G.R. No.
171182               August 23, 2012 UP was then served with the order directing DBP to
UNIVERSITY OF THE PHILIPPINES vs. HON. AGUSTIN
S. DIZON
FACTS:
UP, through its then President Jose V. Abueva, entered
into a General Construction Agreement with respondent
Stern Builders Corporation , represented by its President
and General Manager Servillano dela Cruz, for the
construction of the extension building and the
renovation of the College of Arts and Sciences Building in
the campus of the University of the Philippines in Los
Bañ os  appropriation law or other specific statutory authority;"
Due to the failure of UP to pay for the 3 rd billing despite
the lifting of the disallowance of the same by the
Commission on Audit, Stern Builders and dela Cruz to
sue the UP and its co-respondent officials to collect the
unpaid billing and to recover various damages.
(docketed as Civil Case No. Q-93-14971 of the Regional
Trial Court in Quezon City)
RTC rendered a decision in favor of the Stern Builders
and dela Cruz.
Following the denial of the RTC in its MR, UP filed a
notice of appeal but it was denied by the RTC for having
it filed out of time and granted the private respondents’
motion for execution. An urgent motion to reconsider the
order was still denied.
UP filed a petition for certiorari in the Court of Appeals
but the same was dismissed having been filed late—17
days late of the reglementary period. (received a copy
Nov. 28, 2001 and Jan. 7, 2002, they had until January 22,
2002 within which to file their appeal. On Jan. 16, 2002 or
after the lapse of nine (9) days, petitioners through their
counsel Atty. Nolasco filed a Motion for Reconsideration of
the aforesaid decision, hence, pursuant to the rules,
petitioners still had six (6) remaining days to file their
appeal. Nolasco received a copy of the Order denying their
motion for reconsideration on May 17, 2002, thus,
petitioners still has until May 23, 2002 (the remaining six
(6) days) within which to file their appeal. They only filed
June 3, 2002)
In the meanwhile that the UP was exhausting the
available remedies to overturn the denial of due course
to the appeal and the issuance of the writ of execution,
Stern Builders and dela Cruz filed in the RTC their
motions for execution despite their previous motion
having already been granted and despite the writ of
execution having already issued.  erforming a legitimate government function. It is an
Sheriff served notices of garnishment on the UP’s
depository banks, namely: Land Bank of the Philippines
(Buendia Branch) and the Development Bank of the
Philippines (DBP), Commonwealth Branch.
UP’s urgent motion to quash was denied and granted
respondents for the issuance of release order.
release the garnished funds of the UP. Private
respondents moved to cite DBP in direct contempt of
court for its non-compliance with the order of release.
Upon filing of the petition for certiorari in the CA, UP
averred that RTC committed grave abuse of discretion
amounting to lack or excess of jurisdiction in ruling that
there was no longer any legal impediment to the release
of the garnished funds. The UP argued that government
funds and properties could not be seized by virtue of
writs of execution or garnishment and citing Section 84
of Presidential Decree No. 1445 to the effect that
"revenue funds shall not be paid out of any public
treasury or depository except in pursuance of an
a TRO was issued by CA.
After the 60-day period of the TRO lapsed, the RTC,
directed the sheriff to proceed to the DBP to receive the
check in satisfaction of the judgment.
Later, the RTC noted that the DBP had already delivered
to the sheriff Manager’s Check No. 811941 for ₱
16,370,191.74 representing the garnished funds payable
to the order of Stern Builders and dela Cruz as its
compliance with the RTC’s order dated December 21,
2004. However, the RTC directed in the same order that
Stern Builders and dela Cruz should not encash the check
or withdraw its amount pending the final resolution of
the UP’s petition for certiorari.
Subsequently, CA dismissed the petition for certiorari of
the UP and held that the garnished funds could be the
proper subject of garnishment because they had been
already earmarked for the project, with the UP holding
the funds only in a fiduciary capacity.
UP contends that the CA contravened Section 5, Article
XIV of the Constitution by allowing the garnishment of
UP funds, because the garnishment resulted in a
substantial reduction of the UP’s limited budget allocated
for the remuneration, job satisfaction and fulfillment of
the best available teachers.
ISSUE: whether the funds of the UP were the proper
subject of garnishment in order to satisfy the judgment
award?
HELD: UP’s funds, being government funds,
are not subject to garnishment.
Up was founded through Act no. 1870 and despite being
a body corporate, it remains to be a chartered institution
institution of higher learning, not a corporation
established for profit and declaring any dividends.
In enacting RA no. 9500 (UP charter of 2008), Congress
has declared the UP as the national university"dedicated
to the search for truth and knowledge as well as the
development of future leaders."
UP is a government instrumentality, performing the
State’s constitutional mandate of promoting quality
and accessible education. As a government
instrumentality, the UP administers special funds
sourced from the fees and income enumerated under
Act No. 1870 and Section 1 of Executive Order No. 714,
and from the yearly appropriations, to achieve the
purposes laid down by Section 2 of Act 1870, as
expanded in Republic Act No. 9500.
All the funds going into the possession of the UP,
including any interest accruing from the deposit of
such funds in any banking institution, constitute a
"special trust fund," the disbursement of which
should always be aligned with the UP’s mission and
purpose and should always be subject to auditing by
the COA.
Presidential Decree No. 1445 defines a "trust fund" as a
fund that officially comes in the possession of an agency
of the government or of a public officer as trustee, agent
or administrator, or that is received for the fulfillment of
some obligation. A trust fund may be utilized only for the
"specific purpose for which the trust was created or the
funds received."
The funds of the UP are government funds that are
public in character. They include the income accruing
from the use of real property ceded to the UP that may
be spent only for the attainment of its institutional
objectives. Hence, the funds subject of this action
could not be validly made the subject of the RTC’s
writ of execution or garnishment. The adverse
judgment rendered against the UP in a suit to which
it had impliedly consented was not immediately
enforceable by execution against the UP, because
suability of the State did not necessarily mean its
liability.
"Suability depends on the consent of the state to be sued,
liability on the applicable law and the established facts.
The circumstance that a state is suable does not
necessarily mean that it is liable; on the other hand, it
can never be held liable if it does not first consent to be
sued.
Liability is not conceded by the mere fact that the state
has allowed itself to be sued. When the state does waive
its sovereign immunity, it is only giving the plaintiff the
chance to prove, if it can, that the defendant is liable.
The universal rule that where the State gives its consent
to be sued by private parties either by general or special
law, it may limit claimant’s action "only up to the
completion of proceedings anterior to the stage of
execution" and that the power of the Courts ends when
the judgment is rendered, 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.
The UP correctly submits here that the garnishment of
its funds to satisfy the judgment awards of actual and
moral damages (including attorney’s fees) was not
validly made if there was no special appropriation by
Congress to cover the liability. It was, therefore, legally
unwarranted for the CA to agree with the RTC’s holding
in the order issued on April 1, 2003 that no
appropriation by Congress to allocate and set aside the
payment of the judgment awards was necessary because
"there (were) already an appropriations earmarked for
the said project.
The Constitution strictly mandated that "(n)o money
shall be paid out of the Treasury except in pursuance of
an appropriation made by law.
COA must adjudicate private respondents’ claim
before execution should proceed
The execution of the monetary judgment against the UP
was within the primary jurisdiction of the COA. This was
expressly provided in Section 26 of Presidential Decree
No. 1445
The settlement of the monetary claim was still subject to
the primary jurisdiction of the COA despite the final
decision of the RTC having already validated the claim.
As such, Stern Builders and dela Cruz as the claimants
had no alternative except to first seek the approval of the
COA of their monetary claim.
The RTC had no authority to direct the immediate
withdrawal of any portion of the garnished funds from
the depository banks of the UP. 
However, notwithstanding the rule that government
properties are not subject to levy and execution unless
otherwise provided for by statute or municipal
ordinance the Court has, in various instances,
distinguished between government funds and properties
for public use and those not held for public use. 
Where property of a municipal or other public
corporation is sought to be subjected to execution to
satisfy judgments recovered against such corporation,
the question as to whether such property is leviable or
not is to be determined by the usage and purposes for
which it is held." The following can be culled from Viuda
de Tan Toco v. Municipal Council of Iloilo:
1. Properties held for public uses – and generally
everything held for governmental purposes – are not
subject to levy and sale under execution against such
corporation. The same rule applies to funds in the
hands of a public officer and taxes due to a municipal
corporation.
2. Where a municipal corporation owns in its proprietary
capacity, as distinguished from its public or government
capacity, property not used or used for a public purpose
but for quasi-private purposes, it is the general rule that
such property may be seized and sold under execution
against the corporation.
3. Property held for public purposes is not subject to
execution merely because it is temporarily used for
private purposes. If the public use is wholly abandoned,
such property becomes subject to execution.
G.R. No. 129406             March 6, 2006
REPUBLIC OF THE PHILIPPINES represented by the
PRESIDENTIAL COMMISSION ON GOOD
GOVERNMENT (PCGG), Petitioner,  vs.
SANDIGANBAYAN (SECOND DIVISION) and ROBERTO
S. BENEDICTO, Respondents.
FACTS: Civil Case No. 0034 entitled Republic of the
Philippines, plaintiff, v. Roberto S. Benedicto, et al.,
defendants, is a complaint for reconveyance, reversion,
accounting, reconstitution and damages. The case is one
of several suits involving ill-gotten or unexplained
wealth that petitioner Republic, through the PCGG, filed
with the Sandiganbayan against private respondent
Roberto S. Benedicto and others pursuant to Executive
Order (EO) No. 14, series of 1986.
PCGG issued writs placing under sequestration all
business enterprises, entities and other properties, real
and personal, owned or registered in the name of
Benedicto or of corporations in which he appeared to
have controlling or majority interest.
Among the properties thus sequestered and taken over
by PCGG fiscal agents were the 227 shares in NOGCCI
owned by him and registered under his name.
The PCGG as members of Board of Directors of NOGCCI
passed a resolution effecting a corporate policy change
where the assessed monthly membership due would be
Php 150 for each NOGCCI share. Prior to this resolution,
an investor purchasing more than one NOGCCI share was
exempt from paying monthly membership due for the
second and subsequent shares that he/she owned.
Said membership due was however increased to Php 250
by virtue of another resolution.
As sequestrator of the 227 shares of stock in question,
PCGG did not pay the corresponding monthly
membership and account thereof, it was declared
delinquent to be disposed of in an auction sale.
PCGG filed a complaint for injunction with the RTC of
Bacolod City however it was dismissed paving the way
for the auction sale for said delinquent sale of the stocks.
Republic and Benedicto entered into a compromise
agreement wherein the Republic bound itself to lift the
sequestration on the 227 NOGCCI shares and
acknowledged that it was within the Benedicto’s capacity
to acquire the same shares out of his income from
business and the exercise of his profession. Republic,
impliedly, recognized that subject shares could not have
been ill-gotten.
Sandiganbayan approved the Compromise Agreement
and accordingly rendered judgment in accordance with
its terms. In the process of implementing the
Compromise Agreement, either of the parties would,
from time to time, move for a ruling by the
Sandiganbayan on the proper manner of implementing
or interpreting a specific provision therein.
Benedicto filed a "Motion for Release from Sequestration
and Return of Sequestered Shares/Dividends" praying,
inter alia, that his 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. And, the same has been granted
by the Sandiganbayan.
Due the non-compliance of the PCGG with the directive
of the Sandiganbayan, Benedicto filed a Motion for
Compliance followed by an Ex-Parte Motion for Early
Resolution, the SB has given the PCCG a final extension of
15 days from receipt of the resolution.
PCGG on the other hand, filed a Manifestation with
Motion for Reconsideration, praying for the setting aside
of the Resolution of the SB however it was denied by the
latter and has granted Benedicto’s Motion to Enforce
Judgment Levy.
ISSUE: Whether or not the public respondent
Sandiganbayan, Second Division, gravely abused its
discretion in holding that the PCGG is at fault for not
paying the membership dues on the 227 sequestered
NOGCCI shares of stock, a failing which eventually led to
the foreclosure sale thereof?
HELD:
The term "grave abuse of discretion" connotes capricious
and whimsical exercise of judgment as is equivalent to
excess, or a lack of jurisdiction. The abuse must be so
patent and gross as to amount to an evasion of a positive
duty or a virtual refusal to perform a duty enjoined by
law, or to act at all in contemplation of law as where the
power is exercised in an arbitrary and despotic manner
by reason of passion or hostility. Sadly, this is completely
absent in the present case. For, at bottom, the assailed
resolutions of the Sandiganbayan did no more than to
direct PCGG to comply with its part of the bargain under
the compromise agreement it freely entered into with
private respondent Benedicto. Simply put, the assailed
resolutions of the Sandiganbayan have firm basis in fact
and in law. 
Lest it be overlooked, the issue of liability for the shares
in question had, as both public and private respondents
asserted, long become final and executory. 
In a last-ditch attempt to escape liability, petitioner
Republic, through the PCGG, invokes state immunity
from suit. As argued, the order for it to pay the value of
the delinquent shares would fix monetary liability on a
government agency, thus necessitating the appropriation
of public funds to satisfy the judgment claim. But, as
private respondent Benedicto correctly countered,
the PCGG fails to take stock of one of the exceptions
to the state immunity principle, i.e., when the
government itself is the suitor, as in Civil Case No.
0034. Where, as here, the State itself is no less the
plaintiff in the main case, immunity from suit cannot
be effectively invoked. 

