Republic of the Philippines

SUPREME COURT
Manila

FIRST DIVISION

G.R. No. L-46930 June 10, 1988

DALE SANDERS, AND A.S. MOREAU, JR, petitioners, 

vs.
HON. REGINO T. VERIDIANO II, as Presiding Judge, Branch I, Court of First Instance of
Zambales, Olongapo City, ANTHONY M. ROSSI and RALPH L. WYERS, respondents.

CRUZ, J.:

The basic issue to be resolved in this case is whether or not the petitioners were performing their official
duties when they did the acts for which they have been sued for damages by the private respondents.
Once this question is decided, the other answers will fall into place and this petition need not detain us
any longer than it already has.

Petitioner Sanders was, at the time the incident in question occurred, the special services director of the
U.S. Naval Station (NAVSTA) in Olongapo City. 1 Petitioner Moreau was the commanding officer of the
Subic Naval Base, which includes the said station. 2 Private respondent Rossi is an American citizen with
permanent residence in the Philippines, 3 as so was private respondent Wyer, who died two years
ago. 4 They were both employed as gameroom attendants in the special services department of the
NAVSTA, the former having been hired in 1971 and the latter in 1969. 5

On October 3, 1975, the private respondents were advised that their employment had been converted from
permanent full-time to permanent part-time, effective October 18, 1975. 6 Their reaction was to protest
this conversion and to institute grievance proceedings conformably to the pertinent rules and regulations
of the U.S. Department of Defense. The result was a recommendation from the hearing officer who
conducted the proceedings for the reinstatement of the private respondents to permanent full-time status
plus backwages. The report on the hearing contained the observation that "Special Services management
practices an autocratic form of supervision." 7

In a letter addressed to petitioner Moreau on May 17, 1976 (Annex "A" of the complaint), Sanders
disagreed with the hearing officer's report and asked for the rejection of the abovestated recommendation.
The letter contained the statements that: a ) "Mr. Rossi tends to alienate most co-workers and
supervisors;" b) "Messrs. Rossi and Wyers have proven, according to their immediate supervisors, to be
difficult employees to supervise;" and c) "even though the grievants were under oath not to discuss the
case with anyone, (they) placed the records in public places where others not involved in the case could
hear."

On November 7, 1975, before the start of the grievance hearings, a-letter (Annex "B" of the complaint)
purportedly corning from petitioner Moreau as the commanding general of the U.S. Naval Station in
Subic Bay was sent to the Chief of Naval Personnel explaining the change of the private respondent's
employment status and requesting concurrence therewith. The letter did not carry his signature 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 First Instance of
Olongapo City a for damages against the herein petitioners on November 8, 1976.  8 The plaintiffs claimed
that the letters contained libelous imputations that had exposed them to ridicule and caused them mental
anguish and that the prejudgment of the grievance proceedings was an invasion of their personal and
proprietary rights.

The private respondents made it clear that the petitioners were being sued in their private or personal
capacity. However, in a motion to dismiss filed under a special appearance, the petitioners argued that the
acts complained of were performed by them in the discharge of their official duties and that,
consequently, the court had no jurisdiction over them under the doctrine of state immunity.

After extensive written arguments between the parties, the motion was denied in an order dated March 8,
1977, 9on the main ground that the petitioners had not presented any evidence that their acts were official
in nature and not personal torts, moreover, the allegation in the complaint was that the defendants had
acted maliciously and in bad faith. The same order issued a writ of preliminary attachment, conditioned
upon the filing of a P10,000.00 bond by the plaintiffs, against the properties of petitioner Moreau, who
allegedly was then about to leave the Philippines. Subsequently, to make matters worse for the
defendants, petitioner Moreau was declared in a default by the trial court in its order dated August 9,
1977. The motion to lift the default order on the ground that Moreau's failure to appear at the pre-trial
conference was the result of some misunderstanding, and the motion for reconsideration of the denial of
the motion to dismiss, which was filed by the petitioner's new lawyers, were denied by the respondent
court on September 7, 1977.

This petition for certiorari, prohibition and preliminary injunction was thereafter filed before this Court,
on the contention that the above-narrated acts of the respondent court are tainted with grave abuse of
discretion amounting to lack of jurisdiction.

We return now to the basic question of whether the petitioners were acting officially or only in their
private capacities when they did the acts for which the private respondents have sued them for damages.

It is stressed at the outset that the mere allegation that a government functionary is being sued in his
personal capacity will not automatically remove him from the protection of the law of public officers and,
if appropriate, the doctrine of state immunity. By the same token, the mere invocation of official character
will not suffice to insulate him from suability and liability for an act imputed to him as a personal tort
committed without or in excess of his authority. These well-settled principles are applicable not only to
the officers of the local state but also where the person sued in its courts pertains to the government of a
foreign state, as in the present case.

The respondent judge, apparently finding that the complained acts were prima facie personal and tortious,
decided to proceed to trial to determine inter alia their precise character on the strength of the evidence to
be submitted by the parties. The petitioners have objected, arguing that no such evidence was needed to
substantiate their claim of jurisdictional immunity. Pending resolution of this question, we issued a
temporary restraining order on September 26, 1977, that has since then suspended the proceedings in this
case in the court a quo.

In past cases, this Court has held that where the character of the act complained of can be determined
from the pleadings exchanged between the parties before the trial, it is not necessary for the court to
require them to belabor the point at a trial still to be conducted. Such a proceeding would be superfluous,
not to say unfair to the defendant who is subjected to unnecessary and avoidable inconvenience.

Thus, in Baer v. Tizon, 10 we held that a motion to dismiss a complaint against the commanding general of
the Olongapo Naval Base should not have been denied because it had been sufficiently shown that the act
for which he was being sued was done in his official capacity on behalf of the American government. The
United States had not given its consent to be sued. It was the reverse situation in Syquia v. Almeda
Lopez," where we sustained the order of the lower court granting a where we motion to dismiss a
complaint against certain officers of the U.S. armed forces also shown to be acting officially in the name
of the American government. The United States had also not waived its immunity from suit. Only three
years ago, in United States of America v. Ruiz, 12 we set aside the denial by the lower court of a motion to
dismiss a complaint for damages filed against the United States and several of its officials, it appearing
that the act complained of was governmental rather than proprietary, and certainly not personal. In these
and several other cases 13 the Court found it redundant to prolong the other case proceedings after it had
become clear that the suit could not prosper because the acts complained of were covered by the doctrine
of state immunity.

It is abundantly clear in the present case that the acts for which the petitioners are being called to account
were performed by them in the discharge of their official duties. Sanders, as director of the special
services department of NAVSTA, undoubtedly had supervision over its personnel, including the private
respondents, and had a hand in their employment, work assignments, discipline, dismissal and other
related matters. It is not disputed that the letter he had written was in fact a reply to a request from his
superior, the other petitioner, for more information regarding the case of the private
respondents. 14 Moreover, even in the absence of such request, he still was within his rights in reacting to
the hearing officer's criticism—in effect a direct attack against him—-that Special Services was practicing
"an autocratic form of supervision."

As for Moreau,what he is claimed to have done was write the Chief of Naval Personnel for concurrence
with the conversion of the private respondents' type of employment even before the grievance
proceedings had even commenced. Disregarding for the nonce the question of its timeliness, this act is
clearly official in nature, performed by Moreau as the immediate superior of Sanders and directly
answerable to Naval Personnel in matters involving the special services department of NAVSTA In fact,
the letter dealt with the financial and budgetary problems of the department and contained
recommendations for their solution, including the re-designation of the private respondents. There was
nothing personal or private about it.
Given the official character of the above-described letters, we have to conclude that the petitioners were,
legally speaking, being sued as officers of the United States government. As they have acted on behalf of
that government, and within the scope of their authority, it is that government, and not the petitioners
personally, that is responsible for their acts. Assuming that the trial can proceed and it is proved that the
claimants have a right to the payment of damages, such award will have to be satisfied not by the
petitioners in their personal capacities but by the United States government as their principal. This will
require that government to perform an affirmative act to satisfy the judgment, viz, the appropriation of the
necessary amount to cover the damages awarded, thus making the action a suit against that government
without its consent.

There should be no question by now that such complaint cannot prosper unless the government sought to
be held ultimately liable has given its consent to' be sued. So we have ruled not only in Baer but in many
other decisions where we upheld the doctrine of state immunity as applicable not only to our own
government but also 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 legal right against the
authority which makes the law on which the right depends.  16 In the case of foreign states, the rule is
derived from the principle of the sovereign equality of states which wisely admonishes that par in parem
non habet imperium and that a contrary attitude would "unduly vex the peace of nations." 17 Our
adherence to this precept is formally expressed in Article II, Section 2, of our Constitution, where we
reiterate from our previous charters that the Philippines "adopts the generally accepted principles of
international law as part of the law of the land.

All this is not to say that in no case may a public officer be sued as such without the previous consent of
the state. To be sure, there are a number of well-recognized exceptions. It is clear that a public officer
may be sued as such to compel him to do an act required by law, as where, say, a register of deeds refuses
to record a deed of sale; 18or to restrain a Cabinet member, for example, from enforcing a law claimed to
be unconstitutional; 19 or to compel the national treasurer to pay damages from an already appropriated
assurance fund; 20 or the commissioner of internal revenue to refund tax over-payments from a fund
already available for the purpose; 21 or, in general, to secure a judgment that the officer impleaded may
satisfy by himself without the government itself having to do a positive act to assist him. We have also
held that where the government itself has violated its own laws, the aggrieved party may directly implead
the government even without first filing his claim with the Commission on Audit as normally required, as
the doctrine of state immunity "cannot be used as an instrument for perpetrating an injustice." 22

This case must also be distinguished from such decisions as Festejo v. Fernando, 23 where the Court held
that a bureau director could be sued for damages on a personal tort committed by him when he acted
without or in excess of authority in forcibly taking private property without paying just compensation
therefor although he did convert it into a public irrigation canal. It was not necessary to secure the
previous consent of the state, nor could it be validly impleaded as a party defendant, as it was not
responsible for the defendant's unauthorized act.

The case at bar, to repeat, comes under the rule and not under any of the recognized exceptions. The
government of the United States has not given its consent to be sued for the official acts of the petitioners,
who cannot satisfy any judgment that may be rendered against them. As it is the American government
itself that will have to perform the affirmative act of appropriating the amount that may be adjudged for
the private respondents, the complaint must be dismissed for lack of jurisdiction.

The Court finds that, even under the law of public officers, the acts of the petitioners are protected by the
presumption of good faith, which has not been overturned by the private respondents. Even mistakes
concededly committed by such public officers are not actionable as long as it is not shown that they were
motivated by malice or gross negligence amounting to bad faith.  24 This, to, is well settled . 25 Furthermore,
applying now our own penal laws, the letters come under the concept of privileged communications and
are not punishable, 26 let alone the fact that the resented remarks are not defamatory by our standards. It
seems the private respondents have overstated their case.

A final consideration is that since the questioned acts were done in the Olongapo Naval Base by the
petitioners in the performance of their official duties and the private respondents are themselves
American citizens, it would seem only proper for the courts of this country to refrain from taking
cognizance of this matter and to treat it as coming under the internal administration of the said base.

The petitioners' counsel have submitted a memorandum replete with citations of American cases, as if
they were arguing before a court of the United States. The Court is bemused by such attitude. While these
decisions do have persuasive effect upon us, they can at best be invoked only to support our own
jurisprudence, which we have developed and enriched on the basis of our own persuasions as a people,
particularly since we became independent in 1946.
We appreciate the assistance foreign decisions offer us, and not only from the United States but also from
Spain and other countries from which we have derived some if not most of our own laws. But we should
not place undue and fawning reliance upon them and regard them as indispensable mental crutches
without which we cannot come to our own decisions through the employment of our own endowments
We live in a different ambience and must decide our own problems in the light of our own interests and
needs, and of our qualities and even idiosyncrasies as a people, and always with our own concept of law
and justice.

The private respondents must, if they are still sominded, pursue their claim against the petitioners in
accordance with the laws of the United States, of which they are all citizens and under whose jurisdiction
the alleged offenses were committed. Even assuming that our own laws are applicable, the United States
government has not decided to give its consent to be sued in our courts, which therefore has not acquired
the competence to act on the said claim,.

WHEREFORE, the petition is GRANTED. The challenged orders dated March 8,1977, August 9,1977,
and September 7, 1977, are SET ASIDE. The respondent court is directed to DISMISS Civil Case No.
2077-O. Our Temporary restraining order of September 26,1977, is made PERMANENT. No costs.

SO ORDERED.

Narvasa, Gancayco, Grino-Aquiño and Medialdea, JJ., Concur.

