G.R. No.

185572
CHINA NATIONAL MACHINERY & EQUIPMENT CORP. (GROUP), Petitioner
vs.
HON. CESAR D. SANTAMARIA
DATE: February 7, 2012
PONENTE: Sereno, J.
En Banc Decision
SHORT VERSION:
FACTS: Respondents prayed for the annulment of contracts entered into by CNMEG and
Northrail. These contracts involved the construction of the North Luzon Railway System from
Caloocan to Malolos on a turnkey basis. CNMEG prays for the dismissal of the suit, contending
that it is entitled to immunity, precluding it from being sued before a local court, and that the
contract agreement is an executive agreement, such that it cannot be questioned by or before a
local court.
HELD: The contract agreement is not an executive agreement. It was not concluded between
the government of the Philippines and China but between Northrail and CNMEG, which is
neither a government nor a government agency of China but a corporation duly organized and
created
under
the
laws
of
the
Peoples
Republic
of
China.
Because the Contract Agreement explicitly provides that Philippine Law shall be applicable, the
parties have effectively conceded that their rights and obligations thereunder are not governed
by international law. It is merely an ordinary commercial contract that can be questioned before
the local courts.
CNMEG engaged in a proprietary activity hence was not covered by sovereign immunity. The
Memorandum of Understanding between CNMEG and Northrail showed that CNMEG sought
the construction of the Luzon Railways as a proprietary or commercial venture in the ordinary
course of its business. It was clear that CNMEG initiated the undertaking, and not the Chinese
government.
FACTS:
14 September 2002: China National Machinery & Equipment Corp. (Group) (CNMEG),
represented by its chairperson, Ren Hongbin, entered into a Memorandum of Understanding
(MOU) with the North Luzon Railways Corporation (Northrail), represented by its president, Jose
L. Cortes, Jr. for the conduct of a feasibility study on a possible railway line from Manila to San
Fernando, La Union (the Northrail Project).
30 August 2003: the Export Import Bank of China (EXIM Bank) and the Department of Finance
(DOF) entered into an MOU (Aug 30 MOU), wherein China agreed to extend Preferential
Buyers Credit to the Philippine government to finance the Northrail Project.
The Chinese government designated EXIM Bank as the lender, while the Philippine
government named the DOF as the borrower.
Under the Aug 30 MOU, EXIM Bank agreed to extend an amount not exceeding USD
400,000,000 in favor of the DOF, payable in 20 years, with a 5-year grace period, and at
the rate of 3% per annum.5

1 October 2003: the Chinese Ambassador to PH, Wang Chungui (Amb. Wang), wrote a letter to
DOF Sec. Jose Isidro Camacho (Sec. Camacho) informing him of CNMEGs designation as the
Prime Contractor for the Northrail Project.
30 December 2003: Northrail and CNMEG executed a Contract Agreement for the construction
of Section I, Phase I of the North Luzon Railway System from Caloocan to Malolos on a turnkey
basis (the Contract Agreement). The contract price for the Northrail Project was pegged at USD
421,050,000 (kickback!)
26 February 2004: PH govt and EXIM Bank entered into a counterpart financial agreement
Buyer Credit Loan Agreement (the Loan Agreement).
- EXIM Bank agreed to extend Preferential Buyers Credit in the amount of USD
400,000,000 in favor of the Philippine government in order to finance the construction of
Phase I of the Northrail Project.
13 February 2006: The respondents filed a Complaint for Annulment of Contract and Injunction
with Urgent Motion for Summary Hearing to Determine the Existence of Facts and
Circumstances Justifying the Issuance of Writs of Preliminary Prohibitory and Mandatory
Injunction and/or TRO against CNMEG, the Office of the Executive Secretary, DOF, DBM,
NEDA and Northrail with RTC Makati.
- Respondents alleged that the Contract Agreement and the Loan Agreement were void
for being contrary to (a) the Constitution; (b) RA 9184 (Government Procurement Reform
Act) (c) PD 1445 (Government Auditing Code) and (d) EO 292 (Admin Code)
RTC issued an Order setting the case for hearing on the issuance of injunctive reliefs. CNMEG
filed an Urgent MR of this Order. Before RTC could rule on the MR, CNMEG filed a Motion to
Dismiss arguing that RTC did not have the jurisdiction over (a) its person, as it was an agent of
the Chinese government, making it immune from suit, and (b) the subject matter, as the
Northrail Project was a product of an executive agreement. RTC issued an Omnibus Order
denying MTD and set the case for summary hearing. CNMEG filed an MR, which was denied by
RTC. CNMEG filed before the CA a Petition for Certiorari with Prayer for the Issuance of TRO
and/or Writ of Preliminary Injunction. CA dismissed this petition, and the subsequent MR.
21 January 2009: CNMEG filed the instant Petition for Review on Certiorari.
ISSUES AND RATIO:
1. Whether CNMEG is entitled to immunity, precluding it from being sued before a
local court.
This Court explained the doctrine of sovereign immunity in Holy See v. Rosario:
- There are two conflicting concepts of sovereign immunity, each widely held and firmly
established.
o According to the classical or absolute theory, a sovereign cannot, without its
consent, be made a respondent in the courts of another sovereign.
o 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.
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.
JUSMAG v. National Labor Relations Commission: SC affirmed the Philippines adherence
to the restrictive theory
- The doctrine of state immunity from suit has undergone further metamorphosis. The
view evolved that the existence of a contract does not, per se, mean that sovereign
states may, at all times, be sued in local courts. The complexity of relationships between
sovereign states, brought about by their increasing commercial activities, mothered a
morerestrictive application of the doctrine.
- As it stands now, the application of the doctrine of immunity from suit has been restricted
to sovereign or governmental activities (jure imperii). The mantle of state immunity
cannot be extended to commercial, private and proprietary acts (jure gestionis).
Since the Philippines adheres to the restrictive theory, it is crucial to ascertain the legal
nature of the act involved whether the entity claiming immunity performs
governmental, as opposed to proprietary, functions.
As held in United States of America v. Ruiz:
The restrictive application of State immunity is proper only when the proceedings
arise out of commercial transactions of the foreign sovereign, its commercial
activities or economic affairs. Stated differently, a State may be said to have descended
to the level of an individual and can thus be deemed to have tacitly given its consent to
be sued only when it enters into business contracts. It does not apply where the contract
relates to the exercise of its sovereign functions.
WON CNMEG performed proprietary functions. YES!
The parties executed the Contract Agreement for the purpose of constructing the Luzon
Railways: to construct railways from Caloocan to Malolos, Contractor has offered to provide the
project on turnkey basis, etc etc.. --- Court said these did not on their own reveal whether the
construction of the Luzon railways was meant to be a proprietary endeavor.
The above-cited portion of the Contract Agreement, however, does not on its own reveal
whether the construction of the Luzon railways was meant to be a proprietary endeavor. In order
to fully understand the intention behind and the purpose of the entire undertaking, the Contract
Agreement must not be read in isolation.
Instead, it must be construed in conjunction with 3 other documents executed in relation
to the Northrail Project:
1. Memorandum of Understanding dated 14 September 2002 shows that CNMEG sought
the construction of the Luzon Railways as a proprietary venture.
WHEREAS, CNMEG has the financial capability, professional competence and technical
expertise to assess the state of the and recommend implementation plans as well as
undertake its rehabilitation and/or modernization;
WHEREAS, CNMEG has expressed interest in the rehabilitation and/or modernization of the
MLN from Metro Manila to San Fernando, La Union passing through the provinces of
Bulacan, Pampanga, Tarlac, Pangasinan and La Union.
WHEREAS, the NORTHRAIL CORP. welcomes CNMEGs proposal to undertake a
Feasibility Study (the "Study") at no cost to NORTHRAIL CORP.

