REPUBLIC OF INDONESIA vs. JAMES VINZON [G.R. 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.

KHOSROW MINUCHER, petitioner, vs. HON. COURT OF APPEALS and

ARTHUR SCALZO, respondents

FACTS:
Khosrow Minucher, an Iranian national and a Labor Attach for the Iranian
Embassies in Tokyo, Japan and Manila came to the country to study in 1974
and continued to stay as head of the Iranian National Resistance Movement.
In May 1986, Minucher was charged with an Information for violation of
Republic Act No. 6425, Dangerous Drugs Act of 1972. The criminal charge
followed a buy-bust operation conducted by the Philippine police
narcotic agents in his house where a quantity of heroin was said to have
been seized. The narcotic agents were accompanied by private respondent
Arthur Scalzo who became one of the principal witnesses for the
prosecution.
In August 1988, Minucher filed Civil Case before the Regional Trial Court
(RTC) for damages on the trumped-up charges of drug trafficking made by
Arthur Scalzo.

ISSUE:
WON private respondent Arthur Scalzo can be sued provided his alleged
diplomatic immunity conformably with the Vienna Convention on
Diplomatic Relations

RULING:
The SC DENIED the petition.
Conformably with the Vienna Convention, the functions of the diplomatic
mission involve, the representation of the interests of the sending state and
promoting friendly relations with the receiving state. Only diplomatic
agents, are vested with blanket diplomatic immunity from civil and
criminal suits. Indeed, the main yardstick in ascertaining whether a person
is a diplomat entitled to immunity is the determination of whether or not
he performs duties of diplomatic nature. Being an Attache, Scalzos main
function is to observe, analyze and interpret trends and developments in
their respective fields in the host country and submit reports to their own
ministries or departments in the home government. He is not generally
regarded as a member of the diplomatic mission. On the basis of an
erroneous assumption that simply because of the diplomatic note, divesting
the trial court of jurisdiction over his person, his diplomatic immunity is
contentious.
Under the related doctrine of State Immunity from Suit, the precept that a
State cannot be sued in the courts of a foreign state is a long-standing rule
of customary international law. If the acts giving rise to a suit are those of
a foreign government done by its foreign agent, although not necessarily a
diplomatic personage, but acting in his official capacity, the complaint
could be barred by the immunity of the foreign sovereign from suit without
its consent. Suing a representative of a state is believed to be, in effect,
suing the state itself. The proscription is not accorded for the benefit of an
individual but for the State, in whose service he is, under the maxim par
in parem, non habet imperium that all states are sovereign equals and
cannot assert jurisdiction over one another. The implication is that if the
judgment against an official would require the state itself to perform an
affirmative act to satisfy the award, such as the appropriation of the
amount needed to pay the damages decreed against him, the suit must be
regarded as being against the state itself, although it has not been formally
impleaded
A foreign agent, operating within a territory, can be cloaked with immunity
from suit but only as long as it can be established that he is acting within
the directives of the sending state. The consent of the host state is an
indispensable requirement of basic courtesy between the two sovereigns.
The buy-bust operation and other such acts are indication that the
Philippine government has given its imprimatur, if not consent, to the
activities within Philippine territory of agent Scalzo of the United States
Drug Enforcement Agency. In conducting surveillance activities on Minucher,
later acting as the poseur-buyer during the buy-bust operation, and then
becoming a principal witness in the criminal case against Minucher, Scalzo
hardly can be said to have acted beyond the scope of his official function or
duties.

HOLY SEE VS. ROSARIO

MARCH 28, 2013 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: Petitioner is the Holy See who exercises sovereignty over the
Vatican City in Rome, Italy, and is represented in the Philippines by the
Papal Nuncio; Private respondent, Starbright Sales Enterprises, Inc., is a
domestic corporation engaged in the real estate business.
This petition arose from a controversy over a parcel of land consisting of
6,000 square meters located in the Municipality of Paranaque registered in
the name of petitioner. Said lot was contiguous with two other lots
registered in the name of the Philippine Realty Corporation (PRC).
The three lots were sold to Ramon Licup, through Msgr. Domingo A. Cirilos,
Jr., acting as agent to the sellers. Later, Licup assigned his rights to the sale
to private respondent.
In view of the refusal of the squatters to vacate the lots sold to private
respondent, a dispute arose as to who of the parties has the responsibility
of evicting and clearing the land of squatters. Complicating the relations of
the parties was the sale by petitioner of Lot 5-A to Tropicana Properties and
Development Corporation (Tropicana).
private respondent filed a complaint with the Regional Trial Court, Branch
61, Makati, Metro Manila for annulment of the sale of the three parcels of
land, and specific performance and damages against petitioner,
represented by the Papal Nuncio, and three other defendants: namely,
Msgr. Domingo A. Cirilos, Jr., the PRC and Tropicana
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, petitioners 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.
ISSUE:
Whether the Holy See is immune from suit insofar as its business relations
regarding selling a lot to a private entity
RULING:
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