 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 84607 March 19, 1993

REPUBLIC OF THE PHILIPPINES, GEN. RAMON MONTANO, GEN. ALFREDO LIM, GEN.
ALEXANDER AGUIRRE, COL. EDGAR DULA TORRES, COL. CEZAR NAZARENO, MAJ.
FILEMON GASMEN, PAT. NICANOR ABANDO, PFC SERAFIN CEBU, JR., GEN. BRIGIDO
PAREDES, COL. ROGELIO MONFORTE, PFC ANTONIO LUCERO, PAT. JOSE MENDIOLA,
PAT. NELSON TUASON, POLICE CORPORAL PANFILO ROGOS, POLICE LT. JUAN B.
BELTRAN, PAT. NOEL MANAGBAO, MARINE THIRD CLASS TRAINEE (3CT) NOLITO
NOGATO, 3CT ALEJANDRO B. NAGUIO, JR., EFREN ARCILLAS, 3CT AGERICO LUNA,
3CT BASILIO BORJA, 3CT MANOLITO LUSPO, 3CT CRISTITUTO GERVACIO, 3CT
MANUEL DELA CRUZ, JR., MARINE (CDC) BN., (CIVIL DISTURBANCE CONTROL),
MOBILE DISPERSAL TEAM (MDT), LT. ROMEO PAQUINTO, LT. LAONGLAANG GOCE,
MAJ. DEMETRIO DE LA CRUZ, POLICE CAPTAIN RODOLFO NAVAL, JOHN DOE,
RICHARD DOE, ROBERTO DOE AND OTHER DOES, petitioners, 
vs.
HON. EDILBERTO G. SANDOVAL, Regional Trial Court of Manila, Branch IX, ERLINDA C.
CAYLAO, ANATALIA ANGELES PEREZ, MYRNA BAUTISTA, CIPRIANA EVANGELIO,
ELMA GRAMPA, AMELIA GUTIERREZ, NEMESIO LAKINDANUM, PURITA YUMUL,
MIGUEL ARABE, TERESITA ARJONA, RONALDO CAMPOMANES AND CARMENCITA
ARDONI VDA. DE CAMPOMANES, ROGELIO DOMUNICO, in their capacity as heirs of the
deceased (ROBERTO C. CAYLAO, SONNY "BOY" PEREZ, DIONESIO BAUTISTA, DANTE
EVANGELIO, ADELFA ARIBE, DANILO ARJONA, VICENTE CAMPOMANES, RONILO
DOMUNICO) respectively; and (names of sixty-two injured victims) EDDIE AGUINALDO,
FELICISIMO ALBASIA, NAPOLEON BAUTISTA, DANILO CRUZ, EDDIE MENSOLA,
ALBERT PITALBO, VICENTE ROSEL, RUBEN CARRIEDO, JOY CRUZ, HONORIO
LABAMBA, JR., EFREN MACARAIG, SOLOMON MANALOTO, ROMEO DURAN, NILO
TAGUBAT, JUN CARSELLAR, JOEY CLEMENTE, GERARDO COYOCA, LUISITO DACO,
BENJAMIN DELA CRUZ, ARTHUR FONTANILLA, WILSON GARCIA, CARLOS SIRAY,
JOSE PERRAS, TOMAS VALLOS, ARNOLD ENAJE, MARIANITA DIMAPILIS, FRANCISCO
ANGELES, MARCELO ESGUERRA, JOSE FERRER, RODEL DE GUIA, ELVIS MENDOZA,
VICTORIANO QUIJANO, JOEY ADIME, RESIENO ADUL, ALBERTO TARSONA, CARLOS
ALCANTARA, MAMERTO ALIAS, EMELITO ALMONTE, BENILDA ALONUEVO, EMMA
ABADILLO, REYNALDO CABALLES, JR., JAIME CALDETO, FABIAN CANTELEJO,
RODRIGO CARABARA, ENRIQUE DELGADO, JUN DELOS SANTOS, MARIO DEMASACA,
FRANCISCO GONZALES, ERNESTO GONZALES, RAMIRO JAMIL, JUAN LUCENA,
PERLITO SALAYSAY, JOHNNY SANTOS, MARCELO SANTOS, EMIL SAYAO, BAYANI
UMALI, REMIGIO MAHALIN, BONG MANLULO, ARMANDO MATIENZO, CARLO
MEDINA, LITO NOVENARIO, and ROSELLA ROBALE, respondents.

G.R. No. 84645 March 19, 1993

ERLINDA C. CAYLAO, ANATALIA ANGELES PEREZ, MYRNA BAUTISTA, CIPRIANA

EVANGELIO, ELMA GRAMPA, AMELIA GUTIERREZ, NEMESIO LAKINDANUM, PURITA
YUMUL, MIGUEL ARABE, TERESITA ARJONA, RONALDO CAMPOMANES AND
CARMENCITA ARDONI VDA. DE CAMPOMANES, ROGELIO DOMUNICO, in their capacity
as heirs of the deceased (ROBERTO C. CAYLAO, SONNY "BOY" PEREZ, DIONESIO
GRAMPA, ANGELITO GUTIERREZ, BERNABE LAKINDANUM, ROBERTO YUMUL,
LEOPOLDO ALONZO, ADELFA ARIBE, DANILO ARJONA, VICENTE CAMPOMANES,
RONILO DOMUNICO) respectively; and (names of sixty-two injured victims) EDDIE
AGUINALDO, FELICISIMO ALBASIA, NAPOLEON BAUTISTA, DANILO CRUZ, EDDIE
MENSOLA, ALBERT PITALBO, VICENTE ROSEL, RUBEN CARRIEDO, JOY CRUZ,
HONORIO LABAMBA, JR. EFREN MACARAIG, SOLOMON MANALOTO, ROMEO DURAN,
NILO TAGUBAT, JUN CARSELLAR, JOEY CLEMENTE, GERARDO COYOCA, LUISITO
DACO, BENJAMIN DELA CRUZ, ARTHUR FONTANILLA, WILSON GARCIA, CARLOS
SIRAY, JOSE PERRAS TOMAS VALLOS, ARNOLD ENAJE, MARIANITA DIMAPILIS,
FRANCISCO ANGELES, MARCELO ESGUERRA, JOSE FERRER, RODEL DE GUIA, ELVIS
MENDOZA, VICTORINO QUIJANO, JOEY ADIME, RESIENO ADUL, ALBERTO TARSONA,
CARLOS ALCANTARA, MAMERTO ALIAS, EMELITO ALMONTE, BENILDA ALONUEVO,
EMMA ABADILLO, REYNALDO CABALLES, JR., JAIME CALDETO, FABIAN
CANTELEJO, RODRIGO CARABARA, ENRIQUE DELGADO, JUN DELOS SANTOS, MARIO
DEMASACA, FRANCISCO GONZALES, ERNESTO GONZALES, RAMIRO JAMIL, JUAN
LUCENA, PERLITO SALAYSAY, JOHNNY SANTOS, MARCELO SANTOS, EMIL SAYAO,
BAYANI UMALI, REMIGIO MAHALIN, BONG MANLULO, ARMANDO MATIENZO,
CARLO MEDINA, LITO NOVENARIO, ROSELLA ROBALE, petitioners, 
vs.
REPUBLIC OF THE PHILIPPINES, and HONORABLE EDILBERTO G. SANDOVAL, Regional
Trial Court of Manila, Branch 9, respondents.

The Solicitor General for the Republic of the Philippines.

Structural Alternative Legal Assistance for Grassroots for petitioners in 84645 & private respondents
in 84607.

CAMPOS, JR., J.:

People may have already forgotten the tragedy that transpired on January 22, 1987. It is quite ironic that
then, some journalists called it a Black Thursday, as a 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 in our history books. For those however, who have become widows and orphans, certainly they
would not settle for just that. They seek retribution for the lives taken that will never be brought back to
life again.

Hence, the heirs of the deceased, together with those injured (Caylao group), instituted this petition,
docketed as G.R. No. 84645, under Section 1 of Rule 65 of the Rules of Court, seeking the reversal and
setting aside of the Orders of respondent Judge Sandoval,  1 dated May 31 and August 8, 1988, dismissing
the complaint for damages of herein petitioners against the Republic of the Philippines in Civil Case No.
88-43351.

Petitioner, the Republic of the Philippines, through a similar remedy, docketed as G.R. No. 84607, seeks
to set aside the Order of respondent Judge dated May 31, 1988, in Civil Case No. 88-43351 entitled
"Erlinda Caylao, et al. vs. Republic of the Philippines, et al."

The pertinent portion of the questioned Order 2 dated May 31, 1988, reads as follows:

With respect however to the other defendants, the impleaded Military Officers, since they
are being charged in their personal and official capacity, and holding them liable, if at all,
would not result in financial responsibility of the government, the principle of immunity
from suit cannot conveniently and correspondingly be applied to them.

WHEREFORE, the case as against the defendant Republic of the Philippines is hereby
dismissed. As against the rest of the defendants the motion to dismiss is denied. They are
given a period of ten (10) days from receipt of this order within which to file their
respective pleadings.

On the other hand, the Order 3, dated August 8, 1988, denied the motions filed by both parties, for a
reconsideration of the abovecited Order, respondent Judge finding no cogent reason to disturb the said
order.

The massacre was the culmination of eight days and seven nights of encampment by members of the
militant Kilusang Magbubukid sa Pilipinas (KMP) at the then Ministry (now Department) of Agrarian
Reform (MAR) at the Philippine Tobacco Administration Building along Elliptical Road in Diliman,
Quezon City.

The farmers and their sympathizers presented their demands for what they called "genuine agrarian
reform". The KMP, led by its national president, Jaime Tadeo, presented their problems and demands,
among which were: (a) giving lands for free to farmers; (b) zero retention of lands by landlords; and (c)
stop amortizations of land payments.

The dialogue between the farmers and the MAR officials began on January 15, 1987. The two days that
followed saw a marked increase in people at the encampment. It was only on January 19, 1987 that Jaime
Tadeo arrived to meet with then Minister Heherson Alvarez, only to be informed that the Minister can
only meet with him the following day. On January 20, 1987, the meeting was held at the MAR conference
room. Tadeo demanded that the minimum comprehensive land reform program be granted immediately.
Minister Alvarez, for his part, can only promise to do his best to bring the matter to the attention of then
President Aquino, during the cabinet meeting on January 21, 1987.

Tension mounted the following day. The farmers, now on their seventh day of encampment, barricaded
the MAR premises and prevented the employees from going inside their offices. They hoisted the KMP
flag together with the Philippine flag.

At around 6:30 p.m. of the same day, Minister Alvarez, in a meeting with Tadeo and his leaders, advised
the latter to instead wait for the ratification of the 1987 Constitution and just allow the government to
implement its comprehensive land reform program. Tadeo, however, countered by saying that he did not
believe in the Constitution and that a genuine land reform cannot be realized under a landlord-controlled
Congress. A heated discussion ensued between Tadeo and Minister Alvarez. This notwithstanding,
Minister Alvarez suggested a negotiating panel from each side to meet again the following day.

On January 22, 1987, Tadeo's group instead decided to march to Malacañang to air their demands. Before
the march started, Tadeo talked to the press and TV media. He uttered fiery words, the most telling of
which were:
". . . inalis namin ang barikada bilang kahilingan ng ating Presidente, pero kinakailangan alisin din niya
ang barikada sa Mendiola sapagkat bubutasin din namin iyon at dadanak ang dugo . . . ."  4

The farmers then proceeded to march to Malacañang, from Quezon Memorial Circle, at 10:00 a.m. They
were later joined by members of other sectoral organizations such as the Kilusang Mayo Uno (KMU),
Bagong Alyansang Makabayan (BAYAN), League of Filipino Students (LFS) and Kongreso ng
Pagkakaisa ng Maralitang Lungsod (KPML).

At around 1:00 p.m., the marchers reached Liwasang Bonifacio where they held a brief program. It was at
this point that some of the marchers entered the eastern side of the Post Office Building, and removed the
steel bars surrounding the garden. Thereafter, they joined the march to Malacañang. At about 4:30 p.m.,
they reached C.M. Recto Avenue.

In anticipation of a civil disturbance, and acting upon reports received by the Capital Regional Command
(CAPCOM) that the rallyists would proceed to Mendiola to break through the police lines and rush
towards Malacañang, CAPCOM Commander General Ramon E. Montaño inspected the preparations and
adequacy of the government forces to quell impending attacks.

OPLAN YELLOW (Revised) was put into effect. Task Force Nazareno under the command of Col. Cesar
Nazareno was deployed at the vicinity of Malacañang. The civil disturbance control units of the Western
Police District under Police Brigadier General Alfredo S. Lim were also activated.

Intelligence reports were also received that the KMP was heavily infiltrated by CPP/NPA elements and
that an insurrection was impending. The threat seemed grave as there were also reports that San Beda
College and Centro Escolar University would be forcibly occupied.

In its report, the Citizens' Mendiola Commission (a body specifically tasked to investigate the facts
surrounding the incident, Commission for short) stated that the government anti-riot forces were
assembled at Mendiola in a formation of three phalanges, in the following manner:

(1) The first line was composed of policemen from police stations Nos. 3, 4, 6, 7, 8, 9 and
10 and the Chinatown detachment of the Western Police District. Police Colonel Edgar
Dula Torres, Deputy Superintendent of the Western Police District, was designated as
ground commander of the CDC first line of defense. The WPD CDC elements were
positioned at the intersection of Mendiola and Legarda Streets after they were ordered to
move forward from the top of Mendiola bridge. The WPD forces were in khaki uniform
and carried the standard CDC equipment — aluminum shields, truncheons and gas
masks.

(2) At the second line of defense about ten (10) yards behind the WPD policemen were
the elements of the Integrated National Police (INP) Field Force stationed at Fort
Bonifacio from the 61st and 62nd INP Field Force, who carried also the standard CDC
equipment — truncheons, shields and gas masks. The INP Field Force was under the
command of Police Major Demetrio dela Cruz.

(3) Forming the third line was the Marine Civil Disturbance Control Battalion composed
of the first and second companies of the Philippine Marines stationed at Fort Bonifacio.
The marines were all equipped with shields, truncheons and M-16 rifles (armalites) slung
at their backs, under the command of Major Felimon B. Gasmin. The Marine CDC
 Battalion was positioned in line formation ten (10) yards farther behind the INP Field
Force.

