident that it can bring an action before our courts for any
America, a foreign sovereign which has not given her consent to this suit or any contractual liability that that political entity may assume under the contract. The
other suit for the causes of action asserted in the complaint." (Rollo, p. 50.) trial court, therefore, has jurisdiction to entertain this case ... (Rollo, pp. 20-21.)
Subsequently the defendants filed a motion to dismiss the complaint which The reliance placed on Lyons by the respondent judge is misplaced for the following
included an opposition to the issuance of the writ of preliminary injunction. The reasons:
company opposed the motion. The trial court denied the motion and issued the In Harry Lyons, Inc. vs. The United States of America, supra, plaintiff brought suit in
writ. The defendants moved twice to reconsider but to no avail. Hence the instant the Court of First Instance of Manila to collect several sums of money on account of
petition which seeks to restrain perpetually the proceedings in Civil Case No. 779-M a contract between plaintiff and defendant. The defendant filed a motion to dismiss
for lack of jurisdiction on the part of the trial court. on the ground that the court had no jurisdiction over defendant and over the
The petition is highly impressed with merit. subject matter of the action. The court granted the motion on the grounds that: (a)
The traditional rule of State immunity exempts a State from being sued in the it had no jurisdiction over the defendant who did not give its consent to the suit;
courts of another State without its consent or waiver. This rule is a necessary and (b) plaintiff failed to exhaust the administrative remedies provided in the
consequence of the principles of independence and equality of States. However, contract. The order of dismissal was elevated to this Court for review.
the rules of International Law are not petrified; they are constantly developing and In sustaining the action of the lower court, this Court said:
evolving. And because the activities of states have multiplied, it has been necessary It appearing in the complaint that appellant has not complied with the procedure
to distinguish them-between sovereign and governmental acts (jure imperii) and laid down in Article XXI of the contract regarding the prosecution of its claim against
private, commercial and proprietary acts (jure gestionis). The result is that State the United States Government, or, stated differently, it has failed to first exhaust its
immunity now extends only to acts jure imperil The restrictive application of State administrative remedies against said Government, the lower court acted properly in
immunity is now the rule in the United States, the United Kingdom and other states dismissing this case.(At p. 598.)
in western Europe. (See Coquia and Defensor Santiago, Public International Law, pp. It can thus be seen that the statement in respect of the waiver of State immunity
207-209 [1984].) from suit was purely gratuitous and, therefore, obiter so that it has no value as an
The respondent judge recognized the restrictive doctrine of State immunity when imperative authority.
he said in his Order denying the defendants' (now petitioners) motion: " A The restrictive application of State immunity is proper only when the proceedings
distinction should be made between a strictly governmental function of the arise out of commercial transactions of the foreign sovereign, its commercial
sovereign state from its private, proprietary or non- governmental acts (Rollo, p. activities or economic affairs. Stated differently, a State may be said to have
20.) However, the respondent judge also said: "It is the Court's considered opinion descended to the level of an individual and can thus be deemed to have tacitly
that entering into a contract for the repair of wharves or shoreline is certainly not a given its consent to be sued only when it enters into business contracts. It does not
governmental function altho it may partake of a public nature or character. As aptly apply where the contract relates to the exercise of its sovereign functions. In this
pointed out by plaintiff's counsel in his reply citing the ruling in the case of Lyons, case the projects are an integral part of the naval base which is devoted to the
Inc., [104 Phil. 594 (1958)], and which this Court quotes with approval, viz.: defense of both the United States and the Philippines, indisputably a function of the
government of the highest order; they are not utilized for nor dedicated to Teehankee, Aquino, Concepcion, Jr., Melencio-Herrera, Plana, * Escolin, Relova,
commercial or business purposes. Gutierrez, Jr., De la Fuente, Cuevas and Alampay, JJ., concur.
That the correct test for the application of State immunity is not the conclusion of a Fernando, C.J., took no part.
contract by a State but the legal nature of the act is shown in Syquia vs. Lopez, 84
Phil. 312 (1949). In that case the plaintiffs leased three apartment buildings to the G.R. No. 101949 December 1, 1994
United States of America for the use of its military officials. The plaintiffs sued to THE HOLY SEE, petitioner,
recover possession of the premises on the ground that the term of the leases had vs.
expired. They also asked for increased rentals until the apartments shall have been THE HON. ERIBERTO U. ROSARIO, JR., as Presiding Judge of the Regional Trial
vacated. Court of Makati, Branch 61 and STARBRIGHT SALES ENTERPRISES, INC.,
The defendants who were armed forces officers of the United States moved to respondents.
dismiss the suit for lack of jurisdiction in the part of the court. The Municipal Court Padilla Law Office for petitioner.
of Manila granted the motion to dismiss; sustained by the Court of First Instance, Siguion Reyna, Montecillo & Ongsiako for private respondent.
the plaintiffs went to this Court for review on certiorari. In denying the petition, this
Court said: QUIASON, J.:
On the basis of the foregoing considerations we are of the belief and we hold that This is a petition for certiorari under Rule 65 of the Revised Rules of Court to
the real party defendant in interest is the Government of the United States of reverse and set aside the Orders dated June 20, 1991 and September 19, 1991 of
America; that any judgment for back or Increased rentals or damages will have to the Regional Trial Court, Branch 61, Makati, Metro Manila in Civil Case No. 90-183.
be paid not by defendants Moore and Tillman and their 64 co-defendants but by The Order dated June 20, 1991 denied the motion of petitioner to dismiss the
the said U.S. Government. On the basis of the ruling in the case of Land vs. Dollar complaint in Civil Case No. 90-183, while the Order dated September 19, 1991
already cited, and on what we have already stated, the present action must be denied the motion for reconsideration of the June 20,1991 Order.
considered as one against the U.S. Government. It is clear hat the courts of the Petitioner is the Holy See who exercises sovereignty over the Vatican City in Rome,
Philippines including the Municipal Court of Manila have no jurisdiction over the Italy, and is represented in the Philippines by the Papal Nuncio.
present case for unlawful detainer. The question of lack of jurisdiction was raised Private respondent, Starbright Sales Enterprises, Inc., is a domestic corporation
and interposed at the very beginning of the action. The U.S. Government has not , engaged in the real estate business.
given its consent to the filing of this suit which is essentially against her, though not This petition arose from a controversy over a parcel of land consisting of 6,000
in name. Moreover, this is not only a case of a citizen filing a suit against his own square meters (Lot 5-A, Transfer Certificate of Title No. 390440) located in the
Government without the latter's consent but it is of a citizen filing an action against Municipality of Parañaque, Metro Manila and registered in the name of petitioner.
a foreign government without said government's consent, which renders more Said Lot 5-A is contiguous to Lots 5-B and 5-D which are covered by Transfer
obvious the lack of jurisdiction of the courts of his country. The principles of law Certificates of Title Nos. 271108 and 265388 respectively and registered in the
behind this rule are so elementary and of such general acceptance that we deem it name of the Philippine Realty Corporation (PRC).
unnecessary to cite authorities in support thereof. (At p. 323.) The three lots were sold to Ramon Licup, through Msgr. Domingo A. Cirilos, Jr.,
In Syquia,the United States concluded contracts with private individuals but the acting as agent to the sellers. Later, Licup assigned his rights to the sale to private
contracts notwithstanding the States was not deemed to have given or waived its respondent.
consent to be sued for the reason that the contracts were forjure imperii and not In view of the refusal of the squatters to vacate the lots sold to private respondent,
for jure gestionis. a dispute arose as to who of the parties has the responsibility of evicting and
WHEREFORE, the petition is granted; the questioned orders of the respondent clearing the land of squatters. Complicating the relations of the parties was the sale
judge are set aside and Civil Case No. is dismissed. Costs against the private by petitioner of Lot 5-A to Tropicana Properties and Development Corporation
respondent. (Tropicana).
I the reconveyance of the lots in question; (3) specific performance of the agreement
On January 23, 1990, private respondent filed a complaint with the Regional Trial to sell between it and the owners of the lots; and (4) damages.
Court, Branch 61, Makati, Metro Manila for annulment of the sale of the three On June 8, 1990, petitioner and Msgr. Cirilos separately moved to dismiss the
parcels of land, and specific performance and damages against petitioner, complaint — petitioner for lack of jurisdiction based on sovereign immunity from
represented by the Papal Nuncio, and three other defendants: namely, Msgr. suit, and Msgr. Cirilos for being an improper party. An opposition to the motion was
Domingo A. Cirilos, Jr., the PRC and Tropicana (Civil Case No. filed by private respondent.
90-183). On June 20, 1991, the trial court issued an order denying, among others,
The complaint alleged that: (1) on April 17, 1988, Msgr. Cirilos, Jr., on behalf of petitioner's motion to dismiss after finding that petitioner "shed off [its] sovereign
petitioner and the PRC, agreed to sell to Ramon Licup Lots 5-A, 5-B and 5-D at the immunity by entering into the business contract in question" (Rollo, pp. 20-21).
price of P1,240.00 per square meters; (2) the agreement to sell was made on the On July 12, 1991, petitioner moved for reconsideration of the order. On August 30,
condition that earnest money of P100,000.00 be paid by Licup to the sellers, and 1991, petitioner filed a "Motion for a Hearing for the Sole Purpose of Establishing
that the sellers clear the said lots of squatters who were then occupying the same; Factual Allegation for claim of Immunity as a Jurisdictional Defense." So as to
(3) Licup paid the earnest money to Msgr. Cirilos; (4) in the same month, Licup facilitate the determination of its defense of sovereign immunity, petitioner prayed
assigned his rights over the property to private respondent and informed the sellers that a hearing be conducted to allow it to establish certain facts upon which the
of the said assignment; (5) thereafter, private respondent demanded from Msgr. said defense is based. Private respondent opposed this motion as well as the
Cirilos that the sellers fulfill their undertaking and clear the property of squatters; motion for reconsideration.
however, Msgr. Cirilos informed private respondent of the squatters' refusal to On October 1, 1991, the trial court issued an order deferring the resolution on the
vacate the lots, proposing instead either that private respondent undertake the motion for reconsideration until after trial on the merits and directing petitioner to
eviction or that the earnest money be returned to the latter; (6) private respondent file its answer (Rollo, p. 22).
counterproposed that if it would undertake the eviction of the squatters, the Petitioner forthwith elevated the matter to us. In its petition, petitioner invokes the
purchase price of the lots should be reduced from P1,240.00 to P1,150.00 per privilege of sovereign immunity only on its own behalf and on behalf of its official
square meter; (7) Msgr. Cirilos returned the earnest money of P100,000.00 and representative, the Papal Nuncio.
wrote private respondent giving it seven days from receipt of the letter to pay the On December 9, 1991, a Motion for Intervention was filed before us by the
original purchase price in cash; (8) private respondent sent the earnest money back Department of Foreign Affairs, claiming that it has a legal interest in the outcome of
to the sellers, but later discovered that on March 30, 1989, petitioner and the PRC, the case as regards the diplomatic immunity of petitioner, and that it "adopts by
without notice to private respondent, sold the lots to Tropicana, as evidenced by reference, the allegations contained in the petition of the Holy See insofar as they
two separate Deeds of Sale, one over Lot 5-A, and another over Lots 5-B and 5-D; refer to arguments relative to its claim of sovereign immunity from suit" (Rollo, p.
and that the sellers' transfer certificate of title over the lots were cancelled, 87).
transferred and registered in the name of Tropicana; (9) Tropicana induced Private respondent opposed the intervention of the Department of Foreign Affairs.
petitioner and the PRC to sell the lots to it and thus enriched itself at the expense of In compliance with the resolution of this Court, both parties and the Department of
private respondent; (10) private respondent demanded the rescission of the sale to Foreign Affairs submitted their respective memoranda.
Tropicana and the reconveyance of the lots, to no avail; and (11) private respondent II
is willing and able to comply with the terms of the contract to sell and has actually A preliminary matter to be threshed out is the procedural issue of whether the
made plans to develop the lots into a townhouse project, but in view of the sellers' petition for certiorari under Rule 65 of the Revised Rules of Court can be availed of
breach, it lost profits of not less than P30,000.000.00. to question the order denying petitioner's motion to dismiss. The general rule is
Private respondent thus prayed for: (1) the annulment of the Deeds of Sale that an order denying a motion to dismiss is not reviewable by the appellate courts,
between petitioner and the PRC on the one hand, and Tropicana on the other; (2) the remedy of the movant being to file his answer and to proceed with the hearing
before the trial court. But the general rule admits of exceptions, and one of these is
when it is very clear in the records that the trial court has no alternative but to The Court allowed the said Department to file its memorandum in support of
dismiss the complaint (Philippine National Bank v. Florendo, 206 SCRA 582 [1992]; petitioner's claim of sovereign immunity.
Zagada v. Civil Service Commission, 216 SCRA 114 [1992]. In such a case, it would be In some cases, the defense of sovereign immunity was submitted directly to the
a sheer waste of time and energy to require the parties to undergo the rigors of a local courts by the respondents through their private counsels (Raquiza v. Bradford,
trial. 75 Phil. 50 [1945]; Miquiabas v. Philippine-Ryukyus Command, 80 Phil. 262 [1948];
The other procedural question raised by private respondent is the personality or United States of America v. Guinto, 182 SCRA 644 [1990] and companion cases). In
legal interest of the Department of Foreign Affairs to intervene in the case in behalf cases where the foreign states bypass the Foreign Office, the courts can inquire into
of the Holy See (Rollo, pp. 186-190). the facts and make their own determination as to the nature of the acts and
In Public International Law, when a state or international agency wishes to plead transactions involved.
sovereign or diplomatic immunity in a foreign court, it requests the Foreign Office III
of the state where it is sued to convey to the court that said defendant is entitled to The burden of the petition is that respondent trial court has no jurisdiction over
immunity. petitioner, being a foreign state enjoying sovereign immunity. On the other hand,
In the United States, the procedure followed is the process of "suggestion," where private respondent insists that the doctrine of non-suability is not anymore
the foreign state or the international organization sued in an American court absolute and that petitioner has divested itself of such a cloak when, of its own free
requests the Secretary of State to make a determination as to whether it is entitled will, it entered into a commercial transaction for the sale of a parcel of land located
to immunity. If the Secretary of State finds that the defendant is immune from suit, in the Philippines.
he, in turn, asks the Attorney General to submit to the court a "suggestion" that the A. The Holy See
defendant is entitled to immunity. In England, a similar procedure is followed, only Before we determine the issue of petitioner's non-suability, a brief look into its
the Foreign Office issues a certification to that effect instead of submitting a status as a sovereign state is in order.
"suggestion" (O'Connell, I International Law 130 [1965]; Note: Immunity from Suit Before the annexation of the Papal States by Italy in 1870, the Pope was the
of Foreign Sovereign Instrumentalities and Obligations, 50 Yale Law Journal 1088 monarch and he, as the Holy See, was considered a subject of International Law.
[1941]). With the loss of the Papal States and the limitation of the territory under the Holy
In the Philippines, the practice is for the foreign government or the international See to an area of 108.7 acres, the position of the Holy See in International Law
organization to first secure an executive endorsement of its claim of sovereign or became controversial (Salonga and Yap, Public International Law 36-37 [1992]).
diplomatic immunity. But how the Philippine Foreign Office conveys its In 1929, Italy and the Holy See entered into the Lateran Treaty, where Italy
endorsement to the courts varies. In International Catholic Migration Commission v. recognized the exclusive dominion and sovereign jurisdiction of the Holy See over
Calleja, 190 SCRA 130 (1990), the Secretary of Foreign Affairs just sent a letter the Vatican City. It also recognized the right of the Holy See to receive foreign
directly to the Secretary of Labor and Employment, informing the latter that the diplomats, to send its own diplomats to foreign countries, and to enter into treaties
respondent-employer could not be sued because it enjoyed diplomatic immunity. In according to International Law (Garcia, Questions and Problems In International
World Health Organization v. Aquino, 48 SCRA 242 (1972), the Secretary of Foreign Law, Public and Private 81 [1948]).
Affairs sent the trial court a telegram to that effect. In Baer v. Tizon, 57 SCRA 1 The Lateran Treaty established the statehood of the Vatican City "for the purpose of
(1974), the U.S. Embassy asked the Secretary of Foreign Affairs to request the assuring to the Holy See absolute and visible independence and of guaranteeing to
Solicitor General to make, in behalf of the Commander of the United States Naval it indisputable sovereignty also in the field of international relations" (O'Connell, I
Base at Olongapo City, Zambales, a "suggestion" to respondent Judge. The Solicitor International Law 311 [1965]).
General embodied the "suggestion" in a Manifestation and Memorandum as In view of the wordings of the Lateran Treaty, it is difficult to determine whether
amicus curiae. the statehood is vested in the Holy See or in the Vatican City. Some writers even
In the case at bench, the Department of Foreign Affairs, through the Office of Legal suggested that the treaty created two international persons — the Holy See and
Affairs moved with this Court to be allowed to intervene on the side of petitioner. Vatican City (Salonga and Yap, supra, 37).
The Vatican City fits into none of the established categories of states, and the Some states passed legislation to serve as guidelines for the executive or judicial
attribution to it of "sovereignty" must be made in a sense different from that in determination when an act may be considered as jure gestionis. The United States
which it is applied to other states (Fenwick, International Law 124-125 [1948]; Cruz, passed the Foreign Sovereign Immunities Act of 1976, which defines a commercial
International Law 37 [1991]). In a community of national states, the Vatican City activity as "either a regular course of commercial conduct or a particular
represents an entity organized not for political but for ecclesiastical purposes and commercial transaction or act." Furthermore, the law declared that the
international objects. Despite its size and object, the Vatican City has an "commercial character of the activity shall be determined by reference to the
independent government of its own, with the Pope, who is also head of the Roman nature of the course of conduct or particular transaction or act, rather than by
Catholic Church, as the Holy See or Head of State, in conformity with its traditions, reference to its purpose." The Canadian Parliament enacted in 1982 an Act to
and the demands of its mission in the world. Indeed, the world-wide interests and Provide For State Immunity in Canadian Courts. The Act defines a "commercial
activities of the Vatican City are such as to make it in a sense an "international activity" as any particular transaction, act or conduct or any regular course of
state" (Fenwick, supra., 125; Kelsen, Principles of International Law 160 [1956]). conduct that by reason of its nature, is of a "commercial character."
One authority wrote that the recognition of the Vatican City as a state has The restrictive theory, which is intended to be a solution to the host of problems
significant implication — that it is possible for any entity pursuing objects involving the issue of sovereign immunity, has created problems of its own. Legal
essentially different from those pursued by states to be invested with international treatises and the decisions in countries which follow the restrictive theory have
personality (Kunz, The Status of the Holy See in International Law, 46 The American difficulty in characterizing whether a contract of a sovereign state with a private
Journal of International Law 308 [1952]). party is an act jure gestionis or an act jure imperii.
Inasmuch as the Pope prefers to conduct foreign relations and enter into The restrictive theory came about because of the entry of sovereign states into
transactions as the Holy See and not in the name of the Vatican City, one can purely commercial activities remotely connected with the discharge of
conclude that in the Pope's own view, it is the Holy See that is the international governmental functions. This is particularly true with respect to the Communist
person. states which took control of nationalized business activities and international
The Republic of the Philippines has accorded the Holy See the status of a foreign trading.
sovereign. The Holy See, through its Ambassador, the Papal Nuncio, has had This Court has considered the following transactions by a foreign state with private
diplomatic representations with the Philippine government since 1957 (Rollo, p. parties as acts jure imperii: (1) the lease by a foreign government of apartment
87). This appears to be the universal practice in international relations. buildings for use of its military officers (Syquia v. Lopez, 84 Phil. 312 [1949]; (2) the
B. Sovereign Immunity conduct of public bidding for the repair of a wharf at a United States Naval Station
As expressed in Section 2 of Article II of the 1987 Constitution, we have adopted the (United States of America v. Ruiz, supra.); and (3) the change of employment status
generally accepted principles of International Law. Even without this affirmation, of base employees (Sanders v. Veridiano, 162 SCRA 88 [1988]).
such principles of International Law are deemed incorporated as part of the law of On the other hand, this Court has considered the following transactions by a foreign
the land as a condition and consequence of our admission in the society of nations state with private parties as acts jure gestionis: (1) the hiring of a cook in the
(United States of America v. Guinto, 182 SCRA 644 [1990]). recreation center, consisting of three restaurants, a cafeteria, a bakery, a store, and
There are two conflicting concepts of sovereign immunity, each widely held and a coffee and pastry shop at the John Hay Air Station in Baguio City, to cater to
firmly established. According to the classical or absolute theory, a sovereign cannot, American servicemen and the general public (United States of America v. Rodrigo,
without its consent, be made a respondent in the courts of another sovereign. 182 SCRA 644 [1990]); and (2) the bidding for the operation of barber shops in Clark
According to the newer or restrictive theory, the immunity of the sovereign is Air Base in Angeles City (United States of America v. Guinto, 182 SCRA 644 [1990]).
recognized only with regard to public acts or acts jure imperii of a state, but not The operation of the restaurants and other facilities open to the general public is
with regard to private acts or acts jure gestionis undoubtedly for profit as a commercial and not a governmental activity. By entering
(United States of America v. Ruiz, 136 SCRA 487 [1987]; Coquia and Defensor- into the employment contract with the cook in the discharge of its proprietary
Santiago, Public International Law 194 [1984]).
function, the United States government impliedly divested itself of its sovereign The decision to transfer the property and the subsequent disposal thereof are
immunity from suit. likewise clothed with a governmental character. Petitioner did not sell Lot
In the absence of legislation defining what activities and transactions shall be 5-A for profit or gain. It merely wanted to dispose off the same because the
considered "commercial" and as constituting acts jure gestionis, we have to come squatters living thereon made it almost impossible for petitioner to use it for the
out with our own guidelines, tentative they may be. purpose of the donation. The fact that squatters have occupied and are still
Certainly, the mere entering into a contract by a foreign state with a private party occupying the lot, and that they stubbornly refuse to leave the premises, has been
cannot be the ultimate test. Such an act can only be the start of the inquiry. The admitted by private respondent in its complaint (Rollo, pp. 26, 27).
logical question is whether the foreign state is engaged in the activity in the regular The issue of petitioner's non-suability can be determined by the trial court without
course of business. If the foreign state is not engaged regularly in a business or going to trial in the light of the pleadings, particularly the admission of private
trade, the particular act or transaction must then be tested by its nature. If the act respondent. Besides, the privilege of sovereign immunity in this case was
is in pursuit of a sovereign activity, or an incident thereof, then it is an act jure sufficiently established by the Memorandum and Certification of the Department of
imperii, especially when it is not undertaken for gain or profit. Foreign Affairs. As the department tasked with the conduct of the Philippines'
As held in United States of America v. Guinto, (supra): foreign relations (Administrative Code of 1987, Book IV, Title I, Sec. 3), the
There is no question that the United States of America, like any other state, will be Department of Foreign Affairs has formally intervened in this case and officially
deemed to have impliedly waived its non-suability if it has entered into a contract in certified that the Embassy of the Holy See is a duly accredited diplomatic mission to
its proprietary or private capacity. It is only when the contract involves its sovereign the Republic of the Philippines exempt from local jurisdiction and entitled to all the
or governmental capacity that no such waiver may be implied. rights, privileges and immunities of a diplomatic mission or embassy in this country
In the case at bench, if petitioner has bought and sold lands in the ordinary course (Rollo, pp. 156-157). The determination of the executive arm of government that a
of a real estate business, surely the said transaction can be categorized as an act state or instrumentality is entitled to sovereign or diplomatic immunity is a political
