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Before the Court of Industrial Relations a petition was filed in case No. 36-V entitled ―National Labor
Union, versus Metropolitan Transportation Service (Metran),‖ wherein petitioner alleged that it was a
legitimate labor organization, thirty of whose affiliated members were working and under the employ of
the respondent; that the respondent ―is a semi-governmental transportation entity, popularly known as
‗Metran,‘ and after several other allegations concluded with the prayer that its nine demands at length set
forth in said petition be granted. In behalf of the so-called respondent an oral petition for dismissal of the
case was made before the court on October 22, 1946. ―on the ground that the respondent belongs to the
Republic of the Philippines and as such, it cannot be sued‖
W/N METRAN can invoke the doctrine of immunity from suit
or Sec 3 of Art XVI of the 1987Constitution (The State may not be sued without its consent)
HELD: ―Upon the whole, we are clearly of opinion that the proceedings had in the Court of Industrial
Relations and now subject of this appeal are null and void [and] that the said court should be, as it is
hereby, enjoined from taking any further action in the case inconsistent with this decision.‖
RATIO: It is beyond dispute that the Metropolitan Transportation Service (Metran) is and was at the
times covered by the petition in the Court of Industrial Relations an office created by Executive Order No.
59and operating under the direct supervision and control of the Department of Public Works and
Communications. The said office not being a juridical person, any suit, action or proceeding against it, if it
were to produce any effect, would in practice be a suit, action or proceeding against the Government itself,
of which the said Metropolitan Transportation Service (Metran) is a mere office or agency. The Bureau of
Public Works under whose supervision the Metropolitan Transportation Service(Metran) has been
organized and functions in is an integral part of the government, just as the said office or agency. And
apart from the consideration that neither said Bureau nor said office has any juridical personality to be
sued for reasons already set forth, any suit or action attempted against either will necessarily be a suit or
action against the government itself In a republican state, like the Philippines, government immunity
from suit without its consent is derived from the will of the people themselves in freely creating a
government ―of the people, by the people, and for the people‖
Yes, the court held that Metran was a mere office or agency of the government,
unincorporated and possessing no juridical personality under the law, incapable of suing
or being sued and that a claim against it would in effect be a suit against the Government,
which suit may not prosper without the Government's consent.

2. THE HOLY SEE vs. THE HON. ERIBERTO U. ROSARIO, JR., as Presiding Judge of the
Regional Trial Court of Makati, Branch 61 and STARBRIGHT SALES ENTERPRISES, INC.
G.R. No. 101949 December 1, 1994
FACTS: A piece of real property was acquired by the Holy See by way of donation from the Archdiocese of
Manila. The purpose was to construct the official place of residence of the Papal Nuncio. Later, the Holy
See sold the property on condition that it will evict the squatters therein. For failure to comply with the
condition, the Holy See was sued. It moved to dismiss on the ground of state immunity.
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.
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‖ 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.

Whether the Holy See is immune from suit insofar as its business relations regarding selling a lot to a
private entity
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.
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.
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.
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.
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
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.
WHEREFORE, the petition for certiorari is GRANTED and the complaint in Civil Case No. 90-183 against
petitioner is DISMISSED.

Holy See vs. Rosario Jr.
238 SCRA 524
FACTS: A piece of real property was acquired by the Holy See by way of donation from the Archdiocese of
Manila. The purpose was to construct the official place of residence of the Papal Nuncio. Later, the Holy
See sold the property on condition that it will evict the squatters therein. For failure to comply with the
condition, the Holy See was sued. It moved to dismiss on the ground of state immunity.
ISSUE: Whether respondent trial court has jurisdiction over petitioner being a foreign state enjoying
sovereign immunity.
HELD: The Republic of the Philippines has accorded the Holy See the status if a foreign sovereign, the
Holy See, through its Ambassador, the Papal Nuncio, has had diplomatic representations with the
Philippine Government since 1957.
The privilege of sovereign immunity in this case was sufficiently established by the memorandum and
certification of the Department of Foreign Affairs. The DFA 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. 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.
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.

