THE HOLY SEE, petitioner, vs THE HON. ERIBERTO U. ROSARIO, JR.

, as Presiding Judge of the Regional

Trial Court of Makati, Branch 61 and STARBRIGHT SALES ENTERPRISES, INC., respondents.

Facts:

This is a petition for certiorari to reverse and set side a decision from the RTC of Makati. Petitioner is the
Holy See who exercises sovereignty over the Vatican City and is represented by the Papal Nuncio in the
Philippines. The petition arose from a controversy regarding a lot, Lot 5-A, of 6,000 square meters
located in the Municipality of Parañaque, registered in the name of the petitioner. Lot 5-A is contiguous
to two other lots, 5-B and 5-D. The three lots were sold to Ramon Licup, who later assigned his rights to
the sale to the private respondent, Starbright Sales Enterprises, Inc., involved in real estate. Informal
settlers were squatting in the property, and dispute arose as to who would evict them. The conflict
intensified when the lot was sold to Tropicana Properties and Development Corporation by the
petitioner. The private respondent filed a complaint before the RTC of Makati against the petitioner and
three other defendants: Msgr. Domingo Cirilos, who acted as agent to the sellers, the PRC and
Tropicana. It prayed for: 1) 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. The petitioners and Cirilos
separately moved to dimiss the complaint: petitioners for lack of jurisdiction based on soverign
immunity from suit and Cirilos for being an improper party. An opposition to the motion was filed by
private respondent. The trial court issued an order denying the petitioner’s motion to dismiss, reason
being that the petitioner can no longer be immune as they entered into a business contract. Petitioner
moved for reconsideration. They then filed a “Motion for Hearing for the Sole Purpose of Establishing
Factual Allegation for Claim of Immunity as a Jurisdictional Defense,” to facilitate the hearing in its
defense of sovereign immunity. Private repondents opposed the motion as well as the motion for
reconsideration. The trial court ordered the resolution be suspended until after trial on the marits and
directing the petitioner to file its answer. Petitioner elevated the matter to the Supreme Court. The
petitioner invoked its privilege of sovereign immunity only on its behalf and on behalf of its official
representatives, the Papal Nuncio. Eventually, the Department of Foreign Affairs filed for a Motion of
Intervention caliming its legal interest on the outcome of the case concerning the diplomatic immunity
of the petitioner. It stated its adoption upon the claim of the petitioner with regard to its claim for
soeverign immunity from suit. This was opposed by the private respondent.
Issue: Whether or not the Holy See can invoke its right to Sovereign Immunity to suit.

Ruling: The Supreme Court granted the petition and the complaint against the petitioner is dismissed.

Reason: Generally, there are two accepted concepts of sovereignty: a) classical or absolute theory,
wherein a sovereign cannot be made as respondent to courts of another sovereign without its consent
and; b) restrictive theory, which puts conditions on when to recognize immunity.

Under the restrictive theory, sovereign immunity is only recognized with regard to public acts or acts
jure imperii (or those in pursuant to governmental functions) . If the act is private or acts jure gestionis
(those that are for profit), then immunity cannot be invoked.

In this case, the petitioner had denied that the acquisition and subsequent disposal of the Lot 5-A were
made for profit. It claimed that it acquired the property for its mission or the Apostolic Nunciature in the
Philippines. The lot, allegedly, was acquired by donation from the Archdiocese of Manila for the purpose
of building official residence of Papal Nuncio. However, when the informal settlers refused to leave the
property, the petitioner decided to dispose the property, not for commercial purpose. The DFA
intervened as they established in a Memorandum and Certification the privilege of sovereign immunity
of the petitioner, stating that they are a duly accredited diplomatic mission to the Philippines exempt
from local jurisdiction and has title to all rights, privileges and immunities of a diplomatic mission or
embassy in the country. When the plea of immunity has been recognized by the executive department,
such shall be conclusive to courts.
UNITED STATES OF AMERICA, ET AL. v. HON. ELIODORO B. GUINTO, ET A

FACTS:

