POLITICAL LAW JURISPRUDENCE ATTY.

GOROSPE

PRELIMINARY Maghirang for violating Art 244 (Unlawful

Appointment) under the RPC. Petitioner seeks
CONSIDERATIONS that Maghirang be suspended from his office
but it was denied by the respondent judge
A.M. No. 93-7-696-0 February 21, 1995 holding that the requirement for such action is
In Re JOAQUIN T. BORROMEO, Ex Rel. a simultaneous existence of administrative and
Cebu City Chapter of the Integrated Bar of the criminal cases as against the accused, which
according to him is not present in this case,
Philippines.
and that the reelection of the Barangay
HELD:
Chairman is a condonation of his mistakes
Joaquin Borromeo was declared guilty
during his prior term. Hence, petitioner filed a
of constructive contempt of court for
case against the respondent judge for
repetitiously disrespecting the decisions and
ignorance of the law.
resolutions issued by the courts, and even by
issuing a circular containing libelous and
ISSUE: WON respondent judge is guilty of
offending accusations (like whimsical,
ignorance of the law.
capricious, and tyrannical) against the
Supreme Court justices and its employees. He
HELD: YES.
even delivered a letter accusing lawyers of
The claim of respondent Judge that a
defamatory comments and insults. This is due
local official who is criminally charged can be
to his series of dismissed complaints and
preventively suspended only if there is an
appeals against 3 banks namely Traders Royal
administrative case filed against him is without
Bank, United Coconut Planters Bank, and
basis. It is well settled that Section 13 of RA
Security Bank and Trust Co. from which he
3019 makes it mandatory for the
obtained loans with unfulfilled mortgages. In
Sandiganbayan (or the Court) to suspend any
relation to this, he filed cases against the
public officer against whom a valid information
lawyers of these banks and even against the
charging violation of this law, Book II, Title 7
clerks of court who signed the minute
of the RPC, or any offense involving fraud upon
resolutions of these cases. The actions reached
government or public funds or property is filed
the alarming number of 50 cases varying from
in court. Barangay Chairman Benjamin
civil, criminal, to administrative cases.
Maghirang was charged with Unlawful
In response, the court answered all his
Appointment, punishable under Article 244,
false alleged accusations through a resolution
Title 7, Book II of the Revised Penal
along with declaring him guilty of contempt of
Code. Therefore, it was mandatory on Judge
court.
Monzon’s part, considering the Motion filed, to
order the suspension of Maghirang.
Also, In Ingco v. Sanchez,[17] this Court
A.M. MTJ-98-1147 July 2, 1998 explicitly ruled that the re-election of a public
JESUS S. CONDUCTO vs. official extinguishes only the administrative,
JUDGE ILUMINADO C. MONZON but not the criminal, liability incurred by him
during his previous term of office.
FACTS: Be that as it may, it would also do well
A complaint was filed by petitioner to note that good faith and lack of malicious
Conducto with the Sangguniang Panlungsod of intent cannot completely free respondent from
San Pablo City against Benjamin Maghirang, liability.
the barangay chairman of Barangay III-E of
San Pablo City, for abuse of authority, serious
irregularity and violation of law in that, among
other things for appointing his sister-in-law to
the position of barangay secretary which
violates the law. A case was filed against

Digested and compiled by Monica S. Cajucom, UST Law

“It’s not how good you are, it’s how good you want to be.” –Paul Arden
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE

A.M. No. 133-J May 31, 1982 the Judiciary from engaging or having interest
BERNARDITA R. MACARIOLA in any lawful business
vs. HONORABLE ELIAS B. ASUNCION, Likewise, Article 14 of the Code of
Judge of the Court of First Instance of Leyte Commerce which prohibits judges from
engaging in commerce is, as heretofore stated,
deemed abrogated automatically upon the
FACTS:
transfer of sovereignty from Spain to America,
This is a complaint of petitioner against
because it is political in nature. virtual law
respondent judge of “acts unbecoming of a
libraryMoreover, the prohibition in paragraph
judge” regarding an act following the
5, Article 1491 of the New Civil Code against
unfavorable decision rendered by the
the purchase by judges of a property in
respondent judge against the former
litigation before the court within whose
concerning disputed properties of her deceased
jurisdiction they perform their duties, cannot
father which were being claimed by the latter’s
apply to respondent Judge because the sale of
children from a subsequent marriage. It turned
the lot in question to him took place after the
out that respondent judge purchased one of
finality of his decision in Civil Case No. 3010 as
the lots in the case decided by him and
well as his two orders approving the project of
transferred it to the fishing corporation where
partition; hence, the property was no longer
he is a stockholder and a ranking officer. Along
subject of litigation. virtual l
with this, other misdeeds were also exposed
WE are not, however, unmindful of the
such as that his involvement in the mentioned
fact that respondent Judge and his wife had
business corporation while he is sitting as a
withdrawn on January 31, 1967 from the
judge is in violation of the law, his alleged
aforesaid corporation and sold their respective
coddling of and close relations with an
shares to third parties. Such disposal or sale
impostor, Dominador Tan, who misrepresents
by respondent and his wife of their shares in
himself as a practicing attorney, and other
the corporation only 22 days after the
disregard for ethics.
incorporation of the corporation, indicates that
respondent realized that early that their
ISSUE: WON respondent judge should be held
interest in the corporation contravenes the
guilty of “acts unbecoming of a judge.”
aforesaid Canon 25.
With respect to the third and fourth
HELD: NO.
causes of action, complainant alleged that
Respondent Judge cannot be held liable
respondent was guilty of coddling an impostor
for involving himself in a business because
and acted in disregard of judicial decorum, and
there is no showing that respondent
that there was culpable defiance of the law and
participated or intervened in his
utter disregard for ethics. That fact even if true
official capacity in the business or transactions
did not render respondent guilty of violating
of the Traders Manufacturing and Fishing
any canon of judicial ethics as long as his
Industries, Inc. In the case at bar, the
friendly relations with Dominador A. Tan and
business of the corporation in which
family did not influence his official actuations
respondent participated has obviously no
as a judge where said persons were concerned.
relation or connection with his judicial office. It
There is no tangible convincing proof that
does not appear also from the records that the
herein respondent gave any undue privileges in
aforesaid corporation gained any undue
his court to Dominador Arigpa Tan or that the
advantage in its business operations by reason
latter benefitted in his practice of law from his
of respondent's financial involvement in it, or
personal relations with respondent, or that he
that the corporation benefited in one way or
used his influence, if he had any, on the
another in any case filed by or against it in
Judges of the other branches of the Court to
court. No provision in both the 1935 and 1973
favor said Dominador Tan.
Constitutions of the Philippines, nor is there an
existing law expressly prohibiting members of

