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Rayo vs CFI of Bulacan

Rayo vs CFI of Bulacan

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Published by kerstinilagan

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Published by: kerstinilagan on Aug 06, 2010
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07/30/2013

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CONSTI1 | Kaye

RAYO vs. CFI of BULACAN
Facts:

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During the height of typhoon Kading, the National Power Corporation’s plant superintendent Chavez opened simultaneously all the three floodgates of the Angat Dam. As a direct and immediate result, several towns in Bulacan were flooded (particularly Norzagaray). About a hundred of its residents died and properties worth million of pesos were destroyed. The petitioners, who are among the unfortunate victims of the man-caused flood, filed several complaints for damages against NPC and the plant superintendent. NPC claimed, as its defense, that in the operation of the Angat Dam, it is performing a purely governmental function. Thus, it cannot be sued without the express consent of the State. The petitioners opposed the claim of NPC and claimed that it is performing not governmental but merely proprietary functions and that based on the organic charter (charter - a legal document that provides for the creation of a corporate entity) of NPC, it can be sued and be sued in any court.

Issue: Whether or not the power of NPC to sue and be sued under its organic charter includes the power to be sued for tort. Held: The government has organized a private corporation, put money in it and has allowed it to sue and be sued in any court under its charter. NPC, as a government owned and controlled corporation, has a personality of its own, distinct and separate from that of the Government. In any court, NPC can sue and be sued for tort. The petition of the petitioners was granted. Notes: Government-owned and controlled corporations have a personality of their own, separate and distinct from the government. Therefore, although they are considered to be public in character, they are not exempt from garnishment (legal proceedings).

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