A.

Sovereignty
Rene Saguisag vs. Executive Secretary, G.R. No. 212426, 12 January 2016

Facts: The petitioners question the constitutionality of the Enhanced Defense

Cooperation Agreement (EDCA) between the Republic of the Philippines and the
United States of America (U.S.). EDCA authorizes the U.S. military forces to
have access to and conduct activities within certain "Agreed Locations" in the
country. It was not transmitted to the Senate on the executive's understanding that
to do so was no longer necessary. Petitioners allege that respondents committed
grave abuse of discretion amounting to lack or excess of jurisdiction when they
entered into EDCA with the U.S., claiming that the instrument violated multiple
constitutional provisions.

Issue: W/N the Enhanced Defense Cooperation Agreement (EDCA) between the
Philippines and the United States is unconstitutional?

Held: The EDCA is constitutional. It is an executive agreement that is consistent

with the content, purpose, of our laws and the framework of the Mutual Defense
Treaty and Visiting Forces. As an executive agreement, the law does not require
the concurrence of the Senate since it merely implements an existing treaty. Also,
the entry of U.S. troops has long been authorized through the VFA and the
Agreement did not go beyond the terms of the treaty it sought to purport and is
consistent with the continuing policy of the Philippines to strengthen our defenses
in case of an enemy attack through cooperation with other States.

2. People vs. Gozo, G.R. No. L-36409, October 26, 1973

Facts:
Loreta Gozo seeks to set aside a judgment of the Court of First Instance of
Zambales ,convicting her of a violation of an ordinance of Olongapo, Zambales,
requiring a permit from the municipal mayor for the construction or erection of a
building, as well as any modification,alteration, repair or demolition thereof. She
questions its validity, or at the very least, its applicability to her, by invoking due
process citing the case of People v. Fajardo She contend that her house was
constructed within the naval base leased to the American armed forces located
inside the United States Naval Reservation within the territorial jurisdiction of
Olongapo City and therefore shall be exempted from the Municipal Ordinance No.
14.
Issue:
WON the property of the Appellant shall be exempted from the application of the
Municipal Ordinance.
Ruling:
Yes. The appellant’s contention that because her property was located within the
naval base leased to the American armed forces located inside the United States
Naval Reservation, she must be entitled of the exemption from complying with the
ordinance was given no merit.
3. SANDERS VS. VERIDIANO II

FACTS:

Petitioner Sanders was the special services director of the U.S. Naval Station.

Petitioner Moreau was the commanding officer of the Subic Naval Base. Private

respondent Rossi is an American citizen with permanent residence in the

Philippines. Private respondent Rossi and Wyer were both employed as game room

attendants in the special services department of the NAVSTA.

ISSUES:

Petition for Certiorari, Prohibition, and Preliminary Injunction was thereafter filed

before this court.

W/N petitioners were performing their official duties when they did acts for which

they have been sued for damages by the private respondent.

RULING:

Petition was granted. Challenged Orders were set aside. Respondent Court is

directed to dismiss the case.

Court held that he acts for which the petitioner are being called to account were

performed by them in the discharge of their official duties. Court concludes that