xxx
APPROVAL PROCESS x x x regulations and procedures required from both parties, the
parties shall commence the preparation and negotiation of the terms and conditions of the
Contract to be entered into between them on the implementation of the Project. The parties
shall use their best endeavors to formulate and finalize a Contract with a view to signing the
Contract within one hundred twenty (120) days from CNMEGs presentation of the Study.
Clearly, it was CNMEG that initiated the undertaking, and not the Chinese government.
The Feasibility Study was conducted not because of any diplomatic gratuity from or
exercise of sovereign functions by the Chinese government, but was plainly a business
strategy employed by CNMEG with a view to securing this commercial enterprise.
2. Letter dated 1 October 2003 by Amb. Wang - CNMEG, and not the Chinese government,
initiated the Northrail Project was confirmed by Amb. Wang:
1. CNMEG has the proven competence and capability to undertake the Project as
evidenced by the ranking of 42 given by the ENR among 225 global construction
companies.
2. CNMEG already signed an MOU with the North Luzon Railways Corporation during
the visit of Chairman Li Peng. Such being the case, they have already established an
initial working relationship with your North Luzon Railways Corporation. This would
categorize CNMEG as the state corporation within the Peoples Republic of China which
initiated our Governments involvement in the Project.
3. Among the various state corporations of the Peoples Republic of China, only CNMEG
has the advantage of being fully familiar with the current requirements of the Northrail
Project having already accomplished a Feasibility Study which was used as inputs by
the North Luzon Railways Corporation in the approvals process required by the Republic
of the Philippines.
Thus, the desire of CNMEG to secure the Northrail Project was in the ordinary or regular
course of its business as a global construction company. The implementation of the
Northrail Project was intended to generate profit for CNMEG, with the Contract
Agreement placing a contract price of USD 421,050,000 for the venture.
The use of the term "state corporation" to refer to CNMEG was only descriptive of its
nature as a government-owned and/or -controlled corporation, and its assignment as the
Primary Contractor did not imply that it was acting on behalf of China in the performance
of the latters sovereign functions.
- To imply otherwise would result in an absurd situation, in which all Chinese corporations
owned by the state would be automatically considered as performing governmental
activities, even if they are clearly engaged in commercial or proprietary pursuits.
3. The Loan Agreement
CNMEG claims immunity on the ground that the Aug 30 MOU on the financing of the Northrail
Project was signed by the Philippine and Chinese governments, and its assignment as the
Primary Contractor meant that it was bound to perform a governmental function on behalf of
China.

However, the Loan Agreement, which originated from the same Aug 30 MOU,
belies this reasoning:
Article 11. Commercial Activity: The execution and delivery of this Agreement by the
Borrower constitute, and the Borrowers performance of and compliance with its
obligations under this Agreement will constitute, private and commercial acts done
and performed for commercial purposes under the laws of the Republic of the
Philippines and neither the Borrower nor any of its assets is entitled to any
immunity or privilege (sovereign or otherwise) from suit, execution or any other
legal process with respect to its obligations under this Agreement, as the case
may be, in any jurisdiction.
Notwithstanding the foregoing, the Borrower does not waive any immunity with respect
of its assets which are (i) used by a diplomatic or consular mission of the Borrower and
(ii) assets of a military character and under control of a military authority or defense
agency and (iii) located in the Philippines and dedicated to public or governmental use
(as distinguished from patrimonial assets or assets dedicated to commercial use).
(k) Proceedings to Enforce Agreement In any proceeding in the Republic of the
Philippines to enforce this Agreement, the choice of the laws of the Peoples Republic of
China as the governing law hereof will be recognized and such law will be applied. The
waiver of immunity by the Borrower, the irrevocable submissions of the Borrower to the
non-exclusive jurisdiction of the courts of the Peoples Republic of China and the
appointment of the Borrowers Chinese Process Agent is legal, valid, binding and
enforceable and any judgment obtained in the Peoples Republic of China will be if
introduced, evidence for enforcement in any proceedings against the Borrower and its
assets in the Republic of the Philippines provided that (a) the court rendering judgment
had jurisdiction over the subject matter of the action in accordance with its jurisdictional
rules, (b) the Republic had notice of the proceedings, (c) the judgment of the court was
not obtained through collusion or fraud, and (d) such judgment was not based on a clear
mistake of fact or law.
Further, the Loan Agreement likewise contained an express waiver of immunity:
15.5 Waiver of Immunity - The Borrower irrevocably and unconditionally waives, any
immunity to which it or its property may at any time be or become entitled, whether
characterized as sovereign immunity or otherwise, from any suit, judgment, service of
process upon it or any agent, execution on judgment, set-off, attachment prior to
judgment, attachment in aid of execution to which it or its assets may be entitled in any
legal action or proceedings with respect to this Agreement or any of the transactions
contemplated hereby or hereunder. Notwithstanding the foregoing, the Borrower does
not waive any immunity in respect of its assets which are (i) used by a diplomatic or
consular mission of the Borrower, (ii) assets of a military character and under control of a
military authority or defense agency and (iii) located in the Philippines and dedicated to a
public or governmental use (as distinguished from patrimonial assets or assets
dedicated to commercial use).
Thus, despite CNMEGs claim that the EXIM Bank extended financial assistance to
Northrail because the bank was mandated by the Chinese government, and not because
of any motivation to do business in the Philippines, it is clear from the foregoing
provisions that the Northrail Project was a purely commercial transaction.

Admittedly, the Loan Agreement was entered into between EXIM Bank and the Philippine
government, while the Contract Agreement was between Northrail and CNMEG. Although the
Contract Agreement is silent on the classification of the legal nature of the transaction, the
foregoing provisions of the Loan Agreement, which was an inextricable part of the entire
undertaking, nonetheless revealed the intention of the parties to the Northrail Project to classify
the whole venture as commercial or proprietary in character.
WON CNMEG is immune from suit under Chinese law. It failed to adduce evidence!
Even assuming that CNMEG performs governmental functions, such claim does not
automatically vest it with immunity.
- Malong v. Phil. National Railways: Immunity from suit is determined by the character
of the objects for which the entity was organized."
In this regard, Court examined its ruling in Deutsche Gesellschaft Fr Technische
Zusammenarbeit (GTZ) v. CA, where it ruled that GTZ was not immune from suit. [basically the
court discussed this case here]
Germany and the Philippines entered into a Technical Cooperation Agreement, pursuant to
which both signed an arrangement promoting the Social Health InsuranceNetworking and
Empowerment (SHINE) project. The two governments named their respective implementing
organizations: the DOH and the Philippine Health Insurance Corporation (PHIC) for the
Philippines, and GTZ for the implementation of Germanys contributions.
The arguments raised by GTZ and OSG were the ff:
- The SHINE project was implemented pursuant to the bilateral agreements between the
Philippine and German governments.
- GTZ was tasked, under the 1991 agreement, with the implementation of the
contributions of the German government.
- The activities performed by GTZ pertaining to the SHINE project are governmental in
nature, related as they are to the promotion of health insurance in the Philippines.
The fact that GTZ entered into employment contracts with the private respondents did not
disqualify it from invoking immunity from suit, as held in cases such as Holy See v. Rosario,
Jr., which set forth what remains valid doctrine:
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.
GTZ and OSG failed to address if GTZ, by conception, enjoyed the Federal Republics immunity
from suit.
The principle of state immunity from suit, whether a local state or a foreign state, is reflected in
Section 9, Article XVI of the Constitution, which states that "the State may not be sued without
its consent." Who or what consists of "the State"?