jure gestionis. However, petitioner has denied that the acquisition and subsequent question that is conclusive upon the courts (International Catholic Migration
disposal of Lot 5-A were made for profit but claimed that it acquired said property Commission v. Calleja, 190 SCRA 130 [1990]). Where the plea of immunity is
for the site of its mission or the Apostolic Nunciature in the Philippines. Private recognized and affirmed by the executive branch, it is the duty of the courts to
respondent failed to dispute said claim. accept this claim so as not to embarrass the executive arm of the government in
Lot 5-A was acquired by petitioner as a donation from the Archdiocese of Manila. conducting the country's foreign relations (World Health Organization v. Aquino, 48
The donation was made not for commercial purpose, but for the use of petitioner SCRA 242 [1972]). As in International Catholic Migration Commission and in World
to construct thereon the official place of residence of the Papal Nuncio. The right of Health Organization, we abide by the certification of the Department of Foreign
a foreign sovereign to acquire property, real or personal, in a receiving state, Affairs.
necessary for the creation and maintenance of its diplomatic mission, is recognized Ordinarily, the procedure would be to remand the case and order the trial court to
in the 1961 Vienna Convention on Diplomatic Relations (Arts. 20-22). This treaty conduct a hearing to establish the facts alleged by petitioner in its motion. In view
was concurred in by the Philippine Senate and entered into force in the Philippines of said certification, such procedure would however be pointless and unduly
on November 15, 1965. circuitous (Ortigas & Co. Ltd. Partnership v. Judge Tirso Velasco, G.R. No. 109645,
In Article 31(a) of the Convention, a diplomatic envoy is granted immunity from the July 25, 1994).
civil and administrative jurisdiction of the receiving state over any real action IV
relating to private immovable property situated in the territory of the receiving Private respondent is not left without any legal remedy for the redress of its
state which the envoy holds on behalf of the sending state for the purposes of the grievances. Under both Public International Law and Transnational Law, a person
mission. If this immunity is provided for a diplomatic envoy, with all the more who feels aggrieved by the acts of a foreign sovereign can ask his own government
reason should immunity be recognized as regards the sovereign itself, which in this to espouse his cause through diplomatic channels.
case is the Holy See.
Private respondent can ask the Philippine government, through the Foreign Office, As thus simply and tersely put, with the facts being undisputed and the principle of
to espouse its claims against the Holy See. Its first task is to persuade the Philippine law that calls for application indisputable, the outcome is predictable. The Republic
government to take up with the Holy See the validity of its claims. Of course, the of the Philippines is entitled to the writs prayed for. Respondent Judge ought not to
Foreign Office shall first make a determination of the impact of its espousal on the have acted thus. The order thus impugned and the alias writ of execution must be
relations between the Philippine government and the Holy See (Young, Remedies of nullified.
Private Claimants Against Foreign States, Selected Readings on Protection by Law of In the petition filed by the Republic of the Philippines on July 7, 1969, a summary of
Private Foreign Investments 905, 919 [1964]). Once the Philippine government facts was set forth thus: "7. On July 3, 1961, a decision was rendered in Special
decides to espouse the claim, the latter ceases to be a private cause. Proceedings No. 2156-R in favor of respondents P. J. Kiener Co., Ltd., Gavino
According to the Permanent Court of International Justice, the forerunner of the Unchuan, and International Construction Corporation, and against the petitioner
International Court of Justice: herein, confirming the arbitration award in the amount of P1,712,396.40, subject of
By taking up the case of one of its subjects and by reporting to diplomatic action or Special Proceedings. 8. On June 24, 1969, respondent Honorable Guillermo P.
international judicial proceedings on his behalf, a State is in reality asserting its own Villasor, issued an Order declaring the aforestated decision of July 3, 1961 final and
rights — its right to ensure, in the person of its subjects, respect for the rules of executory, directing the Sheriffs of Rizal Province, Quezon City [as well as] Manila to
international law (The Mavrommatis Palestine Concessions, 1 Hudson, World Court execute the said decision. 9. Pursuant to the said Order dated June 24, 1969, the
Reports 293, 302 [1924]). corresponding Alias Writ of Execution [was issued] dated June 26, 1969, .... 10. On
WHEREFORE, the petition for certiorari is GRANTED and the complaint in Civil Case the strength of the afore-mentioned Alias Writ of Execution dated June 26, 1969,
No. 90-183 against petitioner is DISMISSED. the Provincial Sheriff of Rizal (respondent herein) served notices of garnishment
SO ORDERED. dated June 28, 1969 with several Banks, specially on the "monies due the Armed
Forces of the Philippines in the form of deposits sufficient to cover the amount
G.R. No. L-30671 November 28, 1973 mentioned in the said Writ of Execution"; the Philippine Veterans Bank received the
REPUBLIC OF THE PHILIPPINES, petitioner, same notice of garnishment on June 30, 1969 .... 11. The funds of the Armed Forces
vs. of the Philippines on deposit with the Banks, particularly, with the Philippine
HON. GUILLERMO P. VILLASOR, as Judge of the Court of First Instance of Cebu, Veterans Bank and the Philippine National Bank [or] their branches are public funds
Branch I, THE PROVINCIAL SHERIFF OF RIZAL, THE SHERIFF OF QUEZON CITY, and duly appropriated and allocated for the payment of pensions of retirees, pay and
THE SHERIFF OF THE CITY OF MANILA, THE CLERK OF COURT, Court of First allowances of military and civilian personnel and for maintenance and operations of
Instance of Cebu, P. J. KIENER CO., LTD., GAVINO UNCHUAN, AND the Armed Forces of the Philippines, as per Certification dated July 3, 1969 by the
INTERNATIONAL CONSTRUCTION CORPORATION, respondents. AFP Controller,..."2. The paragraph immediately succeeding in such petition then
Office of the Solicitor General Felix V. Makasiar and Solicitor Bernardo P. Pardo for alleged: "12. Respondent Judge, Honorable Guillermo P. Villasor, acted in excess of
petitioner. jurisdiction [or] with grave abuse of discretion amounting to lack of jurisdiction in
Andres T. Velarde and Marcelo B. Fernan for respondents. granting the issuance of an alias writ of execution against the properties of the
Armed Forces of the Philippines, hence, the Alias Writ of Execution and notices of
FERNANDO, J.: garnishment issued pursuant thereto are null and void." 3 In the answer filed by
The Republic of the Philippines in this certiorari and prohibition proceeding respondents, through counsel Andres T. Velarde and Marcelo B. Fernan, the facts
challenges the validity of an order issued by respondent Judge Guillermo P. Villasor, set forth were admitted with the only qualification being that the total award was
then of the Court of First Instance of Cebu, Branch I, 1 declaring a decision final and in the amount of P2,372,331.40.4
executory and of an alias writ of execution directed against the funds of the Armed The Republic of the Philippines, as mentioned at the outset, did right in filing this
Forces of the Philippines subsequently issued in pursuance thereof, the alleged certiorari and prohibition proceeding. What was done by respondent Judge is not in
ground being excess of jurisdiction, or at the very least, grave abuse of discretion. conformity with the dictates of the Constitution. .
It is a fundamental postulate of constitutionalism flowing from the juristic concept may be due government employees, is not liable to the creditors of these
of sovereignty that the state as well as its government is immune from suit unless it employees in the process of garnishment. One reason is, that the State, by virtue of
gives its consent. It is readily understandable why it must be so. In the classic its sovereignty, may not be sued in its own courts except by express authorization
formulation of Holmes: "A sovereign is exempt from suit, not because of any formal by the Legislature, and to subject its officers to garnishment would be to permit
conception or obsolete theory, but on the logical and practical ground that there indirectly what is prohibited directly. Another reason is that moneys sought to be
can be no legal right as against the authority that makes the law on which the right garnished, as long as they remain in the hands of the disbursing officer of the
depends."5 Sociological jurisprudence supplies an answer not dissimilar. So it was Government, belong to the latter, although the defendant in garnishment may be
indicated in a recent decision, Providence Washington Insurance Co. v. Republic of entitled to a specific portion thereof. And still another reason which covers both of
the Philippines,6 with its affirmation that "a continued adherence to the doctrine of the foregoing is that every consideration of public policy forbids it." 12
non-suability is not to be deplored for as against the inconvenience that may be In the light of the above, it is made abundantly clear why the Republic of the
caused private parties, the loss of governmental efficiency and the obstacle to the Philippines could rightfully allege a legitimate grievance.
performance of its multifarious functions are far greater if such a fundamental WHEREFORE, the writs of certiorari and prohibition are granted, nullifying and
principle were abandoned and the availability of judicial remedy were not thus setting aside both the order of June 24, 1969 declaring executory the decision of
restricted. With the well known propensity on the part of our people to go to court, July 3, 1961 as well as the alias writ of execution issued thereunder. The preliminary
at the least provocation, the loss of time and energy required to defend against law injunction issued by this Court on July 12, 1969 is hereby made permanent.
suits, in the absence of such a basic principle that constitutes such an effective Zaldivar (Chairman), Antonio, Fernandez and Aquino, JJ., concur.
obstacle, could very well be imagined."7 Barredo, J, took no part.
This fundamental postulate underlying the 1935 Constitution is now made explicit
in the revised charter. It is therein expressly provided: "The State may not be sued
without its consent."8 A corollary, both dictated by logic and sound sense from a G.R. No. 104269 November 11, 1993
basic concept is that public funds cannot be the object of a garnishment proceeding DEPARTMENT OF AGRICULTURE, petitioner,
even if the consent to be sued had been previously granted and the state liability vs.
adjudged. Thus in the recent case of Commissioner of Public Highways v. San THE NATIONAL LABOR RELATIONS COMMISSION, et al., respondents.
Diego,9 such a well-settled doctrine was restated in the opinion of Justice Roy Lago Salcedo for private respondents.
Teehankee: "The universal rule that where the State gives its consent to be sued by
private parties either by general or special law, it may limit claimant's action 'only VITUG, J.:
up to the completion of proceedings anterior to the stage of execution' and that the For consideration are the incidents that flow from the familiar doctrine of non-
power of the Courts ends when the judgment is rendered, since government funds suability of the state.
and properties may not be seized under writs of execution or garnishment to satisfy In this petition for certiorari, the Department of Agriculture seeks to nullify the
such judgments, is based on obvious considerations of public policy. Disbursements Resolution, 1 dated 27 November 1991, of the National Labor Relations Commission
of public funds must be covered by the corresponding appropriation as required by (NLRC), Fifth Division, Cagayan de Oro City, denying the petition for injunction,
law. The functions and public services rendered by the State cannot be allowed to prohibition and mandamus that prays to enjoin permanently the NLRC's Regional
be paralyzed or disrupted by the diversion of public funds from their legitimate and Arbitration Branch X and Cagayan de Oro City Sheriff from enforcing the decision 2
specific objects, as appropriated by law." 10 Such a principle applies even to an of 31 May 1991 of the Executive Labor Arbiter and from attaching and executing on
attempted garnishment of a salary that had accrued in favor of an employee. petitioner's property.
Director of Commerce and Industry v. Concepcion, 11 speaks to that effect. Justice The Department of Agriculture (herein petitioner) and Sultan Security Agency
Malcolm as ponente left no doubt on that score. Thus: "A rule which has never entered into a contract3 on 01 April 1989 for security services to be provided by the
been seriously questioned, is that money in the hands of public officers, although it latter to the said governmental entity. Save for the increase in the monthly rate of
the guards, the same terms and conditions were also made to apply to another extending beyond the last quarter of calendar year 1991 to enable petitioner to
contract, dated 01 May 1990, between the same parties. Pursuant to their source and raise funds to satisfy the judgment awards against it;
arrangements, guards were deployed by Sultan Agency in the various premises of 2. Meantime, petitioner is ordered and directed to source for funds within
the petitioner. the period above-stated and to deposit the sums of money equivalent to the
On 13 September 1990, several guards of the Sultan Security Agency filed a aggregate amount. it has been adjudged to pay jointly and severally with
complaint for underpayment of wages, non-payment of 13th month pay, uniform respondent Sultan Security Agency with the Regional Arbitration Branch X, Cagayan
allowances, night shift differential pay, holiday pay and overtime pay, as well as for de Oro City within the same period for proper dispositions;
damages,4 before the Regional Arbitration Branch X of Cagayan de Oro City, 3. In order to ensure compliance with this order, petitioner is likewise
docketed as NLRC Case No. 10-09-00455-90 (or 10-10-00519-90, its original docket directed to put up and post sufficient surety and supersedeas bond equivalent to at
number), against the Department of Agriculture and Sultan Security Agency. least to fifty (50%) percent of the total monetary award issued by a reputable
The Executive Labor Arbiter rendered a decision on 31 May finding herein bonding company duly accredited by the Supreme Court or by the Regional Trial
petitioner and jointly and severallyliable with Sultan Security Agency for the Court of Misamis Oriental to answer for the satisfaction of the money claims in case
payment of money claims, aggregating P266,483.91, of the complainant security of failure or default on the part of petitioner to satisfy the money claims;
guards. The petitioner and Sultan Security Agency did not appeal the decision of the 4. The City Sheriff is ordered to immediately release the properties of
Labor Arbiter. Thus, the decision became final and executory. petitioner levied on execution within ten (10) days from notice of the posting of
On 18 July 1991, the Labor Arbiter issued a writ of execution. 5 commanding the sufficient surety or supersedeas bond as specified above. In the meanwhile,
City Sheriff to enforce and execute the judgment against the property of the two petitioner is assessed to pay the costs and/or expenses incurred by the City Sheriff,
respondents. Forthwith, or on 19 July 1991, the City Sheriff levied on execution the if any, in connection with the execution of the judgments in the above-stated cases
motor vehicles of the petitioner, i.e. one (1) unit Toyota Hi-Ace, one (1) unit Toyota upon presentation of the appropriate claims or vouchers and receipts by the city
Mini Cruiser, and one (1) unit Toyota Crown.6 These units were put under the Sheriff, subject to the conditions specified in the NLRC Sheriff, subject to the
custody of Zacharias Roa, the property custodian of the petitioner, pending their conditions specified in the NLRC Manual of Instructions for Sheriffs;
sale at public auction or the final settlement of the case, whichever would come 5. The right of any of the judgment debtors to claim reimbursement against
first. each other for any payments made in connection with the satisfaction of the
A petition for injunction, prohibition and mandamus, with prayer for preliminary judgments herein is hereby recognized pursuant to the ruling in the Eagle Security
writ of injunction was filed by the petitioner with the National Labor Relations case, (supra). In case of dispute between the judgment debtors, the Executive Labor
Commission (NLRC), Cagayan de Oro, alleging, inter alia, that the writ issued was Arbiter of the Branch of origin may upon proper petition by any of the parties
effected without the Labor Arbiter having duly acquired jurisdiction over the conduct arbitration proceedings for the purpose and thereby render his decision
petitioner, and that, therefore, the decision of the Labor Arbiter was null and void after due notice and hearings;
and all actions pursuant thereto should be deemed equally invalid and of no legal, 7. Finally, the petition for injunction is Dismissed for lack of basis. The writ of
effect. The petitioner also pointed out that the attachment or seizure of its property preliminary injunction previously issued is Lifted and Set Aside and in lieu thereof, a
would hamper and jeopardize petitioner's governmental functions to the prejudice Temporary Stay of Execution is issued for a period of two (2) months but not
of the public good. extending beyond the last quarter of calendar year 1991, conditioned upon the
On 27 November 1991, the NLRC promulgated its assailed resolution; viz: posting of a surety or supersedeas bond by petitioner within ten (10) days from
WHEREFORE, premises considered, the following orders are issued: notice pursuant to paragraph 3 of this disposition. The motion to admit the
1. The enforcement and execution of the judgments against petitioner in complaint in intervention is Denied for lack of merit while the motion to dismiss the
NLRC RABX Cases Nos. 10-10-00455-90; 10-10-0481-90 and 10-10-00519-90 are petition filed by Duty Sheriff is Noted
temporarily suspended for a period of two (2) months, more or less, but not SO ORDERED.
In this petition for certiorari, the petitioner charges the NLRC with grave abuse of immunity is now the rule in the United States, the United Kingdom and other states
discretion for refusing to quash the writ of execution. The petitioner faults the NLRC in Western Europe.
for assuming jurisdiction over a money claim against the Department, which, it xxx xxx xxx
claims, falls under the exclusive jurisdiction of the Commission on Audit. More The restrictive application of State immunity is proper only when the proceedings
importantly, the petitioner asserts, the NLRC has disregarded the cardinal rule on arise out of commercial transactions of the foreign sovereign, its commercial
the non-suability of the State. activities or economic affairs. Stated differently, a state may be said to have
The private respondents, on the other hand, argue that the petitioner has impliedly descended to the level of an individual and can this be deemed to have actually
waived its immunity from suit by concluding a service contract with Sultan Security given its consent to be sued only when it enters into business contracts. It does not
Agency. apply where the contracts relates to the exercise of its sovereign functions. In this
The rule, in any case, is not really absolute for it does not say that the state may not case the projects are an integral part of the naval base which is devoted to the
be sued under any circumstances. On the contrary, as correctly phrased, the defense of both the United States and the Philippines, indisputably a function of the
doctrine only conveys, "the state may not be sued without its consent;" its clear government of the highest order; they are not utilized for not dedicated to
import then is that the State may at times be sued. 12 The States' consent may be commercial or business purposes.
given expressly or impliedly. Express consent may be made through a general law 13 In the instant case, the Department of Agriculture has not pretended to have
or a special law. 14 In this jurisdiction, the general law waiving the immunity of the assumed a capacity apart from its being a governmental entity when it entered into
state from suit is found in Act No. 3083, where the Philippine government the questioned contract; nor that it could have, in fact, performed any act
"consents and submits to be sued upon any money claims involving liability arising proprietary in character.
from contract, express or implied, which could serve as a basis of civil action But, be that as it may, the claims of private respondents, i.e. for underpayment of
between private parties." 15 Implied consent, on the other hand, is conceded when wages, holiday pay, overtime pay and similar other items, arising from the Contract
the State itself commences litigation, thus opening itself to a counterclaim16 or for Service, clearly constitute money claims. Act No. 3083, aforecited, gives the
when it enters into a contract. 17 In this situation, the government is deemed to consent of the State to be "sued upon any moneyed claim involving liability arising
have descended to the level of the other contracting party and to have divested from contract, express or implied, . . . Pursuant, however, to Commonwealth Act
itself of its sovereign immunity. This rule, relied upon by the NLRC and the private ("C.A.") No. 327, as amended by Presidential Decree ("P.D.") No. 1145, the money
respondents, is not, however, without qualification. Not all contracts entered into claim first be brought to the Commission on Audit. Thus, in Carabao, Inc., vs.
by the government operate as a waiver of its non-suability; distinction must still be Agricultural Productivity Commission, 20 we ruled:
made between one which is executed in the exercise of its sovereign function and (C)laimants have to prosecute their money claims against the Government under
another which is done in its proprietary capacity. 18 Commonwealth Act 327, stating that Act 3083 stands now merely as the general
In the Unites States of America vs. Ruiz, 19 where the questioned transaction dealt law waiving the State's immunity from suit, subject to the general limitation
with improvements on the wharves in the naval installation at Subic Bay, we held: expressed in Section 7 thereof that "no execution shall issue upon any judgment
The traditional rule of immunity exempts a State from being sued in the courts of rendered by any Court against the Government of the (Philippines), and that the
another State without its consent or waiver. This rule is a necessary consequence of conditions provided in Commonwealth Act 327 for filing money claims against the
the principles of independence and equality of States. However, the rules of Government must be strictly observed."
International Law are not petrified; they are constantly developing and evolving. We fail to see any substantial conflict or inconsistency between the provisions of
And because the activities of states have multiplied, it has been necessary to C.A. No. 327 and the Labor Code with respect to money claims against the State.
distinguish them — between sovereign and governmental acts ( jure imperii) and The Labor code, in relation to Act No. 3083, provides the legal basis for the State
private, commercial and proprietary act ( jure gestionisis). The result is that State liability but the prosecution, enforcement or satisfaction thereof must still be
immunity now extends only to acts jure imperii. The restrictive application of State pursued in accordance with the rules and procedures laid down in C.A. No. 327, as
amended by P.D. 1445.
When the state gives its consent to be sued, it does thereby necessarily consent to The reliance of petitioner Philippine National Bank in this certiorari and prohibition
unrestrained execution against it. tersely put, when the State waives its immunity, proceeding against respondent Judge Javier Pabalan who issued a writ of execution,
1
all it does, in effect, is to give the other party an opportunity to prove, if it can, that followed thereafter by a notice of garnishment of the funds of respondent
the State has a liability. 21 In Republic vs. Villasor 22 this Court, in nullifying the Philippine Virginia Tobacco Administration, 2 deposited with it, is on the
issuance of an alias writ of execution directed against the funds of the Armed fundamental constitutional law doctrine of non-suability of a state, it being alleged
Forces of the Philippines to satisfy a final and executory judgment, has explained, that such funds are public in character. This is not the first time petitioner raised
thus — that issue. It did so before in Philippine National Bank v. Court of industrial
The universal rule that where the State gives its consent to be sued by private Relations, 3decided only last January. It did not meet with success, this Court ruling
parties either by general or special law, it may limit the claimant's action "only up to in accordance with the two previous cases of National Shipyard and Steel
the completion of proceedings anterior to the stage of execution" and that the Corporation 4 and Manila Hotel Employees Association v. Manila Hotel Company, 5
power of the Courts ends when the judgment is rendered, since government funds that funds of public corporations which can sue and be sued were not exempt from
and properties may not be seized under writs or execution or garnishment to satisfy garnishment. As respondent Philippine Virginia Tobacco Administration is likewise a
such judgments, is based on obvious considerations of public policy. Disbursements public corporation possessed of the same attributes,6 a similar outcome is
of public funds must be covered by the correspondent appropriation as required by indicated. This petition must be dismissed.
law. The functions and public services rendered by the State cannot be allowed to It is undisputed that the judgment against respondent Philippine Virginia Tobacco
be paralyzed or disrupted by the diversion of public funds from their legitimate and Administration had reached the stage of finality. A writ of execution was, therefore,
specific objects, as appropriated by law.23 in order. It was accordingly issued on December 17, 1970. 7There was a notice of
WHEREFORE, the petition is GRANTED. The resolution, dated 27 November 1991, is garnishment for the full amount mentioned in such writ of execution in the sum of
hereby REVERSED and SET ASIDE. The writ of execution directed against the P12,724,66. 8 In view of the objection, however, by petitioner Philippine National
property of the Department of Agriculture is nullified, and the public respondents Bank on the above ground, coupled with an inquiry as to whether or not
are hereby enjoined permanently from doing, issuing and implementing any and all respondent Philippine Virginia Tobacco Administration had funds deposited with
writs of execution issued pursuant to the decision rendered by the Labor Arbiter petitioner's La Union branch, it was not until January 25, 1971 that the order sought
against said petitioner. to be set aside in this certiorari proceeding was issued by respondent Judge. 9 Its
SO ORDERED. dispositive portion reads as follows: Conformably with the foregoing, it is now
ordered, in accordance with law, that sufficient funds of the Philippine Virginia
G.R. No. L-33112 June 15, 1978 Tobacco Administration now deposited with the Philippine National Bank, La Union
PHILIPPINE NATIONAL BANK, petitioner, Branch, shall be garnished and delivered to the plaintiff immediately to satisfy the
vs. Writ of Execution for one-half of the amount awarded in the decision of November
HON. JUDGE JAVIER PABALAN, Judge of the Court of First Instance, Branch III, La 16, 1970." 10 Hence this certiorari and prohibition proceeding.
Union, AGOO TOBACCO PLANTERS ASSOCIATION, INC., PHILIPPINE VIRGINIA As noted at the outset, petitioner Philippine National Bank would invoke the
TOBACCO ADMINISTRATION, and PANFILO P. JIMENEZ, Deputy Sheriff, La Union, doctrine of non-suability. It is to be admitted that under the present Constitution,
respondents. what was formerly implicit as a fundamental doctrine in constitutional law has been