3.Sanders and Moreau, Jr. vs. Veridiano II
10 June 1988 G.R. No. L-56930
Rossi and Wyer were advised that their employment had been converted from permanent full-time to
permanent part-time. Their reaction was to protest this conversion and to institute grievance proceedings
conformably to the pertinent rules and regulations of the US DoD. Moreau sent to the Chief of Naval
Personnel explaining the change of employment status of the two from which Rossi and Wyer filed in the
Court of First Instance of Olongapo City a complaint for damages against the herein petitioners claiming
that the letters contained libellous imputations against the two. Due to the failure to appear in the court,
Moreau and Sanders were declared in default.
Whether the petitioners were performing their official duties when they did the acts for which they have
been sued for damages.
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 and had a hand in their
employment, work assignments, discipline, dismissal and other related matters. The same can be said for
Moreau. Given the official character of the above-described letters, it can be concluded that the
petitioners were being sued as officers of the United States government. 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.

4.Republic of the Philippines, petitioner, vs. Hon. Edilberto G. Sandoval, RTC of Manila,
Branch 9, Caylao et.alG. R. No. 84607, March 19, 2003
The doctrines of immunity of the government from suit is expressly provided in the Constitution under
Article XVI, Section 3. It is provided that the State may not be sued without its consent. Some instances
when a suit against the State is proper are: (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. With
respect to the incident that happened in Mendiola on January 22, 1987 that befell twelve rallyists, the the
case filed against the military officers was dismissed by the lower court. The defendants were held liable
but it would not result in financial responsibility to the government. The petitioner (CaylaoGroup) filed a
suit against the State that for them the State has waived its immunity when the Mendiola Commission
recommended the government to indemnify the victims of the Mendiola incident and the acts and
utterances of President Aquino which is sympathetic to the cause is indicative of State's waiver of
immunity and therefore, the government should also be liable and should be compensated by the
government . The case has been dismissed that State has not waived its immunity. On the other hand, the
Military Officer filed a petition for certiorari to review the orders of the Regional Trial Court, Branch 9.
Whether or not the State has waived its immunity from suit and therefore should the State be liable for
the incident?
No. The recommendation made by the Mendiola Commission regarding the indemnification of the heirs
of the deceased and the victims of the incident does not in any way mean liability automatically attaches
to the State. The purpose of which is to investigate of the disorders that took place and the
recommendation it makes cannot in any way bind the State. The acts and utterances of President Aquino
does not mean admission of the State of its liability. Moreover, the case does not qualify as suit against the
State. While the Republic in this case is sued by name, the ultimate liability does not pertain to the
government. The military officials are held liable for the damages for their official functions ceased the
moment they have exceeded to their authority. They were deployed to ensure that the rally would be
peaceful and orderly and should guarantee the safety of the people. The 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.‖ The court rules that there is no reversible error and no grave abuse of discretion committed by
the respondent Judge in issuing the questioned orders.
The Court held that there was no valid waiver of immunity as claimed by the petitioners. The
recommendation made by the Commission to indemnify the heirs of the deceased and the victims does
not in any way mean that liability attaches to the State. AO 11 merely states the purpose of the creation of
the Commission and, therefore, whatever is the finding of the Commission only serves as the basis for a
cause of action in the event any party decides to litigate the same. Thus, the recommendation of the
Commission does not in any way bind the State. The State cannot be made liable because the
military/police officers who allegedly were responsible for the death and injuries suffered by the marchers
acted beyond the scope of their authority. It is a settled rule that the State as a person can commit no
wrong. The military and police officers who were responsible for the atrocities can be held personally
liable for damages as they exceeded their authority, hence, the acts cannot be considered official.
G.R. No. L-5156 March 11, 1954

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 and caused an irrigation canal to be constructed on the portion of the three parcels of
land on to the damage and prejudice of the plaintiff.

Whether or not this is a suit against the state.

No, the evidence and conceded facts 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 and usefulness, he must be
held to have designedly departed from the duties imposed on him by law. Ordinarily the officer or
employee committing the tort is personally liable therefore, and may be sued as any other citizen and held
answerable for whatever injury or damage results from his tortuous act.

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.

ART. 32. Any public officer or employee, 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:
(6) The right against deprivation of property without due process of law;
6.USA vs. GUINTO, 182 SCRA 644 Case Digest
These are cases that have been consolidated because they all involve the doctrine of state
immunity. The United States of America was not impleaded in the case at bar but has moved to dismiss on
the ground that they are in effect suits against it to which it has not consented.


1. USA vs GUINTO (GR No. 76607)
The private respondents are suing several officers of the US Air Force in Clark Air Base in connection
with the bidding conducted by them for contracts for barber services in the said base, which was won by
Dizon. The respondents wanted to cancel the award because they claimed that Dizon had included in his
bid an area not included in the invitation to bid, and also, to conduct a rebidding.