Digested and compiled by Monica S. Cajucom, UST Law

“It’s not how good you are, it’s how good you want to be.” –Paul Arden
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
G.R. No. 152154 July 15, 2003
REPUBLIC OF THE PHILIPPINES vs.
HONORABLE SANDIGANBAYAN
(SPECIAL FIRST DIVISION), Ferdinand E.
Marcos (represented by his estate/heirs:
Imelda R. Marcos, Maria Imelda [Imee]
Marcos-Manotoc, Ferdinand R. Marcos, Jr.
and Irene Marcos-Araneta) and Imelda
Romualdez Marcos
FACTS:
Petitioner Republic, through the
Presidential Commission on Good Government
(PCGG), represented by the Office of the
Solicitor General (OSG), filed a petition for
forfeiture before the Sandiganbayan. Petitioner
sought the declaration of the aggregate
amount of US$356 million (now estimated to
be more than US$658 million inclusive of
interest) deposited in escrow in the PNB, as ill-
gotten wealth. The funds were previously held
by the following five account groups, using
various foreign foundations in certain Swiss
banks. In addition, the petition sought the
forfeiture of US$25 million and US$5 million in
treasury notes which exceeded the Marcos
couple’s salaries, other lawful income as well
as income from legitimately acquired
property.
The treasury notes are frozen at the
Central Bank of the Philippines by virtue of the
freeze order issued by the PCGG. Before the
case was set for pre-trial, a General Agreement
and the Supplemental Agreement dated
December 28, 1993 were executed by the
Marcos children and then PCGG Chairman
Magtanggol Gunigundo for a global settlement
of the assets of the Marcos family to identify,
collate, cause the inventory of and distribute
all assets presumed to be owned by the Marcos
family under the conditions contained therein.
ISSUE: WON the Swiss funds can be forfeited
in favor of the Republic, on the basis of the
Marcoses’ lawful income.
HELD: NO.
RA 1379 raises the prima facie
presumption that a property is unlawfully
acquired, hence subject to forfeiture, if its
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
amount or value is manifestly disproportionate
to the official salary and other lawful income of
the public officer who owns it. The following
facts must be established in order that
forfeiture or seizure of the Swiss deposits may
be effected: (1) ownership by the public officer
of money or property acquired during his
incumbency, whether it be in his name or
otherwise, and (2) the extent to which the
amount of that money or property exceeds, i.
e., is grossly disproportionate to, the
legitimate income of the public officer. Herein,
the spouses Ferdinand and Imelda Marcos
were public officials during the time material to
the present case was never in dispute.
The spouses accumulated salary of
$304,372.43 should be held as the only known
lawful income of the Marcoses since they did
not file any Statement of Assets and Liabilities
(SAL), as required by law, from which their net
worth could be determined. Besides, under the
1935 Constitution, Ferdinand E. Marcos as
President could not receive "any other
emolument from the Government or any of its
subdivisions and instrumentalities". Likewise,
under the 1973 Constitution, Ferdinand E.
Marcos as President could "not receive during
his tenure any other emolument from the
Government or any other source."
Their only known lawful income of
$304,372.43 can therefore legally and fairly
serve as basis for determining the existence of
a prima facie case of forfeiture of the Swiss
funds. The Republic did not fail to establish a
prima facie case for the forfeiture of the Swiss
deposits.
The Swiss deposits which were
transferred to and are deposited in escrow at
the Philippine National Bank in the estimated
aggregate amount of US$658,175,373.60 as of
31 January 2002, plus interest, were forfeited
in favor of the Republic.
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
THE STATE
G.R. No. L-26379 December 27, 1969
WILLIAM C. REAGAN, ET. AL vs.
COMMISSIONER OF INTERNAL
REVENUE
FACTS:
Petitioner Reagan, a civilian employee
of an American corporation providing technical
assistance to the US Air Force in the
Philippines, questioned the payment of the
income tax assessed on him by respondent CIR
on an amount realized by him on a sale of his
automobile to a member of the US Marine
Corps, the transaction having taken place at
the Clark Field Air Base at Pampanga. It is his
contention, that in legal contemplation the sale
was made outside Philippine territory and
therefore beyond our jurisdictional power to
tax. He seeks that an amount of P2,979.00 as
the income tax paid by him be refunded.
ISSUE: WON the Clark Field Air Base is a
foreign property therefore excluded from the
power of Philippine taxation.
HELD: NO.
By the [Military Bases] Agreement, it
should be noted, the Philippine Government
merely consents that the United States
exercise jurisdiction in certain cases. The
consent was given purely as a matter of
comity, courtesy, or expediency over the bases
as part of the Philippine territory or divested
itself completely of jurisdiction over offenses
committed therein. This provision is not and
can not on principle or authority be construed
as a limitation upon the rights of the Philippine
Government.
The State is not precluded from
allowing another power to participate in the
exercise of jurisdictional right over certain
portions of its territory. If it does so, it by no
means follows that such areas become
impressed with an alien character. They retain
their status as native soil. They are still subject
to its authority. Its jurisdiction may be
diminished, but it does not disappear. So it is
with the bases under lease to the American
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“It’s not how good you are, it’s how good you want to be.” –Paul Arden
armed forces by virtue of the military bases
agreement of 1947. They are not and cannot
be foreign territory.
G.R. No. 175888
SUZETTE NICOLAS vs. ROMULO
FACTS:
Respondent Lance Corporal (L/CPL)
Daniel Smith is a member of the US Armed
Forces. He was charged with the crime of rape
committed against a Filipina, petitioner herein,
sometime on November 1, 2005. Pursuant to
the Visiting Forces Agreement (VFA) between
the Republic of the Philippines and the US
entered into, the US, at its request, was
granted custody of Smith. The RTC of Makati
rendered a decision finding defendant Smith
guilty due to sufficient evidence.
Defendant Smith was taken out of the
Makati jail by a contingent of Philippine law
enforcement agents, purportedly acting under
orders of the DILG and brought to a facility for
detention under the control of the US
government under the new agreements
between the Philippines and the US, referred to
as the Romulo-Kenney Agreement.
Petitioners contend that
the Philippines should have custody of
defendant L/CPL Smith because, first of all, the
VFA is void and unconstitutional.
ISSUE: WON the VFA is void and
unconstitutional.
HELD: NO.
Art. XVIII, Sec. 25 states:
Sec. 25. After the expiration in 1991
of the Agreement between the
Philippines and the United States of
America concerning Military Bases,
foreign military bases, troops, or
facilities shall not be allowed in the
Philippines except under a treaty duly
concurred in by the Senate and, when
the Congress so requires, ratified by a
majority of the votes cast by the
people in a national referendum held
for that purpose, and recognized as a
treaty by the other contracting State.
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
The provision of Art. XVIII, Sec. 25 of the
Constitution, is complied with by virtue of the
fact that the presence of the US Armed Forces
through the VFA is a presence “allowed under”
the RP-US Mutual Defense Treaty. Since the
RP-US Mutual Defense Treaty itself has been
ratified and concurred in by both the Philippine
Senate and the US Senate, there is no
violation of the Constitutional provision
resulting from such presence.
The VFA being a valid and binding
agreement, the parties are required as a
matter of international law to abide by its
terms and provisions.
Applying, however, the provisions of
VFA, the Court finds that there is a different
treatment when it comes to detention as
against custody. “Art. V, Sec. 10. The
confinement or detention by Philippine
authorities of United States personnel shall be
carried out in facilities agreed on by
appropriate Philippines and US authorities.”
Therefore, the Romulo-Kenney
Agreements of December 19 and 22, 2006,
which are agreements on the detention of the
accused in the United States Embassy, are
not in accord with the VFA itself because such
detention is not “by Philippine
authorities.” Respondents should therefore
comply with the VFA and negotiate with
representatives of the United States towards
an agreement on detention facilities under
Philippine authorities as mandated by Art. V,
Sec. 10 of the VFA.
G.R. No. L-9657. November 29, 1956
LEOPOLDO T. BACANI and MATEO A.
MATOTO vs. NATIONAL COCONUT
CORPORATION, ET AL., NATIONAL
COCONUT CORPORATION and BOARD
OF LIQUIDATORS
FACTS:
Plaintiffs herein are court
stenographers assigned in Branch VI of the
Court of First Instance of Manila. During the
pendency of Civil Case No. 2293 of said court,
entitled Francisco Sycip vs. National Coconut
Corporation, Assistant Corporate Counsel
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“It’s not how good you are, it’s how good you want to be.” –Paul Arden
Federico Alikpala, counsel for Defendant,
requested said stenographers for copies of the
transcript of the stenographic notes taken by
them during the hearing. Plaintiffs complied
with the request by delivering to Counsel
Alikpala the needed transcript containing 714
pages and thereafter submitted to him their
bills for the payment of their fees. The National
Coconut Corporation paid the amount of P564
to Leopoldo T. Bacani and P150 to Mateo A.
Matoto for said transcript at the rate of P1 per
page. However, the Auditor General disallowed
the payment of these fees and ordered that it
shall be reimbursed for the reason that
NACOCO, being a public corporation, is
exempted from the fees. For reimbursement to
take place, it was further ordered that the
amount of P25 per payday be deducted from
the salary of Bacani and P10 from the salary of
Matoto. Hence, this petition.
ISSUE: WON NACOCO is exempt from legal
fees being an alleged government corporation.
HELD: NO.
There are functions which our
government is required to exercise to promote
its objectives as expressed in our Constitution
and which are exercised by it as an attribute of
sovereignty (constitute), and those which it
may exercise to promote merely the welfare,
progress and prosperity of the people
(ministrant). To this latter class belongs the
organization of those corporations owned or
controlled by the government to promote
certain aspects of the economic life of our
people such as the National Coconut
Corporation. These are what we call
government-owned or controlled corporations
which may take on the form of a private
enterprise or one organized with powers and
formal characteristics of a private corporations
under the Corporation Law. They do not
acquire the status of a government entity for
the simple reason that they do not come under
the classification of municipal or public
corporation. NACOCO is a GOCC. Thus, not
part of the government.
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
G.R. No. L-21484 November 29, 1969
THE AGRICULTURAL CREDIT AND
COOPERATIVE FINANCING
ADMINISTRATION (ACCFA) vs.
CONFEDERATION OF UNIONS IN
GOVERNMENT CORPORATIONS AND
OFFICES (CUGCO), et. al.
FACTS:
The Agricultural Credit and Cooperative
Financing Administration (ACCFA) was a
government agency created under Republic Act
No. 821, as amended. Its administrative
machinery was reorganized and its name
changed to Agricultural Credit Administration
(ACA) under the Land Reform Code (Republic
Act No. 3844).
On September 4, 1961 a collective
bargaining agreement, which was to be
effective for a period of one (1) year was
entered into by and between the Unions and
the ACCFA. A few months thereafter, the
Unions started protesting against alleged
violations and non-implementation of said
agreement. Thereafter Unions declared a
strike, which was ended when the strikers
voluntarily returned to work. The Unions,
together with its mother union, the
Confederation of Unions in Government
Corporations and Offices (CUGCO), filed a
complaint with the Court of Industrial Relations
against the ACCFA for having allegedly
committed acts of unfair labor practice.
ISSUE: WON the Unions and CUGCO had the
right to commence a CBA with ACA, formerly
ACCFA.
HELD: NO.
We hold that the respondent Unions
are not entitled to the certification election
sought in the Court below. Such certification is
admittedly for purposes of bargaining in behalf
of the employees with respect to terms and
conditions of employment, including the right
to strike as a coercive economic weapon, as in
fact the said unions did strike in 1962 against
the ACCFA. This is contrary to Section 11 of
Republic Act No. 875, which provides for
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
the prohibition against to strike in the
government.
With the reorganization of the ACCFA
and its conversion into the ACA under the Land
Reform Code and in view of our ruling as to the
governmental character of the functions of the
ACA, the decision of the respondent Court
dated March 25, 1963, and the resolution en
banc affirming it, in the unfair labor practice
case filed by the ACCFA, which decision is the
subject of the present review in G. R. No. L-
21484, has become moot and academic,
particularly insofar as the order to bargain
collectively with the respondent Unions is
concerned. The respondent Unions have no
right to the certification election sought by
them nor, consequently, to bargain collectively
with the petitioner, no further fringe benefits
may be demanded on the basis of any
collective bargaining agreement.
G.R. No. 143377. February 20, 2001
SHIPSIDE INCORPORATED vs.
THE HON. COURT OF APPEALS,
HON. REGIONAL TRIAL COURT,
BRANCH 26 (San Fernando City, La Union)
& The REPUBLIC OF THE PHILIPPINES
FACTS:
October 29, 1958, Original Certificate
of Title was issued in favor of Rafael Galvez,
over four parcels of land. Lots No. 1 and 4
were conveyed by Rafael Galvez in favor of
Filipina Mamaril, Cleopatra Llana, Regina
Bustos, and Erlinda Balatbat in a deed of sale.
Then Mamaril et al. sold Lots No. 1 and 4 to
Lepanto Consolidated Mining Company.
Unknown to the latest owner, the CIR of La
Union issued an Order in Land Registration
Case No. N-361 declaring the deed of sale
between Galvez and Mamaril, et. al. (OCT No.
0-381) null and void, and ordered the
cancellation thereof.
Lepanto Consolidated Mining Company
sold to herein petitioner Shipside Inc. Lots No.
1 and 4.
Twenty-four years after, the lots have
never been executed. Consequently, a
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE

complaint for revival of judgment and STATE IMMUNITY

cancellation of titles was filed by the OSG.

ACT NO. 3083

ISSUE: WON Republic of the Philippines can
AN ACT DEFINING THE CONDITIONS
maintain the action for revival of judgment herein
despite the issue of prescription. UNDER WHICH THE GOVERNMENT
OF THE PHILIPPINE ISLANDS MAY BE
HELD: NO.
SUED
While it is true that prescription does not
run against the State, the same may not be
Section 1. Complaint against Government.
invoked by the government in this case since it
— Subject to the provisions of this Act, the
is no longer interested in the subject matter.
Government of the Philippine Islands hereby
Moreover, to recognize the Government as
consents and submits to be sued upon any
a proper party to sue in this case would set a
moneyed claim involving liability arising from
bad precedent as it would allow the Republic to
contract, expressed or implied, which could
prosecute, on behalf of government-owned or
serve as a basis of civil action between private
controlled corporations, causes of action which
parties.
have already prescribed, on the pretext that
the Government is the real party in interest
Sec. 2. A person desiring to avail himself of
against whom prescription does not run, said
the privilege herein conferred must show that
corporations having been created merely as
he has presented his claim to the Insular
agents for the realization of government
Auditor 1 and that the latter did not decide the
programs.
same within two months from the date of its
Parenthetically, petitioner was not a party
presentation.
to the original suit for cancellation of title
commenced by the Republic twenty-seven
Sec. 3. Venue. — Original actions brought
years for which it is now being made to
pursuant to the authority conferred in this Act
answer, nay, being made to suffer financial
shall be instituted in the Court of First Instance
losses.
of the City of Manila or of the province were
It should also be noted that petitioner is
the claimant resides, at the option of the
unquestionably a buyer in good faith and for
latter, upon which court exclusive original
value, having acquired the property in 1963, or
jurisdiction is hereby conferred to hear and
5 years after the issuance of the original
determine such actions.
certificate of title, as a third transferee. If only
not to do violence and to give some measure
Sec. 4. Actions instituted as aforesaid shall be
of respect to the Torrens System, petitioner
governed by the same rules of procedure, both
must be afforded some measure of protection.
original and appellate, as if the litigants were
private parties.

Sec. 5. When the Government of the Philippine

Island is plaintiff in an action instituted in any
court of original jurisdiction, the defendant
shall have the right to assert therein, by way
of set-off or counterclaim in a similar action
between private parties.

Sec. 6. Process in actions brought against the

Government of the Philippine Islands pursuant
to the authority granted in this Act shall be
served upon the Attorney-General 2 whose