At the back of the marines were four (4) 6 x 6 army trucks, occupying the entire width of
Mendiola street, followed immediately by two water cannons, one on each side of the
street and eight fire trucks, four trucks on each side of the street. The eight fire trucks
from Fire District I of Manila under Fire Superintendent Mario C. Tanchanco, were to
supply water to the two water cannons.

Stationed farther behind the CDC forces were the two Mobile Dispersal Teams (MDT)
each composed of two tear gas grenadiers, two spotters, an assistant grenadier, a driver
and the team leader.

In front of the College of the Holy Spirit near Gate 4 of Malacañang stood the VOLVO
Mobile Communications Van of the Commanding General of CAPCOM/INP, General
Ramon E. Montaño. At this command post, after General Montaño had conferred
with TF Nazareno Commander, Colonel Cezar Nazareno, about the adequacy and
readiness of his forces, it was agreed that Police General Alfredo S. Lim would
designate Police Colonel Edgar Dula Torres and Police Major Conrado Francisco as
negotiators with the marchers. Police General Lim then proceeded to the WPD CDC
elements already positioned at the foot of Mendiola bridge to relay to Police Colonel
Torres and Police Major Francisco the instructions that the latter would negotiate with the
marchers. 5 (Emphasis supplied)

The marchers, at around 4:30 p.m., numbered about 10,000 to 15,000. From C.M. Recto Avenue, they
proceeded toward the police lines. No dialogue took place between the marchers and the anti-riot squad.
It was at this moment that a clash occurred and, borrowing the words of the Commission "pandemonium
broke loose". The Commission stated in its findings, to wit:

. . . There was an explosion followed by throwing of pillboxes, stones and bottles. Steel
bars, wooden clubs and lead pipes were used against the police. The police fought back
with their shields and truncheons. The police line was breached. Suddenly shots were
heard. The demonstrators disengaged from the government forces and retreated towards
C.M. Recto Avenue. But sporadic firing continued from the government forces.

After the firing ceased, two MDTs headed by Lt. Romeo Paquinto and Lt. Laonglaan
Goce sped towards Legarda Street and lobbed tear gas at the remaining rallyist still
grouped in the vicinity of Mendiola. After dispersing the crowd, the two MDTs, together
with the two WPD MDTs, proceeded to Liwasang Bonifacio upon order of General
Montaño to disperse the rallyists assembled thereat. Assisting the MDTs were a number
of policemen from the WPD, attired in civilian clothes with white head bands, who were
armed with long firearms.6 (Emphasis ours)

After the clash, twelve (12) marchers were officially confirmed dead, although according to Tadeo, there
were thirteen (13) dead, but he was not able to give the name and address of said victim. Thirty-nine (39)
were wounded by gunshots and 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 twenty (20) suffered minor
physical injuries such as abrasions, contusions and the like.

In the aftermath of the confrontation, then President Corazon C. Aquino issued Administrative Order No.
11, 7 (A.O. 11, for brevity) dated January 22, 1987, which created the Citizens' Mendiola Commission.
The body was composed of retired Supreme Court Justice Vicente Abad Santos as Chairman, retired
Supreme Court Justice Jose Y. Feria and Mr. Antonio U. Miranda, both as members. A.O. 11 stated that
the Commission was created precisely for the "purpose of conducting an investigation of the disorder,
deaths, and casualties that took place in the vicinity of Mendiola Bridge and Mendiola Street and Claro
M. Recto Avenue, Manila, in the afternoon of January 22, 1987". The Commission was expected to have
submitted its findings not later than February 6, 1987. But it failed to do so. Consequently, the deadline
was moved to February 16, 1987 by Administrative Order No. 13. Again, the Commission was unable to
meet this deadline. Finally, on February 27, 1987, it submitted its report, in accordance with
Administrative Order No. 17, issued on February 11, 1987.

In its report, the Commission recapitulated its findings, to wit:

(1) The march to Mendiola of the KMP led by Jaime Tadeo, together with the other
sectoral groups, was not covered by any permit as required under Batas Pambansa Blg.
 880, the Public Assembly Act of 1985, in violation of paragraph (a) Section 13,
punishable under paragraph (a), Section 14 of said law.

(2) The crowd dispersal control units of the police and the military were armed with .38
and .45 caliber handguns, and M-16 armalites, which is a prohibited act under paragraph
4(g), Section 13, and punishable under paragraph (b), Section 14 of Batas Pambansa Blg.
880.

(3) The security men assigned to protect the WPD, INP Field Force, the Marines and
supporting military units, as well as the security officers of the police and military
commanders were in civilian attire in violation of paragraph (a), Section 10, Batas
Pambansa 880.

(4) There was unnecessary firing by the police and military crowd dispersal control units
in dispersing the marchers, a prohibited act under paragraph (e), Section 13, and
punishable under paragraph (b), Section 14, Batas Pambansa Blg. 880.

(5) The carrying and use of steel bars, pillboxes, darts, lead pipe, wooden clubs with
spikes, and guns by the marchers as offensive weapons are prohibited acts punishable
under paragraph (g), Section 13, and punishable under paragraph (e), Section 14 of Batas
Pambansa Blg. 880.

(6) The KMP farmers broke off further negotiations with the MAR officials and were
determined to march to Malacañang, emboldened as they are, by the inflammatory and
incendiary utterances of their leader, Jaime Tadeo — "bubutasin namin ang barikada . .
Dadanak and dugo . . . Ang nagugutom na magsasaka ay gagawa ng sariling butas. . .

(7) There was no dialogue between the rallyists and the government forces. Upon
approaching the intersections of Legarda and Mendiola, the marchers began pushing the
police lines and penetrated and broke through the first line of the CDC contingent.

(8) The police fought back with their truncheons and shields. They stood their ground but
the CDC line was breached. There ensued gunfire from both sides. It is not clear who
started the firing.

(9) At the onset of the disturbance and violence, the water cannons and tear gas were not
put into effective use to disperse the rioting crowd.

(10) The water cannons and fire trucks were not put into operation because (a) there was
no order to use them; (b) they were incorrectly prepositioned; and (c) they were out of
range of the marchers.

(11) Tear gas was not used at the start of the disturbance to disperse the rioters. After the
crowd had dispersed and the wounded and dead were being carried away, the MDTs of
the police and the military with their tear gas equipment and components conducted
dispersal operations in the Mendiola area and proceeded to Liwasang Bonifacio to
disperse the remnants of the marchers.

(12) No barbed wire barricade was used in Mendiola but no official reason was given for
its absence. 8

From the results of the probe, the Commission recommended  9 the criminal prosecution of four
unidentified, uniformed individuals, shown either on tape or in pictures, firing at the direction of the
marchers. In connection with this, it was the Commission's recommendation that the National Bureau of
Investigation (NBI) be tasked to undertake investigations regarding the identities of those who actually
fired their guns that resulted in the death of or injury to the victims of the incident. The Commission also
suggested that all the commissioned officers of both the Western Police District and the INP Field Force,
who were armed during the incident, be prosecuted for violation of paragraph 4(g) of Section 13, Batas
Pambansa Blg. 880, the Public Assembly Act of 1985. The Commission's recommendation also included
the prosecution of the marchers, for carrying deadly or offensive weapons, but whose identities have yet
to be established. As for Jaime Tadeo, the Commission said that he should be prosecuted both for
violation of 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 inciting to sedition. As for the
following officers, namely: (1) Gen. Ramon E. Montaño; (2) Police Gen. Alfredo S. Lim; (3) Police Gen.
Edgar Dula Torres; (4) Police Maj. Demetrio dela Cruz; (5) Col. Cezar Nazareno; and (5) Maj. Felimon
Gasmin, for their failure to make effective use of their skill and experience in directing the dispersal
operations in Mendiola, administrative sanctions were recommended to be imposed.
The last and the most significant recommendation of the Commission was for the deceased and wounded
victims of the Mendiola incident to be compensated by the government. It was this portion that petitioners
(Caylao group) invoke in their claim for damages from the government.

Notwithstanding such recommendation, no concrete form of compensation was received by the victims.
Thus, on July 27, 1987, herein petitioners, (Caylao group) filed a formal letter of demand for
compensation from the Government. 10 This formal demand was indorsed by the office of the Executive
Secretary to the Department of Budget and Management (DBM) on August 13, 1987. The House
Committee on Human Rights, on February 10, 1988, recommended the expeditious payment of
compensation to the Mendiola victims. 11

After almost a year, on January 20, 1988, petitioners (Caylao group) were constrained to institute an
action for damages against the Republic of the Philippines, together with the military officers, and
personnel involved in the Mendiola incident, before the trial court. The complaint was docketed as Civil
Case No. 88-43351.

On February 23, 1988, the Solicitor General filed a Motion to Dismiss on the ground that the State cannot
be sued without its consent. Petitioners opposed said motion on March 16, 1988, maintaining that the
State has waived its immunity from suit and that the dismissal of the instant action is contrary to both the
Constitution and the International Law on Human Rights.

Respondent Judge Sandoval, in his first questioned Order, dismissed the complaint as against the
Republic of the Philippines on the ground that there was no waiver by the State. Petitioners (Caylao
group) filed a Motion for Reconsideration therefrom, but the same was denied by respondent judge in his
Order dated August 8, 1988. Consequently, Caylao and her co-petitioners filed the instant petition.

On the other hand, the Republic of the Philippines, together with the military officers and personnel
impleaded as defendants in the court below, filed its petition for certiorari.

Having arisen from the same factual beginnings and raising practically identical issues, the two (2)
petitions were consolidated and will therefore be jointly dealt with and resolved in this Decision.

The resolution of both petitions revolves around the main issue of whether or not the State has waived its
immunity from suit.

Petitioners (Caylao group) advance the argument that the State has impliedly waived its sovereign
immunity from suit. It is their considered view that by the recommendation made by the Commission for
the government to indemnify the heirs and victims of the Mendiola incident and by the public addresses
made by then President Aquino in the aftermath of the killings, the State has consented to be sued.

Under our Constitution the principle of immunity of the government from suit is expressly provided in
Article XVI, Section 3. The principle is based on the very essence of sovereignty, and on the practical
ground that there can be no legal right as against the authority that makes the law on which the right
depends. 12 It also rests on reasons of public policy — that public service would be hindered, and the
public endangered, if the sovereign authority could be subjected to law suits at the instance of every
citizen and consequently controlled in the uses and dispositions of the means required for the proper
administration of the government. 13

This is not a suit against the State with its consent.

Firstly, the recommendation made by the Commission regarding indemnification of the heirs of the
deceased and the victims of the incident by the government does not in any way mean that liability
automatically attaches to the State. It is important to note that A.O. 11 expressly states that the purpose of
creating the Commission was to have a body that will conduct an "investigation of the disorder, deaths
and casualties that took place." 14 In the exercise of its functions, A.O. 11 provides guidelines, and what is
relevant to Our discussion reads:

1 Its conclusions regarding the existence of probable cause for the commission of any
offense and of the persons probably guilty of the same shall be sufficient compliance with
the rules on preliminary investigation and the charges arising therefrom may be filed
directly with the proper court. 15

In effect, whatever may be the findings of the Commission, the same shall only serve as the cause of
action in the event that any party decides to litigate his/her claim. Therefore, the Commission is merely a
preliminary venue. The Commission is not the end in itself. Whatever recommendation it makes cannot in
any way bind 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 or said, the same are not
tantamount to the State having waived its immunity from suit. The President's act of joining the marchers,
days after the incident, does not mean that there was an admission by the State of any liability. In fact to
borrow the words of petitioners (Caylao group), "it was an act of solidarity by the government with the
people". Moreover, petitioners rely on President Aquino's speech promising that the government would
address the grievances of the rallyists. By this alone, it cannot be inferred that the State has admitted any
liability, much less can it be inferred that it has consented to the suit.

Although consent to be sued may be given impliedly, still it cannot be maintained that such consent was
given considering the circumstances obtaining in the instant case.

Thirdly, the case does not qualify as a suit against the State.

Some instances when a suit against the State is proper are: 16

(1) When the Republic is sued by name;

(2) When the suit is against an unincorporated government agency;

(3) When the, suit is on its face against a government officer but the case is such that ultimate liability
will belong not to the officer but to the government.

While the Republic in this case is sued by name, the ultimate liability does not pertain to the government.
Although the military officers and personnel, then party defendants, were discharging their official
functions when the incident occurred, their functions ceased to be official the moment they exceeded their
authority. Based on the Commission findings, there was lack of justification by the government forces in
the use of firearms. 17 Moreover, the members of the police and military crowd dispersal units committed
a prohibited act under B.P. Blg. 880 18 as there was unnecessary firing by them in dispersing the
marchers. 19

As early as 1954, this Court has pronounced that an officer cannot shelter himself by the plea that he is a
public agent acting under the color of his office when his acts are wholly without authority. 20 Until
recently in 1991, 21 this doctrine still found application, this Court saying that immunity from suit cannot
institutionalize irresponsibility and non-accountability nor grant a privileged status not claimed by any
other official of the Republic. The military and police forces were deployed to ensure that the rally would
be peaceful and orderly as well as to guarantee the safety of the very people that they are duty-bound to
protect. However, the facts as found by the trial court showed that they fired at the unruly crowd to
disperse the latter.