For, as jurisprudence teaches, when the State, through

its duly authorized officers, takes the initiative in a
suit against a private party, it thereby descends to
the level of a private individual and thus opens itself
to whatever counterclaims or defenses the latter
may have against it. Petitioner Republic’s act of filing its
complaint in Civil Case No. 0034 constitutes a waiver of
its immunity from suit. Being itself the plaintiff in that
case, petitioner Republic cannot set up its immunity
against private respondent Benedicto’s prayers in
the same case.

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-48214 December 19, 1978
ILDEFONSO SANTIAGO, represented by his Attorney-
in-Fact, ALFREDO T. SANTIAGO, petitioner,  vs. THE
GOVERNMENT OF THE REPUBLIC OF THE
PHILIPPINES, represented by the Director, Bureau of
Plant Industry, and the Regional Director, Region IX,
Zamboanga City, respondent
FACTS: Ildefonso Santiago filed an action naming
defendant the government of the Republic of the
Philippines represented by the Director of the Bureau of
Plant Industry. His plea was for the revocation of a deed
of donation executed by him and his spouse in January of
1971,  with the Bureau of Plant Industry as the donee.  ordinary action for the collection of the just
Contrary to the terms of donation, the Bureau 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 on or before December 7, 1974.
The lower court however, sustained the motion to
dismiss filed by Republic on the premise that tate cannot
be sued without its consent. 
Hence a petition for certiorari lies.
ISSUE: Whether or not Santiago may sue the Republic of
the Philippines?
HELD: The State may not be sued without its consent.
The Republic cannot be proceeded against unless it
allows itself to be sued. Neither can a department,
bureau, agency, office, or instrumentality of the
government where the suit, may result "in adverse
consequences to the public treasury, whether in the
disbursements of funds or loss of property.  confidence of the people, the repository of the sovereign
It is contended by counsel for petitioner that the above
constitutional provision would be given a retroactive
application in this case if the suit for the revocation of
donation were dismissed.
The doctrine of non-suability recognized in this
jurisdiction even prior to the effectivity of the [1935]
Constitution is a logical corollary of the positivist
concept of law which, to paraphrase Holmes, negates the
assertion of any legal right as against the state, in itself
the source of the law on which such a right may be
predicated. Nor is this all. Even if such a principle does
give rise to problems, considering the vastly expanded
role of government enabling it to engage in business
pursuits to promote the general welfare, it is not
obeisance to the analytical school of thought alone that
calls for its continued applicability. 
Clearly, then, the contention that to dismiss the suit
would be to give the applicable constitutional provision a
retroactive effect is, to put it at its mildest, untenable.
It would be manifestly unfair for the Republic, as donee,
alleged to have violated the conditions under which it
received gratuitously certain property, thereafter to put
as a barrier the concept of non-suitability. That would be
a purely one-sided arrangement offensive to one's sense
of justice.
Fortunately, the constitutional provision itself snows a
waiver. Where there is consent, a suit may be filed.
Consent need not be express. It can be implied. 
The doctrine of governmental immunity from suit cannot
serve as an instrument for perpetrating an injustice on a
citizen. 
Where the government ordinarily benefited by the
taking of the land, the failure to institute the necessary
condemnation proceedings should not be a bar to an
compensation due.
Here, the alleged failure to abide by the conditions under
which a donation was given should not prove an
insuperable obstacle to a civil action, the consent
likewise being presumed. This conclusion is
strengthened by the fact that while a donation partakes
of a contract, there is no money claim, and therefore
reliance on Commonwealth Act No. 327 would be futile.
A Donor, with the Republic or any of its agency being the
donee, is entitled to go to court in case of an alleged
breach of the conditions of such donation.
He has the right to be heard. 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
power. The judiciary under this circumstance has the
grave responsibility of living up to the ideal of objectivity
and impartiality, the very essence of the rule of law. Only
by displaying the neutrality expected of an arbiter, even
if it happens to be one of the departments of a litigant,
can the decision arrived at, whatever it may be,
command respect and be entitled to acceptance.

G.R. No. 206484
DEPARTMENT OF TRANSPORTATION AND
COMMUNICATIONS (DOTC), Petitioner, vs. SPOUSES
VICENTE ABECINA and MARIA CLEOFE ABECINA,
Respondents.
FACTS:
DOTC awarded Digitel Telecommunications Philippines,
Inc. a contract for the management, operation,
maintenance, and development of a Regional
Telecommunications Development Project (RTDP) under
the National Telephone Program, Phase I, Tranche
1 (NTPI-1).
DOTC and Digitel subsequently entered into several
Facilities Management Agreements (FMA) and were later
converted into Financial Lease Agreements (FLA) in
1995.
The Municipality of Jose Panganiban, Camarines Norte
donated a 1,200 sq. m land to DOTC for the
implementation of said project. Pursuant to the FLAs,
Digitel constructed a telephone exchange on the
property which encroached on the properties of the
respondent spouses Vicente and Maria Cleofe Abecina
who are registered owner of Sitio Paltik, Camarines
Norte.
Spouses required the Digitel to vacate the properties and
pay damage however neither DOTC nor Digitel
compliedwith the demand because of the FLA.
Spouses filed an accion publiciana complaint against
DOTC and Digitel for recovery of possession and
damages.
In its answer, the DOTC claimed immunity from suit and
ownership over the subject properties. Nevertheless,
during the pre-trial conference, the DOTC admitted that
the Abecinas were the rightful owners of the properties
and opted to rely instead on state immunity from suit.
Spouses and Digitel executed a Compromise Agreement
and entered in a Contract of Lease, the RTC rendered a
partial decision and approved the Compromise
Agreement however, it brushed aside the state immunity
from suit as it could not be used as an instrument to
perpetuate an injustice on a citizen.
The RTC held that as the lawful owners of the properties,
the respondent spouses enjoyed the right to use and to
possess them – rights that were violated by the DOTC’s
unauthorized entry, construction, and refusal to vacate.
The DOTC elevated the case to the CA arguing: (1) that
the RTC never acquired jurisdiction over it due to state
immunity from suit; (2) that the suit against it should
have been dismissed after the spouses Abecina and
Digitel executed a compromise agreement; and (3) that
the RTC erred in awarding actual, moral, and exemplary
damages against it.
CA affirmed the decision of the RTC but deleted the
award for exemplary damages and likewise denied the
DOTC’s claim of state immunity from suit, reasoning that
the DOTC removed its cloak of immunity after entering
into a proprietary contract – the Financial Lease
Agreement with Digitel.
The DOTC asserts that its Financial Lease Agreement
with Digitel was entered into in pursuit of its
governmental functions to promote and develop
networks of communication systems.Therefore, it cannot
be interpreted as a waiver of state immunity.
ISSUE: Whether or not the DOTC can invoke immunity
from suit?
HELD:
The State may not be sued without its consent. This
fundamental doctrine stems from the principle that there
can be no legal right against the authority which makes
the law on which the right depends. This generally
accepted principle of law has been explicitly expressed in
both the 1973 and the present Constitutions.
But as the principle itself implies, the doctrine of state
immunity is not absolute. The State may waive its cloak
of immunity and the waiver may be made expressly or
by implication.
Over the years, the State’s participation in economic and
commercial activities gradually expanded beyond its
sovereign function as regulator and
governor.1âwphi1 The evolution of the State’s activities
and degree of participation in commerce demanded a
parallel evolution in the traditional rule of state
immunity.
Thus, it became necessary to distinguish between the
State’s sovereign and governmental acts (jure
imperii) and its private, commercial, and proprietary
acts (jure gestionis). Presently, state immunity
restrictively extends only to acts jure imperii while
acts jure gestionis are considered as a waiver of
immunity.
The Philippines recognizes the vital role of information
and communication in nation building. To this end, the
DOTC has been mandated with the promotion,
development, and regulation of dependable and
coordinated networks of communication.
We have no doubt that when the DOTC constructed
the encroaching structures and subsequently
entered into the FLA with Digitel for their
maintenance, it was carrying out a sovereign
function. Therefore, we agree with the DOTC’s
contention that these are acts jure imperii that fall
within the cloak of state immunity.
However, the doctrine of state immunity cannot serve as
an instrument for perpetrating an injustice to a citizen.
DOTC was not a builder in bad faith when the
improvements were constructed. The CA itself found that
the Department's encroachment over the respondents'
properties was a result of a mistaken implementation of
the donation from the municipality of Jose Panganiban.
Good faith consists in the belief of the builder that the
land he is building on is his and [of] his ignorance of any
defect or flaw in his title. While the DOTC later realized
its error and admitted its encroachment over the
respondents' property, there is no evidence that it
acted maliciously or in bad faith when the
construction was done.

Chief among these limitations are the principles that no
person shall be deprived of life, liberty, or property
without due process of law and that private property
shall not be taken for public use without just
compensation. These limitations are enshrined in no less
than the Bill of Rights that guarantees the citizen
protection from abuse by the State.
Article 527 of the Civil Code presumes good faith.
Without proof that. the Department's mistake was made
in bad faith, its construction is presumed to have been
made in good faith. Therefore, the forfeiture of the
improvements in favor of the respondent spouses is
unwarranted.

Hence, State’s power of eminent domain shall be

exercised through expropriation proceedings in
court. Whenever private property is taken for public
use, it becomes the ministerial duty of the concerned
office or agency to initiate expropriation
proceedings. By necessary implication, the filing of a
complaint for expropriation is a waiver of State
immunity.

If the DOTC had correctly followed the regular procedure

upon discovering that it had encroached on the
respondents’ property, it would have initiated
expropriation proceedings instead of insisting on its
immunity from suit. 

We hold, therefore, that the Department’s entry into and

taking of possession of the respondents’ property
amounted to an implied waiver of its governmental
immunity from suit.

We also find no merit in the DOTC’s contention that the

RTC should not have ordered the reconveyance of the
respondent spouses’ property because the property is
being used for a vital governmental function, that is, the
operation and maintenance of a safe and efficient
communication system.

The exercise of eminent domain requires a genuine

necessity to take the property for public use and the
consequent payment of just compensation. The property
is evidently being used for a public purpose. However,
we also note that the respondent spouses willingly
entered into a lease agreement with Digitel for the use of
the subject properties.

If in the future the factual circumstances should change

and the respondents refuse to continue the lease, then
the DOTC may initiate expropriation proceedings. But as
matters now stand, the respondents are clearly willing to
lease the property. Therefore, we find no genuine
necessity for the DOTC to actually take the property at
this point.