UNITED STATES VS RUIZ

En Banc
Doctrine: implied consent

Facts: At times material to this case, the United States of America had a
naval base in Subic, Zambales. The base was one of those provided in the
Military Bases Agreement between the Philippines and the United States.
US invited the submission of bids for Repair offender system and Repair
typhoon damages. Eligio de Guzman & Co., Inc. responded to the
invitation, submitted bids and complied with the requests based on the
letters received from the US.
In June 1972, a letter was received by the Eligio De Guzman & Co indicating
that the company did not qualify to receive an award for the projects
because of its previous unsatisfactory performance rating on a repair
contract for the sea wall at the boat landings of the U.S. Naval Station in
Subic Bay.
The company sued the United States of America and Messrs. James E.
Galloway, William I. Collins and Robert Gohier all members of the
Engineering Command of the U.S. Navy. The complaint is to order the
defendants to allow the plaintiff to perform the work on the projects and,
in the event that specific performance was no longer possible, to order the
defendants to pay damages. The company also asked for the issuance of a
writ of preliminary injunction to restrain the defendants from entering into
contracts with third parties for work on the projects.
The defendants entered their special appearance for the purpose only of
questioning the jurisdiction of this court over the subject matter of the
complaint and the persons of defendants, the subject matter of the
complaint being acts and omissions of the individual defendants as agents
of defendant United States of America, a foreign sovereign which has not
given her consent to this suit or any other suit for the causes of action
asserted in the complaint." (Rollo, p. 50.)
Subsequently the defendants filed a motion to dismiss the complaint which
included an opposition to the issuance of the writ of preliminary injunction.
The company opposed the motion.
The trial court denied the motion and issued the writ. The defendants
moved twice to reconsider but to no avail.
Hence the instant petition which seeks to restrain perpetually the
proceedings in Civil Case No. 779-M for lack of jurisdiction on the part of
the trial court.
Issue/s: WON the US naval base in bidding for said contracts exercise
governmental functions to be able to invoke state immunity

Held: WHEREFORE, the petition is granted; the questioned orders of the

respondent judge are set aside and Civil Case No. is dismissed. Costs
against the private respondent.

Ratio: The traditional rule of State immunity exempts a State from being
sued in the courts of another State without its consent or waiver. This rule
is a necessary consequence of the principles of independence and equality
of States. However, the rules of International Law are not petrified; they
are constantly developing and evolving. And because the activities of states
have multiplied, it has been necessary to distinguish them-between
sovereign and governmental acts (jure imperii) and private, commercial
and proprietary acts (jure gestionis). The result is that State immunity now
extends only to acts jure imperil (sovereign & 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 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. In this case the projects are an integral
part of the naval base which is devoted to the defense of both the United
States and the Philippines, indisputably a function of the government of the
highest order; they are not utilized for nor dedicated to commercial or
business purposes.

correct test for the application of State immunity is not the conclusion of a
contract by a State but the legal nature of the act