While it is true that nothing is better settled than the general rule that a sovereign state and its political
subdivisions cannot be sued in the courts except when it has given its consent, it cannot be invoked by
both the military officers to release them from any liability, and by the heirs and victims to demand
indemnification from the government. The principle of state immunity from suit does not apply, as in this
case, when the relief demanded by the suit requires no affirmative official action on the part of the State
nor the affirmative discharge of any obligation which belongs to the State in its political capacity, even
though the officers or agents who are made defendants claim to hold or act only by virtue of a title of the
state and as its agents and servants. 22 This Court has made it quite clear that even a "high position in the
government does not confer a license to persecute or recklessly injure another." 23

The inescapable conclusion is that the State cannot be held civilly liable for the deaths that followed the
incident. Instead, the liability should fall on the named defendants in the lower court. In line with the
ruling of this court in Shauf vs. Court of Appeals, 24 herein public officials, having been found to have
acted beyond the scope of their authority, may be held liable for damages.

WHEREFORE, finding no reversible error and no grave abuse of discretion committed by respondent
Judge in issuing the questioned orders, the instant petitions are hereby DISMISSED.

SO ORDERED.

Narvasa, C.J., Cruz, Feliciano, Padilla, Bidin, Griño-Aquino, Regalado, Davide, Jr., Romero, Nocon,
Bellosillo, Melo and Quiason, JJ., concur.

Gutierrez, Jr., J., is on leave.

 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-5156             March 11, 1954

CARMEN FESTEJO, demandante-apelante, 
vs.
ISAIAS FERNANDO, Director de Obras Publicas, demandado-apelado.

D. Eloy B. Bello en representacion de la apelante.

El Procurador General Sr. Pompeyo Diaz y el Procurador Sr. Antonio A. Torres en representacion del
apelado.

DIOKNO, J.:

Carmen Festejo, dueña de unos terrenos azucareros, de un total de unas 9 hectareas y media de superfice,
demando a "Isaias Fernando Director, Bureau of public Works, que como tal Director de Obras Publicas
tiene a su cargo los sistemas y proyectos de irrigacion y es el funcionario responsable de la construccion
de los sistemas de irrigacion en el pais," alegando que —

The defendant, as Director of the Bureau of Public Works, without authority obtained first from
the Court of First Instance of Ilocos Sur, without obtaining first a right of way, and without the
consent and knowledge of the plaintiff, and against her express objection unlawfully took
possession of portions of the three parcels of 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 aggregate area being 24,179 square meters to the damage and prejudice of the plaintiff.
----- R. on A., p. 3.

causando a ella variados daños y perjuicios. Pidio, en su consecuencia, sentencia condenando el

demandado:

. . . to return or cause to be returned the possession of the portions of land unlawfully occupied
and appropriated in the aggregate area of 24,179 square meters and to return the land to its former
condition under the expenses of the defendant. . . .

In the remote event that the portions of land unlawfully occupied and appropriated can not be
returned to the plaintiff, then to order the defendant to pay to the plaintiff the sum of P19,343.20
as value of the portions totalling an area of 24,179 square meters; ---- R. on A., p. 5.

y ademas a pagar P9,756.19 de daños y P5,000 de honorarios de abogado, con las costas R. on A., pp. 5-
6.

El demandado, por medio del Procurador General, presento mocion de sobreseimiento de la demanda por
el fundamento de que el Juzgado no tiene jurisdiccion para dictar sentencia valida contra el, toda vez que
judicialmente la reclamacion es contra la Republica de Filipinas, y esta no ha presentado su
consentimiento a la demanda. El Juzgado inferior estimo la mocion y sobreseyo la demanda sin perjuicio
y sin costas.

En apelacion, la demandante sostiene que fue un error considerar la demanda como una contra la
Republica y sobreseer en su virtud la demanda.

La mocion contra "Isaias Fernando, Director de Obras Publicas, encargado y responsable de la

construccion de los sistemas de irrigacion en Filipinas" es una dirigida personalmente contra el, por actos
que asumio ejecutar en su concepto oficial. La ley no le exime de responsabilidad por las
extralimitaciones que cometa o haga cometer en el desempeño de sus funciones oficiales. Un caso
semejante es el de Nelson vs. Bobcock (1933) 18 minn. 584, NW 49, 90 ALR 1472. Alli el Comisionado
de Carreteras, al mejorar un trozo de la carretera ocupo o se apropio de terrenos contiguos al derecho de
paso. El Tribunal Supremo del Estado declaro que es personalmente responsable al dueño de los daños
causados. Declaro ademas que la ratificacion de lo que hicieron sus subordinados era equivalente a una
orden a los mismos. He aqui lo dijo el Tribunal.

We think the evidence and conceded facts permitted the jury in finding that in the trespass on
plaintiff's land defendant committed acts outside the scope of his authority. When he went outside
 the boundaries of the right of way upon plaintiff's land and damaged it or destroyed its former
condition an dusefulness, he must be held to have designedly departed from the duties imposed
on him by law. There can be no claim that he thus invaded plaintiff's land southeasterly of the
right of way innocently. Surveys clearly marked the limits of the land appropriated for the right of
way of this trunk highway before construction began. . . .

"Ratification may be equivalent to command, and cooperation may be inferred from acquiescence
where there is power to restrain." It is unnecessary to consider other cases cited, . . ., for as before
suggested, the jury could find or infer that, in so far as there was actual trespass by appropriation
of plaintiff's land as a dumping place for the rock to be removed from the additional appropriated
right of way, defendant planned, approved, and ratified what was done by his subordinates. —
Nelson vs. Bobcock, 90 A.L.R., 1472, 1476, 1477.

La doctrina sobre la responsabilidad civil de los funcionarios en casos parecidos se resume como sigue:

Ordinarily the officer or employee committing the tort is personally liable therefor, and may be
sued as any other citizen and held answerable for whatever injury or damage results from his
tortious act. — 49 Am. Jur. 289.

. . . If an officer, even while acting under color of his office, exceeds the power conferred on him
by law, he cannot shelter himself under the plea that he is a public agent. — 43 Am. Jur. 86.

It is a general rule that an officer-executive, administrative quasi-judicial, ministerial, or

otherwise who acts outside the scope of his jurisdiction and without authorization of law may
thereby render himself amenable to personal liability in a civil suit. If he exceed the power
conferred on him by law, he cannot shelter himself by the plea that he is a public agent acting
under the color of his office, and not personally. In the eye of the law, his acts then are wholly
without authority. — 43 Am. Jur. 89-90.

El articulo 32 del Codigo Civil dice a su vez:

ART. 32. Any public officer or emplyee, or any private individual, who directly or indirectly
obstructs, defeats, violates or in any manner impedes or impairs any of the following rights and
liberties of another person shall be liable to the latter for damages:

xxx     xxx     xxx

(6) The right against deprivation of property without due process of law;

xxx     xxx     xxx

In any of the cases referred to this article, whether or not the defendant's acts or omission
constitutes a criminal offense, the aggrieved party has a right ot commence an entirely separate
and distinct civil action for damages, and for other relief. Such civil action shall proceed
independently of any criminal prosecution (if the latter be instituted), and may be proved by a
preponderance of evidence.

The inmdemnity shall include moral damages Exemplary damages may also be adjudicated.

Veanse tambien Lung vs. Aldanese, 45 Phil., 784; Syquia vs. Almeda, No. L-1648, Agosto 17,
1947; Marquez vs. Nelson, No. L-2412, Septiembre 1950.

Se revoca la orden apelada y se ordena la continuacion de la tramitacion de la demanda conforme proveen

los reglamentos. Sin especial pronunciamiento en cuanto a las costas. Asi se ordena.

Padilla, Reyes, Jugo, Bautista Angelo and Labrador, MM., estan conformes.

Separate Opinions

CONCEPCION, J., dissenting:

To my mind, the allegations of the complaint lead to no other conclusion than that appellee Isaias
Fernando is a party in this case, not in his personal capacity, but as an officer of the Government.
According to said pleading the defendant is "Isaias Fernando, Director, Bureau of Public Works."
Moreover, in paragraphs 4 and 5 of the complaint, it is alleged:

4. That the defendant as Director of the Bureau of Public Works, is in charge of irrigation
projects and systems, and the official responsible for the construction of irrigation system in the
Philippines;

5. That the defendant, as Director of the Bureau of Public Works, without authority obtained first
from the Court of First Instance of Ilocos Sur, without obtaining first a right of way, and without
the consent and knowledge of the plaintiff, and against her express objection, unlawfully took
possession of portions of the three parcels of 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 aggregate area being 24,179 square meters to the damage and prejudice of the plaintiff.
(Emphasis supplied.)

The emphasis thus placed upon the allegation that the acts complained of were performed by said
defendant "as Director of the Bureau of Public Works," clearly shows that the designation of his office
was included in the title of the case to indicate that he was being sued in his official capacity. This
conclusion is bolstered up by the fact that, among other things, plaintiff prays, in the complaint, for a
judgment

Ordering the defendant to return or caused to be returned the possession of the portions of land
unlawfully occupied and appropriated in the aggregate area of 24,179 square meters and to return
the land to its former condition under the expense of the defendant. (Paragraph a, of the
complaint).

We take judicial notice of the fact that the irrigation projects and system reffered to in the complaint — of
which the defendant, Isaias Fernando, according to the same pleading, is "in charge" and for which he is
"responsible" as Director of the Bureau of Public Works — are established and operated with public
funds, which pursuant to the Constitution, must be appropriated by law. Irrespective of the manner in
which the construction may have been undertaken by the Bureau of Public Works, the system or canal is,
therefore, a property of the Government. Consequently, in 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 restored to its former condition, plaintiff seeks to divest the Government of its possession of said
irrigation canal, and, what is worse, to cause said property of the Government to be removed or destroyed.
As held in Syquia vs. Lopez (47 Off. Gaz., 665), the Government is, accordingly, "the real party in
interest as defendant" in the case at bar. In other words, the same partakes of the nature of a suit against
the state and may not be maintained without its consent.

Hence I am constrained to dissent.

Bengzon, J., concurs.

 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-11154            March 21, 1916

E. MERRITT, plaintiff-appellant, 
vs.
GOVERNMENT OF THE PHILIPPINE ISLANDS, defendant-appellant.

Crossfield and O'Brien for plaintiff.

Attorney-General Avanceña for defendant..

TRENT, J.:

This is an appeal by both parties from a judgment of the Court of First Instance of the city of Manila in
favor of the plaintiff for the sum of P14,741, together with the costs of the cause.

Counsel for the plaintiff insist that the trial court erred (1) "in limiting the general 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 months and twenty-one days and fixing the damage
accordingly in the sum of P2,666, instead of P6,000 as claimed by plaintiff in his complaint."

The Attorney-General on behalf of the defendant urges that the trial court erred: (a) in finding that the
collision between the plaintiff's motorcycle and the ambulance of the General Hospital was due to the
negligence of the chauffeur; (b) in holding that the Government of the Philippine Islands is liable for the
damages sustained by the plaintiff as a result of the collision, even if it be true that the collision was due
to the negligence of the chauffeur; and (c) in rendering judgment against the defendant for the sum of
P14,741.

The trial court's findings of fact, which are fully supported by the record, are as follows:

It is a fact not disputed by counsel for the defendant that when the plaintiff, riding on a
motorcycle, was going toward the western part of Calle Padre Faura, passing along the west side
thereof at a speed of ten to twelve miles an hour, upon crossing Taft Avenue and when he was ten
feet from the southwestern intersection of said streets, the General Hospital ambulance, upon
reaching said avenue, instead of turning toward the south, after passing the center thereof, so that
it would be on the left side of said avenue, as is prescribed by the ordinance and the Motor
Vehicle Act, turned suddenly and unexpectedly and long before reaching the center of the street,
into the right side of Taft Avenue, without having sounded any whistle or horn, by which
movement it struck the plaintiff, who was already six feet from the southwestern point or from
the post place there.

By reason of the resulting collision, the plaintiff was so severely injured that, according to Dr.
Saleeby, who examined him on the very same day that he was taken to the General Hospital, he
was suffering from a depression in the left parietal region, a would in the same place and in the
back part of his head, while blood issued from his nose and he was entirely unconscious.

The marks revealed that he had one or more fractures of the skull and that the grey matter and
brain was had suffered material injury. At ten o'clock of the night in question, which was the time
set for performing the operation, his pulse was so weak and so irregular that, in his opinion, there
was little hope that he would live. His right leg was broken in such a way that the fracture
extended to the outer skin in such manner that it might be regarded as double and the would be
exposed to infection, for which reason it was of the most serious nature.

At another examination six days before the day of the trial, Dr. Saleeby noticed that the plaintiff's
leg showed a contraction of an inch and a half and a curvature that made his leg very weak and
painful at the point of the fracture. Examination of his head revealed a notable readjustment of the
functions of the brain and nerves. The patient apparently was slightly deaf, had a light weakness
in his eyes and in his mental condition. This latter weakness was always noticed when the
plaintiff had to do any difficult mental labor, especially when he attempted to use his money for
mathematical calculations.
 According to the various merchants who testified as witnesses, the plaintiff's mental and physical
condition prior to the accident was excellent, and that after having received the injuries that have
been discussed, his physical condition had undergone a noticeable depreciation, for he had lost
the agility, energy, and ability that he had constantly displayed before the accident as one of the
best constructors of wooden buildings and he could not now earn even a half of the income that
he had secured for his work because he had lost 50 per cent of his efficiency. As a contractor, he
could no longer, as he had before done, climb up ladders and scaffoldings to reach the highest
parts of the building.

As a consequence of the loss the plaintiff suffered in the efficiency of his work as a contractor, he
had to dissolved the partnership he had formed with the engineer. Wilson, because he was
incapacitated from making mathematical calculations on account of the condition of his leg and
of his mental faculties, and he had to give up a contract he had for the construction of the Uy
Chaco building."