Conrado E. Medina, Edgardo M. Magtalas & Walfrido Climaco for petitioner. set forth in express terms: "The State may not be sued without its consent." 11 If the
Felimon A. Aspirin fit respondent Agoo 'Tobacco Planters Association, Inc. funds appertained to one of the regular departments or offices in the government,
Virgilio C. Abejo for respondent Phil. Virginia Tobacco Administration. then, certainly, such a provision would be a bar to garnishment. Such is not the case
here. Garnishment would lie. Only last January, as noted in the opening paragraph
FERNANDO, Acting C.J.: of this decision, this Court, in a case brought by the same petitioner precisely
invoking such a doctrine, left no doubt that the funds of public corporations could
properly be made the object of a notice of garnishment. Accordingly, this petition petitioner Bank could it legally set forth as a bar or impediment to a notice of
must fail. garnishment the doctrine of non-suability.
1. The alleged grave abuse of discretion, the basis of this certiorari WHEREFORE, this petition for certiorari and prohibition is dismissed. No costs.
proceeding, was sought to be justified on the failure of respondent Judge to set Barredo, Antonio, Aquino, and Santos, JJ., concur.
aside the notice of garnishment of funds belonging to respondent Philippine Concepcion, Jr., J., is on leave.
Virginia Tobacco Administration. This excerpt from the aforecited decision of
Philippine National Bank v. Court of Industrial Relations makes manifest why such G.R. No. L-55273-83 December 19, 1981
an argument is far from persuasive. "The premise that the funds could be spoken as GAUDENCIO RAYO, BIENVINIDO PASCUAL, TOMAS MANUEL, MARIANO CRUZ,
public character may be accepted in the sense that the People Homesite and PEDRO BARTOLOME, BERNARDINO CRUZ JOSE PALAD , LUCIO FAJARDO,
Housing Corporation was a government-owned entity. It does not follow though FRANCISCO RAYOS, ANGEL TORRES, NORBERTO TORRES, RODELIO JOAQUIN,
that they were exempt. from garnishment. National Shipyard and Steel Corporation PEDRO AQUINO, APOLINARIO BARTOLOME, MAMERTO BERNARDO, CIRIACO
v. Court of Industrial Relations is squarely in point. As was explicitly stated in the CASTILLO, GREGORIO CRUZ, SIMEON ESTRELLA, EPIFANIO MARCELO,
opinion of the then Justice, later Chief Justice, Concepcion: "The allegation to the HERMOGENES SAN PEDRO, JUAN SANTOS, ELIZABETH ABAN, MARCELINA
effect that the funds of the NASSCO are public funds of the government, and that, BERNABE, BUENAVENTURA CRUZ, ANTONIO MENESES, ROMAN SAN PEDRO,
as such, the same may not be garnished, attached or levied upon, is untenable for, LOPEZ ESPINOSA, GODOFREDO PUNZAL, JULIANA GARCIA, LEBERATO
as a government owned and controlled corporation, the NASSCO has a personality SARMIENTO, INOCENCIO DE LEON, CARLOS CORREA, REYNALDO CASIMIRO,
of its own. distinct and separate from that of the Government. It has — pursuant to ANTONIO GENER, GAUDENCIO CASTILLO, MATIAS PEREZ, CRISPINIANO TORRES,
Section 2 of Executive Order No. 356, dated October 23, 1950 ... , pursuant to which CRESENCIO CRUZ, PROTACIO BERNABE, MARIANO ANDRES, CRISOSTOMO CRUZ,
The NASSCO has been established — all the powers of a corporation under the MARCOS EUSTAQUIO, PABLO LEGASPI, VICENTE PASCUAL, ALEJANDRA SISON,
Corporation Law ... ." Accordingly, it may be sue and be sued and may be subjected EUFRACIO TORRES, ROGELIO BARTOLOME, RODOLFO BERNARDO, APOLONIO
to court processes just like any other corporation (Section 13, Act No. 1459, as CASTILLO, MARCELINO DALMACIO, EUTIQUIO LEGASPI, LORENZO LUCIANO and
amended.)" ... To repeat, the ruling was the appropriate remedy for the prevailing GREGORIO PALAD, petitioners,
party which could proceed against the funds of a corporate entity even if owned or vs.
controlled by the government." 12 COURT OF FIRST INSTANCE OF BULACAN, BRANCH V, STA. MARIA, and NATIONAL
2. The National Shipyard and Steel Corporation decision was not the first of POWER CORPORATION, respondents.
its kind. The ruling therein could be inferred from the judgment announced in
Manila Hotel Employees Association v. Manila Hotel Company, decided as far back ABAD SANTOS, J.:
as 1941. 13 In the language of its ponente Justice Ozaeta "On the other hand, it is The relevant antecedents of this case are narrated in the petition and have not
well-settled that when the government enters into commercial business, it been controverted, namely:
abandons its sovereign capacity and is to be treated like any other corporation. 3. At about midnight on October 26, 1978, during the height of that infamous
(Bank of the United States v. Planters' Bank, 9 Wheat. 904, 6 L.ed. 244). By engaging typhoon "KADING" the respondent corporation, acting through its plant
in a particular business thru the instrumentality of a corporation, the government superintendent, Benjamin Chavez, opened or caused to be opened simultaneously
divests itself pro hac vice of its sovereign character, so as to render the corporation all the three floodgates of the Angat Dam. And as a direct and immediate result of
subject to the rules of law governing private corporations." 14It is worth mentioning the sudden, precipitate and simultaneous opening of said floodgates several towns
that Justice Ozaeta could find support for such a pronouncement from the leading in Bulacan were inundated. Hardest-hit was Norzagaray. About a hundred of its
American Supreme Court case of united States v. Planters' Bank, 15 with the opinion residents died or were reported to have died and properties worth million of pesos
coming from the illustrious Chief Justice Marshall. It was handed down more than destroyed or washed away. This flood was unprecedented in Norzagaray.
one hundred fifty years ago, 1824 to be exact. It is apparent, therefore, that
4. Petitioners, who were among the many unfortunate victims of that man- wrongs upon individuals. To sue said defendant for tort may require the express
caused flood, filed with the respondent Court eleven complaints for damages consent of the State.
against the respondent corporation and the plant superintendent of Angat Dam, WHEREFORE, the cases against defendant NPC are hereby dismissed. (Rollo, p. 60.)
Benjamin Chavez, docketed as Civil Cases Nos. SM-950 951, 953, 958, 959, 964, 965, The Order dated October 3, 1980, denying the motion for reconsideration filed by
966, 981, 982 and 983. These complaints though separately filed have a the plaintiffs is pro forma; the motion was simply denied for lack of merit. (Rollo, p.
common/similar cause of action. ... 74.)
5. Respondent corporation filed separate answers to each of these eleven The petition to review the two orders of the public respondent was filed on October
complaints. Apart from traversing the material averments in the complaints and 16, 1980, and on October 27, 1980, We required the respondents to comment. It
setting forth counterclaims for damages respondent corporation invoked in each was only on April 13, 1981, after a number of extensions, that the Solicitor General
answer a special and affirmative defense that "in the operation of the Angat Dam," filed the required comment. (Rollo, pp. 107-114.)
it is "performing a purely governmental function", hence it "can not be sued On May 27, 1980, We required the parties to file simultaneous memoranda within
without the express consent of the State." ... twenty (20) days from notice. (Rollo, p. 115.) Petitioners filed their memorandum
6. On motion of the respondent corporation a preliminary hearing was held on July 22, 1981. (Rollo, pp. 118-125.) The Solicitor General filed a number of
on its affirmative defense as though a motion to dismiss were filed. Petitioners motions for extension of time to file his memorandum. We granted the seventh
opposed the prayer for dismissal and contended that respondent corporation is extension with a warning that there would be no further extension. Despite the
performing not governmental but merely proprietary functions and that under its warning the Solicitor General moved for an eighth extension which We denied on
own organic act, Section 3 (d) of Republic Act No. 6395, it can sue and be sued in November 9, 1981. A motion for a ninth extension was similarly denied on
any court. ... November 18, 1981. The decision in this case is therefore, without the
7. On July 29, 1980 petitioners received a copy of the questioned order of the memorandum of the Solicitor General.
respondent Court dated December 21, 1979 dismissing all their complaints as The parties are agreed that the Order dated December 21, 1979, raises the
against the respondent corporation thereby leaving the superintendent of the following issues:
Angat Dam, Benjamin Chavez, as the sole party-defendant. ... 1. Whether respondent National Power Corporation performs a
8. On August 7, 1980 petitioners filed with the respondent Court a motion for governmental function with respect to the management and operation of the Angat
reconsideration of the questioned order of dismissal. ... Dam; and
9. The respondent Court denied petitioners' motion for reconsideration in its 2. Whether the power of respondent National Power Corporation to sue and
order dated October 3, 1980. ... Hence, the present petition for review on certiorari be sued under its organic charter includes the power to be sued for tort.
under Republic Act No. 5440. (Rollo, pp. 3-6.) The petition is highly impressed with merit.
The Order of dismissal dated December 12, 1979, reads as follows: It is not necessary to write an extended dissertation on whether or not the NPC
Under consideration is a motion to dismiss embodied as a special affirmative performs a governmental function with respect to the management and operation
defense in the answer filed by defendant NPC on the grounds that said defendant of the Angat Dam. It is sufficient to say that the government has organized a private
performs a purely governmental function in the operation of the Angat Dam and corporation, put money in it and has allowed it to sue and be sued in any court
cannot therefore be sued for damages in the instant cases in connection therewith. under its charter. (R.A. No. 6395, Sec. 3 (d).) As a government owned and controlled
Plaintiffs' opposition to said motion to discuss, relying on Sec. 3 (d) of Republic Act corporation, it has a personality of its own, distinct and separate from that of the
6396 which imposes on the NPC the power and liability to sue and be sued in any Government. (See National Shipyards and Steel Corp. vs. CIR, et al., L-17874, August
court, is not tenable since the same refer to such matters only as are within the 31, 1963, 8 SCRA 781.) Moreover, the charter provision that the NPC can "sue and
scope of the other corporate powers of said defendant and not matters of tort as in be sued in any court" is without qualification on the cause of action and accordingly
the instant cases. It being an agency performing a purely governmental function in it can include a tort claim such as the one instituted by the petitioners.
the operation of the Angat Dam, said defendant was not given any right to commit
WHEREFORE, the petition is hereby granted; the Orders of the respondent court performing government functions. For relief, they prayed that the case be
dated December 12, 1979 and October 3, 1980, are set aside; and said court is dismissed for lack of jurisdiction. Thereafter, before the case could be heard,
ordered to reinstate the complaints of the petitioners. Costs against the NPC. petitioners filed an "Omnibus Motion" asking for a preliminary hearing on the
SO ORDERED. question of jurisdiction raised by them in their answer and for suspension of the
trial of the case on the merits pending the determination of such jurisdictional
G.R. No. L-15751 January 28, 1961 question. The motion was granted, but after hearing, the trial judge of the Industrial
BUREAU OF PRINTING, SERAFIN SALVADOR and MARIANO LEDESMA, petitioners, Court in an order dated January 27, 1959 sustained the jurisdiction of the court on
vs. the theory that the functions of the Bureau of Printing are "exclusively proprietary
THE BUREAU OF PRINTING EMPLOYEES ASSOCIATION (NLU), PACIFICO in nature," and, consequently, denied the prayer for dismissal. Reconsideration of
ADVINCULA, ROBERTO MENDOZA, PONCIANO ARGANDA and TEODULO TOLERAN, this order having been also denied by the court in banc, the petitioners brought the
respondents. case to this Court through the present petition for certiorari and prohibition.
Office of the Solicitor General for petitioners. We find the petition to be meritorious.
Eulogio R. Lerum for respondents. The Bureau of Printing is an office of the Government created by the Administrative
GUTIERREZ DAVID, J.: Code of 1916 (Act No. 2657). As such instrumentality of the Government, it
This is a petition for certiorari and prohibition with preliminary injunction to annul operates under the direct supervision of the Executive Secretary, Office of the
Certain orders of the respondent Court of Industrial Relations and to restrain it President, and is "charged with the execution of all printing and binding, including
from further proceeding in the action for unfair labor practice pending before it on work incidental to those processes, required by the National Government and such
the ground of lack of jurisdiction. Giving due course to the petition, this Court other work of the same character as said Bureau may, by law or by order of the
ordered the issuance of the writ of preliminary injunction prayed for without bond. (Secretary of Finance) Executive Secretary, be authorized to undertake . . .." (See.
The action in question was — upon complaint of the respondents Bureau of Printing 1644, Rev. Adm. Code). It has no corporate existence, and its appropriations are
Employees Association (NLU) Pacifico Advincula, Roberto Mendoza, Ponciano provided for in the General Appropriations Act. Designed to meet the printing
Arganda and Teodulo Toleran — filed by an acting prosecutor of the Industrial Court needs of the Government, it is primarily a service bureau and obviously, not
against herein petitioner Bureau of Printing, Serafin Salvador, the Acting Secretary engaged in business or occupation for pecuniary profit.
of the Department of General Services, and Mariano Ledesma the Director of the It is true, as stated in the order complained of, that the Bureau of Printing receives
Bureau of Printing. The complaint alleged that Serafin Salvador and Mariano outside jobs and that many of its employees are paid for overtime work on regular
Ledesma have been engaging in unfair labor practices by interfering with, or working days and on holidays, but these facts do not justify the conclusion that its
coercing the employees of the Bureau of Printing particularly the members of the functions are "exclusively proprietary in nature." Overtime work in the Bureau of
complaining association petition, in the exercise of their right to self-organization Printing is done only when the interest of the service so requires (sec. 566, Rev.
an discriminating in regard to hire and tenure of their employment in order to Adm. Code). As a matter of administrative policy, the overtime compensation may
discourage them from pursuing the union activities. be paid, but such payment is discretionary with the head of the Bureau depending
Answering the complaint, the petitioners Bureau of Printing, Serafin Salvador and upon its current appropriations, so that it cannot be the basis for holding that the
Mariano Ledesma denied the charges of unfair labor practices attributed to the functions of said Bureau are wholly proprietary in character. Anent the additional
and, by way of affirmative defenses, alleged, among other things, that respondents work it executes for private persons, we find that such work is done upon request,
Pacifico Advincula, Roberto Mendoza Ponciano Arganda and Teodulo Toleran were as distinguished from those solicited, and only "as the requirements of Government
suspended pending result of an administrative investigation against them for work will permit" (sec. 1654, Rev. Adm. Code), and "upon terms fixed by the
breach of Civil Service rules and regulations petitions; that the Bureau of Printing Director of Printing, with the approval of the Department Head" (sec. 1655, id.). As
has no juridical personality to sue and be sued; that said Bureau of Printing is not an shown by the uncontradicted evidence of the petitioners, most of these works
industrial concern engaged for the purpose of gain but is an agency of the Republic consist of orders for greeting cards during Christmas from government officials, and
for printing of checks of private banking institutions. On those greeting cards, the Printing to walk out of their jobs against the order of the duly constituted officials.
Government seal, of which only the Bureau of Printing is authorized to use, is Under the law, the Heads of Departments and Bureaus are authorized to institute
embossed, and on the bank cheeks, only the Bureau of Printing can print the and investigate administrative charges against erring subordinates. For the
reproduction of the official documentary stamps appearing thereon. The volume of Industrial Court now to take cognizance of the case filed before it, which is in effect
private jobs done, in comparison with government jobs, is only one-half of 1 per a review of the acts of executive officials having to do with the discipline of
cent, and in computing the costs for work done for private parties, the Bureau does government employees under them, would be to interfere with the discharge of
not include profit because it is not allowed to make any. Clearly, while the Bureau such functions by said officials. WHEREFORE, the petition for a writ of prohibition is
of Printing is allowed to undertake private printing jobs, it cannot be pretended that granted. The orders complained of are set aside and the complaint for unfair labor
it is thereby an industrial or business concern. The additional work it executes for practice against the petitioners is dismissed, with costs against respondents other
private parties is merely incidental to its function, and although such work may be than the respondent court.
deemed proprietary in character, there is no showing that the employees Bengzon, Bautista Angelo, Labrador, Paredes and Dizon, JJ., concur.
performing said proprietary function are separate and distinct from those employed Reyes, J.B.L., J., concurs in the result.
in its general governmental functions.
From what has been stated, it is obvious that the Court of Industrial Relations did G.R. No. L-23139 December 17, 1966
not acquire jurisdiction over the respondent Bureau of Printing, and is thus devoid MOBIL PHILIPPINES EXPLORATION, INC., plaintiff-appellant,
of any authority to take cognizance of the case. This Court has already held in a long vs.
line of decisions that the Industrial Court has no jurisdiction to hear and determine CUSTOMS ARRASTRE SERVICE and BUREAU of CUSTOMS, defendants-appellees.
the complaint for unfair labor practice filed against institutions or corporations not Alejandro Basin, Jr. and Associates for plaintiff-appellant.
organized for profit and, consequently, not an industrial or business organization. Felipe T. Cuison for defendants-appellees.
This is so because the Industrial Peace Act was intended to apply only to industrial BENGZON, J.P., J.:
employment, and to govern the relations between employers engaged in industry Four cases of rotary drill parts were shipped from abroad on S.S. "Leoville"
and occupations for purposes of gain, and their industrial employees. (University of sometime in November of 1962, consigned to Mobil Philippines Exploration, Inc.,
the Philippines, et al. vs. CIR, et al., G.R. No. L-15416, April 28, 1960; University of Manila. The shipment arrived at the Port of Manila on April 10, 1963, and was
Sto. Tomas vs. Villanueva, et al., G.R. No. L-13748, October 30, 1959; La Consolacion discharged to the custody of the Customs Arrastre Service, the unit of the Bureau of
College vs. CIR, G.R. No. L-13282, April 22, 1960; See also the cases cited therein.) . Customs then handling arrastre operations therein. The Customs Arrastre Service
Indeed, as an office of the Government, without any corporate or juridical later delivered to the broker of the consignee three cases only of the shipment.
personality, the Bureau of Printing cannot be sued. (Sec. 1, Rule 3, Rules of Court). On April 4, 1964 Mobil Philippines Exploration, Inc., filed suit in the Court of First
Any suit, action or proceeding against it, if it were to produce any effect, would Instance of Manila against the Customs Arrastre Service and the Bureau of Customs
actually be a suit, action or proceeding against the Government itself, and the rule to recover the value of the undelivered case in the amount of P18,493.37 plus other
is settled that the Government cannot be sued without its consent, much less over damages.
its objection. (See Metran vs. Paredes, 45 Off. Gaz. 2835; Angat River Irrigation On April 20, 1964 the defendants filed a motion to dismiss the complaint on the
System, et al. vs. Angat River Workers' Union, et. al., G.R. Nos. L-10943-44, ground that not being persons under the law, defendants cannot be sued.
December 28, 1957). After plaintiff opposed the motion, the court, on April 25, 1964, dismissed the
The record also discloses that the instant case arose from the filing of complaint on the ground that neither the Customs Arrastre Service nor the Bureau
administrative charges against some officers of the respondent Bureau of Printing of Customs is suable. Plaintiff appealed to Us from the order of dismissal.
Employees' Association by the Acting Secretary of General Services. Said Raised, therefore, in this appeal is the purely legal question of the defendants'
administrative charges are for insubordination, grave misconduct and acts suability under the facts stated.
prejudicial to public service committed by inciting the employees, of the Bureau of
Appellant contends that not all government entities are immune from suit; that subject to the approval of the department head, contract with any private party for
defendant Bureau of Customs as operator of the arrastre service at the Port of the service of receiving, handling, custody and delivery of articles, and in such
Manila, is discharging proprietary functions and as such, can be sued by private event, the contract may include the sale or lease of government-owned equipment
individuals. and facilities used in such service.
The Rules of Court, in Section 1, Rule 3, provide: In Associated Workers Union, et al. vs. Bureau of Customs, et al., L-21397, resolution
SECTION 1. Who may be parties.—Only natural or juridical persons or entities of August 6, 1963, this Court indeed held "that the foregoing statutory provisions
authorized by law may be parties in a civil action. authorizing the grant by contract to any private party of the right to render said
Accordingly, a defendant in a civil suit must be (1) a natural person; (2) a juridical arrastre services necessarily imply that the same is deemed by Congress to be
person or (3) an entity authorized by law to be sued. Neither the Bureau of Customs proprietary or non-governmental function." The issue in said case, however, was
nor (a fortiori) its function unit, the Customs Arrastre Service, is a person. They are whether laborers engaged in arrastre service fall under the concept of employees in
merely parts of the machinery of Government. The Bureau of Customs is a bureau the Government employed in governmental functions for purposes of the
under the Department of Finance (Sec. 81, Revised Administrative Code); and as prohibition in Section 11, Republic Act 875 to the effect that "employees in the
stated, the Customs Arrastre Service is a unit of the Bureau of Custom, set up under Government . . . shall not strike," but "may belong to any labor organization which
Customs Administrative Order No. 8-62 of November 9, 1962 (Annex "A" to Motion does not impose the obligation to strike or to join in strike," which prohibition "shall
to Dismiss, pp. 13-15, Record an Appeal). It follows that the defendants herein apply only to employees employed in governmental functions of the Government . .
cannot he sued under the first two abovementioned categories of natural or ..
juridical persons. Thus, the ruling therein was that the Court of Industrial Relations had jurisdiction
Nonetheless it is urged that by authorizing the Bureau of Customs to engage in over the subject matter of the case, but not that the Bureau of Customs can be
arrastre service, the law thereby impliedly authorizes it to be sued as arrastre sued. Said issue of suability was not resolved, the resolution stating only that "the
operator, for the reason that the nature of this function (arrastre service) is issue on the personality or lack of personality of the Bureau of Customs to be sued
proprietary, not governmental. Thus, insofar as arrastre operation is concerned, does not affect the jurisdiction of the lower court over the subject matter of the
appellant would put defendants under the third category of "entities authorized by case, aside from the fact that amendment may be made in the pleadings by the
law" to be sued. Stated differently, it is argued that while there is no law expressly inclusion as respondents of the public officers deemed responsible, for the unfair
authorizing the Bureau of Customs to sue or be sued, still its capacity to be sued is labor practice acts charged by petitioning Unions".
implied from its very power to render arrastre service at the Port of Manila, which it Now, the fact that a non-corporate government entity performs a function
is alleged, amounts to the transaction of a private business. proprietary in nature does not necessarily result in its being suable. If said non-
The statutory provision on arrastre service is found in Section 1213 of Republic Act governmental function is undertaken as an incident to its governmental function,
1937 (Tariff and Customs Code, effective June 1, 1957), and it states: there is no waiver thereby of the sovereign immunity from suit extended to such
SEC. 1213. Receiving, Handling, Custody and Delivery of Articles.—The government entity. This is the doctrine recognized in Bureau of Printing, et al. vs.
Bureau of Customs shall have exclusive supervision and control over the receiving, Bureau of Printing Employees Association, et al., L-15751, January 28, 1961:
handling, custody and delivery of articles on the wharves and piers at all ports of The Bureau of Printing is an office of the Government created by the Administrative
entry and in the exercise of its functions it is hereby authorized to acquire, take Code of 1916 (Act No. 2657). As such instrumentality of the Government, it
over, operate and superintend such plants and facilities as may be necessary for the operates under the direct supervision of the Executive Secretary, Office of the
receiving, handling, custody and delivery of articles, and the convenience and President, and is "charged with the execution of all printing and binding, including
comfort of passengers and the handling of baggage; as well as to acquire fire work incidental to those processes, required by the National Government and such
protection equipment for use in the piers: Provided, That whenever in his judgment other work of the same character as said Bureau may, by law or by order of the
the receiving, handling, custody and delivery of articles can be carried on by private (Secretary of Finance) Executive Secretary, be authorized to undertake . . . ." (Sec.
parties with greater efficiency, the Commissioner may, after public bidding and 1644, Rev. Adm. Code.) It has no corporate existence, and its appropriations are
provided for in the General Appropriations Act. Designed to meet the printing necessarily exposing itself to suit. Sovereign immunity, granted as to the end,
needs of the Government, it is primarily a service bureau and, obviously, not should not be denied as to the necessary means to that end.
engaged in business or occupation for pecuniary profit. And herein lies the distinction between the present case and that of National
xxx xxx xxx Airports Corporation vs. Teodoro, 91 Phil. 203, on which appellant would rely. For
. . . Clearly, while the Bureau of Printing is allowed to undertake private printing there, the Civil Aeronautics Administration was found have for its prime reason for
jobs, it cannot be pretended that it is thereby an industrial or business concern. The existence not a governmental but a proprietary function, so that to it the latter was
additional work it executes for private parties is merely incidental to its function, not a mere incidental function:
and although such work may be deemed proprietary in character, there is no Among the general powers of the Civil Aeronautics Administration are, under
showing that the employees performing said proprietary function are separate and Section 3, to execute contracts of any kind, to purchase property, and to grant
