St.

Marys College of Tagum College of Law Political Law

Article XVI of the 1987 Constitution
General Provisions
Section 3. The State Ma !ot "e Sue# $ithout Its Consent
The immunity of the State from suit, known also as the doctrine of sovereign
immunity or nonsua!ility of the State, is e"#ressly #rovided in $rticle %&' of
the ()*+ Constitution,viz,
Section -. The State may not !e sued without its consent.
The immunity from suit is !ased on the #olitical truism that the State, as a
sovereign, can do no wrong. Moreover, as the eminent .ustice /olmes said
in Kawananakoa v. Polyblank:

The territory 0of /awaii1, of course, could waive its e"em#tion 2Smith
v. 3eeves, (+* 4S5-6, 55 L ed ((57, 87 Su#. Ct. 3e#. )()9, and it
took no o!:ection to the #roceedings in the cases cited if it could have
done so. """ ;ut in the case at !ar it did o!:ect, and the <uestion
raised is whether the #laintiffs were !ound to yield. Some dou!ts
have !een e"#ressed as to the source of the immunity of a sovereign
#ower from suit without its own #ermission, !ut the answer has !een
#u!lic #ro#erty since !efore the days of /o!!es.Leviathan, cha#. 86,
8. A soverei%n is e&e'(t fro' suit) not *ecause of an for'al
conce(tion or o*solete theor) *ut on the lo%ical an# (ractical
%roun# that there can *e no le%al ri%ht as a%ainst the authorit
that 'a+es the la, on ,hich the ri%ht #e(en#s. =Car on peut bien
recevoir loy dautruy, mais il est impossible par nature de se donner
loy.> ;odin, Republiue, (, cha#. *, ed. (68), #. (-8? Sir .ohn
@liot, !e "ure #aiestatis, cha#. -. $emo suo statuto li%atur
necessitative. ;aldus, !e Le%. et Const. !i%na &o', 8. ed. (5)6, fol.
A(!, ed. (A-), fol. 6(.