G.R. No. 206510               September 16, 2014
MOST REV. PEDRO D. ARIGO, vs.
SCOTT H. SWIFT in his capacity as Commander of the
US. 7th Fleet,
FACTS: “Tubbataha" came from the Samal (seafaring
people of southern Philippines) language which means
"long reef exposed at low tide." Tubbataha is composed
of two huge coral atolls - the north atoll and the south
atoll - and the Jessie Beazley Reef, a smaller coral
structure about 20 kilometers north of the atolls. The
reefs of Tubbataha and Jessie Beazley are considered
part of Cagayancillo, a remote island municipality of
Palawan.
In 1988, Tubbataha was declared a National Marine
Park by virtue of Proclamation No. 306 issued by
President Corazon C. Aquino on August 11, 1988.
Located in the middle of Central Sulu Sea, 150 kilometers
southeast of Puerto Princesa City, Tubbataha lies at the
heart of the Coral Triangle, the global center of marine
biodiversity.
In 1993, Tubbataha was inscribed by the United Nations
Educational Scientific and Cultural Organization
(UNESCO) as a World Heritage Site, one of the
Philippine’s olderst ecosystems which is an important
habitat for internationally threatened and endangered
marine species.
On April 6, 2010, the Congress passed RA no. 10067
otherwise known as "Tubbataha Reefs Natural Park
(TRNP) Act of 2009"  "to ensure the protection and
conservation of the globally significant economic,
biological, sociocultural, educational and scientific values
of the Tubbataha Reefs into perpetuity for the enjoyment
of present and future generations."
Under the "no-take" policy, entry into the waters of
TRNP is strictly regulated and many human activities are
prohibited and penalized or fined, including fishing,
gathering, destroying and disturbing the resources
within the TRNP.
The law likewise created the Tubbataha Protected Area
Management Board (TPAMB) which shall be the sole
policy-making and permit-granting body of the TRNP.
The US embassy in the Philippines requested diplomatic
clearance for the USS Guardian vessel "to enter and exit
the territorial waters of the Philippines and to arrive at
the port of Subic Bay for the purpose of routine ship
replenishment, maintenance, and crew liberty.
However, while transiting the Sulu Sea, the ship ran
aground on the northwest side of South Shoal of the
Tubbataha Reefs, about 80 miles east-southeast of
Palawan. No cine was injured in the incident, and there
have been no reports of leaking fuel or oil.
U.S. 7th Fleet Commander, Vice Admiral Scott Swift,
expressed regret for the incident in a press
statement. Likewise, US Ambassador to the Philippines
Harry K. Thomas, Jr., in a meeting at the Department of
Foreign Affairs reiterated his regrets over the grounding
incident and assured Foreign Affairs Secretazy Albert F.
del Rosario that the United States will provide
appropriate compensation for damage to the reef caused
by the ship."
Petitioners, on their behalf and in representation of their
respective sector/organization and others, including
minors or generations yet unborn filed a petition a
petition agairtst Scott H. Swift in his capacity as
Commander of the US 7th Fleet including President
Benigno S. Aquino III in his capacity as Commander-in-
Chief of the Armed Forces of the Philippines which is
part in the “Philippine Respondents”
Petitioners claim that the grounding, salvaging and post-
salvaging operations of the USS Guardian cause and
continue to cause environmental damage of such
magnitude as to affect the provinces of Palawan, Antique,
Aklan, Guimaras, Iloilo, Negros Occidental, Negros
Oriental, Zamboanga del Norte, Basilan, Sulu, and Tawi-
Tawi, which events violate their constitutional rights to a
balanced and healthful ecology. Likewise, they seek a
directive from this court for the institution of civil,
administrative and criminal suits for acts committed in
violation of environmental laws and regulations in
connection with the grounding incident.
Petitioners claimed that the following violations was
committed by the US respondents under R.A. No. 10067:
unauthorized entry (Section 19); non-payment of
conservation fees (Section 21 ); obstruction of law
enforcement officer (Section 30); damages to the reef
(Section 20); and destroying and disturbing resources
(Section 26[g]).
Furthermore, petitioners assail certain provisions of the
Visiting Forces Agreement (VFA) which they want this
Court to nullify for being unconstitutional.
Respondents assert that: ( 1) the grounds relied upon for
the issuance of a TEPO or writ of Kalikasan have become
fait accompli as the salvage operations on the USS
Guardian were already completed; (2) the petition is
defective in form and substance; (3) the petition
improperly raises issues involving the VFA between the
Republic of the Philippines and the United States of
America; and ( 4) the determination of the extent of
responsibility of the US Government as regards the
damage to the Tubbataha Reefs rests excursively with
the executive branch.
HELD: There is no dispute on the legal standing of
petitioners to file the present petition.
Locus standi is "a right of appearance in a court of justice
on a given question.  It is "a party's personal and
substantial interest in a case where he has sustained or
will sustain direct injury as a result" of the act being
challenged, and "calls for more than just a generalized
grievance."
In the landmark case of Oposa v. Factoran, Jr., Court
ruled that not only do ordinary citizens have legal
standing to sue for the enforcement of environmental
rights, they can do so in representation of their own and
future generations.
The liberalization of standing first enunciated in Oposa,
insofar as it refers to minors and generations yet unborn,
is now enshrined in the Rules which allows the filing of a
citizen suit in environmental cases. The provision on
citizen suits in the Rules "collapses the traditional rule
on personal and direct interest, on the principle that
humans are stewards of nature."
ISSUE: whether this Court has jurisdiction over the US
respondents who did not submit any pleading or
manifestation in this case?
HELD: The rule that a state may not be sued without its
consent, now · expressed in Article XVI, Section 3, of the
1987 Constitution, is one of the generally accepted
principles of international law that we have adopted as
part of the law of our land under Article II, Section 2.
Even without such affirmation, we would still be
bound by the generally accepted principles of
international law under the doctrine of
incorporation. Under this doctrine, as accepted by the
majority of states, such principles are deemed
incorporated in the law of every civilized state as a
condition and consequence of its membership in the
society of nations. Upon its admission to such society,
the state is automatically obligated to comply with these
principles in its relations with other states.
As applied to the local state, the doctrine of state
immunity is based on the justification given by Justice
Holmes that ''there can be no legal right against the
authority which makes the law on which the right
depends."
In the case of the foreign state sought to be impleaded in
the local jurisdiction, the added inhibition is expressed in
the maxim par in parem, non habet imperium. All states
are sovereign equals and cannot assert jurisdiction over
one another. A contrary disposition would, in the
language of a celebrated case, "unduly vex the peace of
nations."
While the doctrine appears to prohibit only suits against
the state without its consent, it is also applicable to
complaints filed against officials of the state for acts
allegedly performed by them in the discharge of their
duties. The rule is that if the judgment against such
officials will require the state itself to perform an
affirmative act to satisfy the same such as the
appropriation of the amount needed to pay the damages
awarded against them, the suit must be regarded as
against the state itself although it has not been formally
impleaded. In such a situation, the state may move to
dismiss the complaint on the ground that it has been
filed without its consent.
If the acts giving rise to a suit are those of a foreign
government done by its foreign agent, although not
necessarily a diplomatic personage, but acting in his
official capacity, the complaint could be barred by the
immunity of the foreign sovereign from suit without its
consent.
(Minucher vs. CA) Suing a representative of a state is
believed to be, in effect, suing the state itself. The
proscription is not accorded for the benefit of an
individual but for the State, in whose service he is, under
the maxim -par in parem, non habet imperium -that all
states are sovereign equals and cannot assert
jurisdiction over one another. The implication, in broad
terms, is that if the judgment against an official would
require the state itself to perform an affirmative act to
satisfy the award, such as the appropriation of the
amount needed to pay the damages decreed against him,
the suit must be regarded as being against the state itself,
although it has not been formally impleaded.
In the same case we also mentioned that in the case of
diplomatic immunity, the privilege is not an immunity
from the observance of the law of the territorial
sovereign or from ensuing legal liability; it is, rather,
an immunity from the exercise of territorial
jurisdiction.
This traditional rule of State immunity which exempts a
State from being sued in the courts of another State
without the former's consent or waiver has evolved into
a restrictive doctrine which distinguishes sovereign and
governmental acts (Jure imperil") from private,
commercial and proprietary acts (Jure gestionis). Under
the restrictive rule of State immunity, State immunity
extends only to acts Jure imperii. The restrictive
application of State immunity is proper only when the
proceedings arise out of commercial transactions of the
foreign sovereign, its commercial activities or economic
affairs.
Inasmuch as the State authorizes only legal acts by its
officers, unauthorized acts of government officials or
officers are not acts of the State, and an action against
the officials or officers by one whose rights have been
invaded or violated by such acts, for the protection of his
rights, is not a suit against the State within the rule of
immunity of the State from suit.

In the same tenor, it has been said that an action at law
or suit in equity against a State officer or the director of a
State department on the ground that, while claiming to
act for the State, he violates or invades the personal and
property rights of the plaintiff, under an unconstitutional
act or under an assumption of authority which he does
not have, is not a suit against the State within the
constitutional provision that the State may not be sued
without its consent." The rationale for this ruling is that
the doctrine of state immunity cannot be used as an
instrument for perpetrating an injustice.
Doctrine of immunity from suit will not apply and may
not be invoked where the public official is being sued in
his private and personal capacity as an ordinary citizen.
The cloak of protection afforded the officers and agents
of the government is removed the moment they are sued
in their individual capacity. This situation usually arises
where the public official acts without authority or in
excess of the powers vested in him. It is a well-settled
principle of law that a public official may be liable in his
personal private capacity for whatever damage he may
have caused by his act done with malice and in bad faith,
or beyond the scope of his authority or jurisdiction.
In this case, the US respondents were sued in their
official capacity as commanding officers of the US
Navy who had control and supervision over the USS
Guardian and its crew. The alleged act or omission
resulting in the unfortunate grounding of the USS
Guardian on the TRNP was committed while they
were performing official military duties. Considering
that the satisfaction of a judgment against said
officials will require remedial actions and
appropriation of funds by the US government, the
suit is deemed to be one against the US itself. The
principle of State immunity therefore bars the
exercise of jurisdiction by this Court over the
persons of respondents Swift, Rice and Robling.
Senior Associate Justice Antonio T. Carpio explained that
while historically, warships enjoy sovereign immunity
from suit as extensions of their flag State, Art. 31 of the
UNCLOS creates an exception to this rule in cases where
they fail to comply with the rules and regulations of the
coastal State regarding passage through the latter's
internal waters and the territorial sea.
According to Justice Carpio, although the US to date has
not ratified the UNCLOS as a matter of long-standing
policy the US considers itself bound by customary
international rules on the "traditional uses of the oceans"
as codified in UNCLOS, as can be gleaned from previous
declarations by former Presidents Reagan and Clinton,
and the US judiciary in the case of United States v. Royal
Caribbean Cruise Lines, Ltd.
The international law of the sea is generally defined as "a
body of treaty rules arid customary norms governing the
uses of the sea, the exploitation of its resources, and the
exercise of jurisdiction over maritime regimes. It is a
branch of public international law, regulating the
relations of states with respect to the uses of the oceans."
The UNCLOS is a multilateral treaty which was opened
for signature on December 10, 1982 at Montego Bay,
Jamaica. It was ratified by the Philippines in 1984 but
came into force on November 16, 1994 upon the
submission of the 60th ratification.
The UNCLOS is a product of international negotiation
that seeks to balance State sovereignty (mare clausum)
and the principle of freedom of the high seas (mare
liberum). The freedom to use the world's marine waters
is one of the oldest customary principles of international
law. The UNCLOS gives to the coastal State sovereign
rights in varying degrees over the different zones of the
sea which are: 1) internal waters, 2) territorial sea, 3)
contiguous zone, 4) exclusive economic zone, and 5) the
high seas. It also gives coastal States more or less
jurisdiction over foreign vessels depending on where the
vessel is located.
Insofar as the internal waters and territorial sea is
concerned, the Coastal State exercises sovereignty,
subject to the UNCLOS and other rules of international
law. Such sovereignty extends to the air space over the
territorial sea as well as to its bed and subsoil.
In the case of warships, they continue to enjoy the
sovereign immunity subject to the following conditions
—
a. Art. 30 – Non-compliance by warships with the
laws and regulations of the coastal state;
b. Art. 31- Responsibility of the flag state for
damage caused by warship
c. Art. 32- Immunities of warships and other
government ships operated for non-commercial
purposes
With such exceptions as are contained in subsection A
and in articles 30 and 31, nothing in this Convention
affects the immunities of warships and other
government ships operated for non-commercial
purposes. A foreign warship's unauthorized entry into
our internal waters with resulting damage to marine
resources is one situation in which the above provisions
may apply.
ISSUE: But what if the offending warship is a non-party
to the UNCLOS, as in this case, the US?
An overwhelming majority - over 80% -- of nation states
are now members of UNCLOS, but despite this the US, the
world's leading maritime power, has not ratified it.
While the Reagan administration was instrumental in
UNCLOS' negotiation and drafting, the U.S. delegation
ultimately voted against and refrained from signing it
due to concerns over deep seabed mining technology
transfer provisions contained in Part XI.
Thus, member states cooperated to revise the
objectionable provisions and this satisfied the Clinton
Administration. However, despite of the consistent
support from Clinton, Senate has since withheld the
consent required for the President to internationally
bind the United States to UNCLOS.
Justice Carpio invited our attention to the policy
statement given by President Reagan on March 10, 1983
that the US will "recognize the rights of the other , states
in the waters off their coasts, as reflected in the
convention [UNCLOS], so long as the rights and freedom
of the United States and others under international law
are recognized by such coastal states", and President
Clinton's reiteration of the US policy "to act in a manner
consistent with its [UNCLOS] provisions relating to
traditional uses of the oceans and to encourage other
countries to do likewise." Since Article 31 relates to the
"traditional uses of the oceans," and "if under its policy,
the US 'recognize[s] the rights of the other states in the
waters off their coasts,"' Justice Carpio postulates that
"there is more reason to expect it to recognize the rights
of other states in their internal waters, such as the Sulu
Sea in this case."
As to the non-ratification by the US, Justice Carpio
emphasizes that "the US' refusal to join the UN CLOS was
centered on its disagreement with UN CLOS' regime of
deep seabed mining (Part XI) which considers the oceans
and deep seabed commonly owned by mankind,"
pointing out that such "has nothing to do with its [the
US'] acceptance of customary international rules on
navigation."
It may be mentioned that even the US Navy Judge
Advocate General's Corps publicly endorses the
ratification of the UNCLOS, as shown by the following
statement posted on its official website:
The Convention is in the national interest of the United
States because it establishes stable maritime zones,
including a maximum outer limit for territorial seas;
codifies innocent passage, transit passage, and
archipelagic sea lanes passage rights; works against
"jurisdiction creep" by preventing coastal nations from
expanding their own maritime zones; and reaffirms
sovereign immunity of warships, auxiliaries and
government aircraft.
We fully concur with Justice Carpio's view that non-
membership in the UNCLOS does not mean that the
US will disregard the rights of the Philippines as a
Coastal State over its internal waters and territorial
sea. We thus expect the US to bear "international
responsibility" under Art. 31 in connection with the
USS Guardian grounding which adversely affected
the Tubbataha reefs.
Indeed, it is difficult to imagine that our long-time
ally and trading partner, which has been actively
supporting the country's efforts to preserve our vital
marine resources, would shirk from its obligation to
compensate the damage caused by its warship while
transiting our internal waters. Much less can we
comprehend a Government exercising leadership in
international affairs, unwilling to comply with the
UNCLOS directive for all nations to cooperate in the
global task to protect and preserve the marine
environment as provided in Article 197
(Cooperation on global or regional bases).
Petitioners argue that there is a waiver of immunity from
suit found in the VFA. Likewise, they invoke federal
statutes in the US under which agencies of the US have
statutorily waived their immunity to any action. Even
under the common law tort claims, petitioners
asseverate that the US respondents are liable for
negligence, trespass and nuisance.
We are not persuaded.
The VFA is an agreement which defines the treatment of
United States troops and personnel visiting the
Philippines to promote "common security interests"
between the US and the Philippines in the region. It
provides for the guidelines to govern such visits of
military personnel, and further defines the rights of the
United States and the Philippine government in the
matter of criminal jurisdiction, movement of vessel and
aircraft, importation and exportation of equipment,
materials and supplies. The invocation of US federal tort
laws and even common law is thus improper considering
that it is the VFA which governs disputes involving US
military ships and crew navigating Philippine waters in
pursuance of the objectives of the agreement.
As it is, the waiver of State immunity under the VF A
pertains only to criminal jurisdiction and not to special
civil actions such as the present petition for issuance of a
writ of Kalikasan. In fact, it can be inferred from Section
17, Rule 7 of the Rules that a criminal case against a
person charged with a violation of an environmental law
is to be filed separately.
In any case, it is our considered view that a ruling on the
application or non-application of criminal jurisdiction
provisions of the VF A to US personnel who may be
found responsible for the grounding of the USS Guardian,
would be premature and beyond the province of a
petition for a writ of Kalikasan. We also find it
unnecessary at this point to determine whether such
waiver of State immunity is indeed absolute. In the same
vein, we cannot grant damages which have resulted from
the violation of environmental laws. 
The Rules allows the recovery of damages, including the
collection of administrative fines under R.A. No. 10067,
in a separate civil suit or that deemed instituted with the
criminal action charging the same violation of an
environmental law.
We agree with respondents (Philippine officials) in
asserting that this petition has become moot in the sense
that the salvage operation sought to be enjoined or
restrained had already been accomplished when
petitioners sought recourse from this Court. But insofar
as the directives to Philippine respondents to protect
and rehabilitate the coral reef stn icture and marine
habitat adversely affected by the grounding incident are
concerned, petitioners are entitled to these reliefs
notwithstanding the completion of the removal of the
USS Guardian from the coral reef. 
Exploring avenues for settlement of environmental cases
is not proscribed by the Rules. To underscore that the US
government is prepared to pay appropriate
compensation for the damage caused by the USS
Guardian grounding, the US Embassy in the Philippines
has announced the formation of a US interdisciplinary
scientific team which will "initiate discussions with the
Government of the Philippines to review coral reef
rehabilitation options in Tubbataha, based on
assessments by Philippine-based marine scientists." The
US team intends to "help assess damage and remediation
options, in coordination with the Tubbataha
Management Office, appropriate Philippine government
entities, non-governmental organizations, and scientific
experts from Philippine universities."