2. USA vs RODRIGO (GR No. 79470)
Genove filed a complaint for damages for his dismissal as cook in the US Air Force Recreation Center
at Camp John Hay Air Station. It had been ascertained after investigation that Genove had poured urine
into the soup stock used in cooking the vegetables served to the club customers. The club manager
suspended him and thereafter referred the case to a board of arbitrators, which unanimously found him
guilty and recommended his dismissal.

3. USA vs CEBALLOS (GR No. 80018)
Bautista, a barracks boy in Camp O‘ Donnell, was arrested following a buy-bust operation conducted
by petitioners, who were USAF officers and special agents of the Air Force Office. An information was
filed against Bautista and at the trial, petitioners testified against him. As a result of the charge, Bautista
was dismissed from his employment. He then filed for damages against petitioners claiming that it was
because of the latter‘s acts that he lost his job.

4. USA vs VERGARA (GR No. 80258)
A complaint for damages was filed by private respondents against petitioners (US military officers) for
injuries allegedly sustained by the former when defendants beat them up, handcuffed them and unleashed
dogs on them. The petitioners deny this and claim that respondents were arrested for theft but resisted
arrest, thus incurring the injuries.

ISSUE:Whether or not the defendants were immune from suit under the RP-US Bases Treaty for acts
done by them in the performance of their official duties.


The rule that a State may not be sued without its consent is one of the generally accepted
principles of international law that were have adopted as part of the law of our land. Even without such
affirmation, we would still be bound by the generally accepted principles of international law under the
doctrine of incorporation. Under this doctrine, as accepted by the majority of the states, such principles
are deemed incorporated in the law of every civilized state as a condition and consequence of its
membership in the society of nations. All states are sovereign equals and cannot assert jurisdiction over
one another. While the doctrine appears to prohibit only suits against the state without its consent, it is
also applicable to complaints filed against officials of the states for acts allegedly performed by them in the
discharge of their duties. The rule is that if the judgment against such officials will require the state itself
to perform an affirmative act to satisfy the same, the suit must be regarded as against the state although it
has not been formally impleaded. When the government enters into a contract, it is deemed to have
descended to the level of the other contracting party and divested of its sovereign immunity from suit with
its implied consent.

It bears stressing at this point that the aforesaid principle do not confer on the USA a blanket
immunity for all acts done by it or its agents in the Philippines. Neither may the other petitioners claim
that they are also insulated from suit in this country merely because they have acted as agents of the
United States in the discharge of their official functions.

There is no question that the USA, 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 (commercial
acts/jure gestionis). It is only when the contract involves its sovereign or governmental capacity
(governmental acts/jure imperii) that no such waiver may be implied.

In US vs GUINTO, the court finds the barbershops subject to the concessions granted by the US
government to be commercial enterprises operated by private persons. The Court would have directly
resolved the claims against the defendants as in USA vs RODRIGO, except for the paucity of the record as
the evidence of the alleged irregularity in the grant of the barbershop concessions were not available.
Accordingly, this case was remanded to the court below for further proceedings.

In US vs RODRIGO, the restaurant services offered at the John Hay Air Station partake of the
nature of a business enterprise undertaken by the US government in its proprietary capacity, as they were
operated for profit, as a commercial and not a governmental activity. Not even the US government can
claim such immunity because by entering into the employment contract with Genove in the discharge of
its proprietary functions, it impliedly divested itself of its sovereign immunity from suit. But, the court
still dismissed the complaint against petitioners on the ground that there was nothing arbitrary about the
proceedings in the dismissal of Genove, as the petitioners acted quite properly in terminating Genove‘s
employment for his unbelievably nauseating act.

In US vs CEBALLOS, it was clear that the petitioners were acting in the exercise of their official
functions when they conducted the buy-bust operation and thereafter testified against the
complainant. For discharging their duties as agents of the United States, they cannot be directly
impleaded for acts imputable to their principal, which has not given its consent to be sued.

