1. UNITED STATES OF AMERICA and MAXINE BRADFORD vs. HON. LUIS R.

REYES
G.R. No. 79253 March 1, 1993

DAVIDE, JR., J.:

The doctrine of state immunity is at the core of this controversy.

FACTS: Petitioner Maxine Bradford, hereinafter referred to as Bradford, is likewise an American citizen who was the activity exchange manager at
the said JUSMAG Headquarters. Private respondent, hereinafter referred to as Montoya, is an American citizen who was employed as an identification
(I.D.) checker at the U.S. Navy Exchange (NEX) at the Joint United States Military Assistance Group (JUSMAG) headquarters in Quezon City.
Respondents’s body and belongings were searched at the parking area after had bought some items from the retail store of the NEX JUSMAG. Thus,
the filing of a complaint against Bradford for damages due to the oppressive and discriminatory acts committed by the latter in excess of her authority
as store manager of the NEX JUSMAG.

ISSUE: WON Bradford is immune from suit for acts done by her in the performance of her official functions (as manager of the U.S. Navy Exchange
of JUSMAG pursuant to the Philippines-United States Military Assistance Agreement of 1947 and the Military Bases Agreement of 1947, as amended).

RULING: Yes. It is beyond doubt that Montoya's cause of action is premised on the theory that the acts complained of were committed by Bradford
not only outside the scope of her authority — or more specifically, in her private capacity — but also outside the territory where she exercises such
authority, that is, outside the NEX-JUSMAG — particularly, at the parking area which has not been shown to form part of the facility of which she
was the manager.

The doctrine of state immunity and the exceptions thereto are summarized in Shauf vs. Court of Appeals, 40 thus:

I. The rule that a state may not be sued without its consent, now expressed in Article XVI Section 3, of the 1987 Constitution, is
one of the generally accepted principles of international law that we have adopted as part of the law of our land under Article II,
Section 2. This latter provision merely reiterates a policy earlier embodied in the 1935 and 1973 Constitutions and also intended
to manifest our resolve to abide by the rules of the international community. 41

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 state 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, such as the appropriation of
the amount needed to pay the damages awarded against them, the suit must be regarded as against the state itself although it
has not been formally impleaded. It must be noted, however, that the rule is not so all-encompassing as to be applicable under
all circumstances.

It is a different matter where the public official is made to account in his capacity as such for acts contrary to law and injurious to
the rights of plaintiff. As was clearly set forth by Justice Zaldivar in Director of the Bureau of Telecommunications, et al. vs. Aligaen,
etc., et al. "Inasmuch as the State authorizes only legal acts by its officers, unauthorized acts of government officials or officers
are not acts of the State, and an action against the officials or officers by one whose rights have been invaded or violated by such
acts, for the protection of his rights, is not a suit against the State within the rule of immunity of the State from suit. In the same
tenor, it has been said that an action at law or suit in equity against a State officer or the director of a State department on the
ground that, while claiming to act or the State, he violates or invades the personal and property rights of the plaintiff, under an
unconstitutional act or under an assumption of authority which he does not have, is not a suit against the State within the
constitutional provision that the State may not be sued without its consent." The rationale for this ruling is that the doctrinaire
of state immunity cannot be used as an instrument for perpetrating an injustice.

In the case of Baer, etc. vs. Tizon, etc., et al., 46 it was ruled that:

There should be no misinterpretation of the scope of the decision reached by this Court. Petitioner, as the
Commander of the United States Naval Base in Olongapo, does not possess diplomatic immunity. He may
therefore be proceeded against in his personal capacity, or when the action taken by him cannot be imputed
to the government which he represents.

Also, in Animos, et al. vs. Philippine Veterans Affairs Office, et al., 47 we held that:

. . . it is equally well-settled that where a litigation may have adverse consequences on the public treasury, whether in the disbursements of funds or
loss of property, the public official proceeded against not being liable in his personal capacity, then the doctrine of non-suability may appropriately
be invoked. It has no application, however, where the suit against such a functionary had to be instituted because of his failure to comply with the
duty imposed by statute appropriating public funds for the benefit of plaintiff or petitioner. . . . .

The aforecited authorities are clear on the matter. They state that the doctrine of immunity from suit will not apply and may not be invoked where
the public official is being sued in his private and personal capacity as an ordinary citizen. The cloak of protection afforded the officers and agents of
the government is removed the moment they are sued in their individual capacity. This situation usually arises where the public official acts without
authority or in excess of the powers vested in him. It is a well-settled principle of law that a public official may be liable in his personal private
capacity for whatever damage he may have caused by his act done
with malice and in bad faith, or beyond the scope of his authority or jurisdiction.

