The Holy See, petitioner, vs. The Hon. Eriberto U. Rosario, JR.

as
Presiding Judge of the Regional Trail Court of Makati, Branch 61 and
Starbright Sales Enterprises, INC. respondents
G.R. No. 101949. December 1, 1994.
QUIASON, J.:
FACTS:
On, April 17, 1988, Msgr. Cirilos, Jr., on behalf of petitioner(also
agent of the sellers) and the Philippine Realty Corporation (PRC),
agreed to sell to Ramon Licup lots in Paraaque registered in the name
of petitioner. The agreement was to sell was made on the condition
that earnest money of Php 100,000.00 be paid by Licup to the sellers,
and that the sellers clear the said lots of squatters who where then
occupying the said lots. Licup paid and assigned his rights over the
property to private respondent, Starbright Sales Enterprises, Inc.
Thereafter, private respondent demanded that the sellers clear
the property of squatter, Msgr. Cirilos informed them that the
squatters refuse to and propose instead either that private respondent
undertake the eviction or that the earnest money be returned. The
private respondent counter proposed and said that if they would
undertake the eviction the purchase price must be reduced. Msgr.
Cirilos returned the earnest money and wrote private respondent
giving it seven days from receipt of the letter to pay the original
purchase price in cash. Private respondent sent back the money but
later found out that on March 30, 1989, petitioner and the PRC, without
notice sold the lots to Topicana.
Respondent then filed a petition praying for the annulment of the
Deeds of Sale, reconveyance of the lots, specific performance of the
agreement and payment for damages. Petitioner moved to dismiss the
claim and invoked sovereign immunity from suit. Respondent on
opposed this and said that it shed off its sovereign immunity by
entering into the business contract in question. And correspondingly,
petitioner moved for reconsideration
On October 1, 1991, trial court deferred the motion, then
petitioner elevated the matter to the Supreme Court. On,December 9,
1991, the Department of Foreign Affairs filed a Motion for Intervention.
ISSUE:
Whether or not the Holy See can invoke sovereign immunity despite it
entering into a commercial contract?
HELD:
Yes, the Holy See can still invoke sovereign immunity. Under the
Section 2 of Article II of the 1987 Constitution, the Philippines have
adopted the generally accepted principles of International Law and the

Philippines has accorded the Holy See the status of a foreign

sovereign.