In US vs VERGARA, the contradictory factual allegations in this case need a closer study of what
actually happened. The record was too meager to indicate if the defendants were really discharging their
official duties or had actually exceeded their authority when the incident occurred.The needed inquiry
must first be made by the lower court so it may assess and resolve the conflicting claims of the parties.
2. Jure Gestionis – by right of economic or business relations, may be sued. (US vs Guinto)

Jure Imperii – by right of sovereign power, in the exercise of sovereign functions. No implied
consent. (US v. Ruiz, 136 SCRA 487)

34 Phil 311 – Civil Law – Torts and Damages – Liability of the State for acts of special agents
Political Law – Non-Suability of the State – Waiver of Non-Suability is Not Admission of Liability
The facts of the case took place in the 1910‘s. E. Merritt was a constructor who was excellent at his work.
One day, while he was riding his motorcycle along Calle Padre Faura, he was bumped by a government
ambulance. The driver of the ambulance was proven to have been negligent. Because of the incident,
Merritt was hospitalized and he was severely injured beyond rehabilitation so much so that he could never
perform his job the way he used to and that he cannot even earn at least half of what he used to earn.
In order for Merritt to recover damages, he sought to sue the government which later authorized Merritt
to sue the government by virtue of Act 2457 enacted by the legislature (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). The lower court then determined the amount of damages and ordered the
government to pay the same.
ISSUE: Whether or not the government is liable for the negligent act of the driver of the ambulance.
HELD: No. 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. 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. The State can only be
liable if 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.
In the case at bar, the ambulance driver was not a special agent nor was a government officer acting as a
special agent hence, there can be no liability from the government. ―The Government 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.‖

8.Amigable vs Cuenca
G.R. No. L-26400 43 SCRA 360 February 29, 1972
Petitioner: Victoria Amigable
Respondent: Nicolas Cuenca, as Commissioner of Public Highways and the Republic of the Philippines
FACTS: Victoria Amigable rightfully owned a lot in Cebu City which was used by the government for
Mango and Gorordo Avenues without her permission and without proper negotiation of sales. Because of
this, she filed a case in CFI Cebu.
Defendants argue that 1) Action was premature; 2) Right of action has already been prescribed; 3)
Government cannot be sued without its consent and; 4) Cebu already agreed to use the land as such.
CFI rendered a decision which states that Amigable cannot restore and recover her ownership and
possession of the said land and thus dismissed the complaint on grounds that state may not be sued
without its consent.
ISSUE: Whether or not petitioner Amigable may rightfully sue the government without its consent.
HELD: In the case of Ministerio vs Court of First Instance of Cebu, it was held that when 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 violating the doctrine of governmental immunity from suit without its consent.
In the case at bar, since no annotation in favor of the government appears at the back of the certificate of
title and plaintiff has not executed any deed of conveyance of any portion of the lot to the government,
then she remains as the rightful owner of the lot.
She could then bring an action to recover possession of the land anytime, because possession is one of the
attributes of ownership. However, since such action is not feasible at this time since the lot has been used
for other purposes, the only relief left is for the government to make due compensation of the exact
amount, price or value of the lot at the time of the taking.
Petition is partly GRANTED.
9. Republic v. Feliciano
FACTS: Petitioner seeks the review of the decision of the Intermediate Appellate Court dated April 30,
1985 reversing the order of the Court of First Instance of Camarines Sur, Branch VI, dated August 21,
1980, which dismissed the complaint of respondent Pablo Feliciano for recovery of ownership and
possession of a parcel of land on the ground of non-suability of the State. On January 22, 1970, Feliciano
filed a complaint with the then Court of First Instance of Camarines Sur against the RP,represented by the
Land Authority, for the recovery of ownership and possession of a parcel of land, consisting of four (4)lots
with an aggregate area of 1,364.4177 hectares, situated in the Barrio of Salvacion, Municipality of
Tinambac, Camarines Sur. Feliciano alleged that he bought the property in question from Victor Gardiola
by virtue of a Contract of Sale dated May 31, 1952, followed by a Deed of Absolute Sale on October 30,
1954; that Gardiola had acquired the property by purchase from the heirs of Francisco Abrazado whose
title to the said property was evidenced by an informacion posesoria that upon his purchase of the
property, he took actual possession of the same, introduced various improvements therein and caused it
to be surveyed in July 1952, which survey was approved by the Director of Lands onOctober 24, 1954.On
November 1, 1954, President Ramon Magsaysay issued Proclamation No. 90 reserving for settlement
purposes, under the administration of the National Resettlement and Rehabilitation Administration
(NARRA), a tract of land situated in the Municipalities of Tinambac and Siruma, Camarines Sur, after
which the NARRA and its successor agency, the Land Authority, started sub-dividing and distributing the
land to the settlers; that the property in question, while located within the reservation established under
Proclamation No. 90, was the private property of Feliciano and should therefore be excluded therefrom.
Feliciano prayed that he be declared the rightful and true owner of the property in question consisting of
1,364.4177 hectares; that his title of ownership based on informacion posesoria of his predecessor-in-
interest be declared legal valid and subsisting and that defendant be ordered to cancel and nullify all
awards to the settlers.
WON the State can be sued for recovery and possession of a parcel of land
A suit against the State, under settled jurisprudence is not permitted, except upon a showing that the
State has consented to be sued, either expressly or by implication through the use of statutory language
too plain to be misinterpreted. It may be invoked by the courts sua sponte at any stage of the proceedings.
Waiver of immunity, being a derogation of sovereignty, will not be inferred lightly. but must be construed
in strictissimi juris (of strictest right). Moreover, the Proclamation is not a legislative act. The consent of
the State to be sued must emanate from statutory authority. Waiver of State immunity can only be made
by an act of the legislative body.
10.US Vs. Ruiz 136 SCRA 487
The usa had a naval base in subic, zambales. The base was one of those provided in the military bases
agreement between phils. and the US. Respondent alleges that it won in the bidding conducted by the US
for the constrcution of wharves in said base that was merely awarded to another group. For this reason, a
suit for specific preformance was filed by him against the US.
Issue: Whether the US naval base in bidding for said contracts exercise governmental functions to be
able to invoke state immunity.