petitioners acted behalf of the government, within the scope of their authority

making the action a suit against the government without its consent.
3. Laurel vs. Misa [G.R. No. L-409, January 30, 1947]
FACTS: Anastacio Laurel, a Filipino citizen, filed a petition for habeas corpus. He
claims that a Filipino who helped in giving an aid and comfort to an enemy during
the Japanese occupation cannot be prosecuted for treason. He invoked that there
was no legitimate government during this time and that allegiance to the
Philippines was suspended. He cannot be tried when there was a change of
sovereignty in the country since his acts were against the Commonwealth which
was replaced by the Republic.
ISSUE:
Whether or not absolute allegiance of a Filipino citizen to the government becomes
suspended during occupation.
RULING:
No. Considering that the absolute and permanent allegiance of the inhabitants of a
territory occupied by the enemy of their legitimate government or sovereign is not
abrogated or severed by the enemy occupation, because the sovereignty of the
government or sovereign de jure is not transferred thereby to the occupier.
Allegiance remains in the legitimate government.
What may be suspended is the exercise of the rights of sovereignty with the control
and government of the territory occupied by the enemy passes temporarily to the
occupant; that the subsistence of the sovereignty of the legitimate government in a
territory occupied by the military forces of the enemy during the war, “although
the former is in fact prevented from exercising the supremacy over them” is one of
the “rules of international law of our times.”
4. Ruffy vs. Chief of Staff [G.R. No. L-533, August 20, 1946]
FACTS: During the outbreak of war, Ramon Ruffy was the Provincial
Commander, Prudente M. Francisco, a junior officer, and Andres Fortus, a
corporal of the Philippine Constabulary garrison in Mindoro. On January 2, 1943,
Military District Colonel Peralta named Major Ruffy as Acting Commander for 3d
Battalion, 66th Infantry Division 61st Division, Philippine Corps. Later, Lieut. Col.
Jurado had been dispatched by the 6th Military District to Mindoro to assume
operational control supervision over the Bolo Area Unit. Garcia, Adeva, and
Francisco were later on promoted and received compensation. On June 8, 1944,
Raffy was relieved from his assignment and was replaced by Esteban Beloncio. On
October 19, 1944, Lieutenant Col. Jurado was allegedly slain by the petitioners. It
was this murder which gave rise to petitioners’ trial, the legality of which is being
contested.
ISSUE: Were the petitioners subject to the military law at the time of belligerent
occupation of Japan?
HELD: Yes. The petitioners were subject to military law. By their acceptance of
appointments as officers in the Bolo Area from the General Headquarters of the 6 th
Military District, they became members of the Philippine Army amenable to the
Articles of War. The Bolo Area was a contingent of the 6 th Military District which
had been recognized by and placed under the operational control of the United
States Army in the Southwest Pacific. The Bolo Area received supplies and funds
for the salaries of its officers and men from the Southwest Pacific Command. As
officers in the Bolo Area and the 6th Military District, the petitioners operated
under the orders of duly established and duly appointed commanders of the United
States Army.
B. State Immunity
1. Sanders vs. Veridiano [G.R. No. L-46930, June 10, 1988]
2. Republic vs. Sandoval [G.R. No. 84607, March 19, 1993]
Facts: On January 22, 1987, the Mendiola massacre happened which befell 12
rallyists. The massacre was the culmination of eight days and seven nights of
encampment by members of the militant Kilusang Magbubukid sa Pilipinas (KMP)
at the then Ministry (now Department) of Agrarian Reform (MAR) at the
Philippine Tobacco Administration Building along Elliptical Road in Diliman,
Quezon City. The rallyists presented their demands for what they called “genuine
agrarian reform”. The victims of Mendiola massacre filed an action for damages
against the Republic and the military/police officers involved in the incident.
Issues:
1.) Whether or not there is a valid waiver of immunity
2. Whether or not the State is liable for damages
Held:
No. The recommendation made by the Commission regarding indemnification of
the heirs of the deceased and the victims of the incident by the government does
not in any way mean that liability automatically attaches to the State. Whatever
acts or utterances that then President Aquino may have done or said, the same are
not tantamount to the State having waived its immunity from suit. The President's
act of joining the marchers, days after the incident, does not mean that there was an
admission by the State of any liability. In fact to borrow the words of petitioners,
"it was an act of solidarity by the government with the people". Petitioners rely on
President Aquino's speech promising that the government would address the
grievances of the rallyists. By this alone, it cannot be inferred that the State has
admitted any liability, much less can it be inferred that it has consented to the suit.
3. Festejo vs. Fernando [G.R. No. L-5156, March 11, 1954] *

FACTS: Isaias Fernando, the Director of Public Works, unlawfully took

possession of portions of the three parcels of lands of Carmen Festejo by causing
an irrigation canal to be constructed on said portions of land to the damage and
prejudice of the plaintiff. Fernando did not obtain first a right of way, and caused
the construction without the plaintiff’s consent and knowledge, and against her
express objection. Hence, this suit to recover the property or be compensated in
case the portions of land unlawfully occupied and appropriated cannot be returned
to the plaintiff.

ISSUE: W/N Fernando is immune from suit for being a public officer?

HELD: NO. The Court held that that the evidence and conceded facts permitted
the jury in finding that in the trespass on plaintiff’s land defendant committed acts
outside of his authority. Upon destruction of the former condition and usefulness of
plaintiff’s land, he must be held to have designedly departed from the duties
imposed on him by law. 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 exceeds 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.