For one, the doctrine is available to foreign States insofar as they are sought to be sued
in the courts of the local State, necessary as it is to avoid "unduly vexing the peace of
nations."

If the instant suit had been brought directly against the Federal Republic of Germany, there
would be no doubt that it is a suit brought against a State, and the only necessary inquiry is
whether said State had consented to be sued. However, the present suit was brought against
GTZ.
- GTZs counsel characterizes GTZ as "the implementing agency of the Government
of the Federal Republic of Germany.
- BUT SC said assuming that the characterization is correct, it does not automatically
invest GTZ with the ability to invoke State immunity from suit.
- The distinction lies in whether the agency is incorporated or unincorporated.
State immunity from suit may be waived by general or special law. The special law can take the
form of the original charter of the incorporated government agency. Jurisprudence is replete with
examples of incorporated government agencies which were ruled not entitled to invoke
immunity from suit, owing to provisions in their charters manifesting their consent to be sued.
- Court noted that PHIC was established by RA 7875 which granted the corporation the
power to sue and be sued in court
Is GTZ an incorporated agency of the German government? There is some mystery
surrounding that question. Neither GTZ nor the OSG go beyond the claim that petitioner
is "the implementing agency of the Government of the Federal Republic of Germany."
- GTZ has not supplied any evidence defining its legal nature beyond that of the bare
descriptive "implementing agency."
- There is no doubt that the 1991 Agreement designated GTZ as the "implementing
agency" in behalf of the German government. Yet the catch is that such term has no
precise definition that is responsive to our concerns. Inherently, an agent acts in behalf
of a principal, and the GTZ can be said to act in behalf of the German state. But that is
as far as "implementing agency" could take us.
- The term by itself does not supply whether GTZ is incorporated or unincorporated,
whether it is owned by the German state or by private interests, whether it has juridical
personality independent of the German government or none at all.
- GTZ has failed to establish that under German law, it has not consented to be sued
despite it being owned by the Federal Republic of Germany.
The Court adhered to the rule that in the absence of evidence to the contrary, foreign
laws on a particular subject are presumed to be the same as those of the Philippines, and
following the most intelligent assumption the Court gathered, GTZ was akin to a
governmental owned or controlled corporation without original charter which, by virtue
of the Corporation Code, has expressly consented to be sued.
Applying the abovementioned ruling, it was readily apparent that CNMEG cannot claim
immunity from suit, even if it contends that it performs governmental functions.
- Its designation as the Primary Contractor does not automatically grant it immunity, just
as the term "implementing agency" has no precise definition for purposes of ascertaining
whether GTZ was immune from suit.
Although CNMEG claims to be a government-owned corporation, it failed to adduce
evidence that it has not consented to be sued under Chinese law.

CNMEG is to be presumed to be a government-owned and -controlled corporation

without an original charter. As a result, it has the capacity to sue and be sued
under Section 36 of the Corporation Code.

CNMEG failed to present a certification from the Department of Foreign Affairs

Holy See v. Rosario: The determination by the Executive that an entity is entitled to sovereign or
diplomatic immunity is a political question conclusive upon the courts.
- 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 Philippines, the practice was for the foreign government or the international
organization to first secure an executive endorsement of its claim of sovereign or
diplomatic immunity. PAANO? It varies.
In International Catholic Migration Commission v. Calleja: 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: the Secretary of Foreign Affairs sent the
trial court a telegram to that effect.
In Baer v. Tizon: The US 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 this case, the DFA through the Office of Legal Affairs moved with the SC to be allowed to
intervene on the side of CNMEG. The Court allowed DFA to file its memorandum
In some cases, the defense of sovereign immunity was submitted directly to the local courts by
the respondents through their private counsels. 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.
WON any agency of the Executive Branch can make a determination of immunity
from suit, which may be considered as conclusive upon the courts. YES. THE
DFA!
DFA v. NLRC emphasized the DFAs competence and authority to provide such necessary
determination:
- The DFAs function includes the determination of persons and institutions covered by
diplomatic immunities, a determination which, when challenged, entitles it to seek relief
from the court so as not to seriously impair the conduct of the country's foreign relations.
- The DFA must be allowed to plead its case whenever necessary or advisable to enable it
to help keep the credibility of the Philippine government before the international
community.
- When international agreements are concluded, the parties thereto are deemed to have
likewise accepted the responsibility of seeing to it that their agreements are duly
regarded. In our country, this task falls principally of the DFA as being the highest

executive department with the competence and authority to so act in this aspect of the
international arena.
The fact that this authority is EXCLUSIVE to the DFA was also emphasized in GTZ v. CA:
- SC said that LA, in both of its rulings, noted that it was imperative for GTZ to secure from
the DFA "a certification of respondents diplomatic status and entitlement to diplomatic
privileges including immunity from suits."
- The requirement might not necessarily be imperative. However, had GTZ obtained such
certification from the DFA, it would have provided factual basis for its claim of immunity
that would, at the very least, establish a disputable evidentiary presumption that the
foreign party is indeed immune which the opposing party will have to overcome with its
own factual evidence.
CNMEG offers the Certification executed by the Economic and Commercial Office of the
Embassy of the Peoples Republic of China, stating that the Northrail Project is in pursuit of a
sovereign activity.
- This is NOT the kind of certification that can establish their claim to immunity, because it
was said in the case of Holy See v. Rosario that such certification unequivocally refers to
the determination of the "Foreign Office of the state where it is sued."
CNMEG also claims that its immunity from suit has the executive endorsement of both the OSG
and the Office of the Government Corporate Counsel (OGCC), which must be respected by the
courts.
However, as expressly ruled in GTZ v. CA, this determination by the OSG, or by the
OGCC for that matter, does not inspire the same degree of confidence as a DFA
certification.
- BUT SC SAID: Even with a DFA certification, SC is not precluded from making an inquiry
into the intrinsic correctness of such certification.
WON an agreement to submit any dispute to arbitration may be construed as an
implicit waiver of immunity from suit.
In the US, the Foreign Sovereign Immunities Act of 1976 provides for a waiver by implication of
state immunity.
- In the said law, the agreement to submit disputes to arbitration in a foreign country is
construed as an implicit waiver of immunity from suit.
Although there is no similar law in the Philippines, there is reason to apply the legal reasoning
behind the waiver in this case.
- The Conditions of Contract, which is an integral part of the Contract Agreement stated:
33. SETTLEMENT OF DISPUTES AND ARBITRATION
33.2. Arbitration
All disputes or controversies arising from this Contract which cannot be settled between
the Employer and the Contractor shall be submitted to arbitration in accordance with the
UNCITRAL Arbitration Rules at present in force and as may be amended by the rest of
this Clause. The appointing authority shall be Hong Kong International Arbitration
Center. The place of arbitration shall be in Hong Kong at Hong Kong International
Arbitration Center (HKIAC).