The traditional role of the state immunity exempts a state from being sued in the courts of another state
without its consent or waiver. This rule is necessary consequence of the principle of independence and
equality of states. However, the rules of international law are not petrified; they are continually and
evolving and because the activities of states have multiplied. It has been necessary to distinguish them
between sovereign and governmental acts and private, commercial and proprietary acts. The result is that
state immunity now extends only to sovereign and governmental acts.
The restrictive application of state immunity is proper only when the proceedings arise out of commercial
transactions of the foreign sovereign. Its commercial activities of economic affairs. A state may be
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 contracts relates the exercise of
its sovereign function. In this case, the project are integral part of the naval base which is devoted to the
defense of both US and phils., indisputably, a function of the government of highest order, they are not
utilized for , nor dedicated to commercial or business purposes.
G.R. No. L-30671 November 28, 1973
Facts: On July 7, 1969, a decision was rendered in Special Proceedings No. 2156-R infavor of
respondents P.J. Kiener Co., Ltd., Gavino Unchuan, and International Construction Corporation and
against petitioner confirming the arbitration award in the amount of P1,712,396.40.The award is for the
satisfaction of a judgment against the Phlippine Government. On June 24, 1969, respondent Honorable
Guillermo Villasor issued an Order declaring the decision final and executory. Villasor directed the
Sheriffs of Rizal Province, Quezon City as well as Manilato execute said decision. The Provincial Sheriff of
Rizal served Notices of Garnishment with several Banks, specially on Philippine Veterans Bank and PNB.
The funds of the Armed Forces of the Philippines on deposit with Philippine Veterans Bank and PNB are
public funds duly appropriated and allocated for the payment of pensions of retirees, pay and allowances
of military and civilian personnel and for maintenance and operations of the AFP. Petitioner, on
certiorari, filed prohibition proceedings against respondent Judge Villasor for acting in excess of
jurisdiction with grave abuse of discretion amounting to lack of jurisdiction in granting the issuance of a
Writ of Execution against the properties of the AFP, hence the notices and garnishment are null and void.
Issue: Is the Writ of Execution issued by Judge Villasor valid?
Held: What was done by respondent Judge is not in conformity with the dictates of the Constitution. It is
a fundamental postulate of constitutionalism flowing from the juristic concept of sovereignty that the
state as well as its government is immune from suitunless it gives its consent. A sovereign is exempt
from suit, not because of any formal conception or obsolete theory, but on the logical and
practical ground that there can be no legal right as against the authority that makes the law
on which the right depends. The State may not be sued without its consent. A corollary, both dictated
by logic and sound sense from a basic concept is that public funds cannot be the object of a garnishment
proceeding even if the consent to be sued had been previously granted and the state liability adjudged.
The universal rule that where the State gives its consent tobe sued by private parties either by general or
special law, it may limit claimant‘s action only up to the completion of proceedings anterior to the stage of
execution and that the power of the Courts ends when the judgment is rendered, since the government
funds and properties may not be seized under writs of execution or garnishment to satisfy such
judgments, is based on obvious considerations of public policy. Disbursements of public funds must be
covered by the corresponding appropriation as required by law. The functions and public services
rendered by the State cannot be allowed to be paralyzed or disrupted by the diversion of public funds from
their legitimate and specific objects, as appropriated by law.