4. United States vs. Guinto [G.R. No. 76607, February 26, 1990]
FACTS:
US Air Force in Clark, Pampanga was sued by Roberto T. Valencia, Emerenciana
C. Tanglao, and Pablo C. del Pilar (private respondents) as regards to the bidding
that the former conducted through its representatives which was later on won by
Ramon Dizon. Bidding was over but it is also over with the objection of the private
respondents who claimed that he (Ramon Dizon) had made a bid for 4 facilities,
including the Civil Engineering Area which was not included in the invitation to
bid. The Philippine Area Exchange (PHAX) through the petitioner’s
representatives explained to the private respondents that Dizon was not awarded to
him. But Dizon was already operating the concession. The private respondents
filed a complaint in the court to order to cancel the previously conducted bidding
and to conduct rebidding for the concessionaires.
Issue: Whether the suit complained is a suit against the United States.

Held:
No, the concessions being the subject of the complaint is considered not part of
the government function. They can not plead immunity. The concession acted as
business enterprise which means that it functions as a business enterprise. Such
entry of the said concession to business enterprise is an implied waiver of the
state’s immunity.

5. Veterans Manpower & Protective Services, Inc. vs. CA [G.R. No. 91359,
September 25, 1992]
FACTS: On March 28, 1988, VMPSI (Veterans Manpower and Protective
Services, Inc.) filed a complaint in the Regional Trial Court at Makati, Metro
Manila. Praying the court to issue a temporary restraining order to preserve the
status quo, enjoining the defendants, or any one acting in their place or stead, to
refrain from committing acts that would result in the cancellation or non-renewal
of VMPSI’s license. Complaint was filed against The Chief of Philippine
Constabulary (PC) and Philippine Constabulary Unit for Security and Investigation
Agencies (PC-SUSIA).

ISSUE: Whether or not VMPSI’s complaint against the PC Chief and PC-SUSIA
is a suit against the State without its consent.

HELD: Yes. The State may not be sued without its consent (Article XVI, Section
3, of the 1987 Constitution). Invoking this rule, the PC Chief and PC-SUSIA
contend that, being instrumentalities of the national government exercising a
primarily governmental function of regulating the organization and operation of
private detective, watchmen, or security guard agencies, said official (the PC
Chief) and agency (PC-SUSIA) may not be sued without the Government’s
consent.

6. Merritt vs. Government of the Philippine Islands [G.R. No. 11154, March 21,
1916]
FACTS. Merritt was riding a motorcycle along Padre Faura Street when he was
struck by an ambulance of the General Hospital. By reason of the resulting
collision, Merritt sustained severe injuries rendering him incapacitated. As the
negligence which caused the collision is caused by an agent or employee of the
Government, the inquiry is whether the Government is legally liable for the
damages resulting therefrom. The legislature later enacted Act 2547 authorizing
Merritt to file a suit against the Government of the Philippine Islands.
ISSUE. Whether the defendant, the Government of the Philippine Islands, simply
waived its immunity from suit.
HELD. No. The defendant cannot be sued by an individual without its consent. As
the consent of the Government to be sued by Merritt was entirely voluntary on its
part, it is the duty of the Government to look carefully into the terms of the
consent, and render judgment accordingly. The plaintiff, Merritt, was authorized to
bring suit against the Government “in order to fix the responsibility for the
collision and to determine the amount of the damages Merritt is entitled on account
of the said collision. The state is also not responsible for the damages of private
individuals in consequence of acts performed by its employees in the discharge of
the functions pertaining to their office. Under the Civil Code, the state is only
liable when it acts through a special agent. The driver of the ambulance was not a
special agent; thus the Government is not liable. Therefore, in enacting Act 2547,
the Government consented to waive its immunity from suit but it does not concede
its liability to plaintiff. It merely gives remedy to enforce pre existing liability
while it also submits itself to the jurisdiction of the court.
7. Amigable vs. Cuenca [G.R. No. L-26400, February 29, 1972]
Facts:
Victoria Amigable, the appellant herein, is the registered owner of Lot No. 639 of
the Banilad Estate in Cebu City as shown by Transfer Certificate of Title No. T-
18060, which superseded Transfer Certificate of Title No. RT-3272 (T-3435)
issued to her by the Register of Deeds of Cebu on February 1, 1924. No annotation
in favor of the government of any right or interest in the property appears at the
back of the certificate. Without prior expropriation or negotiated sale, the
government used a portion of said lot, with an area of 6,167 square meters, for the
construction of the Mango and Gorordo Avenues.
Issues:
Whether or not the appellant may properly sue the government under the facts of
the case.
Held:
Yes. Where 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 thereby violating the doctrine of governmental immunity from suit without
its consent. Considering that no annotation in favor of the government appears at
the back of her certificate of title and that she has not executed any deed of
conveyance of any portion of her lot to the government, the appellant remains the
owner of the whole lot. As registered owner, she could bring an action to recover
possession of the portion of land in question at anytime because possession is one
of the attributes of ownership.