In the light of the foregoing, the Court defers to the

Executive Branch on the matter of compensation and
rehabilitation measures through diplomatic channels.
Resolution of these issues impinges on our relations with
another State in the context of common security
interests under the VFA. It is settled that "[t]he conduct
of the foreign relations of our government is committed
by the Constitution to the executive and legislative-"the
political" --departments of the government, and the
propriety of what may be done in the exercise of this
political power is not subject to judicial inquiry or
decision."

On the other hand, we cannot grant the additional reliefs

prayed for in the petition to order a review of the VFA
and to nullify certain immunity provisions thereof.

As held in BAYAN (Bagong Alyansang Makabayan) v.

Exec. Sec. Zamora, the VFA was duly concurred in by the
Philippine Senate and has been recognized as a treaty by
the United States as attested and certified by the duly
authorized representative of the United States
government. The VF A being a valid and binding
agreement, the parties are required as a matter of
international law to abide by its terms and provisions.
The present petition under the Rules is not the proper
remedy to assail the constitutionality of its provisions.

WHEREFORE, the petition for the issuance of the

privilege of the Writ of Kalikasan is hereby DENIED.

G.R. No. 142396             February 11, 2003
KHOSROW MINUCHER, petitioner,  vs. HON. COURT OF
APPEALS and ARTHUR SCALZO, respondents.
FACTS: Sometime in May 1986, an Information for
violation of Section 4 of Republic Act No. 6425, otherwise
also known as the "Dangerous Drugs Act of 1972," was
filed against petitioner Khosrow Minucher and one
Abbas Torabian with the Regional Trial Court, Branch
151, of Pasig City.  putting on his shirt as he was only in his pajama pants,
A buy-bust operation was 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.)
Presiding Judge Eutropio Migrino rendered a decision
acquitting the two accused.
Subsequently, Minucher filed a civil case before the RTC
of Manila for damages on account of what he claimed to
have been trumped-up charges of drug trafficking made
by Arthur Scalzo.  his house and likewise arrested Torabian, who was
Per plaintiff’s testimony, he came to the Philippines to
study in UP in 1974. And, under the regime of the Shah of
Iran, he was appointed Labor Attaché for the Iranian
Embassies in Tokyo, Japan and Manila, Philippines in
1976.
When the Shah of Iran was deposed by Ayatollah
Khomeini, plaintiff became a refugee of the United
Nations and continued to stay in the Philippines. He
headed the Iranian National Resistance Movement in the
Philippines.
He came to know Arthur Scalzo when he was introduced
to by Jose Iñ igo, an informer of the Intelligence Unit of
the military. During their introduction in said meeting,
Scalzo gave Minucher a calling card which showed that
the former is working in the US embassy in the
Philippines as a special agent of Drug Enforcement
Administration, DOJ of the US.
On that same day, he signified his interest in buying
caviar and thereafter bought the 2 kilos of the same. He
stated that after the Khomeini government cut his
pension of over $3,000 per month hence he sells caviar
Persian carpets, pistachio nits and other Iraninan
products.
"It was also during this first meeting that plaintiff
expressed his desire to obtain a US Visa for his wife and
the wife of a countryman named Abbas Torabian. Scalzo
told him that he could help Minucher for a fee of $2,000
per visa.
Thereafter, at about 3:00 in the afternoon of May 27,
1986, the defendant came back again to plaintiff's house
and directly proceeded to the latter's bedroom, where
the latter and his countryman, Abbas Torabian, were
playing chess.
Plaintiff opened his safe in the bedroom and obtained
$2,000.00 from it, gave it to the defendant for the latter's
fee in obtaining a visa for plaintiff's wife.
The defendant told him that he would be leaving the
Philippines very soon and requested him to come out of
the house for a while so that he can introduce him to his
cousin waiting in a cab. Without much ado, and without
he followed the defendant where he saw a parked cab
opposite the street. 
To his complete surprise, an American jumped out of the
cab with a drawn high-powered gun. He was in the
company of about 30 to 40 Filipino soldiers with 6
Americans, all armed. He was handcuffed and after about
20 minutes in the street, he was brought inside the house
by the defendant. He was made to sit down while in
handcuffs while the defendant was inside his bedroom.
The defendant came out of the bedroom and out from
defendant's attaché case, he took something and placed
it on the table in front of the plaintiff. They also took
plaintiff's wife who was at that time at the boutique near
playing chess with him in the bedroom and both were
handcuffed together. He asked for any warrant, but the
defendant told him to `shut up.’ He was nevertheless told
that he would be able to call for his lawyer who can
defend him.
The plaintiff took note of the fact that when the
defendant invited him to come out to meet his cousin, his
safe was opened where he kept the $24,000.00 the
defendant paid for the carpets and another $8,000.00
which he also placed in the safe together with a bracelet
worth $15,000.00 and a pair of earrings worth
$10,000.00. He also discovered missing upon his release
his 8 pieces hand-made Persian carpets, valued at
$65,000.00, a painting he bought for P30,000.00 together
with his TV and betamax sets. He claimed that when he
was handcuffed, the defendant took his keys from his
wallet. There was, therefore, nothing left in his house.
That his arrest as a heroin trafficker x x x had been well
publicized throughout the world, in various newspapers,
particularly in Australia, America, Central Asia and in the
Philippines. He was identified in the papers as an
international drug trafficker.
In fact, the arrest of defendant and Torabian was
likewise on television, not only in the Philippines, but
also in America and in Germany. His friends in said
places informed him that they saw him on TV with said
news.
After the arrest made on plaintiff and Torabian, they
were brought to Camp Crame handcuffed together,
where they were detained for three days without food
and water.
The law firm of Luna, Sison and Manas, filed a special
appearance for Scalzo and moved for extension of time
to file an answer pending a supposed advice from the
United States Department of State and Department of
Justice on the defenses to be raised. And the same has
been granted by the trial court.
Scalzo filed another special appearance to quash the
summons on the ground that he, not being a resident of
the Philippines and the action being one in personam,
was beyond the processes of the court. The motion was
denied by the court, holding that the filing by Scalzo of a
motion for extension of time to file an answer to the
complaint was a voluntary appearance equivalent to
service of summons which could likewise be construed a
waiver of the requirement of formal notice.
Scalzo argued that in cases involving the United States
government, as well as its agencies and officials, a
motion for extension was peculiarly unavoidable due to
the need (1) for both the Department of State and the
Department of Justice to agree on the defenses to be
raised and (2) to refer the case to a Philippine lawyer
who would be expected to first review the case. The
court a quo denied the motion for reconsideration in its
order of 15 October 1989.
Meanwhile, at the court a quo, an order was issued (a)
declaring Scalzo in default for his failure to file a
responsive pleading (answer) and (b) setting the case for
the reception of evidence.  The Convention lists the classes of heads of diplomatic
Granting the motion, the trial court set the case for pre-
trial. In his answer, Scalzo denied the material
allegations of the complaint and raised the affirmative
defenses (a) of Minucher’s failure to state a cause of
action in his complaint and (b) that Scalzo had acted in
the discharge of his official duties as being merely an
agent of the Drug Enforcement Administration of the
United States Department of Justice.  members of the administrative, technical and service
After almost two years since the institution of the civil
case, Scalzo filed a motion to dismiss the complaint on
the ground that, being a special agent of the United
States Drug Enforcement Administration, he was entitled
to diplomatic immunity. He attached to his motion
Diplomatic Note No. 414 of the United States Embassy,
dated 29 May 1990, addressed to the Department of
Foreign Affairs of the Philippines and a Certification,
dated 11 June 1990, of Vice Consul Donna Woodward,
certifying that the note is a true and faithful copy of its
original. In an order of 25 June 1990, the trial court
denied the motion to dismiss.
While the trial court gave credence to the claim of
Scalzo and the evidence presented by him that he was a
diplomatic agent entitled to immunity as such, it ruled
that he, nevertheless, should be held accountable for the
acts complained of committed outside his official duties.
On appeal, the Court of Appeals reversed the decision
of the trial court and sustained the defense of Scalzo that
he was sufficiently clothed with diplomatic immunity
during his term of duty and thereby immune from the
criminal and civil jurisdiction of the "Receiving State"
pursuant to the terms of the Vienna Convention.
ISSUE: whether or not Arthur Scalzo is indeed entitled to
diplomatic immunity?
HELD:
Scalzo contends that the Vienna Convention on
Diplomatic Relations, to which the Philippines is a
signatory, grants him absolute immunity from suit,
describing his functions as an agent of the United States
Drugs Enforcement Agency as "conducting surveillance
operations on suspected drug dealers in the Philippines
believed to be the source of prohibited drugs being
shipped to the U.S., (and) having ascertained the target,
(he then) would inform the Philippine narcotic agents
(to) make the actual arrest." 
Traditionally, the exercise of diplomatic intercourse
among states was undertaken by the head of state
himself, as being the preeminent embodiment of the
state he represented, and the foreign secretary, the
official usually entrusted with the external affairs of the
state. Where a state would wish to have a more
prominent diplomatic presence in the receiving state, it
would then send to the latter a diplomatic mission.
Conformably with the Vienna Convention, the functions
of the diplomatic mission involve, by and large, the
representation of the interests of the sending state and
promoting friendly relations with the receiving state.
missions to include (a) ambassadors or nuncios
accredited to the heads of state, (b) envoys, ministers
or internuncios accredited to the heads of states; and (c)
charges d' affairs accredited to the ministers of foreign
affairs. Comprising the "staff of the (diplomatic) mission"
are the diplomatic staff, the administrative staff and the
technical and service staff. Only the heads of missions, as
well as members of the diplomatic staff, excluding the
staff of the mission, are accorded diplomatic rank. Even
while the Vienna Convention on Diplomatic Relations
provides for immunity to the members of diplomatic
missions, it does so, nevertheless, with an understanding
that the same be restrictively applied. 
Only "diplomatic agents," under the terms of the
Convention, are vested with blanket diplomatic
immunity from civil and criminal suits. The Convention
defines "diplomatic agents" as the heads of missions or
members of the diplomatic staff, thus impliedly
withholding the same privileges from all others. It might
bear stressing that even consuls, who represent their
respective states in concerns of commerce and
navigation and perform certain administrative and
notarial duties, such as the issuance of passports and
visas, authentication of documents, and administration
of oaths, do not ordinarily enjoy the traditional
diplomatic immunities and privileges accorded
diplomats, mainly for the reason that they are not
charged with the duty of representing their states in
political matters. Indeed, the main yardstick in
ascertaining whether a person is a diplomat entitled to
immunity is the determination of whether or not he
performs duties of diplomatic nature.
Scalzo asserted that he was an Assistant Attaché of the
United States diplomatic mission and was accredited as
such by the Philippine Government. An attaché belongs
to a category of officers in the diplomatic establishment
who may be in charge of its cultural, press,
administrative or financial affairs.  invaded or violated by such acts, for the protection of his
Attaches assist a chief of mission in his duties and
are administratively under him, but their main
function is to observe, analyze and interpret trends
and developments in their respective fields in the
host country and submit reports to their own
ministries or departments in the home government.
These officials are not generally regarded as
members of the diplomatic mission, nor are they
normally designated as having diplomatic rank.
A significant document would appear to be Exhibit No.
08, dated 08 November 1992, issued by the Office of
Protocol of the Department of Foreign Affairs and signed
by Emmanuel C. Fernandez, Assistant Secretary,
certifying that "the records of the Department (would)
show that Mr. Arthur W. Scalzo, Jr., during his term of
office in the Philippines (from 14 October 1985 up to 10
August 1988) was listed as an Assistant Attaché of the
United States diplomatic mission and was, therefore,
accredited diplomatic status by the Government of the
Philippines." No certified true copy of such "records," the
supposed bases for the belated issuance, was presented
in evidence.
Vesting a person with diplomatic immunity is a
prerogative of the executive branch of the government.  jurisdiction."
But while the diplomatic immunity of Scalzo might
thus remain contentious, it was sufficiently
established that, indeed, he worked for the United
States Drug Enforcement Agency and was tasked to
conduct surveillance of suspected drug activities
within the country on the dates pertinent to this
case. If it should be ascertained that Arthur Scalzo
was acting well within his assigned functions when
he committed the acts alleged in the complaint, the
present controversy could then be resolved under
the related doctrine of State Immunity from Suit.
If the acts giving rise to a suit are those of a foreign
government done by its foreign agent, although not
necessarily a diplomatic personage, but acting in his
official capacity, the complaint could be barred by the
immunity of the foreign sovereign from suit without its
consent. Suing a representative of a state is believed to
be, in effect, suing the state itself. The proscription is not
accorded for the benefit of an individual but for the State,
in whose service he is, under the maxim - par in parem,
non habet imperium - that all states are sovereign equals
and cannot assert jurisdiction over one another.
The implication, in broad terms, is that if the judgment
against an official would require the state itself to
perform an affirmative act to satisfy the award, such as
the appropriation of the amount needed to pay the
damages decreed against him, the suit must be regarded
as being against the state itself, although it has not been
formally impleaded.
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
rights, is not a suit against the State within the rule of
immunity of the State from suit. In the same tenor, it has
been said that an action at law or suit in equity against a
State officer or the director of a State department on the
ground that, while claiming to act for the State, he
violates or invades the personal and property rights of
the plaintiff, under an unconstitutional act or under an
assumption of authority which he does not have, is not a
suit against the State within the constitutional provision
that the State may not be sued without its consent. The
rationale for this ruling is that the doctrine of state
immunity cannot be used as an instrument for
perpetrating an injustice.
"The doctrine of immunity from suit will not apply and
may not be invoked where the public official is being
sued in his private and personal capacity as an ordinary
citizen. The cloak of protection afforded the officers and
agents of the government is removed the moment they
are sued in their individual capacity. This situation
usually arises where the public official acts without
authority or in excess of the powers vested in him. It is a
well-settled principle of law that a public official may be
liable in his personal private capacity for whatever
damage he may have caused by his act done with malice
and in bad faith or beyond the scope of his authority and
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.
Guinto and Shauf both involve officers and personnel of
the United States, stationed within Philippine territory,
under the RP-US Military Bases Agreement. While
evidence is wanting to show any similar agreement
between the governments of the Philippines and of the
United States (for the latter to send its agents and to
conduct surveillance and related activities of suspected
drug dealers in the Philippines), the consent
or imprimatur of the Philippine government to the
activities of the United States Drug Enforcement Agency,
however, can be gleaned from the facts heretofore
elsewhere mentioned.