12 Department of Agriculture vs. NLRC G.R. No. 104269, November 11, 1993
Facts: Petitioner Department of Agriculture (DA) and Sultan Security Agency entered into a contract for
security services to be provided by the latter to the said governmental entity. Pursuant to their
arrangements, guards were deployed by Sultan Security Agency in the various premises of the DA.
Thereafter, several guards filed a complaint for underpayment of wages, nonpayment of 13th month pay,
uniform allowances, night shift differential pay, holiday pay, and overtime pay, as well as for damages
against the DA and the security agency.
The Labor Arbiter rendered a decision finding the DA jointly and severally liable with the security agency
for the payment of money claims of the complainant security guards. The DA and the security agency did
not appeal the decision. Thus, the decision became final and executory. The Labor Arbiter issued a writ of
execution to enforce and execute the judgment against the property of the DA and the security agency.
Thereafter, the City Sheriff levied on execution the motor vehicles of the DA.
Issue: Whether or not the doctrine of non-suability of the State applies in the case
Held: The basic postulate enshrined in the Constitution that ―the State may not be sued without its
consent‖ reflects nothing less than a recognition of the sovereign character of the State and an express
affirmation of the unwritten rule effectively insulating it from the jurisdiction of courts. It is based on the
very essence of sovereignty. A sovereign is exempt from suit based on the logical and practical ground that
there can be no legal right as against the authority that makes the law on which the right depends.
The rule is not really absolute for it does not say that the State may not be sued under any circumstances.
The State may at times be sued. The State‘s consent may be given expressly or impliedly. Express consent
may be made through a general law or a special law. Implied consent, on the other hand, is conceded
when the State itself commences litigation, thus opening itself to a counterclaim, or when it enters into a
contract. In this situation, the government is deemed to have descended to the level of the other
contracting party and to have divested itself of its sovereign immunity.
But not all contracts entered into by the government operate as a waiver of its non-suability; distinction
must still be made between one which is executed in the exercise of its sovereign function and another
which is done in its proprietary capacity. A State may be said to have descended to the level of an
individual and can this be deemed to have actually 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.
In the case, the DA has not pretended to have assumed a capacity apart from its being a governmental
entity when it entered into the questioned contract; nor that it could have, in fact, performed any act
proprietary in character.
But, be that as it may, the claims of the complainant security guards clearly constitute money claims. Act
No. 3083 gives the consent of the State to be sued upon any moneyed claim involving liability arising from
contract, express or implied. Pursuant, however, to Commonwealth Act 327, as amended by PD 1145, the
money claim must first be brought to the Commission on Audit.
13. PNB VS JUDGE JAVIER PABALAN 83 SCRA 595 – Political Law – Constitutional Law –
Immunity of the State from Suit
On December 17, 1970, Judge Javier Pabalan issued a writ of execution followed thereafter by a notice of
garnishment on the funds of Philippine Virginia Tobacco Administration (PVTA) in the sum of P12,724.66
deposited with the Philippine National Bank in La Union. PNB La Union filed an administrative
complaint against Pabalan for grave abuse of discretion, alleging that the latter failed to recognize that the
questioned funds are of public character and therefore may not be garnished, attached, nor may be levied
upon. The PNB La Union Branch invoked the doctrine of non suability, putting a bar on the notice of
ISSUE: Whether or not PNB may be sued.
HELD: Yes. Funds of public corporations which can sue and be sued are not exempt from garnishment.
PVTA is also a public corporation with the same attributes, a similar outcome is attributed. The
government has entered with them into a commercial business hence it has abandoned its sovereign
capacity and has stepped down to the level of a corporation. Therefore, it is subject to rules governing
ordinary corporations and in effect can be sued. Therefore, the petition of PNB La Union is denied.
1.During the height of typhoon Kading , the National Power Corporation‘s plant superintendent Chavez
opened simultaneously all the three floodgates of the Angat Dam.
2.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.
3.The petitioners, who are among the unfortunate victims of the man-caused flood, filed several
complaints for damages against NPC and the plant superintendent.
4.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.
5.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.
15 G.R. No. L-23139 December 17,1966MOBIL PHILIPPINESEXPLORATION, INC.
FACTS: Four cases of rotary drill parts were shipped from abroad on S.S. "Leoville" consigned to Mobil
Philippines Exploration, Inc., Manila. It was discharged to the custody of the Customs Arrastre Service,
the unit of the Bureau of Customs then handling arrastre operations therein. The Customs Arrastre
Service later delivered to the broker of the consignee three cases only. Petitioner filed suit in the Court of
First Instance of Manila against the Customs Arrastre Service and the Bureau of Customs to recover the
value of the undelivered case plus other damages. The respondents filed a motion to dismiss on the
ground that not being persons under the law, they cannot be sued.
ISSUE: WON the defendants can invoke state immunity.