Digested and compiled by Monica S. Cajucom, UST Law

“It’s not how good you are, it’s how good you want to be.” –Paul Arden
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
duty it shall be to appear and make defense,
either himself or through delegates.
Sec. 7. Execution. — No execution shall issue
upon any judgment rendered by any court
against the Government of the Philippine
Islands under the provisions of this Act; but a
copy thereof duly certified by the clerk of the
Court in which judgment is rendered shall be
transmitted by such clerk to the Governor-
General, 3 within five days after the same
becomes final.
Sec. 8. Transmittal of Decision. — The
Governor-General, 4 at the commencement of
each regular session of the Legislature, 5 shall
transmit to that body for appropriate action all
decisions so received by him, and if said body
determine that payment should be made, it
shall appropriate the sum which the
Government has been sentenced to pay,
including the same in the appropriations for
the ensuing year.
Sec. 9. This Act shall take effect on its
approval.
Approved: March 16, 1923.
COMMONWEALTH ACT NO. 327
AN ACT FIXING THE TIME WITHIN
WHICH THE AUDITOR GENERAL
SHALL RENDER HIS DECISIONS AND
PRESCRIBING THE MANNER OF
APPEAL THEREFROM
Section 1. In all cases involving the
settlement of accounts or claims, other than
those of accountable officers, the Auditor
General shall act and decide the same within
sixty days, exclusive of Sundays and holidays,
after their presentation. If said accounts or
claims need reference to other persons, office
or offices, or to a party interested, the period
aforesaid shall be counted from the time the
last comment necessary to a proper decision is
received by him. With respect to the accounts
of accountable officers, the Auditor General
shall act on the same within one hundred days
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
after their submission, Sundays and holidays
excepted.
In case of accounts or claims already
submitted to but still pending decision by the
Auditor General on or before the approval of
this Act, the periods provided in this section
shall commence from the date of such
approval.
Section 2. The party aggrieved by the final
decision of the Auditor General in the
settlement of an account for claim may, within
thirty days from receipt of the decision, take
an appeal in writing:
(a) To the President of the United States,
pending the final and complete withdrawal of
her sovereignty over the Philippines, or
(b) To the President of the Philippines, or
(c) To the Supreme Court of the Philippines if
the appellant is a private person or entity.
If there are more than one appellant, all
appeals shall be taken to the same authority
resorted to by the first appellant.
From a decision adversely affecting the
interests of the Government, the appeal may
be taken by the proper head of the department
or in case of local governments by the head of
the office or branch of the Government
immediately concerned.
The appeal shall specifically set forth the
particular action of the Auditor General to
which exception is taken with the reasons and
authorities relied on for reversing such
decision.
Section 3. This Act shall take effect upon its
approval.
Approved: June 18. 1938.
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
PRESIDENTIAL DECREE No. 1807
PRESCRIBING THE PROCEDURE
WHEREBY THE REPUBLIC OF THE
PHILIPPINES MAY WAIVE SOVEREIGN
IMMUNITY FROM SUIT AND OTHER
LEGAL PROCEEDING WITH RESPECT
TO ITSELF OR ITS PROPERTY IN
CONNECTION WITH FOREIGN
OBLIGATIONS CONTRACTED BY IT
PURSUANT TO LAW
WHEREAS, in the pursuit of economic growth
and development, it has become imperative for
the Republic of the Philippines to enter into
contracts or transactions with international
banking, financial and other foreign
enterprises;
WHEREAS, recognizing this need, existing
legislation expressly authorize the Republic of
the Philippines to contract foreign obligations,
including borrowings in foreign currency, and
to guarantee foreign obligations of
corporations and other entities owned or
controlled by the Government of the
Philippines;
WHEREAS, circumstances in the international
market may require that sovereign states
entering into contracts or transactions make
express waivers of sovereign immunity in
connection with such contracts or transactions;
WHEREAS, it is in the national interest that a
procedure be prescribed with respect to the
waiver of sovereign immunity of the Republic
of the Philippines in respect of international
contracts or transactions entered into by it;
NOW, THEREFORE, I, FERDINAND E. MARCOS,
President of the Republic of the Philippines, by
virtue of the powers vested in me by the
Constitution, do hereby order and decree:
Section 1. Procedure for, and Conditions of,
Waiver of Sovereign Immunity.
In instances where the law expressly
authorizes the Republic of the Philippines to
contract or incur a foreign obligation, it may
consent to be sued in connection therewith.
The President of the Philippines or his duly
designated representative may, in behalf of the
Republic of the Philippines, contractually agree
to waive any claim to sovereign immunity from
suit or legal proceedings and from set-off,
attachment or executive with respect to its
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
property, and to be sued in any appropriate
jurisdiction in regard to such foreign obligation.
For purposes of this decree, a foreign
obligation means any direct, indirect, or
contingent obligation or liability capable of
pecuniary estimation and payable in a currency
other than Philippine currency.
Section 2. Validity of existing Waivers.
Nothing in this Decree shall be construed to
revoke or repeal any waiver of sovereign
immunity from suit or legal proceedings or
from set-off, attachment or execution granted
under or pursuant to other provisions of law.
Section 3. Effectivity. This Decree shall take
effect immediately.
ARTICLE 2180 (NCC)
xxx
The State is responsible in like manner when it
acts through a special agent; but not when the
damage has been caused by the official to
whom the task done properly pertains, in
which case what is provided in Article 2176
shall be applicable.
xxx
G.R. No. L-11154 March 21, 1916
E. MERRITT vs.
GOVERNMENT OF THE PHILIPPINE
ISLANDS
FACTS:
Counsel for the plaintiff insists that the
trial court erred (1) "in limiting the general
damages which the plaintiff suffered to P5,000,
instead of P25,000 as claimed in the
complaint," and (2) "in limiting the time when
plaintiff was entirely disabled to two months
and twenty-one days and fixing the damage
accordingly in the sum of P2,666, instead of
P6,000 as claimed by plaintiff in his
complaint."
The Attorney-General on behalf of the
defendant urges that the trial court erred: (a)
in finding that the collision between the
plaintiff's motorcycle and the ambulance of the
General Hospital was due to the negligence of
the chauffeur, who is an alleged agent or
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
employee of the Government; (b) in holding
that the Government of the Philippine Islands
is liable for the damages sustained by the
plaintiff as a result of the collision, even if it be
true that the collision was due to the
negligence of the chauffeur; and (c) in
rendering judgment against the defendant for
the sum of P14,741.
Consequently, the Government issued
an act allowing the plaintiff to commence a
lawsuit against it.
ISSUE:
1) WON the Government conceded its
liability to the plaintiff by allowing a lawsuit to
commence against it.
2) WON the chauffeur is a government
employee or agent.
HELD:
1) NO.
By consenting to be sued a state simply
waives its immunity from suit. It does not
thereby concede its liability to plaintiff, or
create any cause of action in his favor, or
extend its liability to any cause not previously
recognized. It merely gives a remedy to
enforce a preexisting liability and submits itself
to the jurisdiction of the court, subject to its
right to interpose any lawful defense.
2) NO.
We will now examine the substantive law
touching the defendant's liability for the
negligent acts of its officers, agents, and
employees. Paragraph 5 of article 1903 of the
Civil Code reads: The state is liable in this
sense when it acts through a special agent, but
not when the damage should have been
caused by the official to whom properly it
pertained to do the act performed, in which
case the provisions of the preceding article
shall be applicable. The responsibility of the
state is limited to that which it contracts
through a special agent, duly empowered by
a definite order or commission to perform
some act or charged with some definite
purpose which gives rise to the claim.
The chauffeur of the ambulance of the
General Hospital was not such an agent.
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
GRN L-35645 May 22, 1985.
UNITED STATES OF AMERICA, CAPT.
JAMES B. GALLOWAY, WILLIAM I.
COLLINS and ROBERT GOHIER vs.
HON. V. M. RUIZ, Presiding Judge of
Branch XV, Court of First Instance of Rizal
and ELIGIO DE GUZMAN & CO., INC.
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.
Sometime in May, 1972, the United
States invited the submission of bids for a
couple of repair projects. Eligio de Guzman
land Co., Inc. responded to the invitation and
submitted bids. Subsequent thereto, the
company received from the US two telegrams
requesting it to confirm its price proposals and
for the name of its bonding company. The
company construed this as an acceptance of its
offer so they complied with the requests. The
company received a letter which was signed by
William I. Collins of Department of the Navy of
the United States, also one of the petitioners
herein informing that the company did not
qualify to receive an award for the projects
because of its previous unsatisfactory
performance rating in repairs, and that the
projects were awarded to third parties. The
company filed a complaint against the
defendants herein demanding specific
performance that the company be allowed 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.
ISSUE: WON the US is immune from suit
having dealt with a private corporation.
HELD: YES.
A State may be said to have descended
the 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
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
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.
G.R. No. 129406 March 6, 2006
REPUBLIC OF THE PHILIPPINES
represented by the PRESIDENTIAL
COMMISSION ON GOOD
GOVERNMENT (PCGG) vs.
SANDIGANBAYAN (SECOND DIVISION)
and ROBERTO S. BENEDICTO.
FACTS:
The PCGG issued writs placing under
sequestration all business enterprises, entities
and other properties, real and personal, owned
or registered in the name of private
respondent Benedicto, or of corporations in
which he appeared to have controlling or
majority interest due to his involvement in
cases of ill-gotten wealth. Among the
properties thus sequestered and taken over by
PCGG fiscal agents were the 227 shares in
NOGCCI owned by and registered under the
name of private respondent. As sequester of
the 227 shares formerly owned by Benedicto,
PCGG did not pay the monthly membership
fee. Later on, the shares were declared to be
delinquent to be put into an auction sale.
Despite filing a writ of injunction, it was
nevertheless dismissed. So petitioner Republic
and private respondent Benedicto entered into
a Compromise Agreement which contains a
general release clause where petitioner agreed
and bound itself to lift the sequestration on the
227 NOGCCI shares acknowledging that it was
within private respondent’s capacity to acquire
the same shares out of his income from