8. Republic vs. Sandiganbayan [G.R. No. 90478, November 21, 1991]

Facts: The Presidential Commission on Good Governance (PCGG) filed a
complaint against respondents Tantaco Jr. and Santiago. Both petitioner and
respondents filed a series of pleadings and motions to the Sandiganbayan. The case
was set for pre-trial on July 31, 1989 but was reset to September 11, 1989. On July
25, 1989, PCGG submitted its pre-trial brief and on July 27, 1989 Tantaco and
Santiago filed a pleading denominated “Interrogatories to Plaintiff” followed by a
pleading entitled “amended interrogatories to the plaintiff”. The Sandiganbayan
admitted the amended interrogatories. The PCGG opposed the amended
interrogatories alleging that it is not specific, and does not name the person whom
they are propounded to or “who in the PCGG in particular should answer the
interrogatories?” and further contends that none of its members may be required to
testify or produce evidence in any judicial proceeding concerning matter within its
official cognizance”
ISSUE: Whether or not the PCGG is entitled to diplomatic immunity?
HELD: NO, the PCGG is not entitled to diplomatic immunity. The State is immune
from suit, and cannot be sued without its consent. The immunity extends to the its
authorized officers and government agencies. However, an exception manifests
when the State itself is filing an action. In the case where the State or its officers,
files an action against private persons, the court held that by filing an action, it
divests itself of its sovereign character and sheds its immunity from suit,
descending to the level of an ordinary litigant. Therefore, the PCGG cannot claim a
superior or preferred Status to the state, even while assuming to represent or act for
the State because the PCGG itself initiated the case against private respondents.

9. Republic vs. Feliciano [G.R. No. 70853, March 12, 1987] Miranda,
Jacqueline P.

Facts: In a bid to recover ownership of a piece of land in Tinambac, Camarines

Sur, respondent Pablo Feliciano filed a complaint before the Court of First Instance
of Camarines Sur against the Republic of the Philippines represented by the Land
Authority. The trial court ruled that said lot shall be the property of Feliciano. The
rest of the land were “reverted to public domain”. The case was reopened after 86
settlers contested the ruling, saying they had inhabited the lot for 20 years. The
court then asked the settlers for additional proof of their claim but were unable to
give such. Meanwhile, Feliciano was able to give his set of evidence. The court
ruled in favor of Feliciano. Settlers filed a motion for reconsideration and Feliciano
filed a petition for certiorari before the Court of Appeals which was dismissed.
Subsequently, the Solicitor General, on behalf of the Republic, filed its opposition
citing the non-suability of the State.

Issue: WON the State is immune from suit

Held: The case is clearly a suit against the State. Under settled jurisprudence, the
State may only be sued upon a showing that it has consented to be sued, either
expressly or impliedly through the use of “language too plain to be
misinterpreted”. There was no existence of such consent in the case at bar. The
failure of the petitioner to invoke such immunity in earlier proceedings was not
fatal to the case as such immunity may be asserted at any stage of the court
proceeding.
10. United States vs. Ruiz [G.R. No. L-35645, May 22, 1985] *
USA vs Ruiz G.R. No. L-35645
FACTS: 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. The United States invited the submission of bids
for the 2 projects. Eligio de Guzman & Co., Inc. responded to the invitation and
submitted bids. In addition, they asked to submit price proposal and for the name
of its bonding company. But, the company received a letter which said that they
did not qualify to receive an award for the projects. 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.
ISSUE: Whether the US naval base can invoke state immunity for bidding
contracts exercise by a government function.
HELD: Yes. In this case the projects are an integral part of the naval base
which is devoted to the defence 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. 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.
11. The Holy See vs. Rosario [G.R. No. 101949, December 1, 1994] Miranda,
Jacqueline P. L-1800014