HELD: YES. Now, the fact that a non-corporate government entity performs a function proprietary in
nature does not necessarily result in its being suable. If said non-governmental function is undertaken as
an incident to its governmental function, there is no waiver thereby of the sovereign immunity from suit
extended to such government entity. The Bureau of Customs, to repeat, is part of the Department of
Finance with no personality of its own apart from that of the national government. Its primary function is
governmental, that of assessing and collecting lawful revenues from imported articles and all other tariff
and customs duties, fees, charges, fines and penalties. To this function, arrastre service is a necessary
Facts: A collision occurred involving a passenger jeepney owned by the Estate of MacarioNieveras, a
gravel and sand truck owned by Tanquilino Velasquez and a dump truck of the Municipality of San
Fernando, La Union and driven by Alfredo Bislig. Dueto the impact, several passengers of the jeepney
including Laureano Baniña Sr. died as a result of the injuries they sustained and four (4) others suffered
varying degrees of physical injuries. On December 11, 1966, the private respondents instituted a compliant
for damages against the Estate of Macario Nieveras and Bernardo Balagot, owner and driver, respectively,
of the passenger jeepney. However, the aforesaid defendants filed a Third Party Complaint against the
petitioner and the driver of a dump truck of petitioner. Petitioner filed its answer and raised affirmative
defenses such as lack of cause of action, non-suability of the State, prescription of cause of action and the
negligence of the owner and driver of the passenger jeepney as the proximate cause of the collision.
Respondent Judge Romeo N. Firme ordered defendants Municipality of San Fernando, La Union and
Alfredo Bislig to pay, jointly and severally, the plaintiffs for funeral expenses. Private respondents stress
that petitioner has not considered that every court, including respondent court, has the inherent power to
amend and control its process and orders so as to make them conformable to law and justice.
Whether or not the respondent court committed grave abuse of discretion whenit deferred and failed to
resolve the defense of non-suability of the State amounting tolack of jurisdiction in a motion to dismiss.
Non-suability of the state.
The doctrine of non-suability of the State is expressly provided for in Article XVI, Section 3 of the
Constitution, to wit: "the State may not be sued without its consent. "Consent takes the form of express or
implied consent. Municipal corporations, for example, like provinces and cities, are agencies of the State
when they are engaged in governmental functions and therefore should enjoy the sovereign immunity
from suit. Nevertheless, they are subject to suit even in the performance of such functions because their
charter provided that they can sue and be sued. "Suability depends on the consent of the state to be sued,
liability on the applicable law and the established facts. The circumstance that a state is suable does not
necessarily mean that it is liable; on the other hand, it can never be held liable if it does not first consent
to be sued. Liability is not conceded by the mere fact that the state has allowed itself to be sued. When the
state does waive its sovereign immunity, it is only giving the plaintiff the chance to prove, if it can, that the
defendant is liable. "Anent the issue of whether or not the municipality is liable for the torts committed by
its employee, the test of liability of the municipality depends on whether or not the driver, acting in behalf
of the municipality, is performing governmental or proprietary functions. Dual capacity of LGU.
Municipal corporations exist in a dual capacity, and their functions are twofold. In one they exercise the
right springing from sovereignty, and while in the performance of the duties pertaining thereto, their acts
are political and governmental. Their officers and agents in such capacity, though elected or appointed by
them, are nevertheless public functionaries performing a public service, and as such they are officers,
agents, and servants of the state. In the other capacity the municipalities exercise a private, proprietary or
corporate right, arising from their existence as legal persons and not as public agencies. Their officers and
agents in the performance of such functions act in behalf of the municipalities in their corporate or
individual capacity, and not for the state or sovereign power. "It has already been remarked that
municipal corporations are suable because their charters grant them the competence to sue and be sued.
Nevertheless, they are generally not liable for torts committed by them in the discharge of governmental
functions and can be held answerable only if it can be shown that they were acting in a proprietary
capacity. In the case at bar, the driver of the dump truck of the municipality insists that "he was on his
way to the Naguilian river to get a load of sand and gravel for the repair of San Fernando's municipal
streets. "In the absence of any evidence to the contrary, the regularity of the performance of official duty is
presumed pursuant to Section 3(m) of Rule 131 of the Revised Rules of Court. Hence, We rule that the
driver of the dump truck was performing duties ortasks pertaining to his office. We already stressed in the
case of Palafox, vs. Province of Ilocos Norte, the District Engineer, and the Provincial Treasurer (102
Phil 1186) that "the construction or maintenance of roads in which the truck and the driver worked at the
time of the accident are admittedly governmental activities. "After a careful examination of existing laws
and jurisprudence, We arrive at the conclusion that the municipality cannot be held liable for the torts
committed by its regular employee, who was then engaged in the discharge of governmental functions.