Under the above provisions, if any dispute arises between Northrail and CNMEG, both
parties are bound to submit the matter to the HKIAC for arbitration. x x x The party to
arbitration wishing to have an arbitral award recognized and enforced in the Philippines
must petition the proper regional trial court (a) where the assets to be attached or levied
upon is located; (b) where the acts to be enjoined are being performed; (c) in the
principal place of business in the Philippines of any of the parties; (d) if any of the parties
is an individual, where any of those individuals resides; or (e) in the National Capital
Judicial Region.
It is clear that CNMEG has agreed that it will not be afforded immunity from suit. Thus, the
courts have the competence and jurisdiction to ascertain the validity of the Contract Agreement.

2. WON the Contract Agreement is an executive agreement. NO!! (finally)

Article 2(1) of the Vienna Convention on the Law of Treaties (Vienna Convention) defines
a treaty as follows:
An international agreement concluded between States in written form and governed by
international law, whether embodied in a single instrument or in two or more related
instruments and whatever its particular designation.
Bayan Muna v. Romulo: SC held that an executive agreement is similar to a treaty, except that
the former
a) does not require legislative concurrence
b) is usually less formal
c) deals with a narrower range of subject matters
Despite these differences, to be considered an executive agreement, the following three
requisites provided under the Vienna Convention must nevertheless concur:
a) the agreement must be between states
b) it must be written
c) it must governed by international law
The 1st and 3rd requisites are absent in this case.
A. CNMEG is neither a government nor a government agency.
The Contract Agreement was not concluded between the Philippines and China, but between
Northrail and CNMEG.
By the terms of the Contract Agreement, Northrail is a GOCC while CNMEG is a
corporation duly organized and created under the laws of PRC.
Thus, both Northrail and CNMEG entered into the Contract Agreement as entities with
personalities distinct and separate from the Philippine and Chinese governments,
respectively.
Neither can it be said that CNMEG acted as agent of the Chinese government.
- The fact that Amb. Wang, in his letter (Oct 2003) described CNMEG as a "state
corporation" and declared its designation as the Primary Contractor in the Northrail
Project did not mean it was to perform sovereign functions on behalf of China.
- That label was only descriptive of its nature as a state-owned corporation, and did not
preclude it from engaging in purely commercial or proprietary ventures.

B. The Contract Agreement is to be governed by Philippine law.

Article 2 of the Conditions of Contract, which under Article 1.1 of the Contract Agreement is an
integral part of the latter, states:
APPLICABLE LAW AND GOVERNING LANGUAGE
The contract shall in all respects be read and construed in accordance with the laws of
the Philippines.
The contract shall be written in English language. All correspondence and other
documents pertaining to the Contract which are exchanged by the parties shall be
written in English language.
-

Since the Contract Agreement explicitly provides that Philippine law shall be applicable,
the parties have effectively conceded that their rights and obligations thereunder are not
governed by international law.
It is therefore clear from the foregoing reasons that the Contract Agreement does not
partake of the nature of an executive agreement. It is merely an ordinary commercial
contract that can be questioned before the local courts.

WHEREFORE, the instant Petition is DENIED. Petitioner China National Machinery &
Equipment Corp. (Group) is not entitled to immunity from suit, and the Contract Agreement is
not an executive agreement. CNMEGs prayer for the issuance of a TRO and/or Writ of
Preliminary Injunction is DENIED for being moot and academic. This case is REMANDED to the
Regional Trial Court of Makati, Branch 145, for further proceedings as regards the validity of the
contracts subject of Civil Case No. 06-203.
Corona, C.J., Carpio, Velasco, Leonardo-De Castro, Brion, Peralta, Bersamin, Del Castillo,
Abad, Villarama, Perez, Mendoza, Reyes, Perlas Bernabe JJ. Concur.
KATHLEEN

Pharmaceutical and Health Care Association of the Philippines v Duque III

Facts:
Petition for certiorari seeking to nullify the Revised Implementing Rules and Regulations (RIRR)
of E.O. 51 (Milk Code). Petitioner claims that the RIRR is not valid as it contains provisions that
are not constitutional and go beyond what it is supposed to implement. Milk Code was issued by
President Cory Aquino under the Freedom Constitution on Oct.1986. One of the preambular
clauses of the Milk Code states that the law seeks to give effect to Art 11 of the Intl Code of
Marketing and Breastmilk Substitutes(ICBMS), a code adopted by the World Health
Assembly(WHA). From 1982-2006, The WHA also adopted severe resolutions to the effect that
breastfeeding should be supported, hence, it should be ensured that nutrition and health claims
are not permitted for breastmilk substitutes. In 2006, the DOH issued the assailed RIRR.
Issue:
Sub-Issue: W/N the pertinent intl agreements entered into by the Phil are part of the law of the
land and may be implemented by DOH through the RIRR. If yes, W/N the RIRR is in accord with

intl agreements

MAIN: W/N the DOH acted w/o or in excess of their jurisdiction, or with grave abuse of
discretion amounting to lack of excess of jurisdiction and in violation of the Constitution by
promulgating the RIRR.
Held:
Sub-issue:
Yes for ICBMS. Under 1987 Consti, intl law can become domestic law by transformation (thru
constitutional mechanism such as local legislation) or incorporation (mere constitutional
declaration i.e treaties) The ICBMS and WHA resolutions were not treaties as they have not
been concurred by 2/3 of all members of the Senate as required under Sec, 21, Art 8. However,
the ICBMS had been transformed into domestic law through a local legislation such as the Milk
Code. The Milk Code is almost a verbatim reproduction of ICBMS.
No for WHA Resolutions. The Court ruled that DOH failed to establish that the provisions
pertinent WHA resolutions are customary intl law that may be deemed part of the law of the
land. For an intl rule to be considered as customary law, it must be established that such rule is
being followed by states because they consider it as obligatory to comply with such rules
(opinion juris). The WHO resolutions, although signed by most of the member states, were
enforced or practiced by at least a majority of member states. Unlike the ICBMS whereby
legislature enacted most of the provisions into the law via the Milk Code, the WHA Resolutions
(specifically providing for exclusive breastfeeding from 0-6 months, breastfeeding up to 24
Months and absolutely prohibiting ads for breastmilk substitutes) have not been adopted as
domestic law nor are they followed in our country as well. The Filipinos have the option of how
to take care of their babies as they see fit. WHA Resolutions may be classified as SOFT LAW
non-binding norms, principles and practices that influence state behavior. Soft law is not part of
intl law.
Main issue:
Yes. Some parts of the RIRR were not in consonance with the Milk Code such as Sec. 4(f)
->advertising, promotions of formula are prohibited,
Sec 11 -> prohibitions for advertising breastmilk substitutes intended for infants and young
children uo to 24 months
And Sec 46 -> sanctions for advertising .
These provisions are declared null and void. The DOH and respondents are prohibited from
implementing said provisions.