Facts: Case arose from the selling of Lot 5-A donated by the Archdiocese of
Manila to The Holy See which has sovereignty over Vatican City. The lot was
contiguous to Lots 5-B and 5-D owned by Philippine Realty Corporation. Lots
were sold by agent Msgr. Cirilios to Ramon Licup, who had rights to respondent
Starbright Sales Enterprises. Starbright asked the agent to return P100,000 in
earnest money after it deemed it necessary for the seller to rid the lot of squatters.
After the return of the money, lots were sold to Tropicana Properties and
Development Corporation. Starbright moved for the annulment of sale to
Tropicana. Holy See and PRC asked to dismiss the petition citing Holy See’s
sovereign immunity.

Issue: WON The Holy See has immunity from such suit

Held: Yes, it may invoke immunity for lack of suability under article 31-A of the
Vienna Convention granting immunity to diplomatic envoys from suits. The Court
also ruled that Holy See is immune to lawsuit because the act was proprietary in
nature. Lot was acquired through donation and not used for commercial purposes
but just as the Papal Nuncio’s residence. The lot acquisition was also jure jestionis
because it happened in the course of real estate business.

12. Minucher, vs. Court of Appeals and Scalzo [G.R. No. 142396. February 11,
2003]
Facts: Petitioner Minucher was arrested in his house during a “buy-bust operation”
conducted by the Philippine narcotic agents wherein a quantity of heroin were
seized. The narcotic agents in the operation were accompanied by private
respondent Arthur Scalzo.. Minucher filed a case against respondent on the
grounds of what he claimed to have been trumped-up charges of drug trafficking
made by respondent. Respondent, however, claims that the Philippines, being a
signatory of the Vienna Convention on Diplomatic Relations, cannot sue him
because he acted in the discharge of his official duties as an agent of the U.S. Drug
Enforcement Agency (USDEA).

ISSUE: Whether or not Arthur Scalzo is entitled to diplomatic immunity?

HELD: YES. He is entitled to diplomatic immunity. The principle of State

immunity is grounded on the principle that suing a representative of a state is
tantamount to be 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 immunity of the State is extended to its
officers but will not apply and may not be invoked where the public official acts
without authority or in excess of the powers vested in him. The court expressed
that Scalzo hardly can be said to have acted beyond the scope of his official duties,
being an agent of the USDEA was allowed by the Philippine government to
conduct activities in the country to help contain the problem on drug traffic, is thus
entitled to the defense of state immunity from suit.
13. World Health Organization v. Aquino [G.R. No. L-35131, November 29,
1972]
FACTS: Dr. Verstuyft is an Acting Asst. Director of Health Services of WHO
assigned to the PH. When his personal effects entered the PH, 12 boxes of which
caught the attention of Constabulary Offshore Action Center officers and ordered
the judge of Court of First Instance to issue a search warrant saying that his
personal effects should be subject to tax. Dr. Verstuyft, enjoined by WHO, prayed
for the quashal of said warrant as he is entitled to immunity.
ISSUE: Whether or not Dr. Verstuyft is entitled to diplomatic immunity
Held: He is entitled to immunity. Such diplomatic immunity carries with it among
other diplomatic privileges and immunities, personal inviolability of its personal
properties, and exemption from tax and duties. The Philippines is also bound by
Art. VII Convention on Privileges and Immunities of the Specialized Agencies of
the UN. This is a treaty commitment voluntarily assumed by the Philippine
government and as such has the force and effect of law.
14. Republic vs. Villasor [G.R. No. L-30671, November 28, 1973] *
FACTS:
The petitioner Republic of the Philippines filed a petition for certiorari and
prohibition that challenges the respondent Judge Villasor’s order declaring finality
his decision on the case between the petitioner and Gavino Unchuan and two
corporations. The respondent acted in excess of his jurisdiction or with grave abuse
of discretion according to the petitioner. The assailed decision ordered the AFP to
pay Gavino Unchuan and two corporations 1,712,396.40Php as arbitration award.
The fund for the said award is duly appropriated and allocated for the pensions,
salaries and allowances, and for maintenance of the AFP.