We may say at the outset that we are in full accord with the trial court to the effect that the collision
between the plaintiff's motorcycle and the ambulance of the General Hospital was due solely to the
negligence of the chauffeur.

The two items which constitute a part of the P14,741 and which are drawn in question by the plaintiff are
(a) P5,000, the award awarded for permanent injuries, and (b) the P2,666, the amount allowed for the loss
of wages during the time the plaintiff was incapacitated from pursuing his occupation. We find nothing in
the record which would justify us in increasing the amount of the first. As to the second, the record
shows, and the trial court so found, that the plaintiff's services as a contractor were worth P1,000 per
month. The court, however, limited the time to two months and twenty-one days, which the plaintiff was
actually confined in the hospital. In this we think there was error, because it was clearly established that
the plaintiff was wholly incapacitated for a period of six months. The mere fact that he remained in the
hospital only two months and twenty-one days while the remainder of the six months was spent in his
home, would not prevent recovery for the whole time. We, therefore, find that the amount of damages
sustained by the plaintiff, without any fault on his part, is P18,075.

As the negligence which caused the collision is a tort committed by an agent or employee of the
Government, the inquiry at once arises whether the Government is legally-liable for the damages resulting
therefrom.

Act No. 2457, effective February 3, 1915, reads:

An Act authorizing E. Merritt to bring suit against the Government of the Philippine Islands and
authorizing the Attorney-General of said Islands to appear in said suit.

Whereas a claim has been filed against the Government of the Philippine Islands by Mr. E.
Merritt, of Manila, for damages resulting from a collision between his motorcycle and the
ambulance of the General Hospital on March twenty-fifth, nineteen hundred and thirteen;

Whereas it is not known who is responsible for the accident nor is it possible to determine the
amount of damages, if any, to which the claimant is entitled; and

Whereas the Director of Public Works and the Attorney-General recommended that 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, therefore,

By authority of the United States, be it enacted by the Philippine Legislature, that:

SECTION 1. E. Merritt is hereby authorized to bring suit in the Court of First Instance of the city
of Manila against the Government of the Philippine Islands in order to fix the responsibility for
the collision between his motorcycle and the ambulance of the General Hospital, and to determine
the amount of the damages, if any, to which Mr. E. Merritt is entitled on account of said collision,
and the Attorney-General of the Philippine Islands is hereby authorized and directed to appear at
the trial on the behalf of the Government of said Islands, to defendant said Government at the
same.

SEC. 2. This Act shall take effect on its passage.

Enacted, February 3, 1915.

Did the defendant, in enacting the above quoted Act, simply waive its immunity from suit or did it also
concede its liability to the plaintiff? If only the former, then it cannot be held that the Act created any new
cause of action in favor of the plaintiff or extended the defendant's liability to any case not previously
recognized.

All admit that the Insular Government (the defendant) cannot be sued by an individual without its
consent. It is also admitted that the instant case is one against the Government. As the consent of the
Government to be sued by the plaintiff was entirely voluntary on its part, it is our duty to look carefully
into the terms of the consent, and render judgment accordingly.

The plaintiff was authorized to bring this action against the Government "in order to fix the responsibility
for the collision between his motorcycle and the ambulance of the General Hospital and to determine the
amount of the damages, if any, to which Mr. E. Merritt is entitled on account of said collision, . . . ."
These were the two questions submitted to the court for determination. The Act was passed "in order that
said questions may be decided." We have "decided" that the accident was due solely to the negligence of
the chauffeur, who was at the time an employee of the defendant, and we have also fixed the amount of
damages sustained by the plaintiff as a result of the collision. Does the Act authorize us to hold that the
Government is legally liable for that amount? If not, we must look elsewhere for such authority, if it
exists.

The Government of the Philippine Islands having been "modeled after the Federal and State Governments
in the United States," we may look to the decisions of the high courts of that country for aid in
determining the purpose and scope of Act No. 2457.

In the United States the rule that the state is not liable for the torts committed by its officers or agents
whom it employs, except when expressly made so by legislative enactment, is well settled. "The
Government," says Justice Story, "does not undertake to guarantee to any person the fidelity of the
officers or agents whom it employs, since that would involve it in all its operations in endless
embarrassments, difficulties and losses, which would be subversive of the public interest." (Claussen vs.
City of Luverne, 103 Minn., 491, citing U. S. vs. Kirkpatrick, 9 Wheat, 720; 6 L. Ed., 199; and Beers vs.
States, 20 How., 527; 15 L. Ed., 991.)

In the case of Melvin vs. State (121 Cal., 16), the plaintiff sought to recover damages from the state for
personal injuries received on account of the negligence of the state officers at the state fair, a state
institution created by the legislature for the purpose of improving agricultural and kindred industries; to
disseminate information calculated to educate and benefit the industrial classes; and to advance by such
means the material interests of the state, being objects similar to those sought by the public school system.
In passing upon the question of the state's liability for the negligent acts of its officers or agents, the court
said:

No claim arises against any government is favor of an individual, by reason of the misfeasance,
laches, or unauthorized exercise of powers by its officers or agents. (Citing Gibbons vs. U. S., 8
Wall., 269; Clodfelter vs. State, 86 N. C., 51, 53; 41 Am. Rep., 440; Chapman vs. State, 104 Cal.,
690; 43 Am. St. Rep., 158; Green vs. State, 73 Cal., 29; Bourn vs. Hart, 93 Cal., 321; 27 Am. St.
Rep., 203; Story on Agency, sec. 319.)

As to the scope of legislative enactments permitting individuals to sue the state where the cause of action
arises out of either fort or contract, the rule is stated in 36 Cyc., 915, thus:

By consenting to be sued a state simply waives its immunity from suit. It does not thereby
concede its liability to plaintiff, or create any cause of action in his favor, or extend its liability to
any cause not previously recognized. It merely gives a remedy to enforce a preexisting liability
and submits itself to the jurisdiction of the court, subject to its right to interpose any lawful
defense.

In Apfelbacher vs. State (152 N. W., 144, advanced sheets), decided April 16, 1915, the Act of 1913,
which authorized the bringing of this suit, read:

SECTION 1. Authority is hereby given to George Apfelbacher, of the town of Summit,

Waukesha County, Wisconsin, to bring suit in such court or courts and in such form or forms as
he may be advised for the purpose of settling and determining all controversies which he may
now have with the State of Wisconsin, 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 relative
to the use of the waters of said Bark River and Nagawicka Lake, all in the county of Waukesha,
Wisconsin.
In determining the scope of this act, the court said:

Plaintiff claims that by the enactment of this law the legislature admitted liability on the part of
the state for the acts of its officers, and that the suit now stands just as it would stand between
private parties. It is difficult to see how the act does, or was intended to do, more than remove the
state's immunity from suit. It simply gives authority to commence suit for the purpose of settling
plaintiff's controversies with the estate. Nowhere in the act is there a whisper or suggestion that
the court or courts in the disposition of the suit shall depart from well established principles of
law, or that the amount of damages is the only question to be settled. The act opened the door of
the court to the plaintiff. It did not pass upon the question of liability, but left the suit just where it
would be in the absence of the state's immunity from suit. If the Legislature had intended to
change the rule that obtained in this state so long and to declare liability on the part of the state, it
would not have left so important a matter to mere inference, but would have done so in express
terms. (Murdock Grate Co. vs. Commonwealth, 152 Mass., 28; 24 N.E., 854; 8 L. R. A., 399.)

In Denning vs. State (123 Cal., 316), the provisions of the Act of 1893, relied upon and considered, are as
follows:

All persons who have, or shall hereafter have, claims on contract or for negligence against the
state not allowed by the state board of examiners, are hereby authorized, on the terms and
conditions herein contained, to bring suit thereon against the state in any of the courts of this state
of competent jurisdiction, and prosecute the same to final judgment. The rules of practice in civil
cases shall apply to such suits, except as herein otherwise provided.

And the court said:

This statute has been considered by this court in at least two cases, arising under different facts,
and in both it was held that said statute did not create any liability or cause of action against the
state where none existed before, but merely gave an additional remedy to enforce such liability as
would have existed if the statute had not been enacted. (Chapman vs. State, 104 Cal., 690; 43
Am. St. Rep., 158; Melvin vs. State, 121 Cal., 16.)

A statute of Massachusetts enacted in 1887 gave to the superior court "jurisdiction of all claims against
the commonwealth, whether at law or in equity," with an exception not necessary to be here mentioned.
In construing this statute the court, in Murdock Grate Co. vs. Commonwealth (152 Mass., 28), said:

The statute we are discussing disclose no intention to create against the state a new and heretofore
unrecognized class of liabilities, but only an intention to provide a judicial tribunal where well
recognized existing liabilities can be adjudicated.

In Sipple vs. State (99 N. Y., 284), where the board of the canal claims had, by the terms of the statute of
New York, jurisdiction of claims for damages for injuries in the management of the canals such as the
plaintiff had sustained, Chief Justice Ruger remarks: "It must be conceded that the state can be made
liable for injuries arising from the negligence of its agents or servants, only by force of some positive
statute assuming such liability."

It being quite clear that Act No. 2457 does not operate to extend the Government's liability to any cause
not previously recognized, we will now examine the substantive law touching the defendant's liability for
the negligent acts of its officers, agents, and employees. Paragraph 5 of article 1903 of the Civil Code
reads:

The state is liable in this sense when it acts through a special agent, but not when the damage
should have been caused by the official to whom properly it pertained to do the act performed, in
which case the provisions of the preceding article shall be applicable.

The supreme court of Spain in defining the scope of this paragraph said:

That the obligation to indemnify for damages which a third person causes to another by his fault
or negligence is based, as is evidenced by the same Law 3, Title 15, Partida 7, on that the person
obligated, by his own fault or negligence, takes part in the act or omission of the third party who
caused the damage. It follows therefrom that the state, by virtue of such provisions of law, is not
responsible for the damages suffered by private individuals in consequence of acts performed by
its employees in the discharge of the functions pertaining to their office, because neither fault nor
even negligence can be presumed on the part of the state in the organization of branches of public
service and in the appointment of its agents; on the contrary, we must presuppose all foresight
humanly possible on its part in order that each branch of service serves the general weal an that of
private persons interested in its operation. Between these latter and the state, therefore, no
 relations of a private nature governed by the civil law can arise except in a case where the state
acts as a judicial person capable of acquiring rights and contracting obligations. (Supreme Court
of Spain, January 7, 1898; 83 Jur. Civ., 24.)

That the Civil Code in chapter 2, title 16, book 4, regulates the obligations which arise out of fault
or negligence; and whereas in the first article thereof. No. 1902, where the general principle is
laid down that where a person who by an act or omission causes damage to another through fault
or negligence, shall be obliged to 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 persons and imposes an identical obligation upon those who maintain fixed relations of
authority and superiority over the authors of the damage, because the law presumes that in
consequence of such relations the evil caused by their own fault or negligence is imputable to
them. This legal presumption gives way to proof, however, because, as held in the last paragraph
of article 1903, responsibility for acts of third persons ceases when the persons mentioned in said
article prove that they employed all the diligence of a good father of a family to avoid the
damage, and among these persons, called upon to answer in a direct and not a subsidiary manner,
are found, in addition to the mother or the father in a proper case, guardians and owners or
directors of an establishment or enterprise, the state, but not always, except when it acts through
the agency of a special agent, doubtless because and only in this case, the fault or negligence,
which is the original basis of this kind of objections, must be presumed to lie with the state.

That although in some cases the state might by virtue of the general principle set forth in article
1902 respond for all the damage that is occasioned to private parties by orders or resolutions
which by fault or negligence are made by branches of the central administration acting in the
name and representation of the state itself and 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 occasioned to the petitioners by an executive official, acting in the exercise of his
powers, in proceedings to enforce the collections of certain property taxes owing by the owner of
the property which they hold in sublease.

That the responsibility of the state is limited by article 1903 to the case wherein it 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 to the exercise of the duties of his
office if he is a special official) so that in representation of the state and being bound to act as an
agent thereof, he executes the trust confided to him. This concept does not apply to any executive
agent who is an employee of the acting administration and who on his own responsibility
performs the functions which are inherent in and naturally pertain to his office and which are
regulated by law and the regulations." (Supreme Court of Spain, May 18, 1904; 98 Jur. Civ., 389,
390.)

That according to paragraph 5 of article 1903 of the Civil Code and the principle laid down in a
decision, among others, of the 18th of May, 1904, in a damage case, the responsibility of the state
is limited to that which it contracts through a special agent, duly empowered by a definite order
or commission to perform some act or charged with some definite purpose which gives rise to the
claim, and not where the claim is based on acts or omissions imputable to a public official
charged with some administrative or technical office who can be held to the proper responsibility
in the manner laid down by the law of civil responsibility. Consequently, the trial court in not so
deciding and in sentencing the said entity to the payment of damages, caused by an official of the
second class referred to, has by erroneous interpretation infringed the provisions of articles 1902
and 1903 of the Civil Code. (Supreme Court of Spain, July 30, 1911; 122 Jur. Civ., 146.)

It is, therefore, evidence that the State (the Government of the Philippine Islands) is only liable, according
to the above quoted decisions of the Supreme Court of Spain, for the acts of its agents, officers and
employees when they act as special agents within the meaning of paragraph 5 of article 1903, supra, and
that the chauffeur of the ambulance of the General Hospital was not such an agent.

For the foregoing reasons, the judgment appealed from must be reversed, without costs in this instance.
Whether the Government intends to make itself legally liable for the amount of damages above set forth,
which the plaintiff has sustained by reason of the negligent acts of one of its employees, by legislative
enactment and by appropriating sufficient funds therefor, we are not called upon to determine. This matter
rests solely with the Legislature and not with the courts.