Facts:
Plaintiff, Fernando Froilan filed a complaint against the defendantappellant, Pan Oriental Shipping Co., alleging that he purchased from the
Shipping Commission the vessel for P200,000, paying P50,000 down and
agreeing to pay the balance in instalments. To secure the payment of the
balance of the purchase price, he executed a chattel mortgage of said
vessel in favor of the Shipping Commission. For various reasons, among
them the non-payment of the installments, the Shipping Commission tool
possession of said vessel and considered the contract of sale cancelled. The
Shipping Commission chartered and delivered said vessel to the defendantappellant Pan Oriental Shipping Co. subject to the approval of the President
of the Philippines. Plaintiff appealed the action of the Shipping Commission
to the President of the Philippines and, in its meeting the Cabinet restored
him to all his rights under his original contract with the Shipping
Commission. Plaintiff had repeatedly demanded from the Pan Oriental
Shipping Co. the possession of the vessel in question but the latter refused
to do so.
Plaintiff, prayed that, upon the approval of the bond accompanying his
complaint, a writ of replevin be issued for the seizure of said vessel with all
its equipment and appurtenances, and that after hearing, he be adjudged
to have the rightful possession thereof . The lower court issued the writ of
replevin prayed for by Froilan and by virtue thereof the Pan Oriental
Shipping Co. was divested of its possession of said vessel.
Pan Oriental protested to this restoration of Plaintiff s rights under the
contract of sale, for the reason that when the vessel was delivered to it,
the Shipping Administration had authority to dispose of said authority to
the property, Plaintiff having already relinquished whatever rights he may
have thereon. Plaintiff paid the required cash of P10,000.00 and as Pan
Oriental refused to surrender possession of the vessel, he filed an action to
recover possession thereof and have him declared the rightful owner of said
property. The Republic of the Philippines was allowed to intervene in said
civil case praying for the possession of the in order that the chattel
mortgage constituted thereon may be foreclosed.
Issues:
Whether or not the Court has jurisdiction over the intervenor with regard
to the counterclaim.
Discussions:
When the government enters into a contract, for the State is then deem to
have divested itself of the mantle of sovereign immunity and descended to
the level of the ordinary individual. Having done so, it becomes subject to
judicial action and processes.
Rulings:
Yes. The Supreme Court held that the government impliedly allowed itself
to be sued when it filed a complaint in intervention for the purpose of
asserting claim for affirmative relief against the plaintiff to the recovery of
the vessel. The immunity of the state from suits does not deprive it of the
right to sue private parties in its own courts. The state as plaintiff may
avail itself of the different forms of actions open to private litigants. In
short, by taking the initiative in an action against a private party, the state
surrenders its privileged position and comes down to the level of the
defendant. The latter automatically acquires, within certain limits, the
right to set up whatever claims and other defenses he might have against
the state.

World Health Organization vs Aquino

Facts: Dr. Leonce Verstuyft was assigned by WHO to its regional office in
Manila as Acting Assistant Director of Health Services. His personal effects,
contained in twelve (12) crates, were allowed free entry from duties
and taxes. Constabulary Offshore Action Center (COSAC) suspected that the
crates contain large quantities of highly dutiable goods beyond the
official needs of Verstuyft. Upon application of the COSAC officers, Judge
Aquino issued a search warrant for the search and seizure of the personal
effects of Verstuyft.
Secretary of Foreign Affairs Carlos P. Romulo advised Judge Aquino that Dr.
Verstuyft is entitled to immunity from search in respect for his personal
baggage as accorded to members of diplomatic missions pursuant to the
Host Agreement and requested that the search warrant be suspended. The
Solicitor General accordingly joined Verstuyft for the quashal of the search
warrant but respondent judge nevertheless summarily denied the
quashal. Verstuyft, thus, filed a petition for certiorari and prohibition with
the SC. WHO joined Verstuyft in asserting diplomatic immunity.

Issue: Whether or not personal effect of Verstuyft can be exempted from

search and seizure under the diplomatic immunity.

Held: Yes. The executive branch of the Phils has expressly recognized that
Verstuyft is entitled to diplomatic immunity, pursuant to the provisions of
the Host Agreement. The DFA formally advised respondent judge of the
Philippine Government's official position. The Solicitor General, as principal
law officer of the gorvernment, likewise expressly affirmed said petitioner's
right to diplomatic immunity and asked for the quashal of the search
warrant.
It is a recognized principle of international law and under our system of
separation of powers that diplomatic immunity is essentially a political
question and courts should refuse to look beyond a determination by the
executive branch of the government, and where the plea of diplomatic
immunity is recognized and affirmed by the executive branch of the
government as in the case at bar, it is then the duty of the courts to accept
the claim of immunity upon appropriate suggestion by the principal law
officer of the government, the Solicitor General in this case, or other
officer acting under his discretion. Courts may not so exercise their
jurisdiction by seizure and detention of property, as to embarass the
executive arm of the government in conducting foreign relations.
The Court, therefore, holds the respondent judge acted without
jurisdiction and with grave abuse of discretion in not ordering the quashal
of the search warrant issued by him in disregard of the diplomatic immunity
of petitioner Verstuyft.