ISSUE:
Whether or not this judgment can be executed against the state.

HELD:
The petition for certiorari and prohibition were granted. The general rule is that the
State can not be sued without its consent. The only extent where the state can be
sued is only upon its consent and only up to the completion of proceedings anterior
to the state of execution. As a rule, Judgment against the State cannot be enforced
by execution.
15. Department of Agriculture vs. NLRC [G.R. No. 104269, November 11, 1993]

FACTS: Several guards deployed by Sultan Securities Agency, which the

Department of Agriculture tapped for their security services, filed a complaint for
underpayment of wages, non-payment 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.

ISSUE: Whether or not the doctrine of non-suability of the State applies in the
case.

HELD: No. The rule does not say that the State may not be sued under any
circumstances. The State may at times be sued. The general law waiving the
immunity of the state from suit is found in Act No. 3083, where the Philippine
government “consents and submits to be sued upon any money claims involving
liability arising from contract, express or implied, which could serve as a basis of
civil action between private parties.”
In this 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 the claims of
the complainant security guards clearly constitute money claims.
16. PNB vs. Pabalan [G.R. No. L-33112, June 15, 1978]
FACTS. The petitioner Philippine National Bank (PNB) filed for certiorari and
prohibition against Judge Pabalan, respondent. Judge Pabalan rendered a decision
ordering Writ of Execution against Philippine Virginia Tobacco Administration
(PVTA). Accordingly, a Notice of Garnishment was also issued amounting to P12,
724.66. It is ordered, in accordance with law, that sufficient funds of the PVTA at
the time deposited under PNB , La Union Branch, shall be garnished and delivered
to the party that the PVTA owes immediately to satisfy writ of execution. Hence,
PNB invoked the doctrine of non-suability of the State.
ISSUE/S. Whether PNB can invoke the concept of “state immunity” and whether
funds deposited to PNB be exempt from garnishment.
HELD. No. Citing the judgment announced in Manila Hotel Employees
Association v. Manila Hotel Company, it is well settled that that when the
government enters into commercial business, it abandons its sovereign capacity
and is to be treated like any other corporation. In the jurisprudence of NASSCO v.
Court of Industrial Relations, it was by Chief Justice Concepcion that NASSCO
has a personality of its own distinct and separate from the Government just like the
case of PNB. Accordingly, in this case, it may sue or be sued and may be subjected
to court processes just like any other corporation. In the jurisprudence of Bank of
United States v. Planters’ Bank , it was held that by engaging in a business through
the instrumentality of a corporation, the Government divests itself pro hac vice of
its sovereign character, so as to render the corporation subject to the rules of law
governing private corporations. Therefore, funds of public corporations which can
sue and be sued are not exempt from notice of garnishment. The case is dismissed.
17. Rayo vs. CFI of Bulacan [G.R. No. L-55273-83, December 19, 1981]

FACTS: During the height of Typhoon Kading, the National Power Corporation,
acting through its plant superintendent, opened simultaneously all the three
floodgates of Angat Dam. As a direct and immediate result of the opening of said
floodgates, several towns in Bulacan were inundated. Petitioners then filed
damages against respondent corporation. They contended that the respondent
corporation was performing a proprietary function and that under its own organic
act, it can sue and be sued in court. Respondent corporation, on the other hand,
invoke a special and affirmative defense that in the operation of Angat Dam, it is
performing a purely governmental function, hence it cannot be sued without the
express consent of the State.

ISSUE: Whether or not NPC performs a governmental function with respect to the
management and operation of the Angat Dam?

HELD: Yes. 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. As a GOCC, it
has a personality of its own, distinct and separate from that of the government.
Moreover, the charter provision that the NPC can sue and be sued in any court is
without qualification on the cause of action and can include a tort claim.
18. Bureau of Printing vs. Bureau of Printing Employees Ass. [G.R. No. L-15751,
January 28, 1961

Complaint filed against Bureau of Printing (BOP), alleging that Serafin and
Mariano have been engaging in unfair labor practices by interfering with, or
coercing the employees of BOP, in their right to self-organization and
discriminating in regard to hire and tenure of their employment in order to
discourage them pursuing their union activities. Respondents contends that BOP
has no juridical personality to sue and be sued. It is not an industrial concern for
purposes of gain.