The agents and officials of the United States armed forces stationed in Clark Air Base are no exception to this rule. In the case of United States of
America, et al. vs. Guinto, etc., et al., ante, 49 we declared:

It bears stressing at this point that the above observations do not confer on the United States of America
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.

Since it is apparent from the complaint that Bradford was sued in her private or personal capacity for acts allegedly done beyond the scope and even
beyond her place of official functions, said complaint is not then vulnerable to a motion to dismiss. Thus, the case falls within the exception to the
doctrine of state immunity.

In Williams vs. Rarang and Minucher vs. Court of Appeals, this Court reiterated this exception.

There is no question, therefore, that the two (2) petitioners actively participated in screening the features and articles in the POD
as part of their official functions. Under the rule that U.S. officials in the performance of their official functions are immune from
suit, then it should follow that petitioners may not be held liable for the questioned publication.

It is to be noted, however, that the petitioners were sued in their personal capacities for their alleged tortious acts in publishing
a libelous article.

The question, therefore, arises — are American naval officers who commit a crime or tortious act while discharging official
functions still covered by the principle of state immunity from suit? Pursuing the question further, does the grant of rights, power,
and authority to the United States under the RP-US Bases Treaty cover immunity of its officers from crimes and torts? Our answer
is No.

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

QUIASON, J.:

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 (Lot 5-A, Transfer Certificate of Title No.
390440) located in the Municipality of Parañaque, Metro Manila and registered in the name of petitioner.
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).

FACTS: The complaint alleged that: (1) on April 17, 1988, Msgr. Cirilos, Jr., on behalf of petitioner and the PRC, agreed to sell to Ramon Licup Lots 5-
A, 5-B and 5-D at the price of P1,240.00 per square meters; (2) the agreement to sell was made on the condition that earnest money of P100,000.00
be paid by Licup to the sellers, and that the sellers clear the said lots of squatters who were then occupying the same; (3) Licup paid the earnest
money to Msgr. Cirilos; (4) in the same month, Licup assigned his rights over the property to private respondent and informed the sellers of the said
assignment; (5) thereafter, private respondent demanded from Msgr. Cirilos that the sellers fulfill their undertaking and clear the property of
squatters; however, Msgr. Cirilos informed private respondent of the squatters' refusal to vacate the lots, proposing instead either that private
respondent undertake the eviction or that the earnest money be returned to the latter; (6) private respondent counter proposed that if it would
undertake the eviction of the squatters, the purchase price of the lots should be reduced from P1,240.00 to P1,150.00 per square meter; (7) Msgr.
Cirilos returned the earnest money of P100,000.00 and wrote private respondent giving it seven days from receipt of the letter to pay the original
purchase price in cash; (8) private respondent sent the earnest money back to the sellers, but later discovered that on March 30, 1989, petitioner
and the PRC, without notice to private respondent, sold the lots to Tropicana, as evidenced by two separate Deeds of Sale, one over Lot 5-A, and
another over Lots 5-B and 5-D; and that the sellers' transfer certificate of title over the lots were cancelled, transferred and registered in the name
of Tropicana; (9) Tropicana induced petitioner and the PRC to sell the lots to it and thus enriched itself at the expense of private respondent; (10)
private respondent demanded the rescission of the sale to Tropicana and the reconveyance of the lots, to no avail; and (11) private respondent is
willing and able to comply with the terms of the contract to sell and has actually made plans to develop the lots into a townhouse project, but in view
of the sellers' breach, it lost profits of not less than P30,000.000.00.

Private respondent thus prayed for: (1) the annulment of the Deeds of Sale between petitioner and the PRC on the one hand, and Tropicana on the
other; (2) the reconveyance of the lots in question; (3) specific performance of the agreement to sell between it and the owners of the lots; and (4)
damages.

ISSUE: WON the HOLY SEE is entitled to the privilege of sovereign immunity.

RULING: Yes. The Department of Foreign Affairs 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.

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.
In Article 31(a) of the Convention, a diplomatic envoy is granted immunity from the civil and administrative jurisdiction of the receiving state over
any real action relating to private immovable property situated in the territory of the receiving state which the envoy holds on behalf of the sending
state for the purposes of the mission. If this immunity is provided for a diplomatic envoy, with all the more reason should immunity be recognized as
regards the sovereign itself, which in this case is the Holy See.