Arellano, C. J., Torres, Johnson, and Moreland, JJ., concur.

 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-26400 February 29, 1972

VICTORIA AMIGABLE, plaintiff-appellant, 
vs.
NICOLAS CUENCA, as Commissioner of Public Highways and REPUBLIC OF THE
PHILIPPINES, defendants-appellees.

MAKALINTAL, J.:p

This is an appeal from the decision of the Court of First Instance of Cebu in its Civil Case No. R-5977,
dismissing the plaintiff's complaint.

Victoria Amigable, the appellant herein, is the registered owner of Lot No. 639 of the Banilad Estate in
Cebu City as shown by Transfer Certificate of Title No. T-18060, which superseded Transfer Certificate
of Title No. RT-3272 (T-3435) issued to her by the Register of Deeds of Cebu on February 1, 1924. No
annotation in favor of the government of any right or interest in the property appears at the back of the
certificate. Without prior expropriation or negotiated sale, the government used a portion of said lot, with
an area of 6,167 square meters, for the construction of the Mango and Gorordo Avenues.

It appears that said avenues were already existing in 1921 although "they were in 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 construction in 
1925." *

On March 27, 1958 Amigable's counsel wrote the President of the Philippines, requesting payment of the
portion of her lot which had been appropriated by the government. The claim was indorsed to the Auditor
General, who disallowed it in his 9th Indorsement dated December 9, 1958. A copy of said indorsement
was transmitted to Amigable's counsel by the Office of the President on January 7, 1959.

On February 6, 1959 Amigable filed in the court a quo a complaint, which was later amended on April
17, 1959 upon motion of the defendants, against the Republic of the Philippines and Nicolas Cuenca, in
his capacity as Commissioner of Public Highways for the recovery of ownership and possession of the
6,167 square meters of land traversed by the Mango and Gorordo Avenues. She also sought the payment
of compensatory damages in the sum of P50,000.00 for the illegal occupation of her land, moral damages
in the sum of P25,000.00, attorney's fees in the sum of P5,000.00 and the costs of the suit.

Within the reglementary period the defendants filed a joint answer denying the material allegations of the
complaint and interposing the following affirmative defenses, to wit: (1) that the action was premature,
the claim not having been filed first with the Office of the Auditor General; (2) that the right of action for
the recovery of any amount which might be due the plaintiff, if any, had already prescribed; (3) that the
action being a suit against the Government, the claim for moral damages, attorney's fees and costs had no
valid basis since as to these items the Government had not given its consent to be sued; and (4) that
inasmuch as it was the province of Cebu that appropriated and used the area involved in the construction
of Mango Avenue, plaintiff had no cause of action against the defendants.

During the scheduled hearings nobody appeared for the defendants notwithstanding due notice, so the
trial court proceeded to receive the plaintiff's evidence ex parte. On July 29, 1959 said court rendered its
decision holding that it had no jurisdiction over the plaintiff's cause of action for the recovery of
possession and ownership of the portion of her lot in question on the ground that the government cannot
be sued without its consent; that it had neither original nor appellate jurisdiction to hear, try and decide
plaintiff's claim for compensatory damages in the sum of P50,000.00, the same being a money claim
against the government; and that the claim for moral damages had long prescribed, nor did it have
jurisdiction over said claim because the government had not given its consent to be sued. Accordingly,
the complaint was dismissed. Unable to secure a reconsideration, the plaintiff appealed to the Court of
Appeals, which subsequently certified the case to Us, there being no question of fact involved.
The issue here is whether or not the appellant may properly sue the government under the facts of the
case.

In the case of Ministerio vs. Court of First Instance of Cebu, 1 involving a claim for payment of the value
of a portion of land used for the widening of the Gorordo Avenue in Cebu City, this Court, through Mr.
Justice Enrique M. Fernando, held that where the government takes away property from a private
landowner for public use without going through the legal process of expropriation or negotiated sale, the
aggrieved party may properly maintain a suit against the government without thereby violating the
doctrine of governmental immunity from suit without its consent. We there said: .

... . If the constitutional mandate that the owner be compensated for property taken for
public use were to be respected, as it should, then a suit of this character should not be
summarily dismissed. The doctrine of governmental immunity from suit cannot serve as
an instrument for perpetrating an injustice on a citizen. Had the government followed the
procedure indicated by the governing law at the time, a complaint would have been filed
by it, and only upon payment of the compensation fixed by the judgment, or after tender
to the party entitled to such payment of the amount fixed, may it "have the right to enter
in and upon the land so condemned, to appropriate the same to the public use defined in
the judgment." If there were an observance of procedural regularity, petitioners would not
be in the sad plaint they are now. It is unthinkable then that precisely because there was a
failure to abide by what the law requires, the government would stand to benefit. It is just
as important, if not more so, that there be fidelity to legal norms on the part of
officialdom if the rule of law were to be maintained. It is not too much to say that when
the government takes any property for public use, which is conditioned upon the payment
of just compensation, to be judicially ascertained, it makes manifest that it submits to the
jurisdiction of a court. There is no thought then that the doctrine of immunity from suit
could still be appropriately invoked.

Considering that no annotation in favor of the government appears at the back of her certificate of title
and that she has not executed any deed of conveyance of any portion of her lot to the government, the
appellant remains the owner of the whole lot. As registered owner, she could bring an action to recover
possession of the portion of land in question at anytime because possession is one of the attributes of
ownership. However, since restoration of possession of said portion by the government is neither
convenient nor feasible at this time because it is now and has 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 determine the due compensation for the land, the basis should be the price or value thereof at the
time of the taking. 2

As regards the claim for damages, the plaintiff is entitled thereto in the form of legal interest on the price
of the land from the time it was taken up to the time that payment is made by the government.  3 In
addition, the government should pay for attorney's fees, the amount of which should be fixed by the trial
court after hearing.

WHEREFORE, the decision appealed from is hereby set aside and the case remanded to the court a
quo for the determination of compensation, including attorney's fees, to which the appellant is entitled as
above indicated. No pronouncement as to costs.

Concepcion, C.J., Reyes, J.B.L., Zaldivar, Castro, Fernando, Teehankee, Barredo, Villamor and
Makasiar JJ., concur.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 101949 December 1, 1994

THE HOLY SEE, petitioner, 

vs.
THE HON. ERIBERTO U. ROSARIO, JR., as Presiding Judge of the Regional Trial Court of
Makati, Branch 61 and STARBRIGHT SALES ENTERPRISES, INC., respondents.

Padilla Law Office for petitioner.

Siguion Reyna, Montecillo & Ongsiako for private respondent.

QUIASON, J.:

This is a petition for certiorari under Rule 65 of the Revised Rules of Court to reverse and set aside the
Orders dated June 20, 1991 and September 19, 1991 of the Regional Trial Court, Branch 61, Makati,
Metro Manila in Civil Case No. 90-183.

The Order dated June 20, 1991 denied the motion of petitioner to dismiss the complaint in Civil Case No.
90-183, while the Order dated September 19, 1991 denied the motion for reconsideration of the June
20,1991 Order.

Petitioner is the Holy See who exercises sovereignty over the Vatican City in Rome, Italy, and is
represented in the Philippines by the Papal Nuncio.

Private respondent, Starbright Sales Enterprises, Inc., is a domestic corporation engaged in the real estate
business.

This petition arose from a controversy over a parcel of land consisting of 6,000 square meters (Lot 5-A,
Transfer Certificate of Title No. 390440) located in the Municipality of Parañaque, Metro Manila and
registered in the name of petitioner.

Said Lot 5-A is contiguous to Lots 5-B and 5-D which are covered by Transfer Certificates of Title Nos.
271108 and 265388 respectively and registered in the name of the Philippine Realty Corporation (PRC).

The three lots were sold to Ramon Licup, through Msgr. Domingo A. Cirilos, Jr., acting as agent to the
sellers. Later, Licup assigned his rights to the sale to private respondent.

In view of the refusal of the squatters to vacate the lots sold to private respondent, a dispute arose as to
who of the parties has the responsibility of evicting and clearing the land of squatters. Complicating the
relations of the parties was the sale by petitioner of Lot 5-A to Tropicana Properties and Development
Corporation (Tropicana).

On January 23, 1990, private respondent filed a complaint with the Regional Trial Court, Branch 61,
Makati, Metro Manila for annulment of the sale of the three parcels of land, and specific performance and
damages against petitioner, represented by the Papal Nuncio, and three other defendants: namely, Msgr.
Domingo A. Cirilos, Jr., the PRC and Tropicana (Civil Case No.
90-183).

The complaint alleged that: (1) on April 17, 1988, Msgr. Cirilos, Jr., on behalf of petitioner and the PRC,
agreed to sell to Ramon Licup Lots 5-A, 5-B and 5-D at the price of P1,240.00 per square meters; (2) the
agreement to sell was made on the condition that earnest money of P100,000.00 be paid by Licup to the
sellers, and that the sellers clear the said lots of squatters who were then occupying the same; (3) Licup
paid the earnest money to Msgr. Cirilos; (4) in the same month, Licup assigned his rights over the
property to private respondent and informed the sellers of the said assignment; (5) thereafter, private
respondent demanded from Msgr. Cirilos that the sellers fulfill their undertaking and clear the property of
squatters; however, Msgr. Cirilos informed private respondent of the squatters' refusal to vacate the lots,
proposing instead either that private respondent undertake the eviction or that the earnest money be
returned to the latter; (6) private respondent counterproposed that if it would undertake the eviction of the
squatters, the purchase price of the lots should be reduced from P1,240.00 to P1,150.00 per square meter;
(7) Msgr. Cirilos returned the earnest money of P100,000.00 and wrote private respondent giving it seven
days from receipt of the letter to pay the original purchase price in cash; (8) private respondent sent the
earnest money back to the sellers, but later discovered that on March 30, 1989, petitioner and the PRC,
without notice to private respondent, sold the lots to Tropicana, as evidenced by two separate Deeds of
Sale, one over Lot 5-A, and another over Lots 5-B and 5-D; and that the sellers' transfer certificate of title
over the lots were cancelled, transferred and registered in the name of Tropicana; (9) Tropicana induced
petitioner and the PRC to sell the lots to it and thus enriched itself at the expense of private respondent;
(10) private respondent demanded the rescission of the sale to Tropicana and the reconveyance of the lots,
to no avail; and (11) private respondent is willing and able to comply with the terms of the contract to sell
and has actually made plans to develop the lots into a townhouse project, but in view of the sellers'
breach, it lost profits of not less than P30,000.000.00.

Private respondent thus prayed for: (1) the annulment of the Deeds of Sale between petitioner and the
PRC on the one hand, and Tropicana on the other; (2) the reconveyance of the lots in question; (3)
specific performance of the agreement to sell between it and the owners of the lots; and (4) damages.

On June 8, 1990, petitioner and Msgr. Cirilos separately moved to dismiss the complaint — petitioner for
lack of jurisdiction based on sovereign immunity from suit, and Msgr. Cirilos for being an improper
party. An opposition to the motion was filed by private respondent.

On June 20, 1991, the trial court issued an order denying, among others, petitioner's motion to dismiss
after finding that petitioner "shed off [its] sovereign immunity by entering into the business contract in
question" (Rollo, pp. 20-21).

On July 12, 1991, petitioner moved for reconsideration of the order. On August 30, 1991, petitioner filed
a "Motion for a Hearing for the Sole Purpose of Establishing Factual Allegation for claim of Immunity as
a Jurisdictional Defense." So as to facilitate the determination of its defense of sovereign immunity,
petitioner prayed that a hearing be conducted to allow it to establish certain facts upon which the said
defense is based. Private respondent opposed this motion as well as the motion for reconsideration.

On October 1, 1991, the trial court issued an order deferring the resolution on the motion for
reconsideration until after trial on the merits and directing petitioner to file its answer (Rollo, p. 22).

Petitioner forthwith elevated the matter to us. In its petition, petitioner invokes the privilege of sovereign
immunity only on its own behalf and on behalf of its official representative, the Papal Nuncio.

On December 9, 1991, a Motion for Intervention was filed before us by the Department of Foreign
Affairs, claiming that it has a legal interest in the outcome of the case as regards the diplomatic immunity
of petitioner, and that it "adopts by reference, the allegations contained in the petition of the Holy See
insofar as they refer to arguments relative to its claim of sovereign immunity from suit" (Rollo, p. 87).

Private respondent opposed the intervention of the Department of Foreign Affairs. In compliance with the
resolution of this Court, both parties and the Department of Foreign Affairs submitted their respective
memoranda.

II

A preliminary matter to be threshed out is the procedural issue of whether the petition for certiorari under
Rule 65 of the Revised Rules of Court can be availed of to question the order denying petitioner's motion
to dismiss. The general rule is that an order denying a motion to dismiss is not reviewable by the appellate
courts, 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 dismiss the complaint (Philippine National Bank v. Florendo,
206 SCRA 582 [1992]; Zagada v. Civil Service Commission, 216 SCRA 114 [1992]. In such a case, it
would be a sheer waste of time and energy to require the parties to undergo the rigors of a trial.

The other procedural question raised by private respondent is the personality or legal interest of the
Department of Foreign Affairs to intervene in the case in behalf of the Holy See (Rollo, pp. 186-190).