distinct from those emoloyed in its general governmental functions. concessions rights, and under Section 4, to charge landing fees, royalties on sales to
xxx xxx xxx aircraft of aviation gasoline, accessories and supplies, and rentals for the use of any
Indeed, as an office of the Government, without any corporate or juridical property under its management.
personality, the Bureau of Printing cannot be sued (Sec. 1, Rule 3, Rules of Court.) These provisions confer upon the Civil Aeronautics Administration, in our opinion,
Any suit, action or proceeding against it, if it were to produce any effect, would the power to sue and be sued. The power to sue and be sued is implied from the
actually be a suit, action or proceeding against the Government itself, and the rule power to transact private business. . . .
is settled that the Government cannot be sued without its consent, much less over xxx xxx xxx
its objection. (See Metran vs. Paredes, 45 Off. Gaz. 2835; Angat River Irrigation The Civil Aeronautics Administration comes under the category of a private entity.
System, et al. vs. Angat River Workers Union, et al., G.R. Nos. L-10943-44, December Although not a body corporate it was created, like the National Airports
28, 1957.) Corporation, not to maintain a necessary function of government, but to run what
The situation here is not materially different. The Bureau of Customs, to repeat, is is essentially a business, even if revenues be not its prime objective but rather the
part of the Department of Finance (Sec. 81, Rev. Adm. Code), with no personality of promotion of travel and the convenience of the travelling public. . . .
its own apart from that of the national government. Its primary function is Regardless of the merits of the claim against it, the State, for obvious reasons of
governmental, that of assessing and collecting lawful revenues from imported public policy, cannot be sued without its consent. Plaintiff should have filed its
articles and all other tariff and customs duties, fees, charges, fines and penalties present claim to the General Auditing Office, it being for money under the
(Sec. 602, R.A. 1937). To this function, arrastre service is a necessary incident. For provisions of Commonwealth Act 327, which state the conditions under which
practical reasons said revenues and customs duties can not be assessed and money claims against the Government may be filed.
collected by simply receiving the importer's or ship agent's or consignee's It must be remembered that statutory provisions waiving State immunity from suit
declaration of merchandise being imported and imposing the duty provided in the are strictly construed and that waiver of immunity, being in derogation of
Tariff law. Customs authorities and officers must see to it that the declaration tallies sovereignty, will not be lightly inferred. (49 Am. Jur., States, Territories and
with the merchandise actually landed. And this checking up requires that the landed Dependencies, Sec. 96, p. 314; Petty vs. Tennessee-Missouri Bridge Com., 359 U.S.
merchandise be hauled from the ship's side to a suitable place in the customs 275, 3 L. Ed. 804, 79 S. Ct. 785). From the provision authorizing the Bureau of
premises to enable said customs officers to make it, that is, it requires arrastre Customs to lease arrastre operations to private parties, We see no authority to sue
operations.1 the said Bureau in the instances where it undertakes to conduct said operation
Clearly, therefore, although said arrastre function may be deemed proprietary, it is itself. The Bureau of Customs, acting as part of the machinery of the national
a necessary incident of the primary and governmental function of the Bureau of government in the operation of the arrastre service, pursuant to express legislative
Customs, so that engaging in the same does not necessarily render said Bureau mandate and as a necessary incident of its prime governmental function, is immune
liable to suit. For otherwise, it could not perform its governmental function without from suit, there being no statute to the contrary.
WHEREFORE, the order of dismissal appealed from is hereby affirmed, with costs control, maintain and develop the Manila International Airport ... ." [Sec. 32 (24),
against appellant. So ordered. R.A. 776].
Concepcion, C.J., Reyes, J.B.L., Barrera, Dizon, Regala, Zaldivar and Sanchez, JJ., Said claim for damages included, aside from the medical and hospital bills,
concur. consequential damages for the expenses of two lawyers who had to go abroad in
Makalintal, J., concurs in the result. private respondent's stead to finalize certain business transactions and for the
Castro, J., reserves his vote. publication of notices announcing the postponement of private respondent's
daughter's wedding which had to be cancelled because of his accident [Record on
G.R. No. L-51806 November 8, 1988 Appeal, p. 5].
CIVIL AERONAUTICS ADMINISTRATION, petitioner, Judgment was rendered in private respondent's favor prompting petitioner to
vs. appeal to the Court of Appeals. The latter affirmed the trial court's decision.
COURT OF APPEALS and ERNEST E. SIMKE, respondents. Petitioner then filed with the same court a Motion for, Reconsideration but this was
The Solicitor General for petitioner. denied.
Ledesma, Guytingco, Veleasco & Associates for respondent Ernest E. Simke. Petitioner now comes before this Court raising the following assignment of errors:
1. The Court of Appeals gravely erred in not holding that the present the CAA
CORTES, J.: is really a suit against the Republic of the Philippines which cannot be sued without
Assailed in this petition for review on certiorari is the decision of the Court of its consent, which was not given in this case.
Appeals affirming the trial court decision which reads as follows: 2. The Court of Appeals gravely erred in finding that the injuries of
WHEREFORE, judgment is hereby rendered ordering defendant to pay plaintiff the respondent Ernest E. Simke were due to petitioner's negligence — although there
amount of P15,589.55 as full reimbursement of his actual medical and hospital was no substantial evidence to support such finding; and that the inference that the
expenses, with interest at the legal rate from the commencement of the suit; the hump or elevation the surface of the floor area of the terrace of the fold) MIA
amount of P20,200.00 as consequential damages; the amount of P30,000.00 as building is dangerous just because said respondent tripped over it is manifestly
moral damages; the amount of P40,000.00 as exemplary damages; the further mistaken — circumstances that justify a review by this Honorable Court of the said
amount of P20,000.00 as attorney's fees and the costs [Rollo, p. 24]. finding of fact of respondent appellate court (Garcia v. Court of Appeals, 33 SCRA
The facts of the case are as follows: 622; Ramos v. CA, 63 SCRA 331.)
Private respondent is a naturalized Filipino citizen and at the time of the incident 3. The Court of Appeals gravely erred in ordering petitioner to pay actual,
was the Honorary Consul Geileral of Israel in the Philippines. consequential, moral and exemplary damages, as well as attorney's fees to
In the afternoon of December 13, 1968, private respondent with several other respondent Simke — although there was no substantial and competent proof to
persons went to the Manila International Airport to meet his future son-in-law. In support said awards I Rollo, pp. 93-94 1.
order to get a better view of the incoming passengers, he and his group proceeded I
to the viewing deck or terrace of the airport. Invoking the rule that the State cannot be sued without its consent, petitioner
While walking on the terrace, then filled with other people, private respondent contends that being an agency of the government, it cannot be made a party-
slipped over an elevation about four (4) inches high at the far end of the terrace. As defendant in this case.
a result, private respondent fell on his back and broke his thigh bone. This Court has already held otherwise in the case of National Airports Corporation v.
The next day, December 14, 1968, private respondent was operated on for about Teodoro, Sr. [91 Phil. 203 (1952)]. Petitioner contends that the said ruling does not
three hours. apply in this case because: First, in the Teodoro case, the CAA was sued only in a
Private respondent then filed an action for damages based on quasi-delict with the substituted capacity, the National Airports Corporation being the original party.
Court of First Instance of Rizal, Branch VII against petitioner Civil Aeronautics Second, in the Teodoro case, the cause of action was contractual in nature while
Administration or CAA as the entity empowered "to administer, operate, manage, here, the cause of action is based on a quasi-delict. Third, there is no specific
provision in Republic Act No. 776, the law governing the CAA, which would justify National Airports Corporation). Republic Act No. 776 (Civil Aeronautics Act of the
the conclusion that petitioner was organized for business and not for governmental Philippines), subsequently enacted on June 20, 1952, did not alter the character of
purposes. [Rollo, pp. 94-97]. the CAA's objectives under Exec, Order 365. The pertinent provisions cited in the
Such arguments are untenable. Teodoro case, particularly Secs. 3 and 4 of Exec. Order 365, which led the Court to
First, the Teodoro case, far from stressing the point that the CAA was only consider the CAA in the category of a private entity were retained substantially in
substituted for the National Airports Corporation, in fact treated the CAA as the real Republic Act 776, Sec. 32 (24) and (25).<äre||anº•1àw> Said Act provides:
party in interest when it stated that: Sec. 32. Powers and Duties of the Administrator. Subject to the general — control
xxx xxx xxx and supervision of the Department Head, the Administrator shall have among
... To all legal intents and practical purposes, the National Airports Corporation is others, the following powers and duties:
dead and the Civil Aeronautics Administration is its heir or legal representative, xxx xxx xxx
acting by the law of its creation upon its own rights and in its own name. The better (24) To administer, operate, manage, control, maintain and develop the Manila
practice there should have been to make the Civil Aeronautics Administration the International Airport and all government-owned aerodromes except those
third party defendant instead of the National Airports Corporation. [National controlled or operated by the Armed Forces of the Philippines including such
Airports Corp. v. Teodoro, supra, p. 208.] powers and duties as: (a) to plan, design, construct, equip, expand, improve, repair
xxx xxx xxx or alter aerodromes or such structures, improvement or air navigation facilities; (b)
Second, the Teodoro case did not make any qualification or limitation as to whether to enter into, make and execute contracts of any kind with any person, firm, or
or not the CAA's power to sue and be sued applies only to contractual obligations. public or private corporation or entity; ... .
The Court in the Teodoro case ruled that Sections 3 and 4 of Executive Order 365 (25) To determine, fix, impose, collect and receive landing fees, parking space
confer upon the CAA, without any qualification, the power to sue and be sued, fees, royalties on sales or deliveries, direct or indirect, to any aircraft for its use of
albeit only by implication. Accordingly, this Court's pronouncement that where such aviation gasoline, oil and lubricants, spare parts, accessories and supplies, tools,
power to sue and be sued has been granted without any qualification, it can include other royalties, fees or rentals for the use of any of the property under its
a claim based on tort or quasi-delict [Rayo v. Court of First Instance of Bulacan, G.R. management and control.
Nos. 55273-83, December 19,1981, 1 1 0 SCRA 4561 finds relevance and xxx xxx xxx
applicability to the present case. From the foregoing, it can be seen that the CAA is tasked with private or non-
Third, it has already been settled in the Teodoro case that the CAA as an agency is governmental functions which operate to remove it from the purview of the rule on
not immune from suit, it being engaged in functions pertaining to a private entity. State immunity from suit. For the correct rule as set forth in the Tedoro case states:
xxx xxx xxx xxx xxx xxx
The Civil Aeronautics Administration comes under the category of a private entity. Not all government entities, whether corporate or non-corporate, are immune from
Although not a body corporate it was created, like the National Airports suits. Immunity functions suits is determined by the character of the objects for
Corporation, not to maintain a necessary function of government, but to run what which the entity was organized. The rule is thus stated in Corpus Juris:
is essentially a business, even if revenues be not its prime objective but rather the Suits against State agencies with relation to matters in which they have assumed to
promotion of travel and the convenience of the travelling public. It is engaged in an act in private or non-governmental capacity, and various suits against certain
enterprise which, far from being the exclusive prerogative of state, may, more than corporations created by the state for public purposes, but to engage in matters
the construction of public roads, be undertaken by private concerns. [National partaking more of the nature of ordinary business rather than functions of a
Airports Corp. v. Teodoro, supra, p. 207.] governmental or political character, are not regarded as suits against the state. The
xxx xxx xxx latter is true, although the state may own stock or property of such a corporation
True, the law prevailing in 1952 when the Teodoro case was promulgated was Exec. for by engaging in business operations through a corporation, the state divests itself
Order 365 (Reorganizing the Civil Aeronautics Administration and Abolishing the so far of its sovereign character, and by implication consents to suits against the
corporation. (59 C.J., 313) [National Airport Corporation v. Teodoro, supra, pp. 206- These factual findings are binding and conclusive upon this Court. Hence, the CAA
207; Emphasis supplied.] cannot disclaim its liability for the negligent construction of the elevation since
This doctrine has been reaffirmed in the recent case of Malong v. Philippine under Republic Act No. 776, it was charged with the duty of planning, designing,
National Railways [G.R. No. L-49930, August 7, 1985, 138 SCRA 631, where it was constructing, equipping, expanding, improving, repairing or altering aerodromes or
held that the Philippine National Railways, although owned and operated by the such structures, improvements or air navigation facilities [Section 32, supra, R.A.
government, was not immune from suit as it does not exercise sovereign but purely 776]. In the discharge of this obligation, the CAA is duty-bound to exercise due
proprietary and business functions. Accordingly, as the CAA was created to diligence in overseeing the construction and maintenance of the viewing deck or
undertake the management of airport operations which primarily involve terrace of the airport.
proprietary functions, it cannot avail of the immunity from suit accorded to It must be borne in mind that pursuant to Article 1173 of the Civil Code, "(t)he fault
government agencies performing strictly governmental functions. or negligence of the obligor consists in the omission of that diligence which is
II required by the nature of the obligation and corresponds with the circumstances of
Petitioner tries to escape liability on the ground that there was no basis for a finding the person, of the time and of the place." Here, the obligation of the CAA in
of negligence. There can be no negligence on its part, it alleged, because the maintaining the viewing deck, a facility open to the public, requires that CAA insure
elevation in question "had a legitimate purpose for being on the terrace and was the safety of the viewers using it. As these people come to the viewing deck to
never intended to trip down people and injure them. It was there for no other watch the planes and passengers, their tendency would be to look to where the
purpose but to drain water on the floor area of the terrace" [Rollo, P. 99]. planes and the incoming passengers are and not to look down on the floor or
To determine whether or not the construction of the elevation was done in a pavement of the viewing deck. The CAA should have thus made sure that no
negligent manner, the trial court conducted an ocular inspection of the premises. dangerous obstructions or elevations exist on the floor of the deck to prevent any
xxx xxx xxx undue harm to the public.
... This Court after its ocular inspection found the elevation shown in Exhs. A or 6-A The legal foundation of CAA's liability for quasi-delict can be found in Article 2176 of
where plaintiff slipped to be a step, a dangerous sliding step, and the proximate the Civil Code which provides that "(w)hoever by act or omission causes damage to
cause of plaintiffs injury... another, there being fault or negligence, is obliged to pay for the damage done... As
xxx xxx xxx the CAA knew of the existence of the dangerous elevation which it claims though,
This Court during its ocular inspection also observed the dangerous and defective was made precisely in accordance with the plans and specifications of the building
condition of the open terrace which has remained unrepaired through the years. It for proper drainage of the open terrace [See Record on Appeal, pp. 13 and 57;
has observed the lack of maintenance and upkeep of the MIA terrace, typical of Rollo, p. 391, its failure to have it repaired or altered in order to eliminate the
many government buildings and offices. Aside from the litter allowed to accumulate existing hazard constitutes such negligence as to warrant a finding of liability based
in the terrace, pot holes cause by missing tiles remained unrepaired and on quasi-delict upon CAA.
unattented. The several elevations shown in the exhibits presented were verified by The Court finds the contention that private respondent was, at the very least, guilty
this Court during the ocular inspection it undertook. Among these elevations is the of contributory negligence, thus reducing the damages that plaintiff may recover,
one (Exh. A) where plaintiff slipped. This Court also observed the other hazard, the unmeritorious. Contributory negligence under Article 2179 of the Civil Code
slanting or sliding step (Exh. B) as one passes the entrance door leading to the contemplates a negligent act or omission on the part of the plaintiff, which
terrace [Record on Appeal, U.S., pp. 56 and 59; Emphasis supplied.] although not the proximate cause of his injury, contributed to his own damage, the
The Court of Appeals further noted that: proximate cause of the plaintiffs own injury being the defendant's lack of due care.
The inclination itself is an architectural anomaly for as stated by the said witness, it In the instant case, no contributory negligence can be imputed to the private
is neither a ramp because a ramp is an inclined surface in such a way that it will respondent, considering the following test formulated in the early case of Picart v.
prevent people or pedestrians from sliding. But if, it is a step then it will not serve Smith, 37 Phil. 809 (1918):
its purpose, for pedestrian purposes. (tsn, p. 35, Id.) [rollo, p. 29.]
The test by which to determine the existence of negligence in a particular case may difficult for a pedestrian to see the inclination especially where there are plenty of
be stated as follows: Did the defendant in doing the alleged negligent act use that persons in the terrace as was the situation when plaintiff fell down. There was no
reasonable care and caution which an ordinarily prudent man would have used in warning sign to direct one's attention to the change in the elevation of the
the same situation? If not, then he is guilty of negligence. The law here in effect floorings. [Rollo, pp. 2829.]
adopts the standard supposed to be supplied by the imaginary conduct of the III
discreet paterfamilias of the Roman law. The existence of the negligence in a given Finally, petitioner appeals to this Court the award of damages to private
case is not determined by reference to the personal judgment of the actor in the respondent. The liability of CAA to answer for damages, whether actual, moral or
situation before him. The law considers what would be reckless, blameworthy, or exemplary, cannot be seriously doubted in view of one conferment of the power to
negligent in the man of ordinary intelligence and prudence and determines liability sue and be sued upon it, which, as held in the case of Rayo v. Court of First Instance,
by that. supra, includes liability on a claim for quasi-dilict. In the aforestated case, the
The question as to what would constitute the conduct of a prudent man in a given liability of the National Power Corporation to answer for damages resulting from its
situation must of course be always determined in the light of human experience act of sudden, precipitate and simultaneous opening of the Angat Dam, which
and in view of the facts involved in the particular case. Abstract speculations cannot caused the death of several residents of the area and the destruction of properties,
be here of much value but this much can be profitably said: Reasonable men-overn was upheld since the o,rant of the power to sue and be sued upon it necessarily
their conduct by the circumstances which are before them or known to them. They implies that it can be held answerable for its tortious acts or any wrongful act for
are not, and are not supposed to be omniscient of the future. Hence they can be that matter.
expected to take care only when there is something before them to suggest or warn With respect to actual or compensatory damages, the law mandates that the same
of danger. Could a prudent man, in the case under consideration, foresee harm as a be proven.
result of the course actually pursued' If so, it was the duty of the actor to take Art. 2199. Except as provided by law or by stipulation, one are entitled to an
precautions to guard against that harm. Reasonable foresight of harm, followed by adequate compensation only for such pecuniary loss suffered by him as he has duly
the ignoring of the suggestion born of this prevision, is always necessary before proved. Such compensation is referred to as actual on compensatory damages
negligence can be held to exist.... [Picart v. Smith, supra, p. 813; Emphasis supplied.] [New Civil Code].
The private respondent, who was the plaintiff in the case before the lower court, Private respondent claims P15,589.55 representing medical and hospitalization
could not have reasonably foreseen the harm that would befall him, considering the bills. This Court finds the same to have been duly proven through the testimony of
attendant factual circumstances. Even if the private respondent had been looking Dr. Ambrosio Tangco, the physician who attended to private respondent (Rollo, p.
where he was going, the step in question could not easily be noticed because of its 26) and who Identified Exh. "H" which was his bill for professional services [Rollo, p.
construction. As the trial court found: 31].
In connection with the incident testified to, a sketch, Exhibit O, shows a section of Concerning the P20,200.00 alleged to have been spent for other expenses such as
the floorings oil which plaintiff had tripped, This sketch reveals two pavements the transportation of the two lawyers who had to represent private respondent
adjoining each other, one being elevated by four and one-fourth inches than the abroad and the publication of the postponement notices of the wedding, the Court
other. From the architectural standpoint the higher, pavement is a step. However, holds that the same had also been duly proven. Private respondent had adequately
unlike a step commonly seen around, the edge of the elevated pavement slanted shown the existence of such losses and the amount thereof in the testimonies
outward as one walks to one interior of the terrace. The length of the inclination before the trial court [CA decision, p. 81. At any rate, the findings of the Court of
between the edges of the two pavements is three inches. Obviously, plaintiff had Appeals with respect to this are findings of facts [One Heart Sporting Club, Inc. v.
stepped on the inclination because had his foot landed on the lower pavement he Court of Appeals, G.R. Nos. 5379053972, Oct. 23, 1981, 108 SCRA 4161 which, as
would not have lost his balance. The same sketch shows that both pavements had been held time and again, are, as a general rule, conclusive before this Court
including the inclined portion are tiled in red cement, and as shown by the [Sese v. Intermediate Appellate Court, G.R. No. 66186, July 31, 1987,152 SCRA 585].
photograph Exhibit A, the lines of the tilings are continuous. It would therefore be
With respect to the P30,000.00 awarded as moral damages, the Court holds private WHEREFORE, finding no reversible error, the Petition for review on certiorari is
respondent entitled thereto because of the physical suffering and physical injuries DENIED and the decision of the Court of Appeals in CA-G.R. No. 51172-R is
caused by the negligence of the CAA [Arts. 2217 and 2219 (2), New Civil Code]. AFFIRMED.
With respect to the award of exemplary damages, the Civil Code explicitly, states: SO ORDERED.
Art. 2229. Exemplary or corrective damages, are imposed, by way of
example or correction for the public good, in addition to the moral, liquidated or
compensatory AIR TRANSPORTATION G.R. No. 159402
Art. 2231. In quasi-delicts, exemplary damages may be granted if the OFFICE,
defendant acted with gross negligence. Petitioner, Present:
Gross negligence which, according to the Court, is equivalent to the term "notorious
negligence" and consists in the failure to exercise even slight care [Caunan v. BRION, Acting
Compania General de Tabacos, 56 Phil. 542 (1932)] can be attributed to the CAA for Chairperson,**
its failure to remedy the dangerous condition of the questioned elevation or to - versus - BERSAMIN,
even post a warning sign directing the attention of the viewers to the change in the ABAD,***
elevation of the floorings notwithstanding its knowledge of the hazard posed by VILLARAMA, JR., and
such elevation [Rollo, pp. 28-29; Record oil Appeal, p. 57]. The wanton disregard by SERENO, JJ.
the CAA of the safety of the people using the viewing deck, who are charged an SPOUSES DAVID* and
admission fee, including the petitioner who paid the entrance fees to get inside the ELISEA RAMOS, Promulgated:
vantage place [CA decision, p. 2; Rollo, p. 25] and are, therefore, entitled to expect Respondents. February 23, 2011
a facility that is properly and safely maintained — justifies the award of exemplary
damages against the CAA, as a deterrent and by way of example or correction for
the public good. The award of P40,000.00 by the trial court as exemplary damages
appropriately underscores the point that as an entity changed with providing x-----------------------------------------------------------------------------------------x
service to the public, the CAA. like all other entities serving the public. has the
obligation to provide the public with reasonably safe service. RESOLUTION
Finally, the award of attorney's fees is also upheld considering that under Art. 2208
(1) of the Civil Code, the same may be awarded whenever exemplary damages are BERSAMIN, J.:
awarded, as in this case, and,at any rate, under Art. 2208 (11), the Court has the
discretion to grant the same when it is just and equitable.
The States immunity from suit does not extend to the petitioner because it is an
However, since the Manila International Airport Authority (MIAA) has taken over
the management and operations of the Manila International Airport [renamed agency of the State engaged in an enterprise that is far from being the States
Ninoy Aquino International Airport under Republic Act No. 6639] pursuant to exclusive prerogative.
Executive Order No. 778 as amended by executive Orders Nos. 903 (1983), 909
(1983) and 298 (1987) and under Section 24 of the said Exec. Order 778, the MIAA
has assumed all the debts, liabilities and obligations of the now defunct Civil Under challenge is the decision promulgated on May 14, 2003, [1] by which the Court
Aeronautics Administration (CAA), the liabilities of the CAA have now been
of Appeals (CA) affirmed with modification the decision rendered on February 21,
transferred to the MIAA.
2001 by the Regional Trial Court, Branch 61 (RTC), in Baguio City in favor of the After the RTC likewise denied the ATOs motion for reconsideration on December