Issue: whether or not Bureau of Customs can be sued

Ruling: No. As an office of government, without any corporate or juridical

personality, BOP cannot be sued. It has no corporate existence and primarily a
service bureau. Overtime compensation is discretionary with the head of bureau.
Court of Industrial Relations did not acquire jurisdiction pursuant to Industrial
Peace Act that only engaged in industry and occupations for purposes of gain and
their industrial employees.
19. Mobil Phils. Exploration vs. Customs Arrastre Service [G.R. No. L-23139,
December 17, 1966]

Mobil Philippines filed a suit in CFI Manila against Customs Arrastre and Bureau
of Customs to recover the value of undelivered case in the amount of P18, 493.37
plus other damages. Defendants filed a motion to dismiss on grounds that they
cannot be sued.

Issue: whether or not defendants can invoke state immunity

Ruling: the fact that non-corporate government entity performs a function

propriety in native 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.
20. Civil Aeronautics Administration vs. CA [G.R. No. L-51806, November 8,
1988]

Facts: Petition for review on certiorari was filed by the Civil Aeronautics
Administration (CAA) against the Court of Appeals (CA) for reaffirming the
decision of the lower court. The private respondent went to Manila International
Airport (MIA) and was in the viewing deck on the terrace of the airport. While
walking on terrace, private respondent slipped over an elevation about four inches
high, and broke his thigh bone. Private Respondent filed for damages against the
CAA. Judgement was rendered in private respondent’s favor and CA affirmed
judgement. Petitioner argues that it cannot be sued without its consent because it is
an agency of the government.

Issue: Whether the CA gravely erred in not holding that the suit against CAA is
really a suit against the Republic of the Philippines which cannot be sued without
its consent?