In Public International Law, when a state or international agency wishes to plead sovereign or diplomatic
immunity in a foreign court, it requests the Foreign Office of the state where it is sued to convey to the
court that said defendant is entitled to immunity.
In the United States, the procedure followed is the process of "suggestion," where the foreign state or the
international organization sued in an American court requests the Secretary of State to make a
determination as to whether it is entitled to immunity. If the Secretary of State finds that the defendant is
immune from suit, he, in turn, asks the Attorney General to submit to the court a "suggestion" that the
defendant is entitled to immunity. In England, a similar procedure is followed, only the Foreign Office
issues a certification to that effect instead of submitting a "suggestion" (O'Connell, I International Law
130 [1965]; Note: Immunity from Suit of Foreign Sovereign Instrumentalities and Obligations, 50 Yale
Law Journal 1088 [1941]).

In the Philippines, the practice is for the foreign government or the international organization to first
secure an executive endorsement of its claim of sovereign or diplomatic immunity. But how the
Philippine Foreign Office conveys its endorsement to the courts varies. In International Catholic
Migration Commission v. Calleja, 190 SCRA 130 (1990), the Secretary of Foreign Affairs just sent a
letter directly to the Secretary of Labor and Employment, informing the latter that the respondent-
employer could not be sued because it enjoyed diplomatic immunity. In World Health Organization v.
Aquino, 48 SCRA 242 (1972), the Secretary of Foreign Affairs sent the trial court a telegram to that
effect. In Baer v. Tizon, 57 SCRA 1 (1974), the U.S. Embassy asked the Secretary of Foreign Affairs to
request the Solicitor General to make, in behalf of the Commander of the United States Naval Base at
Olongapo City, Zambales, a "suggestion" to respondent Judge. The Solicitor General embodied the
"suggestion" in a Manifestation and Memorandum as amicus curiae.

In the case at bench, the Department of Foreign Affairs, through the Office of Legal Affairs moved with
this Court to be allowed to intervene on the side of petitioner. The Court allowed the said Department to
file its memorandum in support of petitioner's claim of sovereign immunity.

In some cases, the defense of sovereign immunity was submitted directly to the local courts by the
respondents through their private counsels (Raquiza v. Bradford, 75 Phil. 50 [1945]; Miquiabas v.
Philippine-Ryukyus Command, 80 Phil. 262 [1948]; United States of America v. Guinto, 182 SCRA 644
[1990] and companion cases). In cases where the foreign states bypass the Foreign Office, the courts can
inquire into the facts and make their own determination as to the nature of the acts and transactions
involved.

III

The burden of the petition is that respondent trial court has no jurisdiction over petitioner, being a foreign
state enjoying sovereign immunity. On the other hand, private respondent insists that the doctrine of non-
suability is not anymore absolute and that petitioner has divested itself of such a cloak when, of its own
free will, it entered into a commercial transaction for the sale of a parcel of land located in the
Philippines.

A. The Holy See

Before we determine the issue of petitioner's non-suability, a brief look into its status as a sovereign state
is in order.

Before the annexation of the Papal States by Italy in 1870, the Pope was the monarch and he, as the Holy
See, was considered a subject of International Law. With the loss of the Papal States and the limitation of
the territory under the Holy See to an area of 108.7 acres, the position of the Holy See in International
Law became controversial (Salonga and Yap, Public International Law 36-37 [1992]).

In 1929, Italy and the Holy See entered into the Lateran Treaty, where Italy recognized the exclusive
dominion and sovereign jurisdiction of the Holy See over the Vatican City. It also recognized the right of
the Holy See to receive foreign diplomats, to send its own diplomats to foreign countries, and to enter into
treaties according to International Law (Garcia, Questions and Problems In International Law, Public and
Private 81 [1948]).

The Lateran Treaty established the statehood of the Vatican City "for the purpose of assuring to the Holy
See absolute and visible independence and of guaranteeing to it indisputable sovereignty also in the field
of international relations" (O'Connell, I International Law 311 [1965]).

In view of the wordings of the Lateran Treaty, it is difficult to determine whether the statehood is vested
in the Holy See or in the Vatican City. Some writers even suggested that the treaty created two
international persons — the Holy See and Vatican City (Salonga and Yap, supra, 37).

The Vatican City fits into none of the established categories of states, and the attribution to it of
"sovereignty" must be made in a sense different from that in which it is applied to other states (Fenwick,
International Law 124-125 [1948]; Cruz, International Law 37 [1991]). In a community of national states,
the Vatican City represents an entity organized not for political but for ecclesiastical purposes and
international objects. Despite its size and object, the Vatican City has an independent government of its
own, with the Pope, who is also head of the Roman Catholic Church, as the Holy See or Head of State, in
conformity with its traditions, and the demands of its mission in the world. Indeed, the world-wide
interests and activities of the Vatican City are such as to make it in a sense an "international state"
(Fenwick, supra., 125; Kelsen, Principles of International Law 160 [1956]).

One authority wrote that the recognition of the Vatican City as a state has significant implication — that it
is possible for any entity pursuing objects essentially different from those pursued by states to be invested
with international personality (Kunz, The Status of the Holy See in International Law, 46 The American
Journal of International Law 308 [1952]).

Inasmuch as the Pope prefers to conduct foreign relations and enter into transactions as the Holy See and
not in the name of the Vatican City, one can conclude that in the Pope's own view, it is the Holy See that
is the international person.

The Republic of the Philippines has accorded the Holy See the status of a foreign sovereign. The Holy
See, through its Ambassador, the Papal Nuncio, has had diplomatic representations with the Philippine
government since 1957 (Rollo, p. 87). This appears to be the universal practice in international relations.

B. Sovereign Immunity

As expressed in Section 2 of Article II of the 1987 Constitution, we have adopted the generally accepted
principles of International Law. Even without this affirmation, such principles of International Law are
deemed incorporated as part of the law of the land as a condition and consequence of our admission in the
society of nations (United States of America v. Guinto, 182 SCRA 644 [1990]).

There are two conflicting concepts of sovereign immunity, each widely held and firmly established.
According to the classical or absolute theory, a sovereign cannot, without its consent, be made a
respondent in the courts of another sovereign. According to the newer or restrictive theory, the immunity
of the sovereign is recognized only with regard to public acts or acts jure imperii of a state, but not with
regard to private acts or acts jure gestionis
(United States of America v. Ruiz, 136 SCRA 487 [1987]; Coquia and Defensor-Santiago, Public
International Law 194 [1984]).

Some states passed legislation to serve as guidelines for the executive or judicial determination when an
act may be considered as jure gestionis. The United States passed the Foreign Sovereign Immunities Act
of 1976, which defines a commercial activity as "either a regular course of commercial conduct or a
particular commercial transaction or act." Furthermore, the law declared that the "commercial character of
the activity shall be determined by reference to the nature of the course of conduct or particular
transaction or act, rather than by reference to its purpose." The Canadian Parliament enacted in 1982 an
Act to Provide For State Immunity in Canadian Courts. The Act defines a "commercial activity" as any
particular transaction, act or conduct or any regular course of conduct that by reason of its nature, is of a
"commercial character."

The restrictive theory, which is intended to be a solution to the host of problems involving the issue of
sovereign immunity, has created problems of its own. Legal treatises and the decisions in countries which
follow the restrictive theory have difficulty in characterizing whether a contract of a sovereign state with
a private party is an act jure gestionis or an act jure imperii.

The restrictive theory came about because of the entry of sovereign states into purely commercial
activities remotely connected with the discharge of governmental functions. This is particularly true with
respect to the Communist states which took control of nationalized business activities and international
trading.

This Court has considered the following transactions by a foreign state with private parties as acts jure
imperii: (1) the lease by a foreign government of apartment buildings for use of its military officers
(Syquia v. Lopez, 84 Phil. 312 [1949]; (2) the conduct of public bidding for the repair of a wharf at a
United States Naval Station (United States of America v. Ruiz, supra.); and (3) the change of
employment status of base employees (Sanders v. Veridiano, 162 SCRA 88 [1988]).

On the other hand, this Court has considered the following transactions by a foreign state with private
parties as acts jure gestionis: (1) the hiring of a cook in the recreation center, consisting of three
restaurants, a cafeteria, a bakery, a store, and a coffee and pastry shop at the John Hay Air Station in
Baguio City, to cater to American servicemen and the general public (United States of America v.
Rodrigo, 182 SCRA 644 [1990]); and (2) the bidding for the operation of barber shops in Clark Air Base
in Angeles City (United States of America v. Guinto, 182 SCRA 644 [1990]). The operation of the
restaurants and other facilities open to the general public is undoubtedly for profit as a commercial and
not a governmental activity. By entering into the employment contract with the cook in the discharge of
its proprietary function, the United States government impliedly divested itself of its sovereign immunity
from suit.

In the absence of legislation defining what activities and transactions shall be considered "commercial"
and as constituting acts jure gestionis, we have to come out with our own guidelines, tentative they may
be.

Certainly, the mere entering into a contract by a foreign state with a private party cannot be the ultimate
test. Such an act can only be the start of the inquiry. The logical question is whether the foreign state is
engaged in the activity in the regular course of business. If the foreign state is not engaged regularly in a
business or trade, the particular act or transaction must then be tested by its nature. If the act is in pursuit
of a sovereign activity, or an incident thereof, then it is an act jure imperii, especially when it is not
undertaken for gain or profit.

As held in United States of America v. Guinto, (supra):

There is no question that the United States of America, like any other state, will be
deemed to have impliedly waived its non-suability if it has entered into a contract in its
proprietary or private capacity. It is only when the contract involves its sovereign or
governmental capacity that no such waiver may be implied.

In the case at bench, if petitioner has bought and sold lands in the ordinary course of a real estate
business, surely the said transaction can be categorized as an act jure gestionis. However, petitioner has
denied that the acquisition and subsequent disposal of Lot 5-A were made for profit but claimed that it
acquired said property for the site of its mission or the Apostolic Nunciature in the Philippines. Private
respondent failed to dispute said claim.

Lot 5-A was acquired by petitioner as a donation from the Archdiocese of Manila. The donation was
made not for commercial purpose, but for the use of petitioner to construct thereon the official place of
residence of the Papal Nuncio. The right of a foreign sovereign to acquire property, real or personal, in a
receiving state, necessary for the creation and maintenance of its diplomatic mission, is recognized in the
1961 Vienna Convention on Diplomatic Relations (Arts. 20-22). This treaty was concurred in by the
Philippine Senate and entered into force in the Philippines on November 15, 1965.

In Article 31(a) of the Convention, a diplomatic envoy is granted immunity from the civil and
administrative jurisdiction of the receiving state over any real action relating to private immovable
property situated in the territory of the receiving state which the envoy holds on behalf of the sending
state for the purposes of the mission. If this immunity is provided for a diplomatic envoy, with all the
more reason should immunity be recognized as regards the sovereign itself, which in this case is the Holy
See.

The decision to transfer the property and the subsequent disposal thereof are likewise clothed with a
governmental character. Petitioner did not sell Lot
5-A for profit or gain. It merely wanted to dispose off the same because the squatters living thereon made
it almost impossible for petitioner to use it for the purpose of the donation. The fact that squatters have
occupied and are still occupying the lot, and that they stubbornly refuse to leave the premises, has been
admitted by private respondent in its complaint (Rollo, pp. 26, 27).

The issue of petitioner's non-suability can be determined by the trial court without going to trial in the
light of the pleadings, particularly the admission of private respondent. Besides, the privilege of sovereign
immunity in this case was sufficiently established by the Memorandum and Certification of the
Department of Foreign Affairs. As the department tasked with the conduct of the Philippines' foreign
relations (Administrative Code of 1987, Book IV, Title I, Sec. 3), the Department of Foreign Affairs has
formally intervened in this case and officially certified that the Embassy of the Holy See is a duly
accredited diplomatic mission to the Republic of the Philippines exempt from local jurisdiction and
entitled to all the rights, privileges and immunities of a diplomatic mission or embassy in this country
(Rollo, pp. 156-157). The determination of the executive arm of government that a state or instrumentality
is entitled to sovereign or diplomatic immunity is a political question that is conclusive upon the courts
(International Catholic Migration Commission v. Calleja, 190 SCRA 130 [1990]). Where the plea of
immunity is recognized and affirmed by the executive branch, it is the duty of the courts to accept this
claim so as not to embarrass the executive arm of the government in conducting the country's foreign
relations (World Health Organization v. Aquino, 48 SCRA 242 [1972]). As in International Catholic
Migration Commission and in World Health Organization, we abide by the certification of the
Department of Foreign Affairs.
Ordinarily, the procedure would be to remand the case and order the trial court to conduct a hearing to
establish the facts alleged by petitioner in its motion. In view of said certification, such procedure would
however be pointless and unduly circuitous (Ortigas & Co. Ltd. Partnership v. Judge Tirso Velasco, G.R.
No. 109645, July 25, 1994).

IV

Private respondent is not left without any legal remedy for the redress of its grievances. Under both
Public International Law and Transnational Law, a person who feels aggrieved by the acts of a foreign
sovereign can ask his own government to espouse his cause through diplomatic channels.

Private respondent can ask the Philippine government, through the Foreign Office, to espouse its claims
against the Holy See. Its first task is to persuade the Philippine government to take up with the Holy See
the validity of its claims. Of course, the Foreign Office shall first make a determination of the impact of
its espousal on the relations between the Philippine government and the Holy See (Young, Remedies of
Private Claimants Against Foreign States, Selected Readings on Protection by Law of Private Foreign
Investments 905, 919 [1964]). Once the Philippine government decides to espouse the claim, the latter
ceases to be a private cause.