business and the exercise of his
profession. Implied in this undertaking is the
recognition by petitioner that the subject
shares of stock could not have been ill-gotten
Benedicto filed a Motion for Release
from Sequestration and Return of Sequestered
Shares/Dividends praying, inter alia, that his
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
NOGCCI shares of stock be specifically
released from sequestration and returned,
delivered or paid to him as part of the parties’
Compromise Agreement in that case. It was
granted but the shares were ordered to be put
under the custody of the Clerk of Court. Along
with this, PCGG was ordered to deliver the
shares to the Clerk of Court which it failed to
comply with without any justifiable grounds.
In a last-ditch attempt to escape
liability, petitioner Republic, through the
PCGG, invokes state immunity from suit.
ISSUE: WON the Republic can invoke state
immunity.
HELD: NO.
In fact, by entering into a Compromise
Agreement with private respondent Benedicto,
petitioner Republic thereby stripped itself of its
immunity from suit and placed itself in the
same level of its adversary. When the State
enters into contract, through its officers or
agents, in furtherance of a legitimate aim and
purpose and pursuant to constitutional
legislative authority, whereby mutual or
reciprocal benefits accrue and rights and
obligations arise therefrom, the State may be
sued even without its express consent,
precisely because by entering into a contract
the sovereign descends to the level of the
citizen. Its consent to be sued is implied from
the very act of entering into such contract,
breach of which on its part gives the
corresponding right to the other party to the
agreement.
G.R. No. L-23139 December 17, 1966
MOBIL PHILIPPINES EXPLORATION,
INC. vs.
CUSTOMS ARRASTRE SERVICE and
BUREAU of CUSTOMS
FACTS:
Four cases of rotary drill parts were
shipped from abroad on S.S. "Leoville"
consigned to Mobil Philippines Exploration,
Inc., Manila. It was discharged to the custody
of the Customs Arrastre Service, the unit of
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
the Bureau of Customs then handling arrastre
operations therein. The Customs Arrastre
Service later delivered to the broker of the
consignee three cases only. Petitioner filed suit
in the Court of First Instance of Manila against
the Customs Arrastre Service and the Bureau
of Customs to recover the value of the
undelivered case plus other damages. The
respondents filed a motion to dismiss on the
ground that not being persons under the law,
they cannot be sued.
ISSUE: WON the defendants can invoke state
immunity.
HELD: YES.
Now, the fact that a non-corporate
government entity performs a function
proprietary in nature does not necessarily
result in its being suable. If said non-
governmental function is undertaken as an
incident to its governmental function, there is
no waiver thereby of the sovereign immunity
from suit extended to such government entity.
The Bureau of Customs, to repeat, is
part of the Department of Finance with no
personality of its own apart from that of the
national government. Its primary function is
governmental, that of assessing and collecting
lawful revenues from imported articles and all
other tariff and customs duties, fees, charges,
fines and penalties. To this function, arrastre
service is a necessary incident.
G.R. No. L-33112 June 15, 1978
PHILIPPINE NATIONAL BANK vs.
HON. JUDGE JAVIER PABALAN, Judge of
the Court of First Instance, Branch III, La
Union, AGOO TOBACCO PLANTERS
ASSOCIATION, INC., PHILIPPINE
VIRGINIA TOBACCO
ADMINISTRATION, and PANFILO P.
JIMENEZ, Deputy Sheriff, La Union
FACTS:
The reliance of petitioner Philippine National
Bank against respondent Judge Javier Pabalan
who issued a writ of execution, followed
thereafter by a notice of garnishment of the
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
funds of respondent Philippine Virginia Tobacco
Administration, deposited with it, is on the
fundamental constitutional law doctrine of non-
suability of a state, it being alleged that such
funds are public in character.
ISSUE: WON the funds are public in character,
thus immune from suit.
HELD: NO.
It is to be admitted that under the
present Constitution, what was formerly
implicit as a fundamental doctrine in
constitutional law has been set forth in express
terms: "The State may not be sued without its
consent." If the funds appertained to one of
the regular departments or offices in the
government, then, certainly, such a provision
would be a bar to garnishment. Such is not the
case here.
It is well-settled that when the
government enters into commercial business,
it abandons its sovereign capacity and is to be
treated like any other corporation. By engaging
in a particular business thru 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.
G.R. No. L-31635 August 31, 1971
ANGEL MINISTERIO and ASUNCION
SADAYA vs.
THE COURT OF FIRST INSTANCE OF
CEBU, Fourth Branch, Presided by the
Honorable, Judge JOSE C. BORROMEO,
THE PUBLIC HIGHWAY
COMMISSIONER, and THE AUDITOR
GENERAL
FACTS:
Petitioners sought the payment of just
compensation for a registered lot alleging that
in 1927 the National Government through its
authorized representatives took physical and
material possession of it and used it for the
widening of a national road, without paying
just compensation and without any agreement,
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
either written or verbal. There was an
allegation of repeated demands for the
payment of its price or return of its possession,
but defendants Public Highway Commissioner
and the Auditor General refused to restore its
possession.
ISSUE: WON the defendants are immune from
suit.
HELD: NO.
Where the judgment in such a case
would result not only in the recovery of
possession of the property in favor of said
citizen but also in a charge against or financial
liability to the Government, then the suit
should be regarded as one against the
government itself, and, consequently, it cannot
prosper or be validly entertained by the courts
except with the consent of said Government.
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.
G.R. No. 169304 March 13, 2007
THE DEPARTMENT OF HEALTH,
SECRETARY MANUEL M. DAYRIT,
USEC. MA. MARGARITA GALON and
USEC. ANTONIO M. LOPEZ, vs.
PHIL. PHARMAWEALTH, INC.
FACTS:
Respondent Phil. Pharmawealth, Inc. is
a domestic corporation engaged in the
business of manufacturing and supplying
pharmaceutical products to government
hospitals in the Philippines. Then Secretary of
Health Alberto G. Romualdez, Jr. issued
Administrative Order (A.O.) No. 27 outlining
the guidelines and procedures on the
accreditation of government suppliers for
pharmaceutical products. A.O. No. 27 was later
amended by providing for additional
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
guidelines for accreditation of drug
suppliers aimed at ensuring that only qualified
bidders can transact business with petitioner.
Respondent submitted to petitioner
DOH a request for the inclusion of additional
items in its list of accredited drug products,
including the antibiotic "Penicillin G
Benzathine." DOH issued an Invitation for Bids
for the procurement of 1.2 million units vials of
Penicillin G Benzathine. Despite the lack of
response from petitioner DOH regarding
respondent’s request for inclusion of additional
items in its list of accredited products,
respondent submitted its bid for the Penicillin G
Benzathine contract. Only two companies
participated, the respondent being the lower
bidder. In view, however, of the non-
accreditation of respondent’s Penicillin G
Benzathine product, the contract was awarded
to the other company. Hence, respondent filed
a complaint injunction, mandamus and
damages against DOH.
ISSUE: WON DOH can invoke immunity from
suit.
HELD: NO.
The suability of a government official
depends on whether the official concerned was
acting within his official or jurisdictional
capacity, and whether the acts done in the
performance of official functions will result in a
charge or financial liability against the
government. In the first case, the Constitution
itself assures the availability of judicial
review, and it is the official concerned who
should be impleaded as the proper party. As
regards petitioner DOH, the defense of
immunity from suit will not avail despite its
being an unincorporated agency of the
government, for the only causes of action
directed against it are preliminary injunction
and mandamus.
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
G.R. No. 131544. March 16, 2001
EPG CONSTRUCTION CO., ET. AL. vs.
HONORABLE GREGORIO R. VIGILAR, In
His Capacity as Secretary of Public Works and
Highways
FACTS:
The Ministry of Human Settlement,
through the BLISS Development Corporation,
initiated a housing project on a government
property along the east bank of the
Manggahan Floodway in Pasig City. For this
purpose, the Ministry of Human Settlement
entered into a Memorandum of Agreement
(MOA) with the Ministry of Public Works and
Highways, where the latter undertook to
develop the housing site and construct thereon
145 housing units. By virtue of the MOA, the
Ministry of Public Works and Highways forged
individual contracts with herein petitioners EPG
Construction Co., et. al. for the construction of
the housing units.
By reason of the verbal request and
assurance of then DPWH that additional funds
would be available and forthcoming, petitioners
agreed to undertake and perform “additional
constructions” for the completion of the
housing units, despite the absence of
appropriations and written contracts to cover
subsequent expenses for the “additional
constructions.” Petitioners then received
payment for the construction work duly
covered by the individual written contracts,
thereby leaving an unpaid balance
representing the “additional constructions.”
Petitioners sent a demand letter to the
DPWH Secretary and submitted that their claim
for payment was favorably recommended by
DPWH Assistant Secretary for Legal Services
who recognized the existence of implied
contracts covering the additional
constructions.
Respondent argues that the State may not
be sued in the instant case, invoking the
constitutional doctrine of Non-suability of
the State, otherwise known as the Royal
Prerogative of Dishonesty.
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
ISSUE: WON DPWH can invoke state
immunity.
HELD: NO.
Under these circumstances, respondent
may not validly invoke the Royal Prerogative
of Dishonesty and conveniently hide under
the State’s cloak of invincibility against
suit, considering that this principle yields to
certain settled exceptions. True enough, the
rule, in any case, is not absolute for it does not
say that the state may not be sued under any
circumstance. The doctrine of governmental
immunity from suit cannot serve as an
instrument for perpetrating an injustice on a
citizen.
To be sure, this Court – as the staunch
guardian of the citizens’ rights and welfare –
cannot sanction an injustice so patent on its
face, and allow itself to be an instrument in the
perpetration thereof. Justice and equity
sternly demand that the State’s cloak of
invincibility against suit be shred in this
particular instance, and that petitioners–
contractors be duly compensated – on the
basis of quantum meruit – for construction
done on the public works housing project.
G.R. No. L-48214 December 19, 1978
ILDEFONSO SANTIAGO, represented by
his Attorney-in-Fact, ALFREDO T.
SANTIAGO vs.
REPUBLIC OF THE PHILIPPINES
FACTS:
Santiago’s plea was for the revocation of a
deed of donation executed by him and his
