GOVERNMENT OF THE PHILIPPINE ISLANDS VS.

EL MONTE DE PIEDAD Y CAJA DE AHORRAS DE MANILA

- G.R. NO. 9959

December 13, 1916

Facts:

Around $400,000 was donated and placed in the Philippine Islands' treasury by residents of the Spanish
territories to aid those impacted by the earthquake in the Philippine Islands on June 3, 1863. Authorized
by the King of Spain in October 1863, a central relief board was established to oversee the distribution
of the funds. After a thorough review, the board allocated $365,703 to earthquake victims, and the list
of recipients was formally announced in the official gazette of Manila in April 1870. Yet, in 1883, the
Philippine government instructed the treasury to transfer $80,000 from the relief funds to the Monte de
Piedad in four separate payments. The Monte de Piedad, a charitable organization offering financial aid,
was tasked with holding these funds at the disposal of the Relief Board.

The Philippine government took legal action to recover $80,000 from the Monte de Piedad; the court
ruled in favor of the government, ordering the return of the $80,000 with interest and costs. The
defendant appealed and raised various arguments. Additionally, the court examined the
constitutionality of an act passed by the Philippine legislature in 1912.

The court's decision mandated that the Monte de Piedad return $80,000 to the Philippine Government,
including legal interest, as well as any related costs. Way back in 1879, the Monte de Piedad requested
to access funds from the national subscription due to financial struggles. It entails complex issues
related to conditions, resolution, and constitutional matters.

Issue:

Whether or not the Philippine Islands' government owns the legal authority to initiate a lawsuit against
the Monte de Piedad for the recovery of the mentioned amount

Ruling:

Yes, On the authority of Parens Patriae, the Philippine government, as the protector of the rights of the
people, can act on behalf of the rightful recipients of the funds. This grants the government the legal
standing to bring a lawsuit against the appellant.

The Philippine Government's involvement in this case is not superficial; it has the substantive authority
to both initiate and pursue this legal action through the exercise of its sovereign powers. The Supreme
Court affirmed the government's right to file the lawsuit. In essence, this means that the government
has a genuine, legitimate role in the legal proceedings, and it is well within its rights to bring the case to
court.