G.R. No. L-44896

July 31, 1936

RODOLFO A. SCHNECKENBURGER vs. MANUEL V. MORAN, Judge of First

Instance of Manila
Facts: This petition is for a writ of prohibition overruled with a view to
preventing the Court of First Instance of Manila from taking cognizance of
the criminal action filed against him. The petitioner was an accredited
honorary consul of Uruguay at Manila. He was charged in the Court of First
Instance of Manila of falsification of a private document. He objected to
the jurisdiction of the court on the ground that both under the Constitution
of the United States and the Constitution of the Philippines the court below
had no jurisdiction to try him. His objection was overruled hence this
present petition.
Issue: Whether or not the Court of First Instance of Manila has jurisdiction
to try the petitioner.
Ruling: The counsel for the petitioner contend that the CIF of Manila has no
jurisdiction according to Aticle III Sec. 2 of the United States Constitution
which stipulated that the Supreme Court of the United States has original
jurisdiction in all cases affecting ambassadors, public ministers, and
consuls, and such jurisdiction which excludes the courts of the Philippines
and that that such jurisdiction is conferred exclusively upon the Supreme
Court of the Philippines. Although section 17 of Act No. 136 vests in the
Supreme Court the original jurisdiction to issue writs
of mandamus, certiorari, prohibition, habeas corpus, and quo warranto,
such jurisdictiona was also conferred on the Courts of First Instance by the
Code of Civil Procedure. (Act No. 190, secs. 197, 217, 222, 226, and 525.) It
results that the original jurisdiction possessed and exercised by the
Supreme Court of the Philippine Islands was not exclusive of, but
concurrent with, that of the Courts of First Instance. Hence, the Court of
Instance has jurisdiction over the petitioner.

G.R. No. L-35131 November 29, 1972

THE WORLD HEALTH ORGANIZATION and DR. LEONCE VERSTUYFT vs. HON.
BENJAMIN H. AQUINO, as Presiding Judge of Branch VIII, Court of First
Instance of Rizal
Facts: The present petition is an original action for certiorari and
prohibition to set aside respondent judge's refusal to quash a search
warrant issued by him at the instance of respondents Constabulary Offshore
Action Center (COSAC) officers for the search and seizure of the personal
effects of Verstuyft of the WHO (World Health Organization)
notwithstanding his being entitled to diplomatic immunity, as duly
recognized by the Executive branch of the government and to prohibit
respondent judge from further proceedings in the matter.

The Secretary of Foreign Affairs Carlos P. Romulo pleaded to Hon. Aquino

that Dr. Verstuyft is entitled to immunity from search in respect for his
personal baggage as accorded to members of diplomatic missions pursuant
to the Host Agreement and further requested for the suspension of the
search warrant. The Solicitor General accordingly joined the petitioner for
the quashal of the search warrant but respondent judge nevertheless
summarily denied the quash hence, the petition at bar.
Issue: Whether or not personal effect of WHO Officer Dr. Verstuyft can be
exempted from search and seizure under the diplomatic immunity.
Ruling: The executive branch of the Phils has expressly recognized that
Verstuyft is entitled to diplomatic immunity, pursuant to the provisions of
the Host Agreement. The DFA formally advised respondent judge of the
Philippine Government's official position. The Solicitor General, as principal
law officer of the gorvernment, likewise expressly affirmed said petitioner's
right to diplomatic immunity and asked for the quashal of the search
warrant.
The unfortunate fact remains that respondent judge chose to rely on the
suspicion of respondents COSAC officers "that the other remaining crates
unopened contain contraband items"
The provisions of Republic Act 75 declares as null and void writs or
processes sued out or prosecuted whereby inter alia the person of an
ambassador or public minister is arrested or imprisoned or his goods or
chattels are seized or attached and makes it a penal offense for "every
person by whom the same is obtained or prosecuted, whether as party or as
attorney, and every officer concerned in executing it" to obtain or enforce
such writ or process.
The Court, therefore, holds the respondent judge acted without
jurisdiction and with grave abuse of discretion in not ordering the quashal
of the search warrant issued by him in disregard of the diplomatic immunity
of petitioner Verstuyft. The writs of certiorari and prohibition from the
petitioners were granted.