The official exchanges of communication between

agencies of the government of the two countries,
certifications from officials of both the Philippine
Department of Foreign Affairs and the United States
Embassy, as well as the participation of members of the
Philippine Narcotics Command in the "buy-bust
operation" conducted at the residence of Minucher at the
behest of Scalzo, may be inadequate to support the
"diplomatic status" of the latter but they give enough
indication that the Philippine government has given
its imprimatur, if not consent, to the activities within
Philippine territory of agent Scalzo of the United
States Drug Enforcement Agency. 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 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. 154705               June 26, 2003
THE REPUBLIC OF INDONESIA, HIS EXCELLENCY
AMBASSADOR SOERATMIN, and MINISTER
COUNSELLOR AZHARI KASIM, Petitioners, vs. JAMES
VINZON, doing business under the name and style of
VINZON TRADE AND SERVICES, Respondent.
FACTS: Republic of Indonesia, represented by its
Counsellor, Siti Partinah, entered into a Maintenance
Agreement in August 1995 with James Vinzon, sole
proprietor of Vinzon Trade and Services.  Agreement shall be settled according to the laws of the
Included in the agreement 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 days prior written notice from the date of expiry
Petitioner claimed that prior to the expiration of the
agreement, they informed the respondent that the
renewal of the agreement shall be at the discretion of the
incoming Chief of Administration, Minister Counsellor
Azhari Kasim, who was expected to arrive in February
2000.  waived their immunity from suit by using as its basis the
Upon assumption of office of Minister Kasim, he
terminated, thru a letter said agreement as he allegedly
found that the work and services of the respondent were
rendered unsatisfactorily and non-compliant with the
standards set in the agreement.
Petitioners claim, moreover, 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. 
That on July 2000, Minister Counsellor Kasim still
requested respondent to assign to the embassy an
additional full-time worker to assist one of his other
workers; (b) in August 2000, Minister Counsellor Kasim
asked respondent to donate a prize, which the latter did,
on the occasion of the Indonesian Independence Day golf
tournament; and (c) in a letter dated August 22, 2000,
petitioner Ambassador Soeratmin thanked respondent
for sponsoring a prize and expressed his hope that the
cordial relations happily existing between them will
continue to prosper and be strengthened in the coming
years.
Respondent filed a complaint against petitioner in the
RTC of Makati. A motion to dismiss was filed by the
petitioner alleging that the Republic of Indonesia, as a
foreign sovereign State, has sovereign immunity from
suit and cannot be sued as a party-defendant in the
Philippines. The said motion further alleged that
Ambassador Soeratmin and Minister Counsellor Kasim
are diplomatic agents as defined under the Vienna
Convention on Diplomatic Relations and therefore enjoy
diplomatic immunity.
On their opposition, the respondent alleged that the
Republic of Indonesia has expressly waived its immunity
from suit. He based this claim upon the following
provision in the Maintenance Agreement:
"Any legal action arising out of this Maintenance
Philippines and by the proper court of Makati City,
Philippines." They likewise alleged that Ambassador
Soeratmin and Minister Counsellor Kasim can be sued
and held liable in their private capacities for tortious acts
done with malice and bad faith.
Trial court denied herein petitioners’ Motion to Dismiss.
It likewise denied the Motion for Reconsideration
subsequently filed.
On appeal, the petitioners alleged that the trial court
gravely abused its discretion in ruling that the Republic
of Indonesia gave its consent to be sued and voluntarily
submitted itself to the laws and jurisdiction of Philippine
courts and that petitioners Ambassador Soeratmin and
Minister Counsellor Kasim waived their immunity from
suit. However, it was denied for lack of merit.
ISSUE: whether or not the Court of Appeals erred in
sustaining the trial court’s decision that petitioners have
abovementioned provision in the Maintenance
Agreement?
HELD:
International law is founded largely upon the principles
of reciprocity, comity, independence, and equality of
States which were adopted as part of the law of our land
under Article II, Section 2 of the 1987 Constitution. The
rule that a State may not be sued without its consent is a
necessary consequence of the principles of
independence and equality of States.
The practical justification for the doctrine of sovereign
immunity is that there can be no legal right against the
authority that makes the law on which the right depends.
In the case of foreign States, the rule is derived from the
principle of the sovereign equality of States, as expressed
in the maxim par in parem non habet imperium. All states
are sovereign equals and cannot assert jurisdiction over
one another. A contrary attitude would "unduly vex the
peace of nations."
Indonesia was acting in pursuit of a sovereign activity
when it entered into a contract with respondent for the
upkeep or maintenance of the air conditioning units,
generator sets, electrical facilities, water heaters, and
water motor pumps of the Indonesian Embassy and the
official residence of the Indonesian ambassador.
ISSUE: whether or not petitioners Ambassador
Soeratmin and Minister Counsellor Kasim may be sued
herein in their private capacities?
HELD: Art. 31 of the Vienna Convention on Diplomatic
Relations provides that

The increasing need of sovereign States to enter into

purely commercial activities remotely connected with
the discharge of their governmental functions brought
about a new concept of sovereign immunity. This
concept, the restrictive theory, holds that the immunity
of the sovereign is recognized only with regard to public
acts or acts jure imperii, but not with regard to private
acts or acts jure gestionis.
Apropos the present case, the mere entering into a
contract by a foreign State with a private party cannot be
construed as the ultimate test of whether or not it is an
act jure imperii or jure gestionis. Such act is only the start
of the inquiry. Is the foreign State engaged in the regular
conduct of a business? If the foreign State is not
engaged regularly in a business or commercial
activity, and in this case it has not been shown to be
so engaged, 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.
Hence, the existence alone of a paragraph in a contract
stating that any legal action arising out of the agreement
shall be settled according to the laws of the Philippines
and by a specified court of the Philippines is not
necessarily a waiver of sovereign immunity from suit.  Minister Counsellor Kasim in terminating the
On the other hand, such provision may also be meant to
apply where the sovereign party elects to sue in the local
courts, or otherwise waives its immunity by any
subsequent act. The applicability of Philippine laws must
be deemed to include Philippine laws in its totality,
including the principle recognizing sovereign immunity.
Hence, the proper court may have no proper action, by
way of settling the case, except to dismiss it.
Submission by a foreign state to local jurisdiction must
be clear and unequivocal. It must be given explicitly or
by necessary implication. We find no such waiver in this
case.
1. A diplomatic agent shall enjoy immunity from the
criminal jurisidiction of the receiving State. He shall also
enjoy immunity from its civil and administrative
jurisdiction, except in the case of:
(a) a real action relating to private immovable
property situated in the territory of the
receiving State, unless he holds it on behalf of
the sending State for the purposes of the
mission;
(b) an action relating to succession in which the
diplomatic agent is involved as executor,
administrator, heir or legatee as a private
person and not on behalf of the sending State;
(c) an action relating to any professional or
commercial activity exercised by the diplomatic
agent in the receiving State outside his official
functions.
xxx
The act of petitioners Ambassador Soeratmin and
Maintenance Agreement is not covered by the
exceptions provided in the abovementioned
provision.
The Solicitor General believes that said act may fall
under subparagraph (c) thereof, but said provision
clearly applies only to a situation where the
diplomatic agent engages in any professional or
commercial activity outside official functions, which
is not the case herein.

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

G.R. No. 178551               October 11, 2010
ATCI OVERSEAS CORPORATION, AMALIA G. IKDAL
and MINISTRY OF PUBLIC HEALTH-
KUWAIT Petitioners, vs. MA. JOSEFA
ECHIN, Respondent.
FACTS: Josefina Echin was hired by petitioner ATCI
Overseas Corporation in behalf of its principal-co-
petitioner, the Ministry of Public Health of Kuwait
for the position of medical technologist under a two-year
contract, denominated as a Memorandum of
Agreement with a monthly salary of US$1,200.00.
Under the MOA, all newly-hired employees undergo a
probationary period of one (1) year and are covered by
Kuwait’s Civil Service Board Employment Contract No. 2.
As she did not allegedly passed the probationary period,
Josefina was terminated from employment. As the
Ministry denied respondent’s request for
reconsideration, she returned to the Philippines on
March 17, 2001, shouldering her own air fare.
Josefina filed with the NLRC a complaint for illegal
dismissal against ATCI as the local recruitment agency
represented by petitioner, Amalia Ikda and ministry, as
the foreign principal.
The Labor Arbiter ruled that Josefina was illegally
dismissed as petitioners did not show any just cause to
warrant the dismissal of Enchin nor how she failed to
qualify as regular employees.
On Appeal of petitioner, NLCR affirmed the decision of
the Labor Arbiter.
With CA, the parties contended that their principal, the
Ministry, being a foreign government agency, is immune
from suit and, as such, the immunity extended to them;
and that respondent was validly dismissed for her failure
to meet the performance rating within the one-year
period as required under Kuwait’s Civil Service Laws.
Petitioners further contended that Ikdal should not be
liable as an officer of petitioner ATCI. However, CA
affirmed the NLRC resolution as appellate court noted
that under the law, a private employment agency shall
assume all responsibilities for the implementation of the
contract of employment of an overseas worker, hence, it
can be sued jointly and severally with the foreign
principal for any violation of the recruitment agreement
or contract of employment.
As to Ikdal’s liability, the appellate court held that under
Sec. 10 of Republic Act No. 8042, the "Migrant and
Overseas Filipinos’ Act of 1995," corporate officers,
directors and partners of a recruitment agency may
themselves be jointly and solidarily liable with the
recruitment agency for money claims and damages
awarded to overseas workers.
A petition for review was filed by the petitioners.
Petitioners maintain that they should not be held liable
because respondent’s employment contract specifically
stipulates that her employment shall be governed by the
Civil Service Law and Regulations of Kuwait.
Finally, petitioners posit that assuming arguendo that
Philippine labor laws are applicable, given that the
foreign principal is a government agency which is
immune from suit, as in fact it did not sign any document
agreeing to be held jointly and solidarily liable,
petitioner ATCI cannot likewise be held liable, more so
since the Ministry’s liability had not been judicially
determined as jurisdiction was not acquired over it.
HELD: The petition fails.
Petitioner ATCI, as a private recruitment agency, cannot
evade responsibility for the money claims of Overseas
Filipino workers (OFWs) which it deploys abroad by the
mere expediency of claiming that its foreign principal is a
government agency clothed with immunity from suit, or
that such foreign principal’s liability must first be
established before it, as agent, can be held jointly and
solidarily liable.
Republic Act No. 8042 precisely affords the OFWs with a
recourse and assures them of immediate and sufficient
payment of what is due them.
The imposition of joint and solidary liability is in line
with the policy of the state to protect and alleviate the
plight of the working class. Verily, to allow petitioners to
simply invoke the immunity from suit of its foreign
principal or to wait for the judicial determination of the
foreign principal’s liability before petitioner can be held
liable renders the law on joint and solidary liability
inutile.
As to petitioners’ contentions that Philippine labor laws
on probationary employment are not applicable since it
was expressly provided in respondent’s employment
contract, which she voluntarily entered into, that the
terms of her engagement shall be governed by prevailing
Kuwaiti Civil Service Laws and Regulations as in fact
POEA Rules accord respect to such rules, customs and
practices of the host country, the same was not
substantiated.