Oposa vs. Factoran Case Digest (G.R. No. 101083, July 30, 1993)
FACTS:
The plaintiffs in this case are all minors duly represented and joined by their parents. The first
complaint was filed as a taxpayer's class suit at the Branch 66 (Makati, Metro Manila), of the

Regional Trial Court, National capital Judicial Region against defendant (respondent) Secretary
of the Department of Environment and Natural Reasources (DENR). Plaintiffs alleged that they
are entitled to the full benefit, use and enjoyment of the natural resource treasure that is the
country's virgin tropical forests. They further asseverate that they represent their generation as
well as generations yet unborn and asserted that continued deforestation have caused a
distortion and disturbance of the ecological balance and have resulted in a host of
environmental tragedies.
Plaintiffs prayed that judgement be rendered ordering the respondent, his agents,
representatives and other persons acting in his behalf to cancel all existing Timber License
Agreement (TLA) in the country and to cease and desist from receiving, accepting, processing,
renewing or approving new TLAs.

Defendant, on the other hand, filed a motion to dismiss on the ground that the complaint had no
cause of action against him and that it raises a political question.

The RTC Judge sustained the motion to dismiss, further ruling that granting of the relief prayed
for would result in the impairment of contracts which is prohibited by the Constitution.

Plaintiffs (petitioners) thus filed the instant special civil action for certiorari and asked the court
to rescind and set aside the dismissal order on the ground that the respondent RTC Judge
gravely abused his discretion in dismissing the action.

ISSUES:

(1) Whether or not the plaintiffs have a cause of action.

(2) Whether or not the complaint raises a political issue.
(3) Whether or not the original prayer of the plaintiffs result in the impairment of contracts.

RULING:

First Issue: Cause of Action.

Respondents aver that the petitioners failed to allege in their complaint a specific legal right
violated by the respondent Secretary for which any relief is provided by law. The Court did not
agree with this. The complaint focuses on one fundamental legal right -- the right to a balanced
and healthful ecology which is incorporated in Section 16 Article II of the Constitution. The said
right carries with it the duty to refrain from impairing the environment and implies, among many
other things, the judicious management and conservation of the country's forests. Section 4 of
E.O. 192 expressly mandates the DENR to be the primary government agency responsible for
the governing and supervising the exploration, utilization, development and conservation of the
country's natural resources. The policy declaration of E.O. 192 is also substantially re-stated in
Title XIV Book IV of the Administrative Code of 1987. Both E.O. 192 and Administrative Code of
1987 have set the objectives which will serve as the bases for policy formation, and have
defined the powers and functions of the DENR. Thus, right of the petitioners (and all those they
represent) to a balanced and healthful ecology is as clear as DENR's duty to protect and
advance the said right.

A denial or violation of that right by the other who has the correlative duty or obligation to
respect or protect or respect the same gives rise to a cause of action. Petitioners maintain that
the granting of the TLA, which they claim was done with grave abuse of discretion, violated their
right to a balance and healthful ecology. Hence, the full protection thereof requires that no
further TLAs should be renewed or granted.

After careful examination of the petitioners' complaint, the Court finds it to be adequate enough
to show, prima facie, the claimed violation of their rights.

Second Issue: Political Issue.

Second paragraph, Section 1 of Article VIII of the constitution provides for the expanded
jurisdiction vested upon the Supreme Court. It allows the Court to rule upon even on the wisdom
of the decision of the Executive and Legislature and to declare their acts as invalid for lack or
excess of jurisdiction because it is tainted with grave abuse of discretion.

Third Issue: Violation of the non-impairment clause.

The Court held that the Timber License Agreement is an instrument by which the state regulates
the utilization and disposition of forest resources to the end that public welfare is promoted. It is
not a contract within the purview of the due process clause thus, the non-impairment clause
cannot be invoked. It can be validly withdraw whenever dictated by public interest or public
welfare as in this case. The granting of license does not create irrevocable rights, neither is it
property or property rights.

Moreover, the constitutional guaranty of non-impairment of obligations of contract is limit by the

exercise by the police power of the State, in the interest of public health, safety, moral and
general welfare. In short, the non-impairment clause must yield to the police power of the State.

The instant petition, being impressed with merit, is hereby GRANTED and the RTC decision is
SET ASIDE.

The Diocese of Bacolod, Represented by the Most Rev. Bishop Vicente M. Navarra and
the Bishop Himself in his Personal Capacity v. Commission on Elections and the Election
Officer of Bacolod City, Atty. Mavil V. Majarucon GR No. 205728
SUMMARY OF THE PETITION
FACTS:
Petitioner Diocese of Bacolod is a Roman Catholic diocese and is represented in this petition by
its Bishop, the Most Rev. Vicente M. Navarra. Petitioner Bishop Navarra is also filing this petition
in his individual and personal capacity as the questioned orders are personally directed at him
and also as a concerned citizen, as the issues raised herein are matters of paramount and
transcendental importance to the public which must be settled early given the far-reaching
implications of the unconstitutional acts of the respondents.
Named as respondents are the Commission on Elections (COMELEC) and its Election Officer of
Bacolod City Atty. Mavil V. Majarucon.
On 21 February 2013, the petitioners have caused to be placed on the front wall of the Bacolod
Cathedral two sets of Tarpaulin, each sized 6x10 feet, with the messageConscience Vote (Team
Buhay/Team Patay (Team Patay Tarpaulin). The Team Patay Tarpaulin contained the names of
both Anti- and Pro-Reproductive Health Law senatorial candidates.
In their special civil action for Certiorari and Prohibition under Rule 65 of the Rules of Court,
petitioners sought the nullification of the 22 February 2013 order issued by respondent Atty.
Majarucon, which orders them to remove the supposed oversizedTeam Patay Tarpaulin of the

Diocese of Bacolod. They also sought to nullify the 27 February 2013 order issued by the
COMELEC, through its Law Department, which orders the immediate removal of the Team
Patay Tarpaulin and threatening the petitioner Bishop of Bacolod with the filing of an election
offense if he fails to cause its immediate removal.
On March 5, 2013, the Supreme Court En Banc issued a temporary restraining order enjoining
the respondents COMELEC and Atty. Majarucon from removing the Team Patay Tarpaulin.
ISSUES/GROUNDS:
1. Respondents orders directives to remove or cause the removal of the subjectTeam Patay
Tarpaulin are unconstitutional and void for infringing on petitioners right to freedom of
expression on their own private property. 2. Respondents orders/directives to remove or cause
the removal of the subjectTeam Patay Tarpaulin are unconstitutional and void for violating the
principle of separation of Church and State enshrined in Section 6 of Article II of the 1987
Constitution.
ARGUMENTS/DISCUSSIONS:
1. The assailed Orders/Directives to remove or cause the removal of the subjectTeam Patay
Tarpaulin are not electoral campaign materials and that the mention of the candidates in the
infringes on the petitioners right to freedom of expression on their own private property: o the
subject Team Patay Tarpaulins are not electoral campaign materials, stressing that the
mentioning of candidates name in the second tarpaulin was merely incidental to the petitioners
campaign against the RH Law, which they have firmly campaigned against even when it was
just a bill being deliberated in Congress; o subject Team Patay Tarpaulins are covered by the
broader constitutional guaranty of freedom of expression and of conscience and not by the
more narrow and limited election laws, rules, and regulations; o petitioners have the
constitutional right to communicate their views and beliefs by posting the subject Team Patay
Tarpaulins on the Bacolod Cathedral, a private property owned by the Diocese of Bacolod; o
the RH Law and the candidates and party-lists running in the 2013 National Elections who
supported and who opposed its passage into a law are matters of public concern and a
legitimate subject of general interest and of discussion; o citing the Supreme Courts
jurisprudence in Chavez v. PCGG (G. R. No. 130716, December 9, 1998), the petitioners
argued that that public concern embraces a broad spectrum of subjects which the public may
want to know
o citing the Supreme Courts jurisprudence in Adiong v. COMELEC ( G. R. No. 103956, March
31, 1992), the petitioners further argued that debate on public issues should be uninhibited,
robust, and wide open. o the content and the message of the subject Team Patay Tarpaulin
plainly relates to broad issues of interest to the community especially to the members of the
Catholic community and that the subject tarpaulin simply conveys the position of the
petitioners on the RH bill and the public officials who supported or opposed it as it gains
relevance in the exercise of the peoples right of suffrage in the advent of the 2013 polls; o
considering the petitioners message, through the Team Patay Tarpaulin, was a matter of public
concern, the message being conveyed and the mode used for its communication and