The plaintiff filed with the Court of First Instance of Pangasinan an action to collect a sum of money
against the above defendants. He suffered injuries while undergoing a 10-month military training at
Camp Floridablanca, Pampanga. He filed a claim under Commonwealth Act 400 and in April 1957 with
the Adjutant General’s Office which later disallow his claim for disability benefit. After further demands
of the plaintiff, the same Adjutant General’s Office denied the claim, alleging that the Commonwealth
Act 400 had already been repealed by RA 610 which took effect January 1, 1950. That by the reason of
the injuries suffered by plaintiff, he was deprived of his sight or vision rendering him permanently
disabled; and by the reason of unjustified refusal of defendants on the claim, plaintiff was deprived of
his disability pension from July 1948 totaling no less than Php 4,000 at the rate of P20 per month and
suffered moral damages and attorney’s fees the amount of Php 2,000. The Philippine Veterans
Administration and the Chief of Staff of AFP file separate motions to dismiss the complaint on the
grounds that the court has no jurisdiction over the subject matter of the complaint; that the plaintiff
failed to exhaust all administrative remedies before coming to court; that the complaint states no cause
of action; and that the cause of action is barred by the statute of limitations. Acting on the said Motion,
the Court of First Instance, on March 2, 1962, rendered an order dismissing the complaint on the ground
that action has prescribed. Motion for reconsideration of the said order having been denied, the plaintiff
has interposed this appeal.

ISSUE:

Whether the lower court has jurisdiction on the said matter and dismissing the complaint on ground it
being the money claim against the government.

HELD:

The court affirmed the lower court’s decision on dismissing the complaint for the simple reason that the
Court of First Instance had no jurisdiction over the subject matter, it being a money claim against the
government. If there is a money claim against the government should be filed with the Auditor General.
Plus, under the doctrine of state immunity, the state cannot be sued without its consent. Moreover, it is
in line with the principle that the State cannot be charged without its content as provided by the
Commonwealth Act 328 Sec. 1 that in all cases involving the settlement of accounts and claims other
than those of accountable officers, the Auditor General shall act and decide the same within sixty days.

Also, if all administrative remedies have been made and if superior administrative officers could grant
relief, it is not necessary to entertain actions against the administrative officers as established by the
rule.

CARMEN FESTEJO v. ISAIAS FERNANDO,

FACTS:

The defendant, as Director of the Bureau of Public Works, without authority obtained first from the CFI
of Ilocos Sur, without obtaining first a right of way, and without the consent and knowledge of the
plaintiff, and against her express objection unlawfully took possession of portions of the three parcels of
land and caused an irrigation canal to be constructed on the portion of the three parcels of land on to
the damage and prejudice of the plaintiff.

ISSUE:

Whether the is a suit against the state.

RULING:

No, the evidence and conceded facts in finding that in the trespass on plaintiff’s land defendant
committed acts outside the scope of his authority. When he went outside the boundaries of the right of
way upon plaintiff’s land and damaged it or destroyed its former condition and usefulness, he must be
held to have designedly departed from the duties imposed on him by law.
There can be no claim that he thus invaded plaintiff’s land southeasterly of the right of way innocently
for the surveys clearly marked the limits of the land appropriated for the right of way. It is a general rule
that an officer-executive, administrative, quasi-judicial, ministerial, or otherwise who acts outside the
scope of his jurisdiction and without authorization of law may thereby render himself amenable to
personal liability in a civil suit. He cannot shelter himself by the plea that he is a public agent acting
under the color of his office and not personally.

ILDEFONSO SANTIAGO v. THE GOVERNMENT OF THE REPUBLIC OF THE PHILIPPINES, ET AL.

87 SCRA 294 | December 19, 1978

FACTS:

Petitioner Ildefonso Santiago donated a parcel of land to the Bureau of Plant Industry on the terms that
the Bureau should construct a building and install lighting facilities on the said lot.

When time passed and there were still no improvements on the lot, Santiago filed a case pleading for
the revocation of such contract of donation but the trial court dismissed the petition claiming that it is a
suit against the government and should not prosper without the consent of the government.

ISSUE:

Whether the respondent government has waived its immunity from suit.