respondents.[2] 10, 1998, the ATO commenced a special civil action for certiorari in the CA to assail
Antecedents the RTCs orders. The CA dismissed the petition for certiorari, however, upon its
finding that the assailed orders were not tainted with grave abuse of discretion. [3]

Spouses David and Elisea Ramos (respondents) discovered that a portion of their
land registered under Transfer Certificate of Title No. T-58894 of the Baguio City Subsequently, February 21, 2001, the RTC rendered its decision on the merits, [4]

land records with an area of 985 square meters, more or less, was being used as disposing:

part of the runway and running shoulder of the Loakan Airport being operated by

petitioner Air Transportation Office (ATO). On August 11, 1995, the respondents WHEREFORE, the judgment is rendered ORDERING the defendant Air
Transportation Office to pay the plaintiffs DAVID and ELISEA RAMOS the following:
agreed after negotiations to convey the affected portion by deed of sale to the ATO
(1) The amount of P778,150.00 being the value of the parcel of land appropriated
in consideration of the amount of P778,150.00. However, the ATO failed to pay by the defendant ATO as embodied in the Deed of Sale, plus an annual interest of
despite repeated verbal and written demands. 12% from August 11, 1995, the date of the Deed of Sale until fully paid; (2) The
amount of P150,000.00 by way of moral damages and P150,000.00 as exemplary
damages; (3) the amount of P50,000.00 by way of attorneys fees plus P15,000.00
Thus, on April 29, 1998, the respondents filed an action for collection against the representing the 10, more or less, court appearances of plaintiffs counsel; (4) The
costs of this suit.
ATO and some of its officials in the RTC (docketed as Civil Case No. 4017-R and

entitled Spouses David and Elisea Ramos v. Air Transportation Office, Capt. Panfilo SO ORDERED.
Villaruel, Gen. Carlos Tanega, and Mr. Cesar de Jesus).
In due course, the ATO appealed to the CA, which affirmed the RTCs decision on

May 14, 2003,[5] viz:


In their answer, the ATO and its co-defendants invoked as an affirmative defense
the issuance of Proclamation No. 1358, whereby President Marcos had reserved
IN VIEW OF ALL THE FOREGOING, the appealed decision is hereby AFFIRMED,
certain parcels of land that included the respondents affected portion for use of the
with MODIFICATION that the awarded cost therein is deleted, while that of moral
Loakan Airport. They asserted that the RTC had no jurisdiction to entertain the and exemplary damages is reduced to P30,000.00 each, and attorneys fees is
action without the States consent considering that the deed of sale had been lowered to P10,000.00.
No cost.
entered into in the performance of governmental functions.
SO ORDERED.
On November 10, 1998, the RTC denied the ATOs motion for a preliminary hearing

of the affirmative defense. Hence, this appeal by petition for review on certiorari.
Issue Republique, 1, chap. 8, ed. 1629, p. 132; Sir John Eliot, De Jure Maiestatis, chap. 3.
Nemo suo statuto ligatur necessitative. Baldus, De Leg. et Const. Digna Vox, 2. ed.
1496, fol. 51b, ed. 1539, fol. 61.[7]
The only issue presented for resolution is whether the ATO could be sued without
the States consent.
Practical considerations dictate the establishment of an immunity from suit in favor

of the State. Otherwise, and the State is suable at the instance of every other
individual, government service may be severely obstructed and public safety
Ruling
endangered because of the number of suits that the State has to defend against.[8]

Several justifications have been offered to support the adoption of the doctrine in
The petition for review has no merit.
the Philippines, but that offered in Providence Washington Insurance Co. v. Republic
of the Philippines[9] is the most acceptable explanation, according to Father Bernas,
The immunity of the State from suit, known also as the doctrine of sovereign
a recognized commentator on Constitutional Law,[10] to wit:
immunity or non-suability of the State, is expressly provided in Article XVI of the

1987 Constitution, viz:


[A] continued adherence to the doctrine of non-suability is not to be
deplored for as against the inconvenience that may be caused private parties, the
Section 3. The State may not be sued without its consent. loss of governmental efficiency and the obstacle to the performance of its
multifarious functions are far greater if such a fundamental principle were
abandoned and the availability of judicial remedy were not thus restricted. With the
The immunity from suit is based on the political truism that the State, as a well-known propensity on the part of our people to go to court, at the least
sovereign, can do no wrong. Moreover, as the eminent Justice Holmes said in provocation, the loss of time and energy required to defend against law suits, in the
absence of such a basic principle that constitutes such an effective obstacle, could
Kawananakoa v. Polyblank:[6]
very well be imagined.