Indeed, a contract freely entered into is considered the

law between the parties who can establish stipulations,
clauses, terms and conditions as they may deem
convenient, including the laws which they wish to
govern their respective obligations, as long as they are
not contrary to law, morals, good customs, public order
or public policy. 

It is hornbook principle, however, that the party

invoking the application of a foreign law has the burden
of proving the law, under the doctrine of processual
presumption which, in this case, petitioners failed to
discharge.

In the present case, the employment contract signed by

Gran specifically states that Saudi Labor Laws will
govern matters not provided for in the contract (e.g.
specific causes for termination, termination procedures,
etc.). Being the law intended by the parties (lex loci
intentiones) to apply to the contract, Saudi Labor Laws
should govern all matters relating to the termination of
the employment of Gran.

In international law, the party who wants to have a

foreign law applied to a dispute or case has the burden of
proving the foreign law. The foreign law is treated as a
question of fact to be properly pleaded and proved as the
judge or labor arbiter cannot take judicial notice of a
foreign law. He is presumed to know only domestic or
forum law.

Unfortunately for petitioner, it did not prove the

pertinent Saudi laws on the matter; thus, the
International Law doctrine of presumed-identity
approach or processual presumption comes into play.
Where a foreign law is not pleaded or, even if pleaded, is
not proved, the presumption is that foreign law is the
same as ours. Thus, we apply Philippine labor laws in
determining the issues presented before us.

The Philippines does not take judicial notice of foreign

laws, hence, they must not only be alleged; they must be
proven.

G.R. No. 156208             September 26, 2006
NPC DRIVERS AND MECHANICS ASSOCIATION vs. THE
NATIONAL POWER CORPORATION
FACTS:
Republic Act No. 9136, otherwise known as the "Electric
Power Industry Reform Act of 2001" (EPIRA Law), was
approved and signed into law by President Gloria
Macapagal-Arroyo, and took effect on 26 June 2001.
Under the EPIRA Law, a new National Power Board of
Directors was constituted. Subsequently IRR were
approved by the Department of Energy and later, the
latter created Energy Restructuring Steering Committee
(Restructuring Committee) to manage the privatization
and restructuring of the NPC, the National Transmission
Corporation (TRANSCO), and the Power Sector Assets
and Liabilities Corporation (PSALM).
To serve as the overall organizational framework for the
realigned functions of the NPC mandated under the
EPIRA Law, the Restructuring Committee proposed a
new NPC Table of Organization which was approved by
the NPB through a resolution. thereafter recommended
to the NPB for approval the adoption of measures
pertaining to the separation and hiring of NPC
personnel. The same was then approved by the NPB.
A Guidelines on the Separation Program of the NPC and
the Selection and Placement of Personnel in the NPC
Table of Organization was passed wherein NPC
personnel shall be legally terminated on 31 January
2003, and shall be entitled to separation benefits. 
A transitory team was constituted to manage and
implement the NPC's Separation Program.
Contending that the assailed NPB Resolutions are void
and without force and effect, herein petitioners, in their
individual and representative capacities, filed the
present Petition for Injunction to restrain respondents
from implementing NPB Resolutions.
The petitioners maintain that aid Resolutions were not
passed and issued by a majority of the members of the
duly constituted Board of Directors since only three of its
members were present.
According to petitioners, the other four members who
were present at the meeting and signed the Resolutions
were not the secretaries of their respective departments
but were merely representatives or designated
alternates of the officials who were named under the
EPIRA Law to sit as members of the NPB.
Petitioners claim that the acts of these representatives
are violative of the well-settled principle that "delegated
power cannot be further delegated."
Hence, resolutions have been illegally issued as it were
not issued by a duly constituted board since no quorum
existed because only three of the nine members, as
provided under Section 48 of the EPIRA Law, were
present and qualified to sit and vote.
It is petitioners' submission that even
assuming arguendo that there was no undue delegation
of power to the four representatives who signed the
assailed Resolutions, said Resolutions cannot still be
given legal effect because the same did not comply with
the mandatory requirement of endorsement by the Joint
Congressional Power Commission and approval of the
President of the Philippines, as provided under Section
47 of the EPIRA Law.
Furthermore, petitioner highlight the fact that said
Resolutions will have an adverse effect on about 5,648
employees of the NPC and will result in the displacement
of some 2,370 employees, which, petitioners argue, is
contrary to the mandate of the Constitution to promote
full employment and security of tenure.
Respondents, on the other hand, uphold the validity of
the assailed Resolutions by arguing that while it is true
that four members of the National Power Board of
Directors, particularly the respective Secretaries of the
Department of Interior and Local Government, the
Department of Trade and Industry, and the Department
of Finance, as well as the Director-General of the
National Economic and Development Authority, were not
the actual signatories in NPB they were, however, ably
represented by their respective alternates. Respondents
further contend that Section 48 of the EPIRA Law does
not in any way prohibit any member of the NPB from
authorizing his representative to sign resolutions
adopted by the Board.
ISSUE: whether or not NPB Resolutions No. 2002-124
and No. 2002-125 were properly enacted?
HELD: NO.
In the case at bar, it is not difficult to comprehend that in
approving NPB Resolutions No. 2002-124 and No. 2002-
125, it is the representatives of the secretaries of the
different executive departments and not the secretaries
themselves who exercised judgment in passing the
assailed Resolution, as shown by the fact that it is the
signatures of the respective representatives that are
affixed to the questioned Resolutions.

We agree with petitioners. In enumerating under Section
48 those who shall compose the National Power Board of
Directors, the legislature has vested upon these persons
the power to exercise their judgment and discretion in
running the affairs of the NPC.
Discretion may be defined as "the act or the liberty to
decide according to the principles of justice and one's
ideas of what is right and proper under the
circumstances, without willfulness or favor.
Discretion, when applied to public functionaries, means a
power or right conferred upon them by law of acting
officially in certain circumstances, according to the
dictates of their own judgment and conscience,
uncontrolled by the judgment or conscience of others.
Thus, it violates the duty imposed upon the specifically
enumerated department heads to employ their own
sound discretion in exercising the corporate powers of
the NPC. Evidently, the votes cast by these mere
representatives in favor of the adoption of the said
Resolutions must not be considered in determining
whether or not the necessary number of votes was
garnered in order that the assailed Resolutions may be
validly enacted.
Hence, there being only three valid votes cast out of the
nine board members, namely those of DOE Secretary
Vincent S. Perez, Jr.; Department of Budget and
Management Secretary Emilia T. Boncodin; and NPC OIC-
President Rolando S. Quilala, NPB Resolutions No. 2002-
124 and No. 2002-125 are void and are of no legal effect.

It is to be presumed that in naming the respective

department heads as members of the board of directors,
the legislature chose these secretaries of the various
executive departments on the basis of their personal
qualifications and acumen which made them eligible to
occupy their present positions as department heads.
Thus, the department secretaries cannot delegate their
duties as members of the NPB, much less their power to
vote and approve board resolutions, because it is their
personal judgment that must be exercised in the
fulfillment of such responsibility.

There is no question that the enactment of the assailed

Resolutions involves the exercise of discretion and not
merely a ministerial act that could be validly performed
by a delegate

An officer to whom a discretion is entrusted cannot

delegate it to another, the presumption being that he was
chosen because he was deemed fit and competent to
exercise that judgment and discretion, and unless the
power to substitute another in his place has been given
to him, he cannot delegate his duties to another.

A delegate may exercise his authority through persons

he appoints to assist him in his functions, it must be
stressed that the Court explicitly stated in the same case
that said practice is permissible only when the
judgment and discretion finally exercised are those
of the officer authorized by law. According to the
Court, the rule that requires an administrative officer to
exercise his own judgment and discretion does not
preclude him from utilizing, as a matter of practical
administrative procedure, the aid of subordinates, so
long as it is the legally authorized official who makes
the final decision through the use of his own personal
judgment.