RULING:

Yes. The government’s waiver of immunity was implied by virtue of the terms provided in the deed of
donation. The government is a beneficiary of the terms of the donation but it did not comply with such
terms. Thus, the donor Santiago has the right to be heard in the court. Also, to not allow the donor to be
heard would be unethical and contrary to equity which the government so advances. The Court of First
Instance is hereby directed to proceed with the case.
Republic vs. Sandiganbayan, GR No. 152154, July 15, 2003

Topic: Prohibitions/Inhibitions of President of the Philippines

FACTS:

One of the foremost concerns of the Aquino Government in February 1986 was the recovery of the
unexplained or ill-gotten wealth reputedly amassed by former President and Mrs. Ferdinand E. Marcos,
their relatives, friends and business associates. Thus, the very first Executive Order (EO) issued by then
President Corazon Aquino upon her assumption to office after the ouster of the Marcoses was EO No. 1,
issued on February 28, 1986. It created the Presidential Commission on Good Government (PCGG) and
charged it with the task of assisting the President in the "recovery of all ill-gotten wealth accumulated by
former President Ferdinand E. Marcos, his immediate family, relatives, subordinates and close
associates, whether located in the Philippines or abroad, including the takeover or sequestration of all
business enterprises and entities owned or controlled by them during his administration, directly or
through nominees, by taking undue advantage of their public office and/or using their powers,
authority, influence, connections or relationship."

In all the alleged ill-gotten wealth cases filed by the PCGG, this Court has seen fit to set aside
technicalities and formalities that merely serve to delay or impede judicious resolution. This Court
prefers to have such cases resolved on the merits at the Sandiganbayan. But substantial justice to the
Filipino people and to all parties concerned, not mere legalisms or perfection of form, should now be
relentlessly and firmly pursued. Almost two decades have passed since the government initiated its
search for and reversion of such ill-gotten wealth. The definitive resolution of such cases on the merits is
thus long overdue. If there is proof of illegal acquisition, accumulation, misappropriation, fraud or illicit
conduct, let it be brought out now. Let the ownership of these funds and other assets be finally
determined and resolved with dispatch, free from all the delaying technicalities and annoying
procedural sidetracks.

Issue:

Whether or not President Marcos committed prohibited and inhibited acts as a president during his
term of office
Held:

Yes

Ratio:

It is settled that judicial admissions may be made: (a) in the pleadings filed by the parties; (b) in the
course of the trial either by verbal or written manifestations or stipulations; or (c) in other stages of
judicial proceedings, as in the pre-trial of the case.[82] Thus, facts pleaded in the petition and answer, as
in the case at bar, are deemed admissions of petitioner and respondents, respectively, who are not
permitted to contradict them or subsequently take a position contrary to or inconsistent with such
admissions.[83]

The sum of $304,372.43 should be held as the only known lawful income of respondents 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.[84]
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.[85] In fact, his management of
businesses, like the administration of foundations to accumulate funds, was expressly prohibited under
the 1973 Constitution:

Article VII, Sec. 4(2) The President and the Vice-President shall not, during their tenure, hold any other
office except when otherwise provided in this Constitution, nor may they practice any profession,
participate directly or indirectly in the management of any business, or be financially interested directly
or indirectly in any contract with, or in any franchise or special privilege granted by the Government or
any other subdivision, agency, or instrumentality thereof, including any government owned or
controlled corporation.

Article VII, Sec. 11 No Member of the National Assembly shall appear as counsel before any court
inferior to a court with appellate jurisdiction, x x x. Neither shall he, directly or indirectly, be interested
financially in any contract with, or in any franchise or special privilege granted by the Government, or
any subdivision, agency, or instrumentality thereof including any government owned or controlled
corporation during his term of office. He shall not intervene in any matter before any office of the
government for his pecuniary benefit.

Article IX, Sec. 7 The Prime Minister and Members of the Cabinet shall be subject to the provision of
Section 11, Article VIII hereof and may not appear as counsel before any court or administrative body, or
manage any business, or practice any profession, and shall also be subject to such other disqualification
as may be provided by law.

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.

Respondents argue that petitioner was not able to establish a prima facie case for the forfeiture of the
Swiss funds since it failed to prove the essential elements under Section 3, paragraphs (c), (d) and (e) of
RA 1379. As the Act is a penal statute, its provisions are mandatory and should thus be construed strictly
against the petitioner and liberally in favor of respondent Marcoses.