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 (Rollo, pp. 26, 27).

This Court has considered the following transactions by a foreign state with private parties as acts jure imperii:

(1) the lease by a foreign government of apartment buildings for use of its military officers (Syquia v. Lopez, 84 Phil. 312 [1949];
(2) the conduct of public bidding for the repair of a wharf at a United States Naval Station (United States of America v. Ruiz, supra.); and
(3) the change of employment status of base employees (Sanders v. Veridiano, 162 SCRA 88 [1988]).

On the other hand, this Court has considered the following transactions by a foreign state with private parties as acts jure gestionis:

(1) the hiring of a cook in the recreation center, consisting of three restaurants, a cafeteria, a bakery, a store, and a coffee and pastry shop at the
John Hay Air Station in Baguio City, to cater to American servicemen and the general public (United States of America v. Rodrigo, 182 SCRA 644
[1990]); and
(2) the bidding for the operation of barber shops in Clark Air Base in Angeles City (United States of America v. Guinto, 182 SCRA 644 [1990]). The
operation of the restaurants and other facilities open to the general public is undoubtedly for profit as a commercial and not a governmental activity.
By entering into the employment contract with the cook in the discharge of its proprietary function, the United States government impliedly divested
itself of its sovereign immunity from suit.

In the absence of legislation defining what activities and transactions shall be considered "commercial" and as constituting acts jure gestionis, we
have to come out with our own guidelines, tentative they may be.

Certainly, the mere entering into a contract by a foreign state with a private party cannot be the ultimate test. Such an act can only be the start of
the inquiry. The logical question is whether the foreign state is engaged in the activity in the regular course of business. If the foreign state is not
engaged regularly in a business or trade, the particular act or transaction must then be tested by its nature. 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.

ULTIMATE TEST

Certainly, the mere entering into a contract by a foreign state with a private party cannot be the ultimate test. Such an act can only be the
start of the inquiry. The logical question is whether the foreign state is engaged in the activity in the regular course of business. If the foreign state is
not engaged regularly in a business or trade, the particular act or transaction must then be tested by its nature. 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.

3. SEAFDEC (SOUTHEAST ASIAN FISHERIES DEVELOPMENT CENTER) vs. NLRC (National Labor Relations Commission)
G.R. Nos. 97468-70 September 2, 1993

VITUG, J.:

The private respondents, as well as respondent labor arbiter, allege that the petitioner is not immune from suit and assuming that if,
indeed, it is an international organization, it has, however, impliedly, if not expressly, waived its immunity by belatedly raising the
issue of jurisdiction.

FACTS: Two labor cases, docketed as RAB Case No. VI- 0156-86 and RAB case No. VI - 0214-86, were filed by the herein private
respondents against the petitioner, Southeast Asian Fisheries Development Center (SEAFDEC), before the National Labor Relations
Commission (NLRC), Regional Arbitration Branch, Iloilo City. In these cases, the private respondents claim having been wrongfully
terminated from their employment by the petitioner.

On 22 August 1990, the petitioner, contending to be an international inter-government organization, composed of various Southeast
Asian countries, filed a Motion to Dismiss, challenging the jurisdiction of the public respondent in taking cognizance of the above cases.

ISSUE:

1. WON the petitioner is immune from suit.

2. WON the petitioner waived its immunity by belatedly raising the issue of jurisdiction.
RULING: Yes. Petitioner SEAFDEC is an international agency enjoying diplomatic immunity.

As held in Southeast Asian Fisheries Development Center-Aquaculture Department vs. National Labor Relations Commission, G.R. No.
86773; 206 SCRA 283/1992; see also Lacanilao v. de Leon, G.R. No. 76532, 147 SCRA, 286/1987/, where we said —

Petitioner Southeast Asian Fisheries Development Center-Aquaculture Department (SEAFDEC-AQD) is an

international agency beyond the jurisdiction of public respondent NLRC. The Republic of the Philippines became a
signatory to the Agreement establishing SEAFDEC on January 16, 1968. Its purpose is as follows:

The purpose of the Center is to contribute to the promotion of the fisheries development in Southeast Asia by mutual
co-operation among the member governments of the Center, hereinafter called the 'Members', and through
collaboration with international organizations and governments external to the Center.

Being an intergovernmental organization, SEAFDEC including its Departments (AQD), enjoys functional independence and freedom
from control of the state in whose territory its office is located.