expression to the public is entitled to protection under the Free Expression clause of the Bill of
Rights of the 1987 Constitution; o not being candidates or political parties, the freedom of
expression curtailed by the questioned prohibition, using the logic of the Supreme Court in
Adiong v. COMELEC, is not so much that of the candidate or the political party; o there is no
compelling and substantial State interest that is endangered or which will be endangered by the
posting of the subject Team Patay Tarpaulin which would justify the infringement of the preferred
right of freedom of expression. 2. The assailed orders/directives to remove or cause the removal
of the subjectTeam Patay Tarpaulin are unconstitutional and void for violating the principle of
separation of Church and State enshrined in Section 6 of Article II of the 1987 Constitution: o
petitioners petition against the RH Law is not only a matter of exercise of its freedom of
expression and of conscience but is also a matter of Catholic faith, morals, belief, and of duty; o
the Diocese of Bacolod has taken on the issue of the RH Law as part of her mission as part of
its continued advocacy and obedience to the Catholic Churchs teachings; o in line with what
they believe to be their duty in the faith, the petitioners have declared the RH Law as being antilife, antimorals, anti-family, anti-marriage, and contrary to the teachings of the Catholic Church.
Consequently, petitioners have called on its members and followers not to support any
candidate who is anti-life, and to support those who are pro-life;
o considering that the views and position of the petitioners on the RH Bill is inextricably
connected to its Catholic dogma, faith, and moral teachings, the posting of the subject Team
Patay Tarpaulin has already gone beyond mere exercise of freedom of expression and of
conscience, but also of the right and privilege of the Church to propagate and spread its
teachings which should be insulated from any form of encroachment and intrusion on the part of
the State, and its agencies and officials; o section 6 of the Article II of the 1987 Constitution
monumentalizes the principle of separation of Church and State; o at the core of its advocacy
against the RH Bill is the Gospel of Life which is a matter of Catholic doctrine, creed and
dogma; o the petitioners believe, as a matter of faith, that in these times when there is a great
conflict between a culture of death and a culture of life, the Church should have the courage to
proclaim the culture of life for the common good of society; o the questioned orders are
unpardonable intrusion into the affairs of the Church and constitute serious violations of the
principle of separation of Church and State which the State and its officials, including the herein
respondents, are bound to respect, observe, and hold sacred.
PRAYER:
Petition be given due course; Issue a Temporary Restraining Order and/or a Writ of
Preliminary Injunction restraining respondents from further proceedings in enforcing their orders
for the removal of the subject Team Patay Tarpaulin; Declare the questioned orders of
respondents as unconstitutional and void and permanently restrain the respondents from
enforcing them or any other similar orders; and Issue other reliefs as may be deemed just
and equitable under the premises.
THE ISSUES TO BE ARGUED AS PER ADVISORY OF THE COURT EN BANC DATED
MARCH 12, 2013

1. Whether or not the 22 February 2013 Notice/Order by Election Officer Majarucon and the 27
February 2013 Order by the COMELEC Law Department are considered judgments/final
orders/resolutions of the
COMELEC which would warrant a review of this Court via a Rule 65 Petition.
(a) Whether or not petitioners violated the hierarchy of courts doctrine and jurisprudential rules
governing appeals from COMELEC decisions;
(b) Assuming arguendo that the aforementioned Orders are not considered judgments/final
orders/resolutions of the COMELEC, whether there are exceptional circumstances which would
allow this Court to take cognizance of the case.
2. Whether or not it is relevant to determine whether the tarpaulins are political advertisement
or election propaganda considering that petitioner is not a political candidate. 3. Whether or
not the tarpaulins are a form of expression (protected speech), or election propaganda/political
advertisement.
(a) Assuming arguendo that the tarpaulins are a form of expression, whether or not the
COMELEC possesses the authority to regulate the same.
(b) Whether or not this form of expression may be regulated.
4. Whether or not the 22 February 2013 Notice/Order by Election Officer Majarucon and the 27
February 2013 Order by the COMELEC Law Department violate the Constitutional principle of
separation of church and state. 5. Whether or not the action of the petitioners in posting its
tarpaulin violates the Constitutional principle of separation of church and state.
OSG COMMENT: DIOCESE OF BACOLOD, et al. vs. COMELEC, et al.
ISSUES:
1. Whether or not petitioners availed of the proper remedy in assailing respondents notice and
letter ordering the removal of the subject tarpaulin. 2. Whether or not the assailed order and
notice issued by respondents are valid and constitutional considering that the same allegedly
violate the petitioners right to freedom of expression and the
principle of separation of Church and State enshrined in the 1987 Constitution.
ARGUMENTS/DISCUSSION:
1. A petition for certiorari and prohibition under Rule 65 of the Rules of Court filed before this
Honorable Court is not the proper remedy to question the subject notice and letter of
respondents. o Petitioners filed the petition before the Honorable Court, claiming that they have
no other plain, speedy and adequate remedy to assail the notice and letter issued by the
respondents. Contrary to their claim, prior resort to the COMELEC constitutes a plain, speedy
and adequate remedy that bars the petitioners from directly asking relief from the Honorable
Court from the alleged injurious effects of the subject letter and notice. o In filing the instant suit,