We hold that it was not for petitioner to establish the Marcoses other lawful income or income from
legitimately acquired property for the presumption to apply because, as between petitioner and
respondents, the latter were in a better position to know if there were such other sources of lawful
income. And if indeed there was such other lawful income, respondents should have specifically stated
the same in their answer. Insofar as petitioner Republic was concerned, it was enough to specify the
known lawful income of respondents.

Section 9 of the PCGG Rules and Regulations provides that, in determining prima facie evidence of ill-
gotten wealth, the value of the accumulated assets, properties and other material possessions of those
covered by Executive Order Nos. 1 and 2 must be out of proportion to the known lawful income of such
persons. The respondent Marcos couple did not file any Statement of Assets and Liabilities (SAL) from
which their net worth could be determined. Their failure to file their SAL was in itself a violation of law
and to allow them to successfully assail the Republic for not presenting their SAL would reward them for
their violation of the law.
MOBIL PHILIPPINES EXPLORATION, INC., plaintiff-appellant,

vs.

CUSTOMS ARRASTRE SERVICE and BUREAU of CUSTOMS, defendants-appellees

Facts:

This case was filed by Mobil Phil Exploration Inc. against the Customs Arrastre Service and the Bureau of
Customs to recover the value of the undelivered case of rotary drill parts.

Four cases of rotary drill parts were shipped from abroad, consigned to Mobil Philippines Exploration,
Inc. The shipment was discharged to the custody of the Customs Arrastre Service, the unit of the Bureau
of Customs then handling arrastre operations therein. The Customs Arrastre Service later delivered to
the broker of the consignee three cases only of the shipment. Mobil Philippines Exploration, Inc 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.

Defendants filed a motion to dismiss the complaint on the ground that not being persons under the law,
defendants cannot be sued. Appellant contends that not all government entities are immune from suit;
that defendant Bureau of Customs as operator of the arrastre service at the Port of Manila, is
discharging proprietary functions and as such, can be sued by private individuals.

Issues:

Whether or not both Customs Arrastre Service and the Bureau of Customs can invoke state immunity.

Rulings:

Yes. The Supreme Court ruled that the Bureau of Customs cannot be sued for recovery of money and
damages involving arrastre services, considering that said arrastre function may be deemed proprietary,
because it is a necessary incident of the primary and governmental function of the Bureau of Customs.
The Court ruled that 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 Supreme Court ruled that the plaintiff should have filed its
present claim to the General Auditing Office, it being for money under the provisions of Commonwealth
Act 327, which state the conditions under which money claims against the Government may be filed.

Discussions:

The Bureau of Custom, is a part of Department of Finance. It does not have a separate juridical
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 (Sec. 602, R.A. 1937). To this function, arrastre service is a
necessary incident. As stated in the law, agencies of the government is not suable if it is performing
governmental functions and if it an unincorporated government entity without a separate juridical
personality.

Bermoy v PNC

Facts: On July 6, 1954, (24) twenty four employees from its dormitory known as Normal Hall of the
Philippine Normal College, filled an action in the COF of Manila against the PNC for the recovery of
salary differentials and overtime pay. The Solicitor General on behalf of the defendant answers and
denies the latter liability. The court ordered it dismissed before the case was tried on the merits, on the
ground that neither one of the defendants was a corporation or a juridical entity with capacity to be
sued. The plaintiffs took an appeal to Supreme Court, alleging that it was an error to dismiss their case
on the ground that, R.A. No. 416 took effect July, 1949 converted PNS to PNC, thus created a Board of
Trustees to administer the affairs as a corporation under section 13 of the amended Act 1455 (Corporate
Law), with the power “to sue and to be sued in any court.”

Issue: Whether or not the PNC as a government corporation can be sued.

Held: The state has already given the consent by investing the college with express power to be sued in
the court. The act Authorizes the College to be sued is also made clear in Section 6, where it is provided
that “all process against the Board of Trustees shall be served on the President or Secretary thereof”.
The order appealed from is re revoked and the case remanded to the court of origin for further
proceedings. No cost.