The territory [of Hawaii], of course, could waive its exemption (Smith v. Reeves, 178 An unincorporated government agency without any separate juridical personality of
US 436, 44 L ed 1140, 20 Sup. Ct. Rep. 919), and it took no objection to the
its own enjoys immunity from suit because it is invested with an inherent power of
proceedings in the cases cited if it could have done so. xxx But in the case at bar it
did object, and the question raised is whether the plaintiffs were bound to yield. sovereignty. Accordingly, a claim for damages against the agency cannot prosper;
Some doubts have been expressed as to the source of the immunity of a sovereign otherwise, the doctrine of sovereign immunity is violated. [11] However, the need to
power from suit without its own permission, but the answer has been public
property since before the days of Hobbes. Leviathan, chap. 26, 2. A sovereign is distinguish between an unincorporated government agency performing
exempt from suit, not because of any formal conception or obsolete theory, but governmental function and one performing proprietary functions has arisen. The
on the logical and practical ground that there can be no legal right as against the
immunity has been upheld in favor of the former because its function is
authority that makes the law on which the right depends. Car on peut bien
recevoir loy d'autruy, mais il est impossible par nature de se donner loy. Bodin, governmental or incidental to such function;[12] it has not been upheld in favor of
the latter whose function was not in pursuit of a necessary function of government is engaged in an enterprise which, far from being the exclusive
prerogative of state, may, more than the construction of public
but was essentially a business.[13]
roads, be undertaken by private concerns. [National Airports Corp.
v. Teodoro, supra, p. 207.]
Should the doctrine of sovereignty immunity or non-suability of the State be
xxx
extended to the ATO?
True, the law prevailing in 1952 when the Teodoro case was
promulgated was Exec. Order 365 (Reorganizing the Civil
In its challenged decision,[14] the CA answered in the negative, holding:
Aeronautics Administration and Abolishing the National Airports
Corporation). Republic Act No. 776 (Civil Aeronautics Act of the
On the first assignment of error, appellants seek to impress upon Us that the Philippines), subsequently enacted on June 20, 1952, did not alter
subject contract of sale partook of a governmental character. Apropos, the lower the character of the CAAs objectives under Exec. Order 365. The
court erred in applying the High Courts ruling in National Airports Corporation vs. pertinent provisions cited in the Teodoro case, particularly Secs. 3
Teodoro (91 Phil. 203 [1952]), arguing that in Teodoro, the matter involved the and 4 of Exec. Order 365, which led the Court to consider the CAA
collection of landing and parking fees which is a proprietary function, while the case in the category of a private entity were retained substantially in
at bar involves the maintenance and operation of aircraft and air navigational Republic Act 776, Sec. 32(24) and (25). Said Act provides:
facilities and services which are governmental functions.
Sec. 32. Powers and Duties of the Administrator. Subject to the
We are not persuaded. general control and supervision of the Department Head, the
Administrator shall have among others, the following powers and
Contrary to appellants conclusions, it was not merely the collection of duties:
landing and parking fees which was declared as proprietary in nature by the High
Court in Teodoro, but management and maintenance of airport operations as a xxx
whole, as well. Thus, in the much later case of Civil Aeronautics Administration vs. (24) To administer, operate, manage, control, maintain and
Court of Appeals (167 SCRA 28 [1988]), the Supreme Court, reiterating the develop the Manila International Airport and all government-owned
pronouncements laid down in Teodoro, declared that the CAA (predecessor of ATO) aerodromes except those controlled or operated by the Armed
is an agency not immune from suit, it being engaged in functions pertaining to a Forces of the Philippines including such powers and duties as: (a) to
private entity. It went on to explain in this wise: plan, design, construct, equip, expand, improve, repair or alter
aerodromes or such structures, improvement or air navigation
xxx facilities; (b) to enter into, make and execute contracts of any kind
with any person, firm, or public or private corporation or entity;
The Civil Aeronautics Administration comes under the
category of a private entity. Although not a body corporate it was (25) To determine, fix, impose, collect and receive landing
created, like the National Airports Corporation, not to maintain a fees, parking space fees, royalties on sales or deliveries, direct or
necessary function of government, but to run what is essentially a indirect, to any aircraft for its use of aviation gasoline, oil and
business, even if revenues be not its prime objective but rather the lubricants, spare parts, accessories and supplies, tools, other
promotion of travel and the convenience of the travelling public. It
royalties, fees or rentals for the use of any of the property under its
management and control.
In our view, the CA thereby correctly appreciated the juridical character of the ATO

xxx as an agency of the Government not performing a purely governmental or sovereign


function, but was instead involved in the management and maintenance of the
From the foregoing, it can be seen that the CAA is tasked
with private or non-governmental functions which operate to Loakan Airport, an activity that was not the exclusive prerogative of the State in its
remove it from the purview of the rule on State immunity from suit. sovereign capacity. Hence, the ATO had no claim to the States immunity from suit.
For the correct rule as set forth in the Teodoro case states:
We uphold the CAs aforequoted holding.

xxx
We further observe the doctrine of sovereign immunity cannot be successfully
Not all government entities, whether corporate or non-
corporate, are immune from suits. Immunity from suits is invoked to defeat a valid claim for compensation arising from the taking without
determined by the character of the objects for which the entity was just compensation and without the proper expropriation proceedings being first
organized. The rule is thus stated in Corpus Juris:
resorted to of the plaintiffs property.[16] Thus, in De los Santos v. Intermediate
Suits against State agencies with relation to matters in which they have assumed to Appellate Court,[17] the trial courts dismissal based on the doctrine of non-suability
act in private or non-governmental capacity, and various suits against certain
of the State of two cases (one of which was for damages) filed by owners of
corporations created by the state for public purposes, but to engage in matters
partaking more of the nature of ordinary business rather than functions of a property where a road 9 meters wide and 128.70 meters long occupying a total
governmental or political character, are not regarded as suits against the state. The area of 1,165 square meters and an artificial creek 23.20 meters wide and 128.69
latter is true, although the state may own stock or property of such a corporation
for by engaging in business operations through a corporation, the state divests itself meters long occupying an area of 2,906 square meters had been constructed by the
so far of its sovereign character, and by implication consents to suits against the provincial engineer of Rizal and a private contractor without the owners knowledge
corporation. (59 C.J., 313) [National Airports Corporation v. Teodoro, supra, pp.
and consent was reversed and the cases remanded for trial on the merits. The
206-207; Italics supplied.]
Supreme Court ruled that the doctrine of sovereign immunity was not an
This doctrine has been reaffirmed in the recent case of
instrument for perpetrating any injustice on a citizen. In exercising the right of
Malong v. Philippine National Railways [G.R. No. L-49930, August 7,
1985, 138 SCRA 63], where it was held that the Philippine National eminent domain, the Court explained, the State exercised its jus imperii, as
Railways, although owned and operated by the government, was distinguished from its proprietary rights, or jus gestionis; yet, even in that area,
not immune from suit as it does not exercise sovereign but purely
proprietary and business functions. Accordingly, as the CAA was where private property had been taken in expropriation without just compensation
created to undertake the management of airport operations which being paid, the defense of immunity from suit could not be set up by the State
primarily involve proprietary functions, it cannot avail of the
against an action for payment by the owners.
immunity from suit accorded to government agencies performing
strictly governmental functions.[15]
Lastly, the issue of whether or not the ATO could be sued without the States agency and its offices and branches are likewise transferred to the Authority. Any
real property owned by the national government or government-owned
consent has been rendered moot by the passage of Republic Act No. 9497,
corporation or authority which is being used and utilized as office or facility by the
otherwise known as the Civil Aviation Authority Act of 2008. ATO shall be transferred and titled in favor of the Authority.
Section 23 of R.A. No. 9497 enumerates the corporate powers vested in the CAAP,

R.A. No. 9497 abolished the ATO, to wit: including the power to sue and be sued, to enter into contracts of every class, kind

and description, to construct, acquire, own, hold, operate, maintain, administer and

Section 4. Creation of the Authority. There is hereby created an independent lease personal and real properties, and to settle, under such terms and conditions
regulatory body with quasi-judicial and quasi-legislative powers and possessing most advantageous to it, any claim by or against it.[18]
corporate attributes to be known as the Civil Aviation Authority of the Philippines
(CAAP), herein after referred to as the Authority attached to the Department of
Transportation and Communications (DOTC) for the purpose of policy coordination. With the CAAP having legally succeeded the ATO pursuant to R.A. No. 9497, the
For this purpose, the existing Air transportation Office created under the
obligations that the ATO had incurred by virtue of the deed of sale with the Ramos
provisions of Republic Act No. 776, as amended is hereby abolished.
xxx spouses might now be enforced against the CAAP.

Under its Transitory Provisions, R.A. No. 9497 established in place of the ATO the WHEREFORE, the Court denies the petition for review on certiorari, and affirms the
Civil Aviation Authority of the Philippines (CAAP), which thereby assumed all of the decision promulgated by the Court of Appeals.
ATOs powers, duties and rights, assets, real and personal properties, funds, and

revenues, viz: No pronouncement on costs of suit.

CHAPTER XII SO ORDERED.