the petitioners violated the rule on exhaustion of administrative remedies. Before a party is
allowed to seek intervention of the court, it is a pre-condition that he should have availed of all
the means of administrative processes afforded him. Petitioners should have first brought the
matter to the COMELEC En Banc or to any of its Divisions before going directly to the Supreme
Court via petition for certiorari and prohibition. o The letter and notice issued by the respondents
are not subject to review by the Supreme Court, as the power of the Court to review the
decisions of the COMELEC is limited only to final decisions, rulings and orders of the
COMELEC en banc rendered in the exercise of its adjudicatory or quasi-judicial power (citing
Ambil Jr. vs. COMELEC, G.R. No. 143398 October 25, 2000). Considering that the assailed
letter and notice are not final orders of the COMELEC En Banc rendered in the exercise of its
adjudicatory and quasi-judicial functions but mere issuances of Atty. Marjucom and the
COMELEC Law Department, the same are not reviewable by the Honorable Court but by the
COMELEC itself. o Granting that the assailed notice and letter are subject to review by the
Honorable Court, petitioners must be able to show that respondents committed grave abuse of
discretion amounting to lack or excess of jurisdiction in issuing the same. Petitioners have not
shown facts essential to prove that the assailed notice and letter were issued in a whimsical,
arbitrary
or capricious manner or the abuse of discretion is so patent and gross to amount to grave
abuse of discretion. The respondents issued the notice andletter pursuant to the COMELECs
mandate to regulate and supervise the use of mass media during election period as embodied
in the 1987 Constitution. 2. The subject tarpaulin is an election propaganda subject to regulation
by respondent COMELEC pursuant to its mandate under Section 4, Article IX-C of the 1987
Constitution. Hence, respondents notice and letter ordering its removal for being oversized are
valid and constitutional. o In furtherance of COMELECs mandate to supervise and regulate
elections, Congress enacted RA 9006 (the Fair Elections Act), giving the COMELEC power to
promulgate its own rules and regulations. Pursuant to this, COMELEC promulgated Resolution
9615 (Rules and Regulations Implementing RA 9006, in connection to the 13 May 2013 National
and Local Elections, and Subsequent Elections). Resolution 9615 defines the following terms:
Election Campaign or Partisan Political Activity- an act designed to promote the election of
defeat of a particular candidate or candidates to a public office, and shall include, among others,
the act of directly or indirectly soliciting votes, pledges of support for or against any candidate
Political Advertisement or Election Propaganda- any matter broadcasted, published, printed,
displayed or exhibited, in any medium, which contain the name, image, logo, brand, insignia,
motif, initials,and other symbol or representation, that is capable of being associated with a
candidate or a party, and is intended to draw the attention of thepublic or a segment thereof to
promote or oppose, directly or indirectly, the election of the said candidate or candidates to a
public office
From the definitions, the subject tarpaulin is a form of election propaganda subject to regulation
by the COMELEC pursuant to its mandate under Section 4, Article IX-C of the 1987
Constitution.
o The subject tarpaulin contains the message CONSCIENCE VOTE and classifies the
candidates into two groups, Team Buhay (with a check mark) and Team Patay (with a cross

mark). The check mark on Team Buhay and the cross mark on Team Patay convey to the
public that those belonging to the Team Buhay should be voted while those under Team
Patay should be rejected. On its face, it is obvious that the tarpaulin is petitioners way of
endorsing those candidates who voted against the RH Law and rejecting those who voted for
the said law. Petitioner also admitted in their petition that they have called on its members and
followers not to support any candidate who is anti-life, and to support those who are prolife.
These declarationsconfirm that they put up the tarpaulin not merely to promote the Churchs
position on the RH Law but to express their support for or against the candidates listed therein,
depending on who they voted on the RH Law. o Section 6 of Resolution 9615 sets the size limit
for campaign posters to two feet by three feet. This is also embodied in section 82 of the
Omnibus Election Code. The subject tarpaulin has the estimated size of six feet by ten feet,
which is beyond the maximum allowable size for campaign posters for private properties. In
ordering the removal of the tarpaulin, Atty. Marjucom, in her capacity as election officer, merely
enforcedsection 6 of Resolution 9615 and section 82 of the Omnibus Election Code. Similarly, in
issuing the assailed letter, the COMELEC Law Department only acted pursuant to COMELECs
regulatory and supervisory functions under the 1987 Constitution. o Petitioners cannot claim
that their right to freedom of expression has been violated. Petitioners are completely free to
express their support for or against any candidate through the use of campaign posters and
other forms of propaganda, provided they comply with the limitations provided by law as regards
their size. o The assailed notice and letter are not forms of censorship. The only reason that the
respondents sought the removal of the tarpaulin is that it failed to comply with the maximum
allowable size provided by law. o Assuming that the assailed notice and letter amount to
infringement of the petitioners right to freedom of expression, such encroachment is authorized
by the Constitution itself. The
supervisory and regulatory powers of the COMELEC under the Constitution set to some extent
a limit on the right to free speech during the election period. By ordering the petitioners to
comply with the size requirement, the COMELEC was exercising its supervisory and regulatory
authority for the purpose of ensuring equal opportunity for candidates for political office. o The
assailed notice and letter do not intrude into purely religious and ecclesiastical matters. They do
not seek to regulate the content the subject tarpaulin, but only the size, which respondents
found to be in violation of Resolution 9615 and the Omnibus Election Code. On its face, the
subject tarpaulin does not convey any religious doctrine of the Catholic Church. Rather, it is an
election propaganda. The fact that the tarpaulin did not comply with Resolution 9615 and the
Omnibus Election Code gave respondents reason to order its removal, consistent with
COMELECs mandate to regulate and supervise all form of media communication and
information during election period. Thus, respondents did not violate the principle of separation
of Church and State provided in the Constitution.
PRAYER: The Petition should be dismissed for lack of merit.

pierce vs society of sisters

Brief Fact Summary. Appellees, two non-public schools, were protected by a preliminary
restraining order prohibiting appellants from enforcing an Oregon Act that required parents and
guardians to send their children to public school. Appellants appealed the order.
Synopsis of Rule of Law. The 14th Amendment provides a liberty interest in a parents or
guardians right to decide the mode in which their children are educated. States may not usurp
this right when the questioned legislation does not reasonably relate to a viable state interest.

Facts. Appellee the Society of Sisters, a corporation with the power to establish and maintain
academies or schools and Appellee Hill Military Academy, a private organization conducting an
elementary, college preparatory, and military training school, obtained preliminary restraining
orders prohibiting appellants from enforcing Oregons Compulsory Education Act. The Act
required all parents and guardians to send children between 8 and 16 years to a public school.
The appellants appealed the granting of the preliminary restraining orders.
Issue. Does the Act unreasonably interfere with the liberty of parents and guardians to direct the
upbringing and education of children under their control?
Held. The Act violates the 14th Amendment because it interferes with protected liberty interests
and has no reasonable relationship to any purpose within the competency of the state.
The Appellees have standing because the result of enforcing the Act would be destruction of the
appellees schools. The state has the power to regulate all schools, but parents and guardians
have the right and duty to choose the appropriate preparation for their children.

Discussion. While the state has the right to insure that children receive a proper education, the
14th Amendment provides parents and guardians with a liberty interest in their choice in the
mode in which their children are educated.

TANADA v. ANGARA
272 SCRA 18, May 2, 1997
Facts :
This is a petition seeking to nullify the Philippine ratification of the World Trade Organization
(WTO) Agreement. Petitioners question the concurrence of herein respondents acting in their
capacities as Senators via signing the said agreement.
The WTO opens access to foreign markets, especially its major trading partners, through the
reduction of tariffs on its exports, particularly agricultural and industrial products. Thus, provides
new opportunities for the service sector cost and uncertainty associated with exporting and
more investment in the country. These are the predicted benefits as reflected in the agreement
and as viewed by the signatory Senators, a free market espoused by WTO.