According to the Permanent Court of International Justice, the forerunner of the International Court of
Justice:

By taking up the case of one of its subjects and by reporting to diplomatic action or
international judicial proceedings on his behalf, a State is in reality asserting its own
rights — its right to ensure, in the person of its subjects, respect for the rules of
international law (The Mavrommatis Palestine Concessions, 1 Hudson, World Court
Reports 293, 302 [1924]).

WHEREFORE, the petition for certiorari is GRANTED and the complaint in Civil Case No. 90-183
against petitioner is DISMISSED.

SO ORDERED.

Narvasa, C.J., Bidin, Regalado, Davide, Jr., Romero, Bellosillo, Melo, Puno, Vitug, Kapunan and
Mendoza, JJ., concur.

Padilla, J., took no part.

Feliciano, J., is on leave.

 Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. L-33112 June 15, 1978

PHILIPPINE NATIONAL BANK, petitioner, 

vs.
HON. JUDGE JAVIER PABALAN, Judge of the Court of First Instance, Branch III, La Union,
AGOO TOBACCO PLANTERS ASSOCIATION, INC., PHILIPPINE VIRGINIA TOBACCO
ADMINISTRATION, and PANFILO P. JIMENEZ, Deputy Sheriff, La Union, respondents.

Conrado E. Medina, Edgardo M. Magtalas & Walfrido Climaco for petitioner.

Felimon A. Aspirin fit respondent Agoo 'Tobacco Planters Association, Inc.

Virgilio C. Abejo for respondent Phil. Virginia Tobacco Administration.

FERNANDO, Acting C.J.:

The reliance of petitioner Philippine National Bank in this certiorari and prohibition proceeding against
respondent Judge Javier Pabalan who issued a writ of execution, 1 followed thereafter by a notice of
garnishment of the funds of respondent Philippine Virginia Tobacco Administration, 2 deposited with it, is
on the fundamental constitutional law doctrine of non-suability of a state, it being alleged that such funds
are public in character. This is not the first time petitioner raised that issue. It did so before in Philippine
National Bank v. Court of industrial Relations, 3 decided only last January. It did not meet with success,
this Court ruling in accordance with the two previous cases of National Shipyard and Steel
Corporation 4and Manila Hotel Employees Association v. Manila Hotel Company,  5 that funds of public
corporations which can sue and be sued were not exempt from garnishment. As respondent Philippine
Virginia Tobacco Administration is likewise a public corporation possessed of the same attributes,  6 a
similar outcome is indicated. This petition must be dismissed.

It is undisputed that the judgment against respondent Philippine Virginia Tobacco Administration had
reached the stage of finality. A writ of execution was, therefore, in order. It was accordingly issued on
December 17, 1970. 7There was a notice of garnishment for the full amount mentioned in such writ of
execution in the sum of P12,724,66. 8 In view of the objection, however, by petitioner Philippine National
Bank on the above ground, coupled with an inquiry as to whether or not respondent Philippine Virginia
Tobacco Administration had funds deposited with petitioner's La Union branch, it was not until January
25, 1971 that the order sought to be set aside in this certiorari proceeding was issued by respondent
Judge.9 Its dispositive portion reads as follows: Conformably with the foregoing, it is now ordered, in
accordance with law, that sufficient funds of the Philippine Virginia Tobacco Administration now
deposited with the Philippine National Bank, La Union Branch, shall be garnished and delivered to the
plaintiff immediately to satisfy the Writ of Execution for one-half of the amount awarded in the decision
of November 16, 1970." 10 Hence this certiorari and prohibition proceeding.

As noted at the outset, petitioner Philippine National Bank would invoke the doctrine of non-suability. It
is to be admitted that under the present Constitution, what was formerly implicit as a fundamental
doctrine in constitutional law has been set forth in express terms: "The State may not be sued without its
consent." 11 If the funds appertained to one of the regular departments or offices in the government, 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 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 must fail.

1. The alleged grave abuse of discretion, the basis of this certiorari proceeding, was sought to be justified
on the failure of respondent Judge to set aside the notice of garnishment of funds belonging to respondent
Philippine Virginia Tobacco Administration. This excerpt from the aforecited decision of Philippine
National Bank v. Court of Industrial Relations makes manifest why such an argument is far from
persuasive. "The premise that the funds could be spoken as public character may be accepted in the sense
that the People Homesite and Housing Corporation was a government-owned entity. It does not follow
though that they were exempt. from garnishment. National Shipyard and Steel Corporation v. Court of
Industrial Relations is squarely in point. As was explicitly stated in the opinion of the then Justice, later
Chief Justice, Concepcion: "The allegation to the effect that the funds of the NASSCO are public funds of
the government, and that, as such, the same may not be garnished, attached or levied upon, is untenable
for, as a government owned and controlled corporation, the NASSCO has a personality of its own.
distinct and separate from that of the Government. It has — pursuant to Section 2 of Executive Order No.
356, dated October 23, 1950 ... , pursuant to which The NASSCO has been established — all the powers
of a corporation under the Corporation Law ... ." Accordingly, it may be sue and be sued and may be
subjected to court processes just like any other corporation (Section 13, Act No. 1459, as amended.)" ...
To repeat, the ruling was the appropriate remedy for the prevailing party which could proceed against the
funds of a corporate entity even if owned or controlled by the government." 12

2. The National Shipyard and Steel Corporation decision was not the first of 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 as 1941. 13 In the language of its ponente Justice Ozaeta "On the other
hand, it is well-settled that when the government enters into commercial business, it abandons its
sovereign capacity and is to be treated like any other corporation. (Bank of the United States v. Planters'
Bank, 9 Wheat. 904, 6 L.ed. 244). By engaging in a particular business thru the instrumentality of a
corporation, the government divests itself pro hac vice of its sovereign character, so as to render the
corporation subject to the rules of law governing private corporations." 14 It is worth mentioning that
Justice Ozaeta could find support for such a pronouncement from the leading American Supreme Court
case of united States v. Planters' Bank, 15with the opinion coming from the illustrious Chief Justice
Marshall. It was handed down more than one hundred fifty years ago, 1824 to be exact. It is apparent,
therefore, that petitioner Bank could it legally set forth as a bar or impediment to a notice of garnishment
the doctrine of non-suability.

WHEREFORE, this petition for certiorari and prohibition is dismissed. No costs.

Barredo, Antonio, Aquino, and Santos, JJ., concur.

Concepcion, Jr., J., is on leave.

 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-15751             January 28, 1961

BUREAU OF PRINTING, SERAFIN SALVADOR and MARIANO LEDESMA, petitioners, 

vs.
THE BUREAU OF PRINTING EMPLOYEES ASSOCIATION (NLU), PACIFICO ADVINCULA,
ROBERTO MENDOZA, PONCIANO ARGANDA and TEODULO TOLERAN, respondents.

Office of the Solicitor General for petitioners.

Eulogio R. Lerum for respondents.

GUTIERREZ DAVID, J.:

This is a petition for certiorari and prohibition with preliminary injunction to annul Certain orders of the
respondent Court of Industrial Relations and to restrain it from further proceeding in the action for unfair
labor practice pending before it on the ground of lack of jurisdiction. Giving due course to the petition,
this Court ordered the issuance of the writ of preliminary injunction prayed for without bond.

The action in question was — upon complaint of the respondents Bureau of Printing Employees
Association (NLU) Pacifico Advincula, Roberto Mendoza, Ponciano Arganda and Teodulo Toleran —
filed by an acting prosecutor of the Industrial Court against herein petitioner Bureau of Printing, Serafin
Salvador, the Acting Secretary of the Department of General Services, and Mariano Ledesma the Director
of the Bureau of Printing. The complaint alleged that Serafin Salvador and Mariano Ledesma have been
engaging in unfair labor practices by interfering with, or coercing the employees of the Bureau of Printing
particularly the members of the complaining association petition, in the exercise of their right to self-
organization an discriminating in regard to hire and tenure of their employment in order to discourage
them from pursuing the union activities.

Answering the complaint, the petitioners Bureau of Printing, Serafin Salvador and Mariano Ledesma
denied the charges of unfair labor practices attributed to the and, by way of affirmative defenses, alleged,
among other things, that respondents Pacifico Advincula, Roberto Mendoza Ponciano Arganda and
Teodulo Toleran were suspended pending result of an administrative investigation against them for
breach of Civil Service rules and regulations petitions; that the Bureau of Printing has no juridical
personality to sue and be sued; that said Bureau of Printing is not an industrial concern engaged for the
purpose of gain but is an agency of the Republic performing government functions. For relief, they
prayed that the case be dismissed for lack of jurisdiction. Thereafter, before the case could be heard,
petitioners filed an "Omnibus Motion" asking for a preliminary hearing on the 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 question. The motion was granted, but after hearing, the trial judge of
the Industrial Court in an order dated January 27, 1959 sustained the jurisdiction of the court on the
theory that the functions of the Bureau of Printing are "exclusively proprietary in nature," and,
consequently, denied the prayer for dismissal. Reconsideration of this order having been also denied by
the court in banc, the petitioners brought the case to this Court through the present petition for certiorari
and prohibition.

We find the petition to be meritorious.

The Bureau of Printing is an office of the Government created by the Administrative Code of 1916 (Act
No. 2657). As such instrumentality of the Government, it operates under the direct supervision of the
Executive Secretary, Office of the President, and is "charged with the execution of all printing and
binding, including work incidental to those processes, required by the National Government and such
other work of the same character as said Bureau may, by law or by order of the (Secretary of Finance)
Executive Secretary, be authorized to undertake . . .." (See. 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 needs of the Government, it is primarily a service bureau and obviously, not engaged in business
or occupation for pecuniary profit.

It is true, as stated in the order complained of, that the Bureau of Printing receives outside jobs and that
many of its employees are paid for overtime work on regular working days and on holidays, but these
facts do not justify the conclusion that its functions are "exclusively proprietary in nature." Overtime
work in the Bureau of Printing is done only when the interest of the service so requires (sec. 566, Rev.
Adm. Code). As a matter of administrative policy, the overtime compensation may be paid, but such
payment is discretionary with the head of the Bureau depending upon its current appropriations, so that it
cannot be the basis for holding that the functions of said Bureau are wholly proprietary in character.
Anent the additional work it executes for private persons, we find that such work is done upon request, as
distinguished from those solicited, and only "as the requirements of Government work will permit" (sec.
1654, Rev. Adm. Code), and "upon terms fixed by the Director of Printing, with the approval of the
Department Head" (sec. 1655, id.). As shown by the uncontradicted evidence of the petitioners, most of
these works 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 Government seal, of which
only the Bureau of Printing is authorized to use, is embossed, and on the bank cheeks, only the Bureau of
Printing can print the reproduction of the official documentary stamps appearing thereon. The volume of
private jobs done, in comparison with government jobs, is only one-half of 1 per cent, and in computing
the costs for work done for private parties, the Bureau does not include profit because it is not allowed to
make any. Clearly, while the Bureau of Printing is allowed to undertake private printing jobs, it cannot be
pretended that it is thereby an industrial or business concern. The additional work it executes for private
parties is merely incidental to its function, and although such work may be deemed proprietary in
character, there is no showing that the employees performing said proprietary function are separate and
distinct from those employed in its general governmental functions.

From what has been stated, it is obvious that the Court of Industrial Relations did not acquire jurisdiction
over the respondent Bureau of Printing, and is thus devoid of any authority to take cognizance of the case.
This Court has already held in a long line of decisions that the Industrial Court has no jurisdiction to hear
and determine the complaint for unfair labor practice filed against institutions or corporations not
organized for profit and, consequently, not an industrial or business organization. This is so because the
Industrial Peace Act was intended to apply only to industrial employment, and to govern the relations
between employers engaged in industry and occupations for purposes of gain, and their industrial
employees. (University of the Philippines, et al. vs. CIR, et al., G.R. No. L-15416, April 28, 1960;
University of Sto. Tomas vs. Villanueva, et al., G.R. No. L-13748, October 30, 1959; La Consolacion
College vs. CIR, G.R. No. L-13282, April 22, 1960; See also the cases cited therein.) .

Indeed, as an office of the Government, without any corporate or juridical personality, the Bureau of
Printing cannot be sued. (Sec. 1, Rule 3, Rules of Court). Any suit, action or proceeding against it, if it
were to produce any effect, would actually be a suit, action or proceeding against the Government itself,
and the rule is settled that the Government cannot be sued without its consent, much less over its
objection. (See Metran vs. Paredes, 45 Off. Gaz. 2835; Angat River Irrigation System, et al. vs. Angat
River Workers' Union, et. al., G.R. Nos. L-10943-44, December 28, 1957).

The record also discloses that the instant case arose from the filing of administrative charges against some
officers of the respondent Bureau of Printing Employees' Association by the Acting Secretary of General
Services. Said administrative charges are for insubordination, grave misconduct and acts prejudicial to
public service committed by inciting the employees, of the Bureau of Printing to walk out of their jobs
against the order of the duly constituted officials. Under the law, the Heads of Departments and Bureaus
are authorized to institute and investigate administrative charges against erring subordinates. For the
Industrial Court now to take cognizance of the case filed before it, which is in effect a review of the acts
of executive officials having to do with the discipline of government employees under them, would be to
interfere with the discharge of such functions by said officials. WHEREFORE, the petition for a writ of
prohibition is granted. The orders complained of are set aside and the complaint for unfair labor practice
against the petitioners is dismissed, with costs against respondents other than the respondent court.

Bengzon, Bautista Angelo, Labrador, Paredes and Dizon, JJ., concur.

Reyes, J.B.L., J., concurs in the result.