TRANSITORTY PROVISIONS
Section 85. Abolition of the Air Transportation Office. The Air Transportation
Office (ATO) created under Republic Act No. 776, a sectoral office of the G.R. No. L-52179 April 8, 1991
Department of Transportation and Communications (DOTC), is hereby abolished. MUNICIPALITY OF SAN FERNANDO, LA UNION, petitioner
vs.
All powers, duties and rights vested by law and exercised by the ATO is HON. JUDGE ROMEO N. FIRME, JUANA RIMANDO-BANIÑA, IAUREANO BANIÑA,
hereby transferred to the Authority. JR., SOR MARIETA BANIÑA, MONTANO BANIÑA, ORJA BANIÑA, AND LYDIA R.
BANIÑA, respondents.
Mauro C. Cabading, Jr. for petitioner.
All assets, real and personal properties, funds and revenues owned by or Simeon G. Hipol for private respondent.
vested in the different offices of the ATO are transferred to the Authority. All
contracts, records and documents relating to the operations of the abolished MEDIALDEA, J.:
This is a petition for certiorari with prayer for the issuance of a writ of preliminary complaint wherein the petitioner and its regular employee, Alfredo Bislig were
mandatory injunction seeking the nullification or modification of the proceedings impleaded for the first time as defendants. Petitioner filed its answer and raised
and the orders issued by the respondent Judge Romeo N. Firme, in his capacity as affirmative defenses such as lack of cause of action, non-suability of the State,
the presiding judge of the Court of First Instance of La Union, Second Judicial prescription of cause of action and the negligence of the owner and driver of the
District, Branch IV, Bauang, La Union in Civil Case No. 107-BG, entitled "Juana passenger jeepney as the proximate cause of the collision.
Rimando Baniña, et al. vs. Macario Nieveras, et al." dated November 4, 1975; July In the course of the proceedings, the respondent judge issued the following
13, 1976; August 23,1976; February 23, 1977; March 16, 1977; July 26, 1979; questioned orders, to wit:
September 7, 1979; November 7, 1979 and December 3, 1979 and the decision (1) Order dated November 4, 1975 dismissing the cross-claim against
dated October 10, 1979 ordering defendants Municipality of San Fernando, La Bernardo Balagot;
Union and Alfredo Bislig to pay, jointly and severally, the plaintiffs for funeral (2) Order dated July 13, 1976 admitting the Amended Answer of the
expenses, actual damages consisting of the loss of earning capacity of the deceased, Municipality of San Fernando, La Union and Bislig and setting the hearing on the
attorney's fees and costs of suit and dismissing the complaint against the Estate of affirmative defenses only with respect to the supposed lack of jurisdiction;
Macario Nieveras and Bernardo Balagot. (3) Order dated August 23, 1976 deferring there resolution of the grounds for
The antecedent facts are as follows: the Motion to Dismiss until the trial;
Petitioner Municipality of San Fernando, La Union is a municipal corporation (4) Order dated February 23, 1977 denying the motion for reconsideration of
existing under and in accordance with the laws of the Republic of the Philippines. the order of July 13, 1976 filed by the Municipality and Bislig for having been filed
Respondent Honorable Judge Romeo N. Firme is impleaded in his official capacity as out of time;
the presiding judge of the Court of First Instance of La Union, Branch IV, Bauang, La (5) Order dated March 16, 1977 reiterating the denial of the motion for
Union. While private respondents Juana Rimando-Baniña, Laureano Baniña, Jr., Sor reconsideration of the order of July 13, 1976;
Marietta Baniña, Montano Baniña, Orja Baniña and Lydia R. Baniña are heirs of the (6) Order dated July 26, 1979 declaring the case deemed submitted for
deceased Laureano Baniña Sr. and plaintiffs in Civil Case No. 107-Bg before the decision it appearing that parties have not yet submitted their respective
aforesaid court. memoranda despite the court's direction; and
At about 7 o'clock in the morning of December 16, 1965, a collision occurred (7) Order dated September 7, 1979 denying the petitioner's motion for
involving a passenger jeepney driven by Bernardo Balagot and owned by the Estate reconsideration and/or order to recall prosecution witnesses for cross examination.
of Macario Nieveras, a gravel and sand truck driven by Jose Manandeg and owned On October 10, 1979 the trial court rendered a decision, the dispositive portion is
by Tanquilino Velasquez and a dump truck of the Municipality of San Fernando, La hereunder quoted as follows:
Union and driven by Alfredo Bislig. Due to the impact, several passengers of the IN VIEW OF ALL OF (sic) THE FOREGOING, judgment is hereby rendered for the
jeepney including Laureano Baniña Sr. died as a result of the injuries they sustained plaintiffs, and defendants Municipality of San Fernando, La Union and Alfredo Bislig
and four (4) others suffered varying degrees of physical injuries. are ordered to pay jointly and severally, plaintiffs Juana Rimando-Baniña, Mrs.
On December 11, 1966, the private respondents instituted a compliant for damages Priscilla B. Surell, Laureano Baniña Jr., Sor Marietta Baniña, Mrs. Fe B. Soriano,
against the Estate of Macario Nieveras and Bernardo Balagot, owner and driver, Montano Baniña, Orja Baniña and Lydia B. Baniña the sums of P1,500.00 as funeral
respectively, of the passenger jeepney, which was docketed Civil Case No. 2183 in expenses and P24,744.24 as the lost expected earnings of the late Laureano Baniña
the Court of First Instance of La Union, Branch I, San Fernando, La Union. However, Sr., P30,000.00 as moral damages, and P2,500.00 as attorney's fees. Costs against
the aforesaid defendants filed a Third Party Complaint against the petitioner and said defendants.
the driver of a dump truck of petitioner. The Complaint is dismissed as to defendants Estate of Macario Nieveras and
Thereafter, the case was subsequently transferred to Branch IV, presided over by Bernardo Balagot.
respondent judge and was subsequently docketed as Civil Case No. 107-Bg. By SO ORDERED. (Rollo, p. 30)
virtue of a court order dated May 7, 1975, the private respondents amended the
Petitioner filed a motion for reconsideration and for a new trial without prejudice to Stated in simple parlance, the general rule is that the State may not be sued except
another motion which was then pending. However, respondent judge issued when it gives consent to be sued. Consent takes the form of express or implied
another order dated November 7, 1979 denying the motion for reconsideration of consent.
the order of September 7, 1979 for having been filed out of time. Express consent may be embodied in a general law or a special law. The standing
Finally, the respondent judge issued an order dated December 3, 1979 providing consent of the State to be sued in case of money claims involving liability arising
that if defendants municipality and Bislig further wish to pursue the matter from contracts is found in Act No. 3083. A special law may be passed to enable a
disposed of in the order of July 26, 1979, such should be elevated to a higher court person to sue the government for an alleged quasi-delict, as in Merritt v.
in accordance with the Rules of Court. Hence, this petition. Government of the Philippine Islands (34 Phil 311). (see United States of America v.
Petitioner maintains that the respondent judge committed grave abuse of Guinto, G.R. No. 76607, February 26, 1990, 182 SCRA 644, 654.)
discretion amounting to excess of jurisdiction in issuing the aforesaid orders and in Consent is implied when the government enters into business contracts, thereby
rendering a decision. Furthermore, petitioner asserts that while appeal of the descending to the level of the other contracting party, and also when the State files
decision maybe available, the same is not the speedy and adequate remedy in the a complaint, thus opening itself to a counterclaim. (Ibid)
ordinary course of law. Municipal corporations, for example, like provinces and cities, are agencies of the
On the other hand, private respondents controvert the position of the petitioner State when they are engaged in governmental functions and therefore should enjoy
and allege that the petition is devoid of merit, utterly lacking the good faith which is the sovereign immunity from suit. Nevertheless, they are subject to suit even in the
indispensable in a petition for certiorari and prohibition. (Rollo, p. 42.) In addition, performance of such functions because their charter provided that they can sue and
the private respondents stress that petitioner has not considered that every court, be sued. (Cruz, Philippine Political Law, 1987 Edition, p. 39)
including respondent court, has the inherent power to amend and control its A distinction should first be made between suability and liability. "Suability depends
process and orders so as to make them conformable to law and justice. (Rollo, p. on the consent of the state to be sued, liability on the applicable law and the
43.) established facts. The circumstance that a state is suable does not necessarily mean
The controversy boils down to the main issue of whether or not the respondent that it is liable; on the other hand, it can never be held liable if it does not first
court committed grave abuse of discretion when it deferred and failed to resolve consent to be sued. Liability is not conceded by the mere fact that the state has
the defense of non-suability of the State amounting to lack of jurisdiction in a allowed itself to be sued. When the state does waive its sovereign immunity, it is
motion to dismiss. only giving the plaintiff the chance to prove, if it can, that the defendant is liable."
In the case at bar, the respondent judge deferred the resolution of the defense of (United States of America vs. Guinto, supra, p. 659-660)
non-suability of the State amounting to lack of jurisdiction until trial. However, said Anent the issue of whether or not the municipality is liable for the torts committed
respondent judge failed to resolve such defense, proceeded with the trial and by its employee, the test of liability of the municipality depends on whether or not
thereafter rendered a decision against the municipality and its driver. the driver, acting in behalf of the municipality, is performing governmental or
The respondent judge did not commit grave abuse of discretion when in the proprietary functions. As emphasized in the case of Torio vs. Fontanilla (G. R. No. L-
exercise of its judgment it arbitrarily failed to resolve the vital issue of non-suability 29993, October 23, 1978. 85 SCRA 599, 606), the distinction of powers becomes
of the State in the guise of the municipality. However, said judge acted in excess of important for purposes of determining the liability of the municipality for the acts
his jurisdiction when in his decision dated October 10, 1979 he held the of its agents which result in an injury to third persons.
municipality liable for the quasi-delict committed by its regular employee. Another statement of the test is given in City of Kokomo vs. Loy, decided by the
The doctrine of non-suability of the State is expressly provided for in Article XVI, Supreme Court of Indiana in 1916, thus:
Section 3 of the Constitution, to wit: "the State may not be sued without its Municipal corporations exist in a dual capacity, and their functions are twofold. In
consent." one they exercise the right springing from sovereignty, and while in the
performance of the duties pertaining thereto, their acts are political and
governmental. Their officers and agents in such capacity, though elected or
appointed by them, are nevertheless public functionaries performing a public ACCORDINGLY, the petition is GRANTED and the decision of the respondent court is
service, and as such they are officers, agents, and servants of the state. In the other hereby modified, absolving the petitioner municipality of any liability in favor of
capacity the municipalities exercise a private, proprietary or corporate right, arising private respondents.
from their existence as legal persons and not as public agencies. Their officers and SO ORDERED.
agents in the performance of such functions act in behalf of the municipalities in
their corporate or individual capacity, and not for the state or sovereign power." G.R. No. L-61744 June 25, 1984
(112 N.E., 994-995) (Ibid, pp. 605-606.) MUNICIPALITY OF SAN MIGUEL, BULACAN, petitioner,
It has already been remarked that municipal corporations are suable because their vs.
charters grant them the competence to sue and be sued. Nevertheless, they are HONORABLE OSCAR C. FERNANDEZ, in his capacity as the Presiding Judge, Branch
generally not liable for torts committed by them in the discharge of governmental IV, Baliuag, Bulacan, The PROVINCIAL SHERIFF of Bulacan, MARGARITA D. VDA. DE
functions and can be held answerable only if it can be shown that they were acting IMPERIO, ADORACION IMPERIO, RODOLFO IMPERIO, CONRADO IMPERIO,
in a proprietary capacity. In permitting such entities to be sued, the State merely ERNESTO IMPERIO, ALFREDO IMPERIO, CARLOS IMPERIO, JR., JUAN IMPERIO and
gives the claimant the right to show that the defendant was not acting in its SPOUSES MARCELO PINEDA and LUCILA PONGCO, respondents.
governmental capacity when the injury was committed or that the case comes Pascual C. Liatchko for petitioner.
under the exceptions recognized by law. Failing this, the claimant cannot recover. The Solicitor General and Marcelo Pineda for respondents.
(Cruz, supra, p. 44.)
In the case at bar, the driver of the dump truck of the municipality insists that "he RELOVA, J.:
was on his way to the Naguilian river to get a load of sand and gravel for the repair In Civil Case No. 604-B, entitled "Margarita D. Vda. de Imperio, et al. vs. Municipal
of San Fernando's municipal streets." (Rollo, p. 29.) Government of San Miguel, Bulacan, et al.", the then Court of First Instance of
In the absence of any evidence to the contrary, the regularity of the performance of Bulacan, on April 28, 1978, rendered judgment holding herein petitioner
official duty is presumed pursuant to Section 3(m) of Rule 131 of the Revised Rules municipality liable to private respondents, as follows:
of Court. Hence, We rule that the driver of the dump truck was performing duties or WHEREFORE, premises considered, judgment is hereby rendered in favor of the
tasks pertaining to his office. plaintiffs and against the defendant Municipal Government of San Miguel Bulacan,
We already stressed in the case of Palafox, et. al. vs. Province of Ilocos Norte, the represented by Mayor Mar Marcelo G. Aure and its Municipal Treasurer:
District Engineer, and the Provincial Treasurer (102 Phil 1186) that "the 1. ordering the partial revocation of the Deed of Donation signed by the
construction or maintenance of roads in which the truck and the driver worked at deceased Carlos Imperio in favor of the Municipality of San Miguel Bulacan, dated
the time of the accident are admittedly governmental activities." October 27, 1947 insofar as Lots Nos. 1, 2, 3, 4 and 5, Block 11 of Subdivision Plan
After a careful examination of existing laws and jurisprudence, We arrive at the Psd-20831 are concerned, with an aggregate total area of 4,646 square meters,
conclusion that the municipality cannot be held liable for the torts committed by its which lots are among those covered and described under TCT No. T-1831 of the
regular employee, who was then engaged in the discharge of governmental Register of Deeds of Bulacan in the name of the Municipal Government of San
functions. Hence, the death of the passenger –– tragic and deplorable though it may Miguel Bulacan,
be –– imposed on the municipality no duty to pay monetary compensation. 2. ordering the defendant to execute the corresponding Deed of
All premises considered, the Court is convinced that the respondent judge's Reconveyance over the aforementioned five lots in favor of the plaintiffs in the
dereliction in failing to resolve the issue of non-suability did not amount to grave proportion of the undivided one-half (½) share in the name of plaintiffs Margarita D.
abuse of discretion. But said judge exceeded his jurisdiction when it ruled on the Vda. de Imperio, Adoracion, Rodolfo, Conrado, Ernesto, Alfredo, Carlos, Jr. and
issue of liability. Juan, all surnamed Imperio, and the remaining undivided one-half (½) share in favor
of plaintiffs uses Marcelo E. Pineda and Lucila Pongco;
3. ordering the defendant municipality to pay to the plaintiffs in the Finally, defendants are hereby given an inextendible period of ten (10) days from
proportion mentioned in the immediately preceding paragraph the sum of receipt of a copy of this order by the Office of the Provincial Fiscal of Bulacan within
P64,440.00 corresponding to the rentals it has collected from the occupants for which to submit their written compliance, (p. 24, Rollo)
their use and occupation of the premises from 1970 up to and including 1975, plus When the treasurers (provincial and municipal) failed to comply with the order of
interest thereon at the legal rate from January 1970 until fully paid; September 13, 1982, respondent judge issued an order for their arrest and that
4. ordering the restoration of ownership and possession over the five lots in they will be release only upon compliance thereof.
question in favor of the plaintiffs in the same proportion aforementioned; Hence, the present petition on the issue whether the funds of the Municipality of
5. ordering the defendant to pay the plaintiffs the sum of P3,000.00 for San Miguel, Bulacan, in the hands of the provincial and municipal treasurers of
attomey's fees; and to pay the cost of suit. Bulacan and San Miguel, respectively, are public funds which are exempt from
The counterclaim of the defendant is hereby ordered dismissed for lack of evidence execution for the satisfaction of the money judgment in Civil Case No. 604-B.
presented to substantiate the same. Well settled is the rule that public funds are not subject to levy and execution. The
SO ORDERED. (pp. 11-12, Rollo) reason for this was explained in the case of Municipality of Paoay vs. Manaois, 86
The foregoing judgment became final when herein petitioner's appeal was Phil. 629 "that they are held in trust for the people, intended and used for the
dismissed due to its failure to file the record on appeal on time. The dismissal was accomplishment of the purposes for which municipal corporations are created, and
affirmed by the then Court of Appeals in CA-G.R. No. SP-12118 and by this Court in that to subject said properties and public funds to execution would materially
G.R. No. 59938. Thereafter, herein private respondents moved for issuance of a writ impede, even defeat and in some instances destroy said purpose." And, in Tantoco
of execution for the satisfaction of the judgment. Respondent judge, on July 27, vs. Municipal Council of Iloilo, 49 Phil. 52, it was held that "it is the settled doctrine
1982, issued an order, to wit: of the law that not only the public property but also the taxes and public revenues
Considering that an entry of judgment had already been made on June 14, 1982 in of such corporations Cannot be seized under execution against them, either in the
G. R. No. L-59938 and; treasury or when in transit to it. Judgments rendered for taxes, and the proceeds of
Considering further that there is no opposition to plaintiffs' motion for execution such judgments in the hands of officers of the law, are not subject to execution
dated July 23, 1983; unless so declared by statute." Thus, it is clear that all the funds of petitioner
Let a writ of execution be so issued, as prayed for in the aforestated motion. (p. 10, municipality in the possession of the Municipal Treasurer of San Miguel, as well as
Rollo) those in the possession of the Provincial Treasurer of Bulacan, are also public funds
Petitioner, on July 30, 1982, filed a Motion to Quash the writ of execution on the and as such they are exempt from execution.
ground that the municipality's property or funds are all public funds exempt from Besides, Presidential Decree No. 477, known as "The Decree on Local Fiscal
execution. The said motion to quash was, however, denied by the respondent judge Administration", Section 2 (a), provides:
in an order dated August 23, 1982 and the alias writ of execution stands in full force SEC. 2. Fundamental Principles. — Local government financial affairs, transactions,
and effect. and operations shall be governed by the fundamental principles set forth
On September 13, 1982, respondent judge issued an order which in part, states: hereunder:
It is clear and evident from the foregoing that defendant has more than enough (a) No money shall be paid out of the treasury except in pursuance of a lawful
funds to meet its judgment obligation. Municipal Treasurer Miguel C, Roura of San appropriation or other specific statutory authority.
Miguel, Bulacan and Provincial Treasurer of Bulacan Agustin O. Talavera are xxx xxx xxx
therefor hereby ordered to comply with the money judgment rendered by Judge Otherwise stated, there must be a corresponding appropriation in the form of an
Agustin C. Bagasao against said municipality. In like manner, the municipal ordinance duly passed by the Sangguniang Bayan before any money of the
authorities of San Miguel, Bulacan are likewise ordered to desist from plaintiffs' municipality may be paid out. In the case at bar, it has not been shown that the
legal possession of the property already returned to plaintiffs by virtue of the alias Sangguniang Bayan has passed an ordinance to this effect.
writ of execution.
Furthermore, Section 15, Rule 39 of the New Rules of Court, outlines the procedure It appears that the action for eminent domain was filed on May 20, 1986, docketed
for the enforcement of money judgment: as Civil Case No. 13699. Attached to petitioner's complaint was a certification that a
(a) By levying on all the property of the debtor, whether real or personal, not bank account (Account No. S/A 265-537154-3) had been opened with the PNB
otherwise exempt from execution, or only on such part of the property as is Buendia Branch under petitioner's name containing the sum of P417,510.00, made
sufficient to satisfy the judgment and accruing cost, if he has more than sufficient pursuant to the provisions of Pres. Decree No. 42. After due hearing where the
property for the purpose; parties presented their respective appraisal reports regarding the value of the
(b) By selling the property levied upon; property, respondent RTC judge rendered a decision on June 4, 1987, fixing the
(c) By paying the judgment-creditor so much of the proceeds as will satisfy the appraised value of the property at P5,291,666.00, and ordering petitioner to pay
judgment and accruing costs; and this amount minus the advanced payment of P338,160.00 which was earlier
(d) By delivering to the judgment-debtor the excess, if any, unless otherwise, released to private respondent.
directed by judgment or order of the court. After this decision became final and executory, private respondent moved for the
The foregoing has not been followed in the case at bar. issuance of a writ of execution. This motion was granted by respondent RTC judge.
ACCORDINGLY, the petition is granted and the order of respondent judge, dated After issuance of the writ of execution, a Notice of Garnishment dated January 14,
July 27, 1982, granting issuance of a writ of execution; the alias writ of execution, 1988 was served by respondent sheriff Silvino R. Pastrana upon the manager of the
dated July 27, 1982; and the order of respondent judge, dated September 13, 1982, PNB Buendia Branch. However, respondent sheriff was informed that a "hold code"
directing the Provincial Treasurer of Bulacan and the Municipal Treasurer of San was placed on the account of petitioner. As a result of this, private respondent filed
Miguel, Bulacan to comply with the money judgments, are SET ASIDE; and a motion dated January 27, 1988 praying that an order be issued directing the bank
respondents are hereby enjoined from implementing the writ of execution. to deliver to respondent sheriff the amount equivalent to the unpaid balance due
SO ORDERED. under the RTC decision dated June 4, 1987.
Petitioner filed a motion to lift the garnishment, on the ground that the manner of
G.R. Nos. 89898-99 October 1, 1990 payment of the expropriation amount should be done in installments which the
MUNICIPALITY OF MAKATI, petitioner, respondent RTC judge failed to state in his decision. Private respondent filed its
vs. opposition to the motion.
THE HONORABLE COURT OF APPEALS, HON. SALVADOR P. DE GUZMAN, JR., as Pending resolution of the above motions, petitioner filed on July 20, 1988 a
Judge RTC of Makati, Branch CXLII ADMIRAL FINANCE CREDITORS CONSORTIUM, "Manifestation" informing the court that private respondent was no longer the true
INC., and SHERIFF SILVINO R. PASTRANA, respondents. and lawful owner of the subject property because a new title over the property had
Defante & Elegado for petitioner. been registered in the name of Philippine Savings Bank, Inc. (PSB) Respondent RTC
Roberto B. Lugue for private respondent Admiral Finance Creditors' Consortium, Inc. judge issued an order requiring PSB to make available the documents pertaining to
RESOLUTION its transactions over the subject property, and the PNB Buendia Branch to reveal
the amount in petitioner's account which was garnished by respondent sheriff. In
CORTÉS, J.: compliance with this order, PSB filed a manifestation informing the court that it had
The present petition for review is an off-shoot of expropriation proceedings consolidated its ownership over the property as mortgagee/purchaser at an
initiated by petitioner Municipality of Makati against private respondent Admiral extrajudicial foreclosure sale held on April 20, 1987. After several conferences, PSB
Finance Creditors Consortium, Inc., Home Building System & Realty Corporation and and private respondent entered into a compromise agreement whereby they
one Arceli P. Jo, involving a parcel of land and improvements thereon located at agreed to divide between themselves the compensation due from the expropriation
Mayapis St., San Antonio Village, Makati and registered in the name of Arceli P. Jo proceedings.
under TCT No. S-5499. Respondent trial judge subsequently issued an order dated September 8, 1988
which: (1) approved the compromise agreement; (2) ordered PNB Buendia Branch
to immediately release to PSB the sum of P4,953,506.45 which corresponds to the enforcing and/or carrying out the RTC order dated December 21, 1988 and the writ
balance of the appraised value of the subject property under the RTC decision of garnishment issued pursuant thereto. Private respondent then filed its comment
dated June 4, 1987, from the garnished account of petitioner; and, (3) ordered PSB to the petition, while petitioner filed its reply.
and private respondent to execute the necessary deed of conveyance over the Petitioner not only reiterates the arguments adduced in its petition before the
subject property in favor of petitioner. Petitioner's motion to lift the garnishment Court of Appeals, but also alleges for the first time that it has actually two accounts
was denied. with the PNB Buendia Branch, to wit:
Petitioner filed a motion for reconsideration, which was duly opposed by private xxx xxx xxx
respondent. On the other hand, for failure of the manager of the PNB Buendia (1) Account No. S/A 265-537154-3 — exclusively for the expropriation of the
Branch to comply with the order dated September 8, 1988, private respondent filed subject property, with an outstanding balance of P99,743.94.
two succeeding motions to require the bank manager to show cause why he should (2) Account No. S/A 263-530850-7 — for statutory obligations and other
not be held in contempt of court. During the hearings conducted for the above purposes of the municipal government, with a balance of P170,098,421.72, as of
motions, the general manager of the PNB Buendia Branch, a Mr. Antonio Bautista, July 12, 1989.
informed the court that he was still waiting for proper authorization from the PNB xxx xxx xxx
head office enabling him to make a disbursement for the amount so ordered. For its [Petition, pp. 6-7; Rollo, pp. 11-12.]
part, petitioner contended that its funds at the PNB Buendia Branch could neither Because the petitioner has belatedly alleged only in this Court the existence of two
be garnished nor levied upon execution, for to do so would result in the bank accounts, it may fairly be asked whether the second account was opened only
disbursement of public funds without the proper appropriation required under the for the purpose of undermining the legal basis of the assailed orders of respondent
law, citing the case of Republic of the Philippines v. Palacio [G.R. No. L-20322, May RTC judge and the decision of the Court of Appeals, and strengthening its reliance
29, 1968, 23 SCRA 899]. on the doctrine that public funds are exempted from garnishment or execution as
Respondent trial judge issued an order dated December 21, 1988 denying enunciated in Republic v. Palacio [supra.] At any rate, the Court will give petitioner
petitioner's motion for reconsideration on the ground that the doctrine enunciated the benefit of the doubt, and proceed to resolve the principal issues presented
in Republic v. Palacio did not apply to the case because petitioner's PNB Account based on the factual circumstances thus alleged by petitioner.
No. S/A 265-537154-3 was an account specifically opened for the expropriation Admitting that its PNB Account No. S/A 265-537154-3 was specifically opened for
proceedings of the subject property pursuant to Pres. Decree No. 42. Respondent expropriation proceedings it had initiated over the subject property, petitioner
RTC judge likewise declared Mr. Antonio Bautista guilty of contempt of court for his poses no objection to the garnishment or the levy under execution of the funds
inexcusable refusal to obey the order dated September 8, 1988, and thus ordered deposited therein amounting to P99,743.94. However, it is petitioner's main
his arrest and detention until his compliance with the said order. contention that inasmuch as the assailed orders of respondent RTC judge involved
Petitioner and the bank manager of PNB Buendia Branch then filed separate the net amount of P4,965,506.45, the funds garnished by respondent sheriff in
petitions for certiorari with the Court of Appeals, which were eventually excess of P99,743.94, which are public funds earmarked for the municipal
consolidated. In a decision promulgated on June 28, 1989, the Court of Appeals government's other statutory obligations, are exempted from execution without
dismissed both petitions for lack of merit, sustained the jurisdiction of respondent the proper appropriation required under the law.
RTC judge over the funds contained in petitioner's PNB Account No. 265-537154-3, There is merit in this contention. The funds deposited in the second PNB Account
and affirmed his authority to levy on such funds. No. S/A 263-530850-7 are public funds of the municipal government. In this
Its motion for reconsideration having been denied by the Court of Appeals, jurisdiction, well-settled is the rule that public funds are not subject to levy and