G.R. No. 177597               July 16, 2008
BAI SANDRA S. A. SEMA, Petitioner, vs. COMMISSION
ON ELECTIONS and DIDAGEN P.
DILANGALEN, Respondents.
FACTS:
The Ordinance appended to the 1987 Constitution
apportioned two legislative districts for the Province of
Maguindanao. The first legislative district consists of
Cotabato City and eight municipalities.
Maguindanao forms part of the Autonomous Region in
Muslim Mindanao (ARMM), created under its Organic
Act, Republic Act No. 6734 (RA 6734), as amended by
Republic Act No. 9054 (RA 9054). Although under the
Ordinance, Cotabato City forms part of Maguindanao’s
first legislative district, it is not part of the ARMM but of
Region XII, having voted against its inclusion in the
ARMM in the plebiscite held in November 1989.
ARMM’s legislature, the ARMM Regional Assembly,
exercising its power to create provinces under Section
19, Article VI of RA 9054, enacted Muslim Mindanao
Autonomy Act No. 201 (MMA Act 201) creating the
Province of Shariff Kabunsuan composed of the eight
municipalities in the first district of Maguindanao. 
Later, three new municipalities were carved out of the
original nine municipalities constituting Shariff
Kabunsuan, bringing its total number of municipalities to
11. Thus, what was left of Maguindanao were the
municipalities constituting its second legislative district.
Cotabato City, although part of Maguindanao’s first
legislative district, is not part of the Province of
Maguindanao.
The voters of Maguindanao ratified Shariff Kabunsuan’s
creation in a plebiscite held on 29 October 2006.
Sangguniang Panlungsod of Cotabato City passed
Resolution No. 3999 requesting the COMELEC to "clarify
the status of Cotabato City in view of the conversion of
the First District of Maguindanao into a regular
province" under MMA Act 201. In answer to Cotabato
City’s query, the COMELEC issued Resolution No. 07-
0407 on 6 March 2007 "maintaining the status quo with
Cotabato City as part of Shariff Kabunsuan in the First
Legislative District of Maguindanao." 
However, in preparation for the 14 May 2007 elections,
the COMELEC promulgated on 29 March 2007
Resolution No. 7845 stating that Maguindanao’s first
legislative district is composed only of Cotabato City
because of the enactment of MMA Act 201.
COMELEC issued Resolution No. 7902, subject of these
petitions, amending Resolution No. 07-0407 by
renaming the legislative district in question as "Shariff
Kabunsuan Province with Cotabato City (formerly First
District of Maguindanao with Cotabato City).
In G.R. No. 177597, Sema, who was a candidate in the 14
May 2007 elections for Representative of "Shariff
Kabunsuan with Cotabato City," prayed for the
nullification of COMELEC Resolution No. 7902 and the
exclusion from canvassing of the votes cast in Cotabato
City for that office.
Sema contended that Shariff Kabunsuan is entitled to
one representative in Congress under Section 5 (3),
Article VI of the Constitution and Section 3 of the
Ordinance appended to the Constitution. Thus, Sema
asserted that the COMELEC acted without or in excess of
its jurisdiction in issuing Resolution No. 7902 which
maintained the status quo in Maguindanao’s first
legislative district despite the COMELEC’s earlier
directive in Resolution No. 7845 designating Cotabato
City as the lone component of Maguindanao’s
reapportioned first legislative district. Sema further
claimed that in issuing Resolution No. 7902, the
COMELEC usurped Congress’ power to create or
reapportion legislative districts.
In its Comment, the COMELEC, through the Office of the
Solicitor General (OSG), contended that (1) Sema
wrongly availed of the writ of certiorari to nullify
COMELEC Resolution No. 7902 because the COMELEC
issued the same in the exercise of its administrative, not
quasi-judicial, power and (2) Sema’s prayer for the writ
of prohibition in G.R. No. 177597 became moot with the
proclamation of respondent Didagen P. Dilangalen
(respondent Dilangalen) on 1 June 2007 as
representative of the legislative district of Shariff
Kabunsuan Province with Cotabato City.
Respondent Dilangalen countered that Sema is estopped
from questioning COMELEC Resolution No. 7902 because
in her certificate of candidacy filed on 29 March 2007,
Sema indicated that she was seeking election as
representative of "Shariff Kabunsuan including Cotabato
City."  which provides:
He  added that COMELEC Resolution No. 7902 is
constitutional because it did not apportion a legislative
district for Shariff Kabunsuan or reapportion the
legislative districts in Maguindanao but merely renamed
Maguindanao’s first legislative district. Respondent
Dilangalen further claimed that the COMELEC could not
reapportion Maguindanao’s first legislative district to
make Cotabato City its sole component unit as the power
to reapportion legislative districts lies exclusively with
Congress, not to mention that Cotabato City does not
meet the minimum population requirement under
Section 5 (3), Article VI of the Constitution for the
creation of a legislative district within a city.
(a) the "province" contemplated in Section 5 (3), Article
VI of the Constitution is one that is created by an act of
Congress taking into account the provisions in RA 7160
on the creation of provinces; (b) Section 3, Article IV of
RA 9054 withheld from the ARMM Regional Assembly
the power to enact measures relating to national
elections, which encompasses the apportionment of
legislative districts for members of the House of
Representatives; (c) recognizing a legislative district in
every province the ARMM Regional Assembly creates
will lead to the disproportionate representation of the
ARMM in the House of Representatives as the Regional
Assembly can create provinces without regard to the
requirements in Section 461 of RA 7160; and (d)
Cotabato City, which has a population of less than
250,000, is not entitled to a representative in the House
of Representatives.
HELD: (1) Section 19, Article VI of RA 9054 is
unconstitutional insofar as it grants to the ARMM
Regional Assembly the power to create provinces and
cities; (2) MMA Act 201 creating the Province of Shariff
Kabunsuan is void; and (3) COMELEC Resolution No.
7902 is valid.
Respondent Dilangalen’s Proclamation Does Not Moot
the Petition
This case does not concern respondent Dilangalen’s
election. Rather, it involves an inquiry into the validity of
COMELEC Resolution No. 7902, as well as the
constitutionality of MMA Act 201 and Section 19, Article
VI of RA 9054. Admittedly, the outcome of this petition,
one way or another, determines whether the votes cast
in Cotabato City for representative of the district of
"Shariff Kabunsuan Province with Cotabato City" will be
included in the canvassing of ballots.  representative" in the House of Representatives.
The Court’s ruling in these petitions affects not only the
recently concluded elections but also all the other
succeeding elections for the office in question, as well as
the power of the ARMM Regional Assembly to create in
the future additional provinces.
ISSUE: Whether the ARMM Regional Assembly
Can Create the Province of Shariff Kabunsuan?
HELD: The creation of local government units is
governed by Section 10, Article X of the Constitution,
Sec. 10. No province, city, municipality, or barangay may
be created, divided, merged, abolished or its boundary
substantially altered except in accordance with the
criteria established in the local government code and
subject to approval by a majority of the votes cast in a
plebiscite in the political units directly affected.
Thus, the creation of any of the four local government
units – province, city, municipality or barangay – must
comply with three conditions. First, the creation of a
local government unit must follow the criteria fixed in
the Local Government Code. Second, such creation must
not conflict with any provision of the Constitution. Third,
there must be a plebiscite in the political units affected.
There is neither an express prohibition nor an express
grant of authority in the Constitution for Congress to
delegate to regional or local legislative bodies the power
to create local government units. However, under its
plenary legislative powers, Congress can delegate to
local legislative bodies the power to create local
government units, subject to reasonable standards and
provided no conflict arises with any provision of the
Constitution. In fact, Congress has delegated to
provincial boards, and city and municipal councils, the
power to create barangays within their jurisdiction,
subject to compliance with the criteria established in the
Local Government Code, and the plebiscite requirement
in Section 10, Article X of the Constitution. However,
under the Local Government Code, "only x x x an Act of
Congress" can create provinces, cities or municipalities.
Under Section 19, Article VI of RA 9054, Congress
delegated to the ARMM Regional Assembly the power to
create provinces, cities, municipalities and barangays
within the ARMM. Congress made the delegation under
its plenary legislative powers because the power to
create local government units is not one of the express
legislative powers granted by the Constitution to
regional legislative bodies.
In the present case, the question arises whether the
delegation to the ARMM Regional Assembly of the power
to create provinces, cities, municipalities and barangays
conflicts with any provision of the Constitution.
Section 5 (3), Article VI of the Constitution provides,
"Each city with a population of at least two hundred fifty
thousand, or each province, shall have at least one
Similarly, Section 3 of the Ordinance appended to the
Constitution provides, "Any province that may hereafter
be created, or any city whose population may hereafter
increase to more than two hundred fifty thousand shall
be entitled in the immediately following election to at
least one Member x x x."
Clearly, a province cannot be created without a
legislative district because it will violate Section 5 (3),
Article VI of the Constitution as well as Section 3 of the
Ordinance appended to the Constitution. For the same
reason, a city with a population of 250,000 or more
cannot also be created without a legislative district.
Thus, the power to create a province, or a city with a
population of 250,000 or more, requires also the power
to create a legislative district. Even the creation of a city
with a population of less than 250,000 involves the
power to create a legislative district because once the
city’s population reaches 250,000, the city automatically
becomes entitled to one representative under Section 5
(3), Article VI of the Constitution and Section 3 of the
Ordinance appended to the Constitution. Thus, the
power to create a province or city inherently involves
the power to create a legislative district.
For Congress to delegate validly the power to create a
province or city, it must also validly delegate at the same
time the power to create a legislative district. The
threshold issue then is, can Congress validly delegate to
the ARMM Regional Assembly the power to create
legislative districts for the House of Representatives?
The answer is in the negative.
Legislative Districts are Created or Reapportioned
Only by an Act of Congress
The power to increase the allowable membership in the
House of Representatives, and to reapportion legislative
districts, is vested exclusively in Congress.
Section 5 (1), Article VI of the Constitution vests in
Congress the power to increase, through a law, the
allowable membership in the House of Representatives.
Section 5 (4) empowers Congress to reapportion
legislative districts. The power to reapportion legislative
districts necessarily includes the power to create
legislative districts out of existing ones. Congress
exercises these powers through a law that Congress itself
enacts, and not through a law that regional or local
legislative bodies enact. The allowable membership of
the House of Representatives can be increased, and new
legislative districts of Congress can be created, only
through a national law passed by Congress.  present case because in Felwa the new provinces were
We held that the "power of redistricting x x x is
traditionally regarded as part of the power (of Congress)
to make laws," and thus is vested exclusively in Congress.
The creation of the ARMM, and the grant of legislative
powers to its Regional Assembly under its organic act,
did not divest Congress of its exclusive authority to
create legislative districts. This is clear from the
Constitution and the ARMM Organic Act, as amended.
Nothing in Section 20, Article X of the Constitution
authorizes autonomous regions, expressly or
impliedly, to create or reapportion legislative
districts for Congress.
Indeed, the office of a legislative district representative
to Congress is a national office, and its occupant, a
Member of the House of Representatives, is a national
official.
To allow the ARMM Regional Assembly to create a
national office is to allow its legislative powers to
operate outside the ARMM’s territorial jurisdiction. This
violates Section 20, Article X of the Constitution which
expressly limits the coverage of the Regional Assembly’s
legislative powers "[w]ithin its territorial jurisdiction.
Whether Republic Act No. 4695 (RA 4695), creating
the provinces of Benguet, Mountain Province, Ifugao,
and Kalinga-Apayao and providing for congressional
representation in the old and new provinces, was
unconstitutional for "creati[ng] congressional
districts without the apportionment provided in the
Constitution." The Court answered in the negative.
Pursuant to this Section, a representative district
may come into existence: (a) indirectly, through the
creation of a province — for "each province shall
have at least one member" in the House of
Representatives; or (b) by direct creation of several
representative districts within a province. The
requirements concerning the apportionment of
representative districts and the territory thereof refer
only to the second method of creation of representative
districts, and do not apply to those incidental to the
creation of provinces, under the first method. This is
deducible, not only from the general tenor of the
provision above quoted, but, also, from the fact that the
apportionment therein alluded to refers to that which is
made by an Act of Congress. Indeed, when a province is
created by statute, the corresponding representative
district, comes into existence neither by authority of that
statute — which cannot provide otherwise — nor by
apportionment, but by operation of the Constitution,
without a reapportionment.
Court sustained the constitutionality of RA 4695 because
(1) it validly created legislative districts
"indirectly" through a special law enacted by
Congress creating a province and (2) the creation of the
legislative districts will not result in breaching the
maximum number of legislative districts provided under
the 1935 Constitution. Felwa does not apply to the
created by a national law enacted by Congress itself.
Here, the new province was created merely by
a regional law enacted by the ARMM Regional
Assembly.
Creation of a legislative district by Congress does not
emanate alone from Congress’ power to reapportion
legislative districts, but also from Congress’ power to
create provinces which cannot be created without a
legislative district. Thus, when a province is created, a
legislative district is created by operation of the representative of Congress because the legislative
Constitution because the Constitution provides that powers of the ARMM Regional Assembly operate only
"each province shall have at least one representative" in within its territorial jurisdiction as provided in Section
the House of Representatives. This does not detract from 20, Article X of the Constitution. Thus, we rule that MMA
the constitutional principle that the power to create Act 201, enacted by the ARMM Regional Assembly and
legislative districts belongs exclusively to Congress. It creating the Province of Shariff Kabunsuan, is void.
merely prevents any other legislative body, except
Congress, from creating provinces because for a Resolution No. 7902 Complies with the Constitution 
legislative body to create a province such legislative
body must have the power to create legislative districts. Consequently, we hold that COMELEC Resolution No.
In short, only an act of Congress can trigger the creation 7902, preserving the geographic and legislative district
of a legislative district by operation of the Constitution. of the First District of Maguindanao with Cotabato City, is
Thus, only Congress has the power to create, or trigger valid as it merely complies with Section 5 of Article VI
the creation of, a legislative district. and Section 20 of Article X of the Constitution, as well as
Section 1 of the Ordinance appended to the Constitution.
Moreover, if as Sema claims MMA Act 201
apportioned a legislative district to Shariff
WHEREFORE, we declare Section 19, Article VI of
Kabunsuan upon its creation, this will leave Cotabato
Republic Act No. 9054 UNCONSTITUTIONAL insofar as it
City as the lone component of the first legislative
grants to the Regional Assembly of the Autonomous
district of Maguindanao. However, Cotabato City
Region in Muslim Mindanao the power to create
cannot constitute a legislative district by itself
provinces and cities. Thus, we declare VOID Muslim
because as of the census taken in 2000, it had a
Mindanao Autonomy Act No. 201 creating the Province
population of only 163,849. To constitute Cotabato
of Shariff Kabunsuan. Consequently, we rule that
City alone as the surviving first legislative district of
COMELEC Resolution No. 7902 is VALID.
Maguindanao will violate Section 5 (3), Article VI of
the Constitution which requires that "[E]ach city
with a population of at least two hundred fifty
thousand x x x, shall have at least one
representative."

Clearly, the power to create or reapportion legislative

districts cannot be delegated by Congress but must be
exercised by Congress itself. Even the ARMM Regional
Assembly recognizes this.

The present case involves the creation of a local

government unit that necessarily involves also the
creation of a legislative district. The Court will not pass
upon the constitutionality of the creation of
municipalities and barangays that does not comply with
the criteria established in Section 461 of RA 7160, as
mandated in Section 10, Article X of the Constitution,
because the creation of such municipalities and
barangays does not involve the creation of legislative
districts. We leave the resolution of this issue to an
appropriate case.

In summary, we rule that Section 19, Article VI of RA

9054, insofar as it grants to the ARMM Regional
Assembly the power to create provinces and cities, is
void for being contrary to Section 5 of Article VI and
Section 20 of Article X of the Constitution, as well as
Section 3 of the Ordinance appended to the Constitution.
Only Congress can create provinces and cities because
the creation of provinces and cities necessarily includes
the creation of legislative districts, a power only
Congress can exercise under Section 5, Article VI of the
Constitution and Section 3 of the Ordinance appended to
the Constitution. The ARMM Regional Assembly cannot
create a province without a legislative district because
the Constitution mandates that every province shall have
a legislative district.

Moreover, the ARMM Regional Assembly cannot enact a

law creating a national office like the office of a district
 Salaveria was convicted. On appeal, He questioned the
validity of the ordinance.

The ordinance of Orion, Bataan, merely prohibits the

playing of panguingue on certain days, without
describing it. Further, although this court has considered
the method by which many other games are played, it
has never as yet authoritatively decided whether
panguingue was a game of skill or hazard. Nor was any
evidence on this point introduced in the present case.
However, a reading of the decision of the trial court and
of official opinions of two Attorneys-General, of which
we can take judicial cognizance, warrants the deduction
that panguingue  is not a game of chance or hazard and is
not prohibited by Act No. 1757. 