Held: No. The CA was not wrong in affirming the lower court’s decision.
The CAA is tasked with private or non-governmental functions which operate to
remove it from the purview of the rule on State immunity from suit. The CAA is
tasked to manage MIA and the elevation in question is proven to be negligence on
the petitioner’s part to ensure safety of persons. Because of their negligence, they
are assigned to pay for the damages against private respondent. Manila
International Airport Authority (MIAA) has taken over management of MIA,
MIAA then assumed all debts of CAA. CA decision is affirmed
21. Mun. of San Fernando vs. Firme [G.R. No. 52179, April 8, 1991]
FACTS: A collision occurred involving a jeepney, a sand truck and a dump truck
of the Municipality of San Fernando, La Union. Due to the impact, several
passengers of the jeepney including Laureano Baniña Sr. died and four others
suffered injuries. The heirs of Baniña filed a complaint for damages against the
owner and driver of the jeepney. However, the aforesaid defendants filed a Third
Party Complaint against the Municipality and its dump truck driver. The
Municipality raised the defense of non-suability of the State.
ISSUE: Whether or not the municipality can be sued?
RULING: Yes. 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 permitting such entities to be sued, the State merely gives the claimant
the right to show that the defendant was not acting in its governmental capacity
when the injury was committed or that the case comes under the exceptions
recognized by law. Failing this, the claimant cannot recover.
In this case, 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. Hence, the municipality
cannot be held liable for the torts committed by its regular employee who was then
engaged in the discharge of government functions.
22. Mun. of San Miguel vs. Fernandez [G.R. No. L-61744, June 25, 1984]
Facts: This is a petition to review the order of the Court of First Instant of Baliuag,
Bulacan. The said court rendered judgement ordering defendant municipality to
pay to plaintiff in proportion mentioned the sum of P64,440 corresponding to
rentals it has collected from occupants for their use and occupation of premises
from 1970 to 1975 plus interest. Petitioner filed motion to quash on the ground that
municipality’s property or funds are public funds exempt from execution.
Issue: Whether the fund of the Municipality of San Miguel, Bulacan in the hands
of the provincial and municipal treasurers are public funds which are exempt from
execution?
Held: YES. It is a well settled rule that public funds are not subject to levy and
execution because it was held in trust for the people, intended and used for the
accomplishment of the purpose for which municipal corporations are created, to
subject said properties and public funds to execution would materially impede
purpose. The doctrine of law that not only the public property but also the taxes
and public revenues of such corporations cannot be seized under execution against
them. It is clear that all funds of petitioner municipality in possession of treasurer
are public funds and exempt from execution. There must be a corresponding
appropriation in the form of an ordinance duly passed by Sangguniang Bayan
before any money of the municipality may be paid out. No ordinance has been
passed in the case at bar. Petition is granted and order of respondent judge
directing treasurer to comply with money judgement is set aside.
23. Mun. of Makati vs. CA [G.R. Nos. 89898-99, October 1, 1990]
FACTS: Petitioner expropriated a portion of land owned by Admiral Finance
Creditors Consortium, Inc. After which, the RTC fixed the appraised value of the
property and order the petitioner to pay such amount. The RTC then issued a writ
of execution together with a writ of garnishment of funds of the petitioner
deposited in PNB. Petitioner claims that its funds could not be garnished or levied
because if it is done so then it would be a disbursement of public funds without
proper appropriation required by law.
ISSUE: Whether or not funds of the Municipal of Makati are exempted from
garnishment and levy.
RULING:
The funds deposited in the second PNB are public funds of the municipal
government. In this jurisdiction, well-settled is the rule that public funds are not
subject to levy and execution, unless otherwise provided for by statute. The
properties of a municipality, whether real or personal, which are necessary for
public use cannot be attached and sold at execution sale to satisfy a money
judgment against the municipality. Municipal revenues derived from taxes,
licenses and market fees, and which are intended primarily and exclusively for the
purpose of financing the governmental activities and functions of the municipality,
are exempt from execution. Nevertheless, this is not to say that private respondent
and PSB are left with no legal recourse. Where a municipality fails or refuses,
without justifiable reason, to effect payment of a final money judgment rendered
against it, the claimant may avail of the remedy of mandamus in order to compel
the enactment and approval of the necessary appropriation ordinance, and the
corresponding disbursement of municipal funds therefor.
24. City of Caloocan vs. Judge Allarde [G.R. No. 107271, September 10, 2003]
Facts:
1972, the Mayor of Caloocan City, Marcial Samson, abolished through
Ordinance 1749 the position of Assistant City Administrator along with 17 other
positions from the plantilla of the city. Then-Assistant City Administrator Delfina
Hernandez Santiago, along with the 17 unnamed employees of the city assailed the
legality of the abolition before the then Court of First Instance (CFI) of Caloocan
City, Branch 33. The CFI declared the abolition illegal and ordered the
reinstatement of the affected parties as well as the payment of all salaries owed
during the period of unlawful termination. The City Government of Caloocan
appealed to the Court of Appeals a total of four times including this one, first in
1985, second in 1991, third in 1995, and this one in 2003, all appeals are,
essentially, for the courts to reverse their decision that the City pay back the
principal affected party the amount owed to her for wrongful termination.
Issue:
Whether the funds of City of Caloocan, in PNB, may be garnished (i.e.
exempt from execution), to satisfy Santiago’s claim.
Held:
Petition dismissed for utter lack of merit. The appropriation of funds is fully
within the parameters set by the law and that the City of Caloocan, in depriving the
affected party of due payment for 21 years acted, at the very least, merciless and
unchristian.

25. China National machinery & Equipment Corp. v. Hon. Cesar Santamaria, et.
al, [G.R. No. 185572, February 7, 2012].
FACTS:
CNMEG entered into a Memorandum of Understanding with Northrail to
conduct a feasibility study on a possible railway line from Manila to San Fernando,
La Union (the Northrail Project); the respondents later filed a Complaint for
Annulment of Contract and Injunction with Urgent Motion for Summary Hearing.
ISSUE:
Whether or not the Northrail contracts are products of an executive
agreement between two sovereign states.
RULING:
The instant Petition is DENIED. CNMEG is not entitled to immunity from
suit, and the Contract Agreement is not an executive agreement. As it stands now,
the application of the doctrine of immunity from suit has been restricted to
sovereign or governmental activities. The mantle of state immunity cannot be
extended to commercial, private and proprietary acts. 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.