petitioner now files the present petition for review with prayer for preliminary execution, unless otherwise provided for by statute [Republic v. Palacio, supra.; The
injunction. Commissioner of Public Highways v. San Diego, G.R. No. L-30098, February 18,
On November 20, 1989, the Court resolved to issue a temporary restraining order 1970, 31 SCRA 616]. More particularly, the properties of a municipality, whether
enjoining respondent RTC judge, respondent sheriff, and their representatives, from real or personal, which are necessary for public use cannot be attached and sold at
execution sale to satisfy a money judgment against the municipality. Municipal 164 SCRA 393, 400. See also Provincial Government of Sorsogon v. Vda. de
revenues derived from taxes, licenses and market fees, and which are intended Villaroya, G.R. No. 64037, August 27, 1987, 153 SCRA 291].
primarily and exclusively for the purpose of financing the governmental activities The State's power of eminent domain should be exercised within the bounds of fair
and functions of the municipality, are exempt from execution [See Viuda De Tan play and justice. In the case at bar, considering that valuable property has been
Toco v. The Municipal Council of Iloilo, 49 Phil. 52 (1926): The Municipality of taken, the compensation to be paid fixed and the municipality is in full possession
Paoay, Ilocos Norte v. Manaois, 86 Phil. 629 (1950); Municipality of San Miguel, and utilizing the property for public purpose, for three (3) years, the Court finds
Bulacan v. Fernandez, G.R. No. 61744, June 25, 1984, 130 SCRA 56]. The foregoing that the municipality has had more than reasonable time to pay full compensation.
rule finds application in the case at bar. Absent a showing that the municipal council WHEREFORE, the Court Resolved to ORDER petitioner Municipality of Makati to
of Makati has passed an ordinance appropriating from its public funds an amount immediately pay Philippine Savings Bank, Inc. and private respondent the amount
corresponding to the balance due under the RTC decision dated June 4, 1987, less of P4,953,506.45. Petitioner is hereby required to submit to this Court a report of
the sum of P99,743.94 deposited in Account No. S/A 265-537154-3, no levy under its compliance with the foregoing order within a non-extendible period of SIXTY (60)
execution may be validly effected on the public funds of petitioner deposited in DAYS from the date of receipt of this resolution.
Account No. S/A 263-530850-7. The order of respondent RTC judge dated December 21, 1988, which was rendered
Nevertheless, this is not to say that private respondent and PSB are left with no in Civil Case No. 13699, is SET ASIDE and the temporary restraining order issued by
legal recourse. Where a municipality fails or refuses, without justifiable reason, to the Court on November 20, 1989 is MADE PERMANENT.
effect payment of a final money judgment rendered against it, the claimant may SO ORDERED.
avail of the remedy of mandamus in order to compel the enactment and approval
of the necessary appropriation ordinance, and the corresponding disbursement of [G.R. No. 107271. September 10, 2003]
municipal funds therefor [SeeViuda De Tan Toco v. The Municipal Council of Iloilo, CITY OF CALOOCAN and NORMA M. ABRACIA, petitioners, vs. HON. MAURO T.
supra; Baldivia v. Lota, 107 Phil. 1099 (1960); Yuviengco v. Gonzales, 108 Phil. 247 ALLARDE, Presiding Judge of Branch 123, RTC of Caloocan City, ALBERTO A.
(1960)]. CASTILLO, Deputy Sheriff of Branch 123, RTC of Caloocan City, and DELFINA
In the case at bar, the validity of the RTC decision dated June 4, 1987 is not disputed HERNANDEZ SANTIAGO and PHILIPPINE NATIONAL BANK (PNB), respondents.
by petitioner. No appeal was taken therefrom. For three years now, petitioner has DECISION
enjoyed possession and use of the subject property notwithstanding its inexcusable CORONA, J.:
failure to comply with its legal obligation to pay just compensation. Petitioner has Assailed in this petition for certiorari is the decision[1] dated August 31, 1992, of the
benefited from its possession of the property since the same has been the site of Court of Appeals in CA G.R. SP No. 27423, ordering the Regional Trial Court of
Makati West High School since the school year 1986-1987. This Court will not Caloocan City, Branch 123, to implement an alias writ of execution dated January
condone petitioner's blatant refusal to settle its legal obligation arising from 16, 1992. The dispositive portion read as follows:
expropriation proceedings it had in fact initiated. It cannot be over-emphasized WHEREFORE the petition is hereby granted ordering the Regional Trial Court of
that, within the context of the State's inherent power of eminent domain, Kaloocan City, Branch 123, to immediately effect the alias writ of execution dated
. . . [j]ust compensation means not only the correct determination of the amount to January 16, 1992 without further delay.
be paid to the owner of the land but also the payment of the land within a Counsel for the respondents are warned that a repetition of their contemptuous act
reasonable time from its taking. Without prompt payment, compensation cannot to delay the execution of a final and executory judgment will be dealt with more
be considered "just" for the property owner is made to suffer the consequence of severely.
being immediately deprived of his land while being made to wait for a decade or SO ORDERED.[2]
more before actually receiving the amount necessary to cope with his loss It is important to state at the outset that the dispute between petitioner and
[Cosculluela v. The Honorable Court of Appeals, G.R. No. 77765, August 15, 1988, private respondent has been litigated thrice before this Court: first, in G.R. No. L-
39288-89, entitled Heirs of Abelardo Palomique, et al. vs. Marcial Samson, et al.,
decided on January 31, 1985; second, in G.R. No. 98366, entitled City Government affirmed the order of issuance of the writ of execution.[5] One of the issues raised
of Caloocan vs. Court of Appeals, et al., resolved on May 16, 1991, and third, in G.R. and resolved therein was the extent to which back salaries and emoluments were
No. 102625, entitled Santiago vs. Sto. Tomas, et al., decided on August 1, 1995. This due to respondent Santiago. The appellate court held that she was entitled to her
is not to mention the numerous concurrent efforts by the City Government of salaries from October, 1983 to December, 1986.
Caloocan to seek relief from other judicial and quasi-judicial bodies. The present And for the second time, the City Government of Caloocan appealed to this Court in
petition for certiorari is the fourth time we are called upon to resolve the dispute. G.R. No. 98366, City Government of Caloocan vs. Court of Appeals, et al. The
The factual and procedural antecedents follow. petition was dismissed, through our Resolution of May 16, 1991, for having been
Sometime in 1972, Marcial Samson, City Mayor of Caloocan City, through Ordinance filed late and for failure to show any reversible error on the part of the Court of
No. 1749, abolished the position of Assistant City Administrator and 17 other Appeals. The resolution subsequently attained finality and the corresponding entry
positions from the plantilla of the local government of Caloocan. Then Assistant City of judgment was made on July 29, 1991.
Administrator Delfina Hernandez Santiago and the 17 affected employees of the On motion of private respondent Santiago, Judge Mauro T. Allarde ordered the
City Government assailed the legality of the abolition before the then Court of First issuance of an alias writ of execution on March 3, 1992. The City Government of
Instance (CFI) of Caloocan City, Branch 33. Caloocan moved to reconsider the order, insisting in the main that respondent
In 1973, the CFI declared the abolition illegal and ordered the reinstatement of all Santiago was not entitled to backwages from 1983 to 1986. The court a quo denied
the dismissed employees and the payment of their back salaries and other the motion and forthwith issued the alias writ of execution. Unfazed, the City
emoluments. The City Government of Caloocan appealed to the Court of Appeals. Government of Caloocan filed a motion to quash the writ, maintaining that the
Respondent Santiago and her co-parties moved for the dismissal of the appeal for money judgment sought to be enforced should not have included salaries and
being dilatory and frivolous but the appellate court denied their motion. Thus, they allowances for the years 1983-1986. The trial court likewise denied the motion.
elevated the case on certiorari before this Court, docketed as G.R. No. L-39288-89, On July 27, 1992, Sheriff Alberto A. Castillo levied and sold at public auction one of
Heirs of Abelardo Palomique, et al. vs. Marcial Samson, et al. In our Resolution the motor vehicles of the City Government of Caloocan, with plate no. SBH-165, for
dated January 31, 1985, we held that the appellate court erred in not dismissing the P100,000. The proceeds of the sale were turned over to respondent Santiago in
appeal, and that the appeal of the City Government of Caloocan was frivolous and partial satisfaction of her claim, thereby leaving a balance of P439,377.14, inclusive
dilatory. In due time, the resolution lapsed into finality and entry of judgment was of interest. Petitioners filed a motion questioning the validity of the auction sale of
made on February 27, 1985. the vehicle with plate no. SBH-165, and a supplemental motion maintaining that the
In 1986, the City Government of Caloocan paid respondent Santiago P75,083.37 in properties of the municipality were exempt from execution. In his Order dated
partial payment of her backwages, thereby leaving a balance of P530,761.91. Her October 1, 1992, Judge Allarde denied both motions and directed the sheriff to levy
co-parties were paid in full.[3] In 1987, the City of Caloocan appropriated funds for and schedule at public auction three more vehicles of the City of Caloocan - [6]
her unpaid back salaries. This was included in Supplemental Budget No. 3 for the ONE (1) Unit Motor Vehicle (Hunter Station Wagon); Motor No. C-240-199629;
fiscal year 1987. Surprisingly, however, the City later refused to release the money Chassis No. MBB-910369C;
to respondent Santiago. ONE (1) Unit Motor Vehicle (Hunter Series 11-Diesel); Engine No. 4FB1-174328,
Respondent Santiago exerted effort for the execution of the remainder of the Chassis No. MBB-910345C; Plate No. SDL-653;
money judgment but she met stiff opposition from the City Government of ONE (1) Unit Motor Vehicle (Hunter Series 11-Diesel); Engine No. 4FB-165196;
Caloocan. On February 12, 1991, Judge Mauro T. Allarde, RTC of Caloocan City, Chassis No. MBB 910349C.
Branch 123, issued a writ of execution for the payment of the remainder of All the vehicles, including that previously sold in the auction sale, were owned by
respondent Santiagos back salaries and other emoluments. [4] the City and assigned for the use of herein petitioner Norma Abracia, Division
For the second time, the City Government of Caloocan went up to the Court of Superintendent of Caloocan City, and other officials of the Division of City Schools.
Appeals and filed a petition for certiorari, prohibition and injunction to stop the trial Meanwhile, the City Government of Caloocan sought clarification from the Civil
court from enforcing the writ of execution. The CA dismissed the petition and Service Commission (CSC) on whether respondent Santiago was considered to have
rendered services from 1983-1986 as to be entitled to backwages for that period. In Thus, in an order dated May 7, 1993, Judge Allarde ordered Sheriff Alberto A.
its Resolution No. 91-1124, the CSC ruled in the negative. Castillo to immediately garnish the funds of the City Government of Caloocan
On November 22, 1991, private respondent Santiago challenged the CSC resolution corresponding to the claim of respondent Santiago. [9] On the same day, Sheriff
before this Court in G.R. No. 102625, Santiago vs. Sto. Tomas, et al. On July 8, 1993, Alberto A. Castillo served a copy of the Notice of Garnishment on the Philippine
we initially dismissed the petition for lack of merit; however, we reconsidered the National Bank (PNB), Sangandaan Branch, Caloocan City. When PNB immediately
dismissal of the petition in our Resolution dated August 1, 1995, this time ruling in notified the City of Caloocan of the Notice of Garnishment, the City Treasurer sent a
favor of respondent Santiago: letter-advice informing PNB that the order of garnishment was illegal, with a
The issue of petitioner Santiagos right to back salaries for the period from October warning that it would hold PNB liable for any damages which may be caused by the
1983 to December 1986 having been resolved in G.R. No. 98366 on 16 May 1991, withholding of the funds of the city. PNB opted to comply with the order of Judge
CSC Resolution No. 91-1124 promulgated later on 24 September 1991 in particular, Allarde and released to the Sheriff a managers check amounting to P439,378. After
its ruling on the extent of backwages due petitioner Santiago was in fact moot and 21 long years, the claim of private respondent Santiago was finally settled in full.
academic at the time of its promulgation. CSC Resolution No. 91-1124 could not, of On June 4, 1993, however, while the instant petition was pending, the City
course, set aside what had been judicially decided with finality x x x x the court Government of Caloocan filed yet another motion with this Court, a Motion to
considers that resort by the City Government of Caloocan to respondent CSC was Declare in Contempt of Court; to Set Aside the Garnishment and Administrative
but another attempt to deprive petitioner Santiago of her claim to back salaries x x Complaint against Judge Allarde, respondent Santiago and PNB. Subsequently, the
x and a continuation of the Citys abuse and misuse of the rules of judicial City Government of Caloocan filed a Supplemental Petition formally impleading PNB
procedure. The Citys acts have resulted in wasting the precious time and resources as a party-respondent in this case.
of the courts and respondent CSC. (Underscoring supplied). The instant petition for certiorari is directed this time against the validity of the
On October 5, 1992, the City Council of Caloocan passed Ordinance No. 0134, Series garnishment of the funds of the City of Caloocan, as well as the validity of the levy
of 1992, which included the amount of P439,377.14 claimed by respondent and sale of the motor vehicles belonging to the City of Caloocan. More specifically,
Santiago as back salaries, plus interest.[7] Pursuant to the subject ordinance, Judge petitioners insist that Judge Allarde gravely abused his discretion in:
Allarde issued an order dated November 10, 1992, decreeing that: (a) ordering the garnishment of the funds of the City of Caloocan deposited with the
WHEREFORE, the City Treasurer (of Caloocan), Norberto Azarcon is hereby ordered PNB, since it is settled that public funds are beyond the reach of garnishment and
to deliver to this Court within five (5) days from receipt hereof, (a) managers check even with the appropriation passed by the City Council, the authority of the Mayor
covering the amount of P439,378.00 representing the back salaries of petitioner is still needed for the release of the appropriation;
Delfina H. Santiago in accordance with Ordinance No. 0134 S. 1992 and pursuant to (b) ordering the levy and sale at public auction of three (3) motor vehicles owned by
the final and executory decision in these cases. the City of Caloocan, which vehicles are necessary for public use and cannot be
Then Caloocan Mayor Macario A. Asistio, Jr., however, refused to sign the check attached nor sold in an execution sale to satisfy a money judgment against the City
intended as payment for respondent Santiagos claims. This, despite the fact that he of Caloocan;
was one of the signatories of the ordinance authorizing such payment. On April 29, (c) peremptorily denying petitioner City of Caloocans urgent motions to vacate and
1993, Judge Allarde issued another order directing the Acting City Mayor of set aside the auction sale of the motor vehicle with PLATE NO. SBH-165,
Caloocan, Reynaldo O. Malonzo, to sign the check which had been pending before notwithstanding that the auction sale by the Sheriff was tainted with serious
the Office of the Mayor since December 11, 1992. Acting City Mayor Malonzo irregularities, more particularly:
informed the trial court that he could not comply with the order since the subject i. non-compliance with the mandatory posting of the notice of sale;
check was not formally turned over to him by the City Mayor who went on official ii. non-observance of the procedure that a sale through public auction has to be
leave of absence on April 15, 1993, and that he doubted whether he had authority made and consummated at the time of the auction, at the designated place and
to sign the same.[8] upon actual payment of the purchase price by the winning bidder;
iii. violation of Sec. 21, Rule 39 of the Rules of Court to the effect that sale of In such a case, the monetary judgment may be legally enforced by judicial
personal property capable of manual delivery must be sold within the view of those processes.
attending the sale; and, Thus, in the similar case of Pasay City Government, et al. vs. CFI of Manila, Br. X, et
iv. the Sheriffs Certificate of Sale contained false narration of facts respecting the al.,[14] where petitioners challenged the trial courts order garnishing its funds in
actual time of the public auction; payment of the contract price for the construction of the City Hall, we ruled that,
(d) the enforcement of the levy made by the Sheriff covering the three (3) motor while government funds deposited in the PNB are exempt from execution or
vehicles based on an alias writ that has long expired. garnishment, this rule does not apply if an ordinance has already been enacted for
The petition has absolutely no merit. The trial court committed no grave abuse of the payment of the Citys obligations
discretion in implementing the alias writ of execution to settle the claim of Upon the issuance of the writ of execution, the petitioner-appellants moved for its
respondent Santiago, the satisfaction of which petitioner had been maliciously quashal alleging among other things the exemption of the government from
evading for 21 years. execution. This move on the part of petitioner-appellants is at first glance laudable
Petitioner argues that the garnishment of its funds in PNB was invalid inasmuch as for all government funds deposited with the Philippine National Bank by any agency
these were public funds and thus exempt from execution. Garnishment is or instrumentality of the government, whether by way of general or special deposit,
considered a specie of attachment by means of which the plaintiff seeks to subject remain government funds and may not be subject to garnishment or levy. But
to his claim property of the defendant in the hands of a third person, or money inasmuch as an ordinance has already been enacted expressly appropriating the
owed by such third person or garnishee to the defendant. [10] amount of P613,096.00 as payment to the respondent-appellee, then the herein
The rule is and has always been that all government funds deposited in the PNB or case is covered by the exception to the general rule x x x x
any other official depositary of the Philippine Government by any of its agencies or In the instant case, the City Council of Caloocan already approved and passed
instrumentalities, whether by general or special deposit, remain government funds Ordinance No. 0134, Series of 1992, allocating the amount of P439,377.14 for
and may not be subject to garnishment or levy, in the absence of a corresponding respondent Santiagos back salaries plus interest. Thus this case fell squarely within
appropriation as required by law:[11] the exception. For all intents and purposes, Ordinance No. 0134, Series of 1992,
Even though the rule as to immunity of a state from suit is relaxed, the power of the was the corresponding appropriation as required by law. The sum indicated in the
courts ends when the judgment is rendered. Although the liability of the state has ordinance for Santiago were deemed automatically segregated from the other
been judicially ascertained, the state is at liberty to determine for itself whether to budgetary allocations of the City of Caloocan and earmarked solely for the Citys
pay the judgment or not, and execution cannot issue on a judgment against the monetary obligation to her. The judgment of the trial court could then be validly
state. Such statutes do not authorize a seizure of state property to satisfy enforced against such funds.
judgments recovered, and only convey an implication that the legislature will Indeed, this conclusion is further buttressed by the Certification issued on
recognize such judgment as final and make provision for the satisfaction thereof. [12] December 23, 1992 by Norberto C. Azarcon, City Treasurer of Caloocan:
The rule is based on obvious considerations of public policy. The functions and CERTIFICATION
public services rendered by the State cannot be allowed to be paralyzed or This is to certify that according to the records available in this Office the claim for
disrupted by the diversion of public funds from their legitimate and specific objects, backwages of the HON. JUDGE DELFINA H. SANTIAGO has been properly obligated
as appropriated by law.[13] and can be collected in accordance with existing accounting and auditing rules and
However, the rule is not absolute and admits of a well-defined exception, that is, regulations.
when there is a corresponding appropriation as required by law. Otherwise stated, This is to certify further that in case the claim is not collected within the present
the rule on the immunity of public funds from seizure or garnishment does not fiscal year, such claim shall be entered in the books of Accounts Payable and can still
apply where the funds sought to be levied under execution are already allocated by be collected in the next fiscal year x x x x (Underscoring supplied)
law specifically for the satisfaction of the money judgment against the government. Petitioners reliance on Municipality of Makati vs. Court of Appeals, et al.,[15] and
Commissioner of Public Highways vs. San Diego,[16] does not help their cause.[17]
Both cases implicitly affirmed that public funds may be garnished if there is a fatal flaws. No evidence was adduced to prove that the sheriff had been remiss in
statute which appropriated the amount so garnished. Thus, in Municipality of the performance of his duties during the public auction sale. Indeed it would be
Makati, citing San Diego, we unequivocally held that: injudicious for us to assume, as petitioners want us to do, that the sheriff failed to
In this jurisdiction, well-settled is the rule that public funds are not subject to levy follow the established procedures governing public auctions.
and execution, unless otherwise provided by statute x x x x On the contrary, a review of the records shows that the sheriff complied with the
Similarly, we cannot agree with petitioners argument that the appropriation rules on public auction. The sale of the Citys vehicle was made publicly in front of
ordinance of the City Council did not authorize PNB to release the funds because the Caloocan City Hall on the date fixed in the notice July 27, 1992. In fact,
only the City Mayor could authorize the release thereof. A valid appropriation of petitioners in their Motion to Declare in Contempt of Court; to Set Aside the
public funds lifts its exemption from execution. Here, the appropriation passed by Garnishment and Administrative Complaint admitted as much:
the City Council of Caloocan providing for the payment of backwages to respondent On July 27, 1992, by virtue of an alias writ of execution issued by the respondent
was duly approved and signed by both the council and then Mayor Macario Asistio, court, a vehicle owned by the petitioner xxx was levied and sold at public auction
Jr. The mayors signature approving the budget ordinance was his assent to the for the amount of P100,000.00 and which amount was immediately delivered to the
appropriation of funds for respondent Santiagos backwages. If he did not agree private respondent x x x x[21]
with such allocation, he could have vetoed the item pursuant to Section 55 of the Hence, petitioners cannot now be heard to impugn the validity of the auction sale.
Local Government Code.[18] There was no such veto. Petitioners, in desperation, likewise make much of the proceedings before the trial
In view of the foregoing discourse, we dismiss petitioners unfounded assertion, court on October 8, 1992, wherein petitioner Norma Abracia, Superintendent of the
probably made more out of sheer ignorance of prevailing jurisprudence than a Division of City Schools of Caloocan, was commanded to appear and show cause
deliberate attempt to mislead us, that the rule that public funds (are) beyond the why she should not be cited in contempt for delaying the execution of judgment.
reach of levy and garnishment is not qualified by any condition.[19] This was in connection with her failure (or refusal) to surrender the three motor
We now come to the issue of the legality of the levy on the three motor vehicles vehicles assigned to the Division of City Schools to the custody of the sheriff.
belonging to the City of Caloocan which petitioners claimed to be exempt from Petitioner Abracia, assisted by Mr. Ricardo Nagpacan of the Division of City Schools,
execution, and which levy was based on an alias writ that had purportedly expired. appeared during the hearing but requested a ten-day period within which to refer
Suffice it to say that Judge Allarde, in his Order dated November 10, 1992, [20] the matter of contempt to a counsel of her choice. The request was denied by
already lifted the levy on the three vehicles, thereby formally discharging them Judge Allarde in his assailed order dated October 8, 1992. Thus petitioner Abracia
from the jurisdiction of the court and turning them over to the City Government of claimed, inter alia, that: (a) she was denied due process; (b) the silence of the order
Caloocan: of Judge Allarde on her request for time violated an orderly and faithful recording
x x x x the levy of the three (3) vehicles made by Sheriff Alberto Castillo pursuant to of the proceedings, and (c) she was coerced into agreeing to surrender the vehicles.
the Orders of this Court dated October 1 and 8, 1992 is hereby lifted and the said We do not think so. What violates due process is the absolute lack of opportunity to
Sheriff is hereby ordered to return the same to the City Government in view of the be heard. That opportunity, the Court is convinced, was sufficiently accorded to
satisfaction of the decision in these cases x x x x petitioner Abracia. She was notified of the contempt charge against her; she was
It is thus unnecessary for us to discuss a moot issue. effectively assisted by counsel when she appeared during the hearing on October 8,
We turn to the third issue raised by petitioners that the auction sale by Sheriff 1992; and she was afforded ample opportunity to answer and refute the charge
Alberto A. Castillo of the motor vehicle with plate no. SBH-165 was tainted with against her. The circumstance that she opted not to avail of her chance to be heard
serious irregularities. We need not emphasize that the sheriff enjoys the on that occasion by asking for an extension of time within which to hire a counsel of
presumption of regularity in the performance of the functions of his office. This her choice, a request denied by the trial court, did not transgress nor deprive her of
presumption prevails in the absence of substantial evidence to the contrary and her right to due process.
cannot be overcome by bare and self-serving allegations. The petitioners failed to Significantly, during the hearing on October 8, 1992, Mr. Nagpacan manifested in
convince us that the auction sale conducted by the sheriff indeed suffered from open court that, after conferring with petitioner Abracia, the latter was willing to
surrender these vehicles into the custody of the sheriff on the condition that the Petitioners and their counsels are hereby warned against filing any more pleadings
standing motion (for contempt) be withdrawn.[22] Her decision was made freely and in connection with the issues already resolved with finality herein and in related
voluntarily, and after conferring with her counsel. Moreover, it was petitioner cases.
Abracia herself who imposed the condition that respondent Santiago should Costs against petitioners.
withdraw her motion for contempt in exchange for her promise to surrender the SO ORDERED.
subject vehicles. Thus, petitioner Abracias claim that she was coerced into Panganiban, (Acting Chairman), Sandoval-Gutierrez, and Carpio-Morales, JJ.,
surrendering the vehicles had no basis. concur.
Even assuming ex gratia argumenti that there indeed existed certain legal Puno, (Chairman), J., on official leave.
infirmities in connection with the assailed orders of Judge Allarde, still, considering
the totality of circumstances of this case, the nullification of the contested orders
would be way out of line. For 21 long years, starting 1972 when this controversy
started up to 1993 when her claim was fully paid out of the garnished funds of the
City of Caloocan, respondent Santiago was cruelly and unjustly deprived of what
was due her. It would be, at the very least, merciless and unchristian to make
private respondent refund the City of Caloocan the amount already paid to her,
only to force her to go through the same nightmare all over again.
At any rate, of paramount importance to us is that justice has been served. No right
of the public was violated and public interest was preserved.
Finally, we cannot simply pass over in silence the deplorable act of the former
Mayor of Caloocan City in refusing to sign the check in payment of the Citys
obligation to private respondent. It was an open defiance of judicial processes,
smacking of political arrogance, and a direct violation of the very ordinance he
himself approved. Our Resolution in G.R. No. 98366, City Government of Caloocan
vs. Court of Appeals, et al., dated May 16, 1991, dismissing the petition of the City
of Caloocan assailing the issuance of a writ of execution by the trial court, already
resolved with finality all impediments to the execution of judgment in this case. Yet,
the City Government of Caloocan, in a blatant display of malice and bad faith,
refused to comply with the decision. Now, it has the temerity to come to this Court
once more and continue inflicting injustice on a hapless citizen, as if all the harm
and prejudice it has already heaped upon respondent Santiago are still not enough.
This Court will not condone the repudiation of just obligations contracted by
municipal corporations. On the contrary, we will extend our aid and every judicial
facility to any citizen in the enforcement of just and valid claims against abusive
local government units.
WHEREFORE, the petition is hereby DISMISSED for utter lack of merit. The assailed
orders of the trial court dated October 1, 1992, October 8, 1992 and May 7, 1993,
respectively, are AFFIRMED.