HELD: Authority for the State or a municipality to take

action to control gambling in this larger sense can be
found in an analysis of what is called the police power.

 "the most essential of all powers, at times the most

insistent, an always one of least limitable of the powers
of government."

The police power is based on the maxim "salus populi est

suprema lex" — the welfare of the people is the first law.
The United States Supreme Court has said that it extends
"to the protection of the lives, health and property of the
citizens, and to the preservation of good order and
the public morals.

The Supreme Court of these Islands has said that it

extends "the police power of the state includes not only
the public health safety, but also the public welfare,
protection against impositions, and generally the public's
best interest." 

The Philippine Legislature, as before intimated,

delegated to municipalities certain legislative powers are
named specifically. But in addition, and preceding both
the specific powers of a mandatory and discretionary
character, is the general power of a municipal council to
enact ordinances and make regulations. It is this grant
G.R. No. L-13678             November 12, 1918 that the preamble of the ordinance of Orion assigns as
authority for its enactment.
THE UNITED STATES, plaintiff-appellee, vs.
PRUDENCIO SALAVERIA, defendant-appellant. The municipal council shall enact such
ordinances and make such regulations, not
FACTS: The municipal council of Orion, Bataan, enacted, repugnant to law, as may be necessary to carry
an ordinance which prohibited the playing into effect and discharge the powers an duties
of panguingue on days not Sundays or legal holidays, conferred upon it by law an such as shall seem
and penalized the violation thereof by necessary and proper  to provide for the health
a casero [housekeeper] by a fine of not less than P10 nor and safety, promote the prosperity, improve the
more than P200, and by jugadores [gamblers] by a fine morals, peace, good order, comfort, and
of not less than P5 nor more than P200.  convenience of the municipality and the
inhabitants thereof, and for the protection of
On March 8, 1917, Prudencio Salaverio, justice of peace, property therein.
and his wife ere surprised by the police while indulging
in a game of panguingue in the house of the former. he This section, known as the general welfare clause,
chief of police took possession of the cards, the counters delegates in statutory form the police power to a
(sigayes), a tray, an P2.07 in money, used in the game. municipality. As above stated, this clause has been given
wide application by municipal authorities and has in its
relation to the particular circumstances of the case been
liberally construed by the courts. Such, it is well to recall,
is the progressive view of Philippine jurisprudence.
It is a general rule that ordinances passed by virtue of
the implied power found in the general powers and
purposes of the corporation, and not inconsistent with
the laws or policy of the State. The ordinance of the
municipality of Orion does not seem in itself to be
pernicious, or unreasonable or discriminatory. Its
purposes evidently are to improve the morals and
stimulate the industry of the people. A person is to be
compelled to refrain from private acts injurious both to
himself an his neighbors. These objects, to be attained by
limiting the pastime to definite days, do not infringe any
law of the general government.
The culprit in this case is himself a member of the
Judiciary. Instead of enforcing the law, he has scorned it.
His example to the people of Orion has been pernicious
in its influence. If gambling is to be suppressed, not only
the weak and ignorant must be punished, but those with
full knowledge of the law and the consequences of
violation. We would accordingly suggest to Courts of
First Instance that in all cases arising under the
Gambling Law or ordinances, except for unusual
circumstances, a prison sentence should be imposed, if
permitted by the law or ordinance. We further suggest
that, where the defendant has been found guilty and is a
man of station, he be given the maximum
penalty.lawphil.net
Applying the foregoing in this instance, it results that the
defendant and appellant must be found guilty of a
violation of ordinance No. 3 of the municipality of Orion,
Bataan; and, in accordance therewith, shall be sentenced
to the maximum penalty of the payment of a fine of P200,
or to subsidiary imprisonment in case of insolvency, with
the costs of all three instances against him. So ordered.
G.R. No. 161107               March 12, 2013
HON. MA. LOURDES C. FERNANDO vs. ST.
SCHOLASTICA'S COLLEGE and ST. SCHOLASTICA'S
ACADEMY-MARIKINA, INC., Respondents.
FACTS:
St. Scholastica’s College (SSC) and St. Scholastica’s
Academy-Marikina, Inc. re educational institutions
organized under the laws of the Republic of the
Philippines.
SSC is the owner of 4 lands in Marikin Heights. Located
within the property are SSA-Marikina, the residence of
the sisters of the Benedictine Order, the formation house
of the novices, and the retirement house for the elderly
sisters. The property is enclosed by a tall concrete
perimeter fence built some thirty (30) years ago.
Abutting the fence along the West Drive are buildings,
facilities, and other improvements.
Sangguniang Panlungsod of Marikina City enacted
Ordinance No. 192, entitled "Regulating the Construction
of Fences and Walls in the Municipality of Marikina." In
1995 and 1998, Ordinance Nos. 217 and 200were
enacted to amend Sections 7 and 5, respectively. 
City Government of Marikina sent a letter to the
respondents ordering them to demolish and replace the
fence of their Marikina property to make it 80% see-
thru, and, at the same time, to move it back about six (6)
meters to provide parking space for vehicles to park.
When respondents requested for an extension of time to
comply with the order, petitioners, through City Mayor
Bayani Fernando insisted on the enforcement of the
ordinance.
Respondents filed a petition for prohibition with an
application for a writ of preliminary injunction and
temporary restraining order before the Regional Trial
Court, Marikina. The respondents argued that the
petitioners were acting in excess of jurisdiction in
enforcing Ordinance No. 192, asserting that such
contravenes Section 1, Article III of the 1987
Constitution.
The implementation of the ordinance on their property
would be tantamount to an appropriation of property
without due process of law; and that the petitioners
could only appropriate a portion of their property
through eminent domain.
The petitioners, on the other hand, countered that the
ordinance was a valid exercise of police power, by virtue
of which, they could restrain property rights for the
protection of public safety, health, morals, or the
promotion of public convenience and general prosperity.
RTC: granted the position of SSC, petitioners to
permanently desist from enforcing or implementing
Ordinance No. 192 on the respondents’ property. It held
that the petitioners could not take the respondents’
property under the guise of police power to evade the
payment of just compensation.
It also found that the respondents were able to prove
that the danger to security had no basis in their case.
Moreover, it held that the purpose of beautification could
not be used to justify the exercise of police power.
CA: Ordinance No. 192 did not justify the exercise of
police power, as it did not only seek to regulate, but also
involved the taking of the respondents’ property without
due process of law. The respondents were bound to lose
an unquantifiable sense of security, the beneficial use of
their structures, and a property. It, thus, ruled that the
assailed ordinance could not be upheld as valid as it
clearly invaded the personal and property rights of the
respondents and "[f]or being unreasonable, and undue
restraint of trade."
 Under the rational relationship test, an ordinance must
ISSUE: whether Sections 3.1 and 5 of Ordinance No. 192 pass the following requisites as discussed in Social
are valid exercises of police power by the City Justice Society (SJS) v. Atienza, Jr.:
Government of Marikina?
As with the State, local governments may be considered
HELD: as having properly exercised their police power only if
the following requisites are met: (1) the interests of the
"Police power is the plenary power vested in the public generally, as distinguished from those of a
legislature to make statutes and ordinances to promote particular class, require its exercise and (2) the means
the health, morals, peace, education, good order or safety employed are reasonably necessary for the
and general welfare of the people." The State, through accomplishment of the purpose and not unduly
the legislature, has delegated the exercise of police oppressive upon individuals. In short, there must be a
power to local government units, as agencies of the State. concurrence of a lawful subject and lawful method.
This delegation of police power is embodied in Section
16 of the Local Government Code of 1991 (R.A. No.
7160), known as the General Welfare Clause, which has
two branches. "The first, known as the general legislative
power, authorizes the municipal council to enact
ordinances and make regulations not repugnant to law,
as may be necessary to carry into effect and discharge
the powers and duties conferred upon the municipal
council by law. The second, known as the police power
proper, authorizes the municipality to enact ordinances
as may be necessary and proper for the health and
safety, prosperity, morals, peace, good order, comfort,
and convenience of the municipality and its inhabitants,
and for the protection of their property."

The test of a valid ordinance is well established. A long

line of decisions including City of Manila has held that for
an ordinance to be valid, it must not only be within the
corporate powers of the local government unit to enact
and pass according to the procedure prescribed by law, it
must also conform to the following substantive
requirements: (1) must not contravene the

Constitution or any statute; (2) must not be unfair or

oppressive; (3) must not be partial or discriminatory; (4)
must not prohibit but may regulate trade; (5) must be
general and consistent with public policy; and (6) must
not be unreasonable.

Ordinance No. 192 was passed by the City Council of

Marikina in the apparent exercise of its police power. To
successfully invoke the exercise of police power as the
rationale for the enactment of an ordinance and to free it
from the imputation of constitutional infirmity, two tests
have been used by the Court – the rational relationship
test and the strict scrutiny test:

We ourselves have often applied the rational basis test

mainly in analysis of equal protection challenges. Using
the rational basis examination, laws or ordinances are
upheld if they rationally further a legitimate
governmental interest. Under intermediate review,
governmental interest is extensively examined and the
availability of less restrictive measures is considered.
Applying strict scrutiny, the focus is on the presence of
compelling, rather than substantial, governmental
interest and on the absence of less restrictive means for
achieving that interest.

G.R. No. 183891               October 19, 2011
ROMARICO J. MENDOZA, Petitioner,  month availment period that triggers the
vs.
PEOPLE OF THE PHILIPPINES, Respondent.
Petitioner admitted during trial that he did not remit the
SSS premium contributions of his employees at Summa
Alta Tierra Industries, Inc. from August 1998 to July
1999; that his failure to to remit, which the trial court
disbelieved, was that during this period, Summa Alta
Tierra Industries, Inc. shut down as a result of the
general decline in the economy. The petitioner pleaded
good faith and lack of criminal intent as his defenses.
We ruled that the decree of conviction was founded on
proof beyond reasonable doubt, based on the following
considerations: first, the remittance of employee
contributions to the SSS is mandatory under RA No.
8282; and second, the failure to comply with a special
law being malum prohibitum, the defenses of good faith
and lack of criminal intent are immaterial.
The present motion for reconsideration rests on the
following points:
First. On January 7, 2010, during the pendency
of the petitioner’s case before the Court, then
President Gloria Macapagal-Arroyo signed RA
No. 9903 into law. RA No. 9903 mandates the
effective withdrawal of all pending cases
against employers who would remit their
delinquent contributions to the SSS within a
specified period, viz., within six
months after the law’s effectivity.4 The
petitioner claims that in view of RA No. 9903
and its implementing rules, the settlement of his
delinquent contributions in 2007 entitles him to
an acquittal. He invokes the equal protection
clause in support of his plea.
Second. The petitioner alternatively prays that
should the Court find his above argument
wanting, he should still be acquitted since the
prosecution failed to prove all the elements of
the crime charged.
Third. The petitioner prays that a fine be
imposed, not imprisonment, should he be found
guilty.
ISSUE: Whether or not the conviction of Mendoza is
affirmed?
HELD: The court partially grants the petitioner’s
motion for reconsideration.
The clear intent of the law is to grant condonation
only to employers with delinquent contributions or
pending cases for their delinquencies and who pay
their delinquencies within the six (6)-month period
set by the law.
Mere payment of unpaid contributions does not suffice;
it is payment within, and only within, the six (6)-
applicability of RA No. 9903.
True, the petitioner’s case was pending with us when RA
No. 9903 was passed. Unfortunately for him, he paid his
delinquent SSS contributions in 2007. By paying outside
of the availment period, the petitioner effectively placed
himself outside the benevolent sphere of RA No. 9903. 
This is how the law is written: it condones employers
— and only those employers — with unpaid SSS
contributions or with pending cases who pay
within the six (6)-month period following the law’s
date of effectivity. Dura lex, sed lex.

Equal Protection

The Court cannot amplify the scope of RA No. 9903 on

the ground of equal protection, and acquit the petitioner
and other delinquent employers like him; it would in
essence be an amendment of RA No. 9903, an act of
judicial legislation abjured by the trias politica principle.

RA No. 9903 creates two classifications of employers

delinquent in remitting the SSS contributions of their
employees: (1) those delinquent employers who
pay within the six (6)-month period (the former group),
and (2) those delinquent employers who pay outside of
this availment period (the latter group).

Laws granting condonation constitute an act of

benevolence on the government’s part, similar to tax
amnesty laws; their terms are strictly construed against
the applicants

It is an established principle of constitutional law that

the guaranty of the equal protection of the laws is not
violated by a legislation based on reasonable
classification.

And the classification, to be reasonable, (1) must rest on

substantial distinctions; (2) must be germane to the
purposes of the law; (3) must not be limited to existing
conditions only; and (4) must apply equally to all
members of the same class.

The difference in the dates of payment of delinquent

contributions provides a substantial distinction
between the two classes of employers.

In limiting the benefits of RA No. 9903 to delinquent

employers who pay within the six (6)-month period, the
legislature refused to allow a sweeping, non-
discriminatory condonation to all delinquent employers,
lest the policy behind RA No. 8282 be undermined.