spouse with the Bureau of Plant Industry as
the donee. As alleged in such complaint, such
Bureau, contrary to the terms of the donation,
failed to "install lighting facilities and water
system on the property donated and to build
an office building and parking [lot] thereon
which should have been constructed and ready
for occupancy. That led him to conclude that
under the circumstances, he was exempt from
compliance with such an explicit constitutional
command.
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
ISSUE: WON the Bureau is immune from suit.
HELD: YES.
If an order of dismissal would suffice,
then the element of unfairness enters, the
facts alleged being hypothetically admitted. It
is the considered opinion of this Court then
that to conform to the high dictates of equity
and justice, the presumption of consent could
be indulged in safely. That would serve to
accord to petitioner as plaintiff, at the very
least, the right to be heard.
The doctrine of governmental immunity
from suit cannot serve as an instrument for
perpetrating an injustice on a citizen.
Under the circumstances, the
fundamental postulate of non-suability cannot
stand in the way. It is made to accommodate
itself to the demands of procedural due
process, which is the negation of arbitrariness
and inequity. The government, in the final
analysis, is the beneficiary. It thereby
manifests its adherence to the highest ethical
standards, which can only be ignored at the
risk of losing the confidence of the people, the
repository of the sovereign power.
G.R. No. L-29993 October 23, 1978
LAUDENCIO TORIO, ET. AL. vs.
ROSALINA, ANGELINA, LEONARDO,
EDUARDO, ARTEMIO, ANGELITA,
ANITA, ERNESTO, NORMA, VIRGINIA,
REMEDIOS and ROBERTO, all surnamed
FONTANILLA, and THE HONORABLE
COURT OF APPEALS
FACTS:
The Municipal Council of Malasiqui,
Pangasinan, passed a resolution whereby "it
resolved to manage the 1959 Malasiqui town
fiesta celebration. Another resolution was also
passed creating the "1959 Malasiqui 'Town
Fiesta Executive Committee" which in turn
organized a sub-committee on entertainment
and stage. The council appropriated an amount
for the construction of 2 stages, one for the
"zarzuela" and another for the cancionan Jose
Macaraeg supervised the construction of the
stage. The "zarzuela" then began but before
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
the dramatic part of the play was reached, the
stage collapsed and Vicente Fontanilla who was
at the rear of the stage was pinned
underneath. Fontanilia was taken to the
hospital where he died in the afternoon of the
following day.
The heirs of Vicente Fontanilia filed a
complaint against Municipality. Answering the
complaint defendant municipality invoked inter
alia the principal defense that as a legally and
duly organized public corporation it performs
sovereign functions and the holding of a town
fiesta was an exercise of its governmental
functions from which no liability can arise to
answer for the negligence of any of its agents.
ISSUE: WON the defendant Municipality was
performing sovereign functions therefore
immune from suit.
HELD: NO.
Holding a fiesta even if the purpose is
to commemorate a religious or historical event
of the town is in essence an act for the special
benefit of the community and not for the
general welfare of the public performed in
pursuance of a policy of the state. The mere
fact that the celebration, as claimed was not to
secure profit or gain but merely to provide
entertainment to the town inhabitants is not a
conclusive test. For instance, the maintenance
of parks is not a source of income for the
nonetheless it is private undertaking as
distinguished from the maintenance of public
schools, jails, and the like which are for public
service.
There can be no hard and fast rule for
purposes of determining the true nature of an
undertaking or function of a municipality; the
surrounding circumstances of a particular case
are to be considered and will be decisive. The
basic element, however beneficial to the public
the undertaking may be, is that it is
governmental in essence, otherwise. the
function becomes private or proprietary in
character. Easily, no governmental or public
policy of the state is involved in the celebration
of a town fiesta.
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
G.R. No. L-52179 April 8, 1991
MUNICIPALITY OF SAN FERNANDO, LA
UNION vs.
HON. JUDGE ROMEO N. FIRME, ET. AL.
FACTS:
At about 7am of December 16, 1965, a
collision occurred involving a passenger
jeepney driven by Bernardo Balagot (owned by
the Estate of Macario Nieveras), a gravel and
sand truck driven by Jose Manandeg (owned
by Tanquilino Velasquez), and a dump truck of
the Municipality of San Fernando, La Union and
driven by Alfredo Bislig. Due to the impact,
several passengers of the jeepney including
Laureano Baniña Sr. died as a result of the
injuries they sustained and four others suffered
varying degrees of physical injuries.
The private respondents instituted a
complaint for damages against the Estate of
Macario Nieveras and Bernardo Balagot, owner
and driver, respectively, of the passenger
jeepney. However, the aforesaid defendants
filed a Third Party Complaint against the
petitioner and the driver of a dump truck of
petitioner.
Petitioner raised as one of its defenses
the non-suability of the State.
ISSUE: WON the Municipality of San Fernando
is immune from suit.
HELD: YES.
Anent the issue of whether or not the
municipality is liable for the torts committed by
its employee, the test of liability of the
municipality depends on whether or not the
driver, acting in behalf of the municipality, is
performing governmental or proprietary
functions.
In the case at bar, the driver of the
dump truck of the municipality insists that "he
was on his way to the Naguilian river to get a
load of sand and gravel for the repair of San
Fernando's municipal streets." We already
stressed in the case of Palafox,
et. al. vs. Province of Ilocos Norte, the District
Engineer, and the Provincial Treasurer (102
Phil 1186) that "the construction or
maintenance of roads in which the truck and
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
the driver worked at the time of the accident
are admittedly governmental activities."
We arrive at the conclusion that the
municipality cannot be held liable for the torts
committed by its regular employee, who was
then engaged in the discharge of governmental
functions. Hence, the death of the passenger –
– tragic and deplorable though it may be ––
imposed on the municipality no duty to pay
monetary compensation.
G.R. No. L-30671 November 28, 1973
REPUBLIC OF THE PHILIPPINES vs.
HON. GUILLERMO P. VILLASOR, ET. AL.
FACTS:
In the petition filed by the Republic of
the Philippines, a summary of facts was set
forth thus:
A decision was rendered in favor of
respondents P. J. Kiener Co., Ltd., Gavino
Unchuan, and International Construction
Corporation, and against the petitioner herein,
confirming the arbitration award in the
amount of P1,712,396.40, subject of Special
Proceedings. Respondent Judge Villasor, issued
an Order declaring the aforestated decision
final and executory, directing the Sheriffs of
Rizal Province, Quezon City [as well as] Manila
to execute the said decision. Pursuant to the
said Order, the corresponding Alias Writ of
Execution [was issued]. On the strength of the
afore-mentioned Alias Writ of Execution, the
Provincial Sheriff of Rizal (respondent herein)
served notices of garnishment with several
Banks, specially on the monies due the Armed
Forces of the Philippines in the form of deposits
sufficient to cover the amount mentioned in
the said Writ of Execution. The Philippine
Veterans Bank received the same notice of
garnishment. The funds of the Armed Forces of
the Philippines on deposit with the Banks,
particularly, with the Philippine Veterans Bank
and the Philippine National Bank [or] their
branches are public funds duly appropriated
and allocated for the payment of pensions of
retirees, pay and allowances of military and
civilian personnel and for maintenance and
operations of the Armed Forces of the
Philippines.
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
ISSUE: WON the Republic can invoke state
immunity from suit.
HELD: YES.
Since government funds and properties
may not be seized under writs of execution or
garnishment to satisfy such judgments, is
based on obvious considerations of public
policy. Disbursements of public funds must be
covered by the corresponding appropriation as
required by law. The functions and
public services rendered by the State cannot
be allowed to be paralyzed or disrupted by the
diversion of public funds from their legitimate
and specific objects, as appropriated by law.
A.M. No. RTJ-05-1959
REPUBLIC OF THE PHILIPPINES vs.
JUDGE VICENTE A. HIDALGO, Presiding
Judge of the Regional Trial Court of Manila,
Branch 37
FACTS:
Tarcila Laperal Mendoza filed an action
for the annulment or declaration of nullity of
the title and deed of sale, reconveyance and/or
recovery of ownership and possession a
property against the Republic of the
Philippinesin the RTC of Manila.
It is also known as the Arlegui
Residence which housed two Philippine
presidents and which now holds the Office of
the Press Secretary and the News Information
Bureau.
The case was initially dismissed by the
presiding Judge of the Manila RTC (Branch 35)
on the ground of state immunity. The case was
re-raffled to the Manila RTC (Branch 37), with
respondent Vicente A. Hidalgo as presiding
Judge. In an Order, Judge Hidalgo declared the
Republic in default for failure of Solicitor
Gabriel Francisco Ramirez, the handling
solicitor, to file the required Answer within the
period prayed for in his motion for extension.
It is contended that the respondent
Judge violated the Constitution and the
fundamental rule that government funds are
exempt from execution or garnishment when
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
he caused the issuance of the writ of execution
against the Republic.
ISSUE: WON the Republic can invoke immunity
from suit.
HELD:
It is settled that when the State gives
its consent to be sued, it does not thereby
necessarily consent to an unrestrained
execution against it. Tersely put, when the
State waives its immunity, all it does, in effect,
is to give the other party an opportunity to
prove, if it can, that the state has a liability.
The functions and public services
rendered by the State cannot be allowed to
paralyzed or disrupted by the diversion of
public funds from their legitimate and specific
objects, as appropriated by law
G.R. Nos. 89898-99 October 1, 1990
MUNICIPALITY OF MAKATI vs.
THE HONORABLE COURT OF APPEALS,
HON. SALVADOR P. DE GUZMAN, JR., as
Judge RTC of Makati, Branch CXLII
ADMIRAL FINANCE CREDITORS
CONSORTIUM, INC., and SHERIFF
SILVINO R. PASTRANA
FACTS:
The present petition for review is an
off-shoot of expropriation proceedings initiated
by petitioner Municipality of Makati against
private respondent Admiral Finance Creditors
Consortium, Inc., Home Building System &
Realty Corporation and one Arceli P. Jo,
involving a parcel of land and improvements
and registered in the name of the latter.
It was certified that a bank account
had been opened with the PNB Buendia Branch
under petitioner's name made pursuant to the
provisions of Pres. Decree No. 42. After due
hearing where the parties presented their
respective appraisal reports regarding the
value of the property, respondent RTC judge
rendered a decision fixing the appraised value
of the property at P5,291,666.00, and ordering
petitioner to pay this amount minus the
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE

advanced payment which was earlier released G.R. No. 164282 October 12, 2005
to private respondent. TERESITA M. YUJUICO vs.
Petitioner however refused to comply HON. JOSE L. ATIENZA, ET. AL.
with the garnishment despite its having two
bank accounts in PNB. The first one was
FACTS:
dedicated for expropriation proceedings while
On 8 December 1995, the City Council
the other was for public funds. The first bank
of Manila enacted an ordinance authorizing the
account cannot cover the remaining amount
City Mayor to acquire by negotiation or
due, while the other account had more than
expropriation certain parcels of land for
enough to satisfy the amount due. Petitioner
utilization as a site for the Francisco Benitez
reasoned out that its funds at the PNB Buendia
Elementary School. Failing to acquire the land
Branch could neither be garnished nor levied
by negotiation, the City filed a case for
upon execution, for to do so would result in the
eminent domain against petitioner as owner of
disbursement of public funds without the
the property.
proper appropriation required under the law.
It is the City School Board which has
the authority to pass a resolution allocating
ISSUE: WON the Municipality of Makati is
funds for the full satisfaction of the just
exempt from paying just compensation.
compensation fixed, the said body is hereby
given thirty (30) days from receipt to pass the
HELD: NO.
necessary resolution for the payments of the
For three years now, petitioner has
remaining balance due to Yujuico. However,
enjoyed possession and use of the subject
despite petitioner demanding compliance from
property notwithstanding its inexcusable failure
the CSB after 30 days, the latter still did not
to comply with its legal obligation to pay just
take action.
compensation. Just compensation means not
only the correct determination of the amount
ISSUE: WON respondent is justified in not
to be paid to the owner of the land but also the
paying the petitioner her just compensation.
payment of the land within a reasonable time
from its taking. Without prompt payment,
HELD: NO.
compensation cannot be considered "just" for
While this Court recognizes the power
the property owner is made to suffer the
of LGU to expropriate private property for
consequence of being immediately deprived of
public use, it will not stand idly by while the
his land while being made to wait for a long
expropriating authority maneuvers to evade
period.
the payment of just compensation of property
The State's power of eminent domain
already in its possession.
should be exercised within the bounds of fair
The notion of expropriation is hard
play and justice. In the case at bar,
enough to take for a private owner. He is
considering that valuable property has been
compelled to give up his property for the
taken, the compensation to be paid fixed and
common weal. But to give it up and wait in
the municipality is in full possession and
vain for the just compensation decreed by the
utilizing the property for public purpose, for
courts is too much to bear. In cases like these,
three (3) years, the Court finds that the
courts will not hesitate to step in to ensure
municipality has had more than reasonable
that justice and fair play are served.
time to pay full compensation.

