Case #6.

DEPARTMENT OF AGRICULTURE VS NLRC – immunity of state in civil cases

FACTS:

The herein petitioner, Department of Agriculture (DA), entered into a contract with Sultan Security
Agency (SSA) wherein SSA will provide security services to the DA.

Pursuant to the contract and subsequent arrangements, SSA deployed guards to the vicinity of DA.

A friction occurred when DA failed to comply with the wage agreement, 13 th month pay, uniform
allowances, night shift differential pay, holiday pay and overtime pay, as well as for damages.

SSA’s guards filed complaint, for the incompliance of DA regarding their compensation, before the
Regional Arbitration Branch X of Cagayan de Oro City.

The Executive Labor Arbiter rendered a decision on May 31 regarding the pending complaint before them
and found that DA is jointly and severally liable with SSA regarding the money claims amounting to
P266,483.91.

The DA were now asked to settle the payments through acquisition of its properties.

DA filed petitions before NLRC contending that the labor arbiter doesn’t have jurisdiction over their case
and the pending acquisition would jeopardize the petitioner’s governmental functions. NLRC granted
their petition and suspended the acquisition for 2 months tops that way the DA can gather enough funds
for the settlement,

HENCE this case, the petitioner is contending that NLRC abused their discretion gravely when they did
not quash the writ of execution and the pending case is outside their jurisdiction.

ISSUE:

Whether the DA as a governmental agency can be sued without its consent.

RULING/APPLICATION

The petition was granted but it was based on the procedural error of SSA not because of the non-suability
of DA. The DA waived their immunity to be sued upon entering a contract with a private entity involving
money as stated in Act No. 3083. In the event that the private entity wanted to seek redress, they should
bring their case before the Commission on Audit, not through NLRC as per C.A. No. 327, as amended
by P.D. 1445.

CONCLUSION:

In general, the state and its instrumentalities are immune to be subjected in civil cases without its consent.
The state can extend their willingness to be sued through express and implied consent. The state impliedly
allows itself to be sued when the state was the one who initiated the case. On the other hand, upon
entering into contracts with private entities, there is also an implication that the state consented itself to be
subjected to a civil case proceedings involving money claims.