Municipality of San Miguel, Bulacan v. Fernandez
No. L-61744 June 25, 1984


In Civil Case No. 604-B, entitled "Margarita D. Vda. De Imperio, et al. v. Municipal Government of San
Miguel, Bulacan, et al." dated April 28, 1978, under presiding Judge Oscar C. Fernandez, rendered
judgement in favour of the plaintiffs and against the defendant Municipal Government of San Miguel,
Bulacan, represented by Mayor Mar Marcelo G. Aure and its Municipal Treasurer. The court ordered the
defendant municipality to pay the plaintiffs the sum of Php64,440.00 corresponding to the rentals
collected from the tenants from 1970 up to and including 1975 plus interest thereon at the legal rate from
January 1970 until fully paid. In addition to this, the defendant municipality must pay the plaintiffs the
sum of Php3,000.00 for attorney's fees and to pay the cost of suit. Thereafter, the private respondents
moved for issuance of the writ of execution for the satisfaction of the said judgement, however, petitioner,
on July 30, 1982, filed a Motion to Quash the writ of execution on the ground that the municipality's
property or funds are all public funds exempt from execution. The said Motion was then denied by the
respondent judge in an order dated August 23, 1982 and the writ of execution still stands in full force and


Whether or not the funds of the Municipality of San Miguel, Bulacan, in the possession of the provincial
and municipal treasurers of Bulacan and San Miguel, respectively, are public funds which are exempt
from execution for the satisfaction of the money judgement in Civil Case No. 604-B.


Yes, all the funds of the municipality in the possession of the Municipal Treasurer of San Miguel and of
Bulacan, are public funds which are exempt from execution as stated under Presidential Decree No. 477,
"The Decree on Local Fiscal Administration", Section 2, paragraph (a): No money shall be paid out of the
treasury except in pursuance of a lawful appropriation or other specific statutory authority. Furthermore,
there must be an ordinance duly passed by the Sangguniang Bayan containing the corresponding
appropriation for the funds before any money of the municipality may be paid out.

Unlike the State which has the immunity of not being sued without its consent, A municipal corporation is
an example of an incorporated agency which has a charter of its own that grants them the competence to
sue and be sued. However, municipal government is generally not liable for torts committed during the
discharge of its governmental functions. It can be held liable only if it has been proven that they were
acting in a proprietary function. Failing to do this, the claimant cannot recover.
No. 154705. June 26, 2003]
FACTS: Petitioner Vinzon entered into a Maintenance Agreement with respondent. The maintenance
agreement includes the following specific equipments: air conditioning units, generator sets, electrical
facilities, water heaters and water motor pumps. The agreement shall be effective for 4 years.

The new Minister Counsellor allegedly found respondent's work and services unsatisfactory and not in
compliance with the standards set in the Agreement. The respondent terminated the agreement with the
respondent. The latter claim that it was unlawful and arbitrary. Respondent filed a Motion to Dismiss
alleging that the Republic of Indonesia, as a foreign state, has sovereign immunity from suit and cannot
be sued as party-defendant in the Philippines.

ISSUE: W/N the CA erred in sustaining the trial court's decision that petitioners have waived their
immunity from suit by using as its basis the provision in the Maintenance Agreement.

HELD: The mere entering into a contract by a foreign state with a private party cannot be construed as
the ultimate test of whether or not it is an act juri imperii or juri gestionis. Such act is only the start of the
inquiry. There is no dispute that the establishment of a diplomatic mission is an act juri imperii. The state
may enter into contracts with private entities to maintain the premises, furnishings and equipment of the
embassy. The Republic of Indonesia is acting in pursuit of a sovereign activity when it entered into a
contract with the respondent. The maintenance agreement was entered into by the Republic of Indonesia
in the discharge of its governmental functions. It cannot be deemed to have waived its immunity from suit.