Digested and compiled by Monica S. Cajucom, UST Law

“It’s not how good you are, it’s how good you want to be.” –Paul Arden
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
G.R. No. 77765 August 15, 1988
SEBASTIAN COSCULLUELA vs.
THE HONORABLE COURT OF APPEALS
and the REPUBLIC OF THE
PHILIPPINES, represented by NATIONAL
IRRIGATION ADMINISTRATION
FACTS:
The Republic of the Philippines filed a
complaint with the Court of First Instance of
Iloilo to expropriate two parcels of land in the
municipality of Barotac, Iloilo owned by
petitioner Sebastian Cosculluela and one Mita
Lumampao, for the construction of the canal
network of the Barotac Irrigation Project.
The trial court rendered a decision
granting the expropriation and ordered the
public respondent to pay Lumampao, the sum
of P20,000 and Cosculluela, the sum of
P200,000.00.
The Republic contends that the funds
of the National Irrigation Authority (NIA) are
government funds and therefore, cannot be
disbursed without a government appropriation.
ISSUE: WON the Republic is exempt from
paying the just compensation demanded by
the petitioner in view of non-disbursement of
funds without prior public appropriation.
HELD: NO.
One of the basic principles enshrined in
our Constitution is that no person shall be
deprived of his private property without due
process of law; and in expropriation cases, an
essential element of due process is that there
must be just compensation whenever private
property is taken for public use.
Just compensation means not only the
correct determination of the amount to be paid
to the owner of the land but also the payment
of the land within a reasonable time from its
taking.
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
G.R. No. 101949 December 1, 1994
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.
FACTS:
This petition arose from a controversy
over a parcel of land, Lot 5-A, located in the
Municipality of Parañaque, Metro Manila and
registered in the name of petitioner. Said Lot
5-A is contiguous to Lots 5-B and 5-D
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, Starbright Enterprises.
The squatters refused to vacate the
lots sold to private respondent so a dispute
arose as to who of the parties has the
responsibility of evicting and clearing the land
of squatters occurred. 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 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.
ISSUE: WON the petitioner Holy See is
immune from suit.
HELD: YES.
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.
Lot 5-A was acquired by petitioner as a
donation from the Archdiocese of Manila. The
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
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.
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.
G.R. No. 154705. June 26, 2003
THE REPUBLIC OF INDONESIA, HIS
EXCELLENCY AMBASSADOR
SOERATMIN, and MINISTER
COUNSELLOR AZHARI KASIM vs.
JAMES VINZON, doing business under the
name and style of VINZON TRADE AND
SERVICES
FACTS:
Petitioner, Republic of Indonesia,
represented by its Counsellor entered into a
Maintenance Agreement with respondent
James Vinzon, owner of Vinzon Trade and
Services. The Maintenance Agreement stated
that respondent shall, for a consideration,
maintain specified equipment at the Embassy
Main Building, Embassy Annex Building and the
Wisma Duta, the official residence of petitioner
Ambassador Soeratmin. The equipment
covered by the Maintenance Agreement are air
conditioning units, generator sets, electrical
facilities, water heaters, and water motor
pumps. It is likewise stated therein that the
agreement shall be effective for a period of
four years and will renew itself automatically
unless cancelled by either party by giving thirty
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
days prior written notice from the date of
expiry.
Petitioners claim that sometime prior to
the date of expiration of the said agreement,
or before August 1999, they informed
respondent that the renewal of the agreement
shall be at the discretion of the incoming Chief
of Administration. When the Chief of
Administration assumed his position, he
allegedly found respondent’s work and services
unsatisfactory and not in compliance with the
standards in the Agreement. Hence, the
Indonesian Embassy terminated the
agreement. Petitioners claim, that they had
earlier verbally informed respondent of their
decision to terminate the agreement.
On the other hand, respondent claims that
the aforesaid termination was arbitrary and
unlawful. Hence, he filed a complaint against
the petitioners which opposed by invoking
immunity from suit.
ISSUE: WON the Republic of Indonesia can
successfully invoke state immunity from suit.
HELD: YES.
There is no dispute that the
establishment of a diplomatic mission is an
act jure imperii. A sovereign State does not
merely establish a diplomatic mission and
leave it at that; the establishment of a
diplomatic mission encompasses its
maintenance and upkeep. Hence, the State
may enter into contracts with private entities
to maintain the premises, furnishings and
equipment of the embassy and the living
quarters of its agents and officials. It is
therefore clear that petitioner Republic of
Indonesia was acting in pursuit of a sovereign
activity when it entered into a contract with
respondent for the upkeep or maintenance.
The Solicitor General, in his Comment,
submits the view that, “the Maintenance
Agreement was entered into by the Republic of
Indonesia in the discharge of its governmental
functions. In such a case, it cannot be deemed
to have waived its immunity from suit.”
G.R. No. 142396. February 11, 2003
KHOSROW MINUCHER vs. HON. COURT
OF APPEALS and ARTHUR SCALZO
FACTS:
Sometime in May 1986, an Information for
violation of Section 4 of Republic Act No. 6425,
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
otherwise also known as the “Dangerous Drugs
Act of 1972,” was filed against petitioner
Khosrow Minucher and one Abbas Torabian.
The criminal charge followed a “buy-bust
operation” conducted by the Philippine police
narcotic agents in the house of Minucher, an
Iranian national, where a quantity of heroin, a
prohibited drug, was said to have been
seized. The narcotic agents were accompanied
by private respondent Arthur Scalzo who
would, in due time, become one of the
principal witnesses for the prosecution. On 08
January 1988, Presiding Judge Eutropio Migrino
rendered a decision acquitting the two
accused.
ISSUE: WON respondent Scalzo can invoke
immunity from suit.
HELD: YES.
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
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 job description of Scalzo has tasked
him to conduct surveillance on suspected drug
suppliers and, after having ascertained the
target, to inform local law enforcers who would
then be expected to make the arrest. 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.
All told, this Court is constrained to rule
that respondent Arthur Scalzo, an agent of the
United States Drug Enforcement Agency
allowed by the Philippine government to
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
conduct activities in the country to help contain
the problem on the drug traffic, is entitled to
the defense of state immunity from suit.
G.R. No. 124772 August 14, 2007
PRESIDENTIAL COMMISSION ON
GOOD GOVERNMENT and
MAGTANGGOL C. GUNIGUNDO, in his
capacity as CHAIRMAN thereof vs.
SANDIGANBAYAN and OFFICECO
HOLDINGS, N.V.
FACTS:
On 7 April 1986, in connection with criminal
proceedings initiated in the Philippines to
locate, sequester and seek restitution of
alleged ill-gotten wealth amassed by the
Marcoses and other accused from the
Philippine Government,1 the Office of the
Solicitor General (OSG) wrote the Federal
Office for Police Matters in Berne, Switzerland,
requesting assistance for the latter office to:
(a) ascertain and provide the OSG with
information as to where and in which cantons
the ill-gotten fortune of the Marcoses and other
accused are located, the names of the
depositors and the banks and the amounts
involved; and (b) take necessary precautionary
measures, such as sequestration, to freeze the
assets in order to preserve their existing value
and prevent any further transfer thereof
(herein referred to as the IMAC request). The
Office of the District Attorney in Zurich,
pursuant to the OSG’s request, issued an Order
directing the Swiss Banks in Zurich to freeze
the accounts of the accused.
ISSUE: WON the Swiss officials can invoke
state immunity from suit.
HELD: NO.
The act of state doctrine is one of the
methods by which States prevent their national
courts from deciding disputes which relate to
the internal affairs of another State, the other
two being immunity and non-justiciability. It is
an avoidance technique that is directly related
to a State’s obligation to respect the
independence and equality of other States by
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
not requiring them to submit to adjudication in
a national court or to settlement of their
disputes without their consent. It requires the
forum court to exercise restraint in the
adjudication of disputes relating to legislative
or other governmental acts which a foreign
State has performed within its territorial limits.
It is petitioners’ contention that the
Sandiganbayan "could not grant or deny the
prayers in [Officeco’s] complaint without first
examining and scrutinizing the freeze order of
the Swiss officials in the light of the evidence,
which however is in the possession of said
officials" and that it would therefore "sit in
judgment on the acts of the government of
another country." We disagree.
The parameters of the use of the act of
state doctrine were clarified in Banco Nacional
de Cuba v. Sabbatino. There, the U.S.
Supreme Court held that international law does
not require the application of this doctrine nor
does it forbid the application of the rule even if
it is claimed that the act of state in question
violated international law. Moreover, due to the
doctrine’s peculiar nation-to-nation character,
in practice the usual method for an individual
to seek relief is to exhaust local remedies and
then repair to the executive authorities of his
own state to persuade them to champion his
claim in diplomacy or before an international
tribunal.
G.R. No. 125865. January 28, 200
JEFFREY LIANG (HUEFENG) vs.
PEOPLE OF THE PHILIPPINES
FACTS:
Petitioner is an economist working with
the Asian Development Bank (ADB). Sometime
in 1994, for allegedly uttering defamatory
words against fellow ADB worker Joyce Cabal,
he was charged before the Metropolitan Trial
Court (MeTC) of Mandaluyong City with two
counts of grave oral defamation.
Petitioner was arrested by virtue of a
warrant issued by the MeTC. After fixing
petitioner’s bail, the MeTC released him to the
custody of the Security Officer of ADB. The
next day, the MeTC judge received an "office of
protocol" from the DFA stating that petitioner
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
is covered by immunity from legal process
under Section 45 of the Agreement between
the ADB and the Philippine Government
regarding the Headquarters of the ADB
(hereinafter Agreement) in the country. Based
on the said protocol communication that
petitioner is immune from suit, the MeTC judge
without notice to the prosecution dismissed the
two criminal cases.
ISSUE: WON petitioner Liang is immune from
suit.
HELD: NO.
Slandering a person could not possibly
be covered by the immunity agreement
because our laws do not allow the commission
of a crime, such as defamation, in the name of
official duty. It is 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 or in bad faith or beyond the scope of
his authority or jurisdiction.
SEPARATE CONCURRING OPINION OF JUSTICE
PUNO:
 The Charter of the ADB provides under Article
55(i) that officers and employees of the bank shall
be immune from legal process with respect to acts
performed by them in their official capacity except
when the Bank waives immunity. Section 45 (a) of
the ADB Headquarters Agreement accords the
same immunity to the officers and staff of the
bank. There can be no dispute that international
officials are entitled to immunity only with
respect to acts performed in their official
capacity, unlike international organizations
which enjoy absolute immunity
 Clearly, the most important immunity to an
international official, in the discharge of his
international functions, is immunity from local
jurisdiction. There is no argument in doctrine or
practice with the principle that an international
official is independent of the jurisdiction of the local
authorities for his official acts. Those acts are not
his, but are imputed to the organization, and without
waiver the local courts cannot hold him liable for
them. In strict law, it would seem that even the
organization itself could have no right to waive
an official’s immunity for his official acts. This
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE
permits local authorities to assume jurisdiction
over and individual for an act which is not, in
the wider sense of the term, his act at all. It is
the organization itself, as a juristic person,
which should waive its own immunity and
appear in court, not the individual, except
insofar as he appears in the name of the
organization.
 Historically, international officials were granted
diplomatic privileges and immunities and were thus
considered immune for both private and official
acts. In practice, this wide grant of diplomatic
prerogatives was curtailed because of practical
necessity and because the proper functioning of the
organization did not require such extensive
immunity for its officials. Thus, the current status
of the law does not maintain that states grant
jurisdictional immunity to international officials
for acts of their private lives.
 Under the Vienna Convention on Diplomatic
Relations, a diplomatic envoy is immune from
criminal jurisdiction of the receiving State for all
acts, whether private or official, and hence he
cannot be arrested, prosecuted and punished for
any offense he may commit, unless his diplomatic
immunity is waived.[ On the other hand, officials
of international organizations enjoy “functional”
immunities, that is, only those necessary for the
exercise of the functions of the organization
and the fulfillment of its purposes. This is the
reason why the ADB Charter and Headquarters
Agreement explicitly grant immunity from legal
process to bank officers and employees only with
respect to acts performed by them in their official
capacity, except when the Bank waives
immunity. In other words, officials and
employees of the ADB are subject to the
jurisdiction of the local courts for their private
acts, notwithstanding the absence of a waiver
of immunity.
 Considering that bank officials and employees are
covered by immunity only for their official acts, the
necessary inference is that the authority of the
Department of Affairs, or even of the ADB for
that matter, to certify that they are entitled to
immunity is limited only to acts done in their
official capacity. Stated otherwise, it is not within
the power of the DFA, as the agency in charge of
the executive department’s foreign relations, nor
the ADB, as the international organization vested
with the right to waive immunity, to invoke immunity
for private acts of bank official and employees,
Digested and compiled by Monica S. Cajucom, UST Law
“It’s not how good you are, it’s how good you want to be.” –Paul Arden
since no such prerogative exists in the first place. If
the immunity does not exist, there is nothing to
certify.
G.R. No. 152318 April 16, 2009
DEUTSCHE GESELLSCHAFT FÜR
TECHNISCHE ZUSAMMENARBEIT, ET.
AL. vs.
HON. COURT OF APPEALS, ET. AL.
FACTS:
The governments of the Federal
Republic of Germany and the Republic of the
Philippines ratified an Agreement called Social
Health Insurance—Networking and
Empowerment (SHINE which was designed to
"enable Philippine families–especially poor
ones–to maintain their health and secure
health care of sustainable quality." Private
respondents were engaged as contract
employees hired by GTZ to work for SHINE.
Nicolay, a Belgian national, assumed
the post of SHINE Project Manager.
Disagreements eventually arose between
Nicolay and private respondents in matters
such as proposed salary adjustments, and the
course Nicolay was taking in the
implementation of SHINE different from her
predecessors.
The dispute culminated in a signed by
the private respondents, addressed to Nicolay,
and copies furnished officials of the DOH,
Philheath, and the director of the Manila office
of GTZ. The letter raised several issues which
private respondents claim had been brought up
several times in the past, but have not been
given appropriate response.
In response, Nicolay wrote each of the
private respondents a letter, all similarly
worded except for their respective addressees.
She informed private respondents that they
could no longer find any reason to stay with
the project unless ALL of these issues be
addressed immediately and appropriately.
Under the foregoing premises and
circumstances, it is now imperative that I am
to accept your resignation, which I expect to
receive as soon as possible.
Negotiations ensued between private
respondents and Nicolay, but for naught. Each
 POLITICAL LAW JURISPRUDENCE ATTY. GOROSPE

of the private respondents received a letter

from Nicolay, informing them of the pre-
termination of their contracts of employment
on the grounds of "serious and gross
insubordination, among others, resulting to
loss of confidence and trust."

HELD: NO.
This self-description of GTZ in its own
official website gives further cause for pause in
adopting petitioners’ argument that GTZ is
entitled to immunity from suit because it is "an
implementing agency." The above-quoted
statement does not dispute the
characterization of GTZ as an "implementing
agency of the Federal Republic of Germany,"
yet it bolsters the notion that as a company
organized under private law, it has a legal
personality independent of that of the Federal
Republic of Germany.
The Court is thus holds and so rules
that GTZ consistently has been unable to
establish with satisfaction that it enjoys the
immunity from suit generally enjoyed by its
parent country, the Federal Republic of
Germany.

Digested and compiled by Monica S. Cajucom, UST Law

“It’s not how good you are, it’s how good you want to be.” –Paul Arden