Anent the issue of waiver of immunity, suffice it to say at the moment that the petitioner has timely raised the issue of jurisdiction.
While the petitioner did not question the public respondent's lack of jurisdiction at the early stages of the proceedings, it, nevertheless,
did so before it rested its case and certainly well before the proceedings thereat had terminated. The invocation by private
respondents of the doctrine of estoppel is unavailing, because estoppel does not confer jurisdiction on a tribunal that has none over
a cause of action.

4. Ernesto COLLADO vs. IRRI (INTERNATIONAL RICE RESEARCH INSTITUTE)

G.R. No. 106483 May 22, 1995

ROMERO, J.:

Did the International Rice Research Institute (IRRI) waive its immunity from suit in this dispute which arose from an employer-
employee relationship?

FACTS: Ernesto Callado, petitioner, was employed as a driver at the IRRI. On February 11, 1990, while driving an IRRI vehicle on an
official trip to the Ninoy Aquino International Airport and back to the IRRI, petitioner figured in an accident. Petitioner was informed
of the findings of a preliminary investigation conducted by the IRRI's HRD Manager. After evaluating petitioner's answer, explanations
and other evidence, IRRI issued a Notice of Termination to petitioner on December 7, 1990. Thereafter, petitioner filed a complaint
before the Labor Arbiter for illegal dismissal.

Thereafter, private respondent IRRI, through counsel, wrote the Labor Arbiter to inform him that the Institute enjoys immunity from
legal process by virtue of Article 3 of Presidential Decree No. 1620, and that it invokes such diplomatic immunity and privileges as an
international organization in the instant case filed by petitioner, not having waived the same.

ISSUE: WON Petitioner, as an international organization, waived its immunity (by virtue of its Memorandum on "Guidelines on the
handling of dismissed employees in relation to P.D. 1620.")

RULING: No. IRRI's immunity from suit is undisputed.

Presidential Decree No. 1620, Article 3 provides:

Art. 3. Immunity from Legal Process. The Institute shall enjoy immunity from any penal, civil and administrative
proceedings, except insofar as that immunity has been expressly waived by the Director-General of the Institute or
his authorized representatives.

In International Catholic Migration Commission v. Hon. Calleja, et al. and Kapisanan ng Manggagawa at TAC sa IRRI v.
Secretary of Labor and Employment and IRRI G.R No. 85750, the Court stated that “the letter of the Acting Secretary of Foreign Affairs
to the Secretary of Labor constituted a categorical recognition by the Executive Branch of the Government that . . . IRRI enjoy(s)
immunities accorded to international organizations, which determination has been held to be a political question conclusive upon the
Courts in order not to embarass a political department of Government.”

Further, we held that "(t)he raison d'etre for these immunities is the assurance of unimpeded performance of their functions by the
agencies concerned.

The grant of immunity from local jurisdiction to . . . and IRRI is clearly necessitated by their international character
and respective purposes. The objective is to avoid the danger of partiality and interference by the host country in
their internal workings. The exercise of jurisdiction by the Department of Labor in these instances would defeat the
 very purpose of immunity, which is to shield the affairs of international organizations, in accordance with
international practice, from political pressure or control by the host country to the prejudice of member States of
the organization, and to ensure the unhampered the performance of their functions. 16

The grant of immunity to IRRI is clear and unequivocal and an express waiver by its Director-General is the only way by which it
may relinquish or abandon this immunity.

On the matter of waiving its immunity from suit, IRRI had, early on, made its position clear. Through counsel, the Institute wrote the
Labor Arbiter categorically informing him that the Institute will not waive its diplomatic immunity. In the second place, petitioner's
reliance on the Memorandum with "Guidelines in handling cases of dismissal of employees in relation to P.D. 1620" dated July 26,
1983, is misplaced. The Memorandum reads, in part:

“Time and again the Institute has reiterated that it will not use its immunity under P.D. 1620 for the purpose of
terminating the services of any of its employees. Despite continuing efforts on the part of IRRI to live up to this
undertaking, there appears to be apprehension in the minds of some IRRI employees. To help allay these fears the
following guidelines will be followed hereafter by the Personnel/Legal Office while handling cases of dismissed
employees.”
xxx xxx xxx

Therefore, The IRRI shall enjoy immunity from any penal, civil, and administrative proceedings, except insofar as that immunity has
been expressly waived by the Director General of the Institute or his authorized representative.