Petitioners on the other hand viewed the WTO agreement as one that limits, restricts and impair
Philippine economic sovereignty and legislative power. That the Filipino First policy of the
Constitution was taken for granted as it gives foreign trading intervention.
Issue : Whether or not there has been a grave abuse of discretion amounting to lack or excess
of jurisdiction on the part of the Senate in giving its concurrence of the said WTO agreement.
Held:
In its Declaration of Principles and state policies, the Constitution adopts the generally
accepted principles of international law as part of the law of the land, and adheres to the policy
of peace, equality, justice, freedom, cooperation and amity , with all nations. By the doctrine of
incorporation, the country is bound by generally accepted principles of international law, which
are considered automatically part of our own laws. Pacta sunt servanda international
agreements must be performed in good faith. A treaty is not a mere moral obligation but creates
a legally binding obligation on the parties.
Through WTO the sovereignty of the state cannot in fact and reality be considered as absolute
because it is a regulation of commercial relations among nations. Such as when Philippines
joined the United Nations (UN) it consented to restrict its sovereignty right under the concept of
sovereignty as autolimitation. What Senate did was a valid exercise of authority. As to
determine whether such exercise is wise, beneficial or viable is outside the realm of judicial
inquiry and review. The act of signing the said agreement is not a legislative restriction as WTO
allows withdrawal of membership should this be the political desire of a member. Also, it should
not be viewed as a limitation of economic sovereignty. WTO remains as the only viable structure
for multilateral trading and the veritable forum for the development of international trade law. Its
alternative is isolation, stagnation if not economic self-destruction. Thus, the people be allowed,
through their duly elected officers, make their free choice.
Petition is DISMISSED for lack of merit.

Cruz vs DENR, G.R. No. 135385, December 6, 2000

Isagani Cruz v. Dept. of Energy and Natural Resources,
G.R. No. 135385, December 6, 2000
FACTS: Cruz, a noted constitutionalist, assailed the validity of the RA 8371 or the Indigenous
Peoples Rights Act on the ground that the law amount to an unlawful deprivation of the States
ownership over lands of the public domain as well as minerals and other natural resources
therein, in violation of the regalian doctrine embodied in Section 2, Article XII of the Constitution.
The IPRA law basically enumerates the rights of the indigenous peoples over ancestral domains
which may include natural resources. Cruz et al content that, by providing for an allencompassing definition of ancestral domains and ancestral lands which might even include
private lands found within said areas, Sections 3(a) and 3(b) of said law violate the rights of
private landowners.

ISSUE: Whether or not the IPRA law is unconstitutional.

HELD: The SC deliberated upon the matter. After deliberation they voted and reached a 7-7
vote. They deliberated again and the same result transpired. Since there was no majority vote,
Cruzs petition was dismissed and the IPRA law was sustained. Hence, ancestral domains may
include natural resources somehow against the regalian doctrine.
CASE DIGEST
Rev. Ely Velez Pamatong Vs. Commission on Elections
G.R. No. 161872, April 13, 2004
FACTS:
Petitioner Pamatong filed his Certificate of Candidacy (COC) for President. Respondent
COMELEC declared petitioner and 35 others as nuisance candidates who could not wage a
nationwide campaign and/or are not nominated by a political party or are not supported by a
registered political party with a national constituency.
Pamatong filed a Petition For Writ of Certiorari with the Supreme Court claiming that the
COMELEC violated his right to "equal access to opportunities for public service" under Section
26, Article II of the 1987 Constitution, by limiting the number of qualified candidates only to
those who can afford to wage a nationwide campaign and/or are nominated by political parties.
The COMELEC supposedly erred in disqualifying him since he is the most qualified among all
the presidential candidates, i.e., he possesses all the constitutional and legal qualifications for
the office of the president, he is capable of waging a national campaign since he has numerous
national organizations under his leadership, he also has the capacity to wage an international
campaign since he has practiced law in other countries, and he has a platform of government.
ISSUE:
Is there a constitutional right to run for or hold public office?
RULING:
No. What is recognized in Section 26, Article II of the Constitution is merely a privilege subject to
limitations imposed by law. It neither bestows such a right nor elevates the privilege to the level
of an enforceable right. There is nothing in the plain language of the provision which suggests
such a thrust or justifies an interpretation of the sort.
The "equal access" provision is a subsumed part of Article II of the Constitution, entitled
"Declaration of Principles and State Policies." The provisions under the Article are generally
considered not self-executing, and there is no plausible reason for according a different
treatment to the "equal access" provision. Like the rest of the policies enumerated in Article II,

the provision does not contain any judicially enforceable constitutional right but merely specifies
a guideline for legislative or executive action. The disregard of the provision does not give rise
to any cause of action before the courts.
Obviously, the provision is not intended to compel the State to enact positive measures that
would accommodate as many people as possible into public office. Moreover, the provision as
written leaves much to be desired if it is to be regarded as the source of positive rights. It is
difficult to interpret the clause as operative in the absence of legislation since its effective means
and reach are not properly defined. Broadly written, the myriad of claims that can be subsumed
under this rubric appear to be entirely open-ended. Words and phrases such as "equal access,"
"opportunities," and "public service" are susceptible to countless interpretations owing to their
inherent impreciseness. Certainly, it was not the intention of the framers to inflict on the people
an operative but amorphous foundation from which innately unenforceable rights may be
sourced.
The privilege of equal access to opportunities to public office may be subjected to limitations.
Some valid limitations specifically on the privilege to seek elective office are found in the
provisions of the Omnibus Election Code on "Nuisance Candidates. As long as the limitations
apply to everybody equally without discrimination, however, the equal access clause is not
violated. Equality is not sacrificed as long as the burdens engendered by the limitations are
meant to be borne by any one who is minded to file a certificate of candidacy. In the case at bar,
there is no showing that any person is exempt from the limitations or the burdens which they
create.
The rationale behind the prohibition against nuisance candidates and the disqualification of
candidates who have not evinced a bona fide intention to run for office is easy to divine. The
State has a compelling interest to ensure that its electoral exercises are rational, objective, and
orderly. Towards this end, the State takes into account the practical considerations in conducting
elections. Inevitably, the greater the number of candidates, the greater the opportunities for
logistical confusion, not to mention the increased allocation of time and resources in preparation
for the election. The organization of an election with bona fide candidates standing is onerous
enough. To add into the mix candidates with no serious intentions or capabilities to run a viable
campaign would actually impair the electoral process. This is not to mention the candidacies
which are palpably ridiculous so as to constitute a one-note joke. The poll body would be
bogged by irrelevant minutiae covering every step of the electoral process, most probably posed
at the instance of these nuisance candidates. It would be a senseless sacrifice on the part of the
State.
The question of whether a candidate is a nuisance candidate or not is both legal and factual.
The basis of the factual determination is not before this Court. Thus, the remand of this case for
the reception of further evidence is in order. The SC remanded to the COMELEC for the
reception of further evidence, to determine the question on whether petitioner Elly Velez Lao
Pamatong is a nuisance candidate as contemplated in Section 69 of the Omnibus Election
Code.

Obiter Dictum: One of Pamatong's contentions was that he was an international lawyer and is
thus more qualified compared to the likes of Erap, who was only a high school dropout. Under
the Constitution (Article VII, Section 2), the only requirements are the following: (1) natural-born
citizen of the Philippines; (2) registered voter; (3) able to read and write; (4) at least forty years
of age on the day of the election; and (5) resident of the Philippines for at least ten years
immediately preceding such election.
At any rate, Pamatong was eventually declared a nuisance candidate and was disqualified.