Practical considerations dictate the esta!lishment of an immunity from suit in
favor of the State. Btherwise, and the State is sua!le at the instance of every
other individual, government service may !e severely o!structed and #u!lic
safety endangered !ecause of the num!er of suits that the State has to
defend against. Several :ustifications have !een offered to su##ort the
ado#tion of the doctrine in the Phili##ines, !ut that offered in Providence
(ashin%ton )nsurance Co. v. Republic o* the Philippines is =the most
acce#ta!le e"#lanation,> according to Cather ;ernas, a recogniDed
commentator on Constitutional Law, to wit,
0$1 continued adherence to the doctrine of nonsua!ility is not to !e
de#lored for as against the inconvenience that may !e caused #rivate
#arties, the loss of governmental efficiency and the o!stacle to the
#erformance of its multifarious functions are far greater if such a
fundamental #rinci#le were a!andoned and the availa!ility of :udicial
remedy were not thus restricted. Eith the wellknown #ro#ensity on
the #art of our #eo#le to go to court, at the least #rovocation, the loss
of time and energy re<uired to defend against law suits, in the
a!sence of such a !asic #rinci#le that constitutes such an effective
o!stacle, could very well !e imagined.
$n unincor#orated government agency without any se#arate :uridical
#ersonality of its own en:oys immunity from suit !ecause it is invested
with an inherent #ower of sovereignty. $ccordingly, a claim for
damages against the agency cannot #ros#er? otherwise, the doctrine
of sovereign immunity is violated. /owever, the need to distinguish
!etween an unincor#orated government agency #erforming
governmental function and one #erforming #ro#rietary functions has
arisen. The immunity has !een u#held in favor of the former !ecause
its function is governmental or incidental to such function? it has not
!een u#held in favor of the latter whose function was not in #ursuit of
a necessary function of government !ut was essentially a !usiness.
Should the doctrine of sovereignty immunity or nonsua!ility of the State !e
e"tended to the $TBF
'n its challenged decision, the C$ answered in the negative, holding,
Bn the first assignment of error, a##ellants seek to im#ress u#on 4s that the
su!:ect contract of sale #artook of a governmental character. +propos, the
lower court erred in a##lying the /igh Courts ruling in $ational +irports
Corporation vs. ,eodoro 2-. Phil. /01 0.-2/19, arguing that in ,eodoro, the
matter involved the collection of landing and #arking fees which is a
#ro#rietary function, while the case at !ar involves the maintenance and
o#eration of aircraft and air navigational facilities and services which are
governmental functions.
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
1
St. Marys College of Tagum College of Law Political Law
Ee are not #ersuaded.
Contrary to a##ellants conclusions, it was not merely the collection of landing
and #arking fees which was declared as #ro#rietary in nature !y the /igh
Court in ,eodoro, !ut management and maintenance of air#ort o#erations as
a whole, as well. Thus, in the much later case of Civil +eronautics
+dministration vs. Court o* +ppeals 3.45 6CR+ /7 8.-779:,the Su#reme
Court, reiterating the #ronouncements laid down in ,eodoro, declared that the
C$$ 2#redecessor of +,;9 is an agency not immune from suit, it !eing
engaged in functions #ertaining to a #rivate entity. 't went on to e"#lain in this
wise,
" " "
The Civil $eronautics $dministration comes under the category of a #rivate
entity. $lthough not a !ody cor#orate it was created, like the Hational $ir#orts
Cor#oration, not to maintain a necessary function of government, !ut to run
what is essentially a !usiness, even if revenues !e not its #rime o!:ective !ut
rather the #romotion of travel and the convenience of the travelling #u!lic. 't
is engaged in an enter#rise which, far from !eing the e"clusive #rerogative of
state, may, more than the construction of #u!lic roads, !e undertaken !y
#rivate concerns. 0Hational $ir#orts Cor#. v. Teodoro, supra, #. 87+.1
" " "
True, the law #revailing in ()A8 when the ,eodoro case was #romulgated
was @"ec. Brder -6A 23eorganiDing the Civil $eronautics $dministration and
$!olishing the Hational $ir#orts Cor#oration9. 3e#u!lic $ct Ho. ++6 2Civil
$eronautics $ct of the Phili##ines9, su!se<uently enacted on .une 87, ()A8,
did not alter the character of the C$$s o!:ectives under @"ec. Brder -6A.
The #ertinent #rovisions cited in the ,eodoro case, #articularly Secs. - and 5
of @"ec. Brder -6A, which led the Court to consider the C$$ in the category
of a #rivate entity were retained su!stantially in 3e#u!lic $ct ++6, Sec. -82859
and 28A9. Said $ct #rovides,
Sec. -8. Powers and !uties o* the +dministrator. Su!:ect to the
general control and su#ervision of the Ie#artment /ead, the
$dministrator shall have among others, the following #owers and
duties,
" " "
2859 ,o administer, operate, mana%e, control, maintain and develop
the #anila )nternational +irport and all %overnment<owned
aerodromes e"ce#t those controlled or o#erated !y the $rmed Corces
of the Phili##ines including such #owers and duties as, 2a9 to #lan,
design, construct, e<ui#, e"#and, im#rove, re#air or alter aerodromes
or such structures, im#rovement or air navigation facilities? 2!9 to
enter into, make and e"ecute contracts of any kind with any #erson,
firm, or #u!lic or #rivate cor#oration or entity? J
28A9 To determine, fi", im#ose, collect and receive landing fees,
#arking s#ace fees, royalties on sales or deliveries, direct or indirect,
to any aircraft for its use of aviation gasoline, oil and lu!ricants, s#are
#arts, accessories and su##lies, tools, other royalties, fees or rentals
for the use of any of the #ro#erty under its management and control.
" " "
Crom the foregoing, it can !e seen that the C$$ is tasked with #rivate or non
governmental functions which o#erate to remove it from the #urview of the
rule on State immunity from suit. Cor the correct rule as set forth in
the ,eodoro case states,
" " "
Hot all government entities, whether cor#orate or noncor#orate, are immune
from suits. )mmunity *rom suits is determined by the character o* the ob=ects
*or which the entity was or%anized. The rule is thus stated in Cor#us .uris,
Suits against State agencies with relation to matters in which they have
assumed to act in #rivate or nongovernmental ca#acity, and various suits
against certain cor#orations created !y the state for #u!lic #ur#oses, !ut to
engage in matters #artaking more of the nature of ordinary !usiness rather
than functions of a governmental or #olitical character, are not regarded as
suits against the state. The latter is true, although the state may own stock or
#ro#erty of such a cor#oration for !y engaging in !usiness o#erations through
a cor#oration, the state divests itself so far of its sovereign character, and !y
im#lication consents to suits against the cor#oration. 2A) C..., -(-9 0Hational
$ir#orts Cor#oration v. Teodoro, supra, ##. 87687+? 'talics su##lied.1
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
-
St. Marys College of Tagum College of Law Political Law
This doctrine has !een reaffirmed in the recent case of #alon% v. Philippine
$ational Railways 0K.3. Ho. L5))-7, $ugust +, ()*A, (-* SC3$ 6-1, where
it was held that the Phili##ine Hational 3ailways, although owned and
o#erated !y the government, was not immune from suit as it does not
e"ercise sovereign !ut #urely #ro#rietary and !usiness functions.
$ccordingly, as the C$$ was created to undertake the management of air#ort
o#erations which #rimarily involve #ro#rietary functions, it cannot avail of the
immunity from suit accorded to government agencies #erforming strictly
governmental functions.

'n our view, the C$ there!y correctly a##reciated the :uridical character of the
$TB as an agency of the Kovernment not per*ormin% a purely %overnmental
or soverei%n *unction, !ut was instead involved in the management and
maintenance of the Loakan $ir#ort, an activity that was not the e"clusive
#rerogative of the State in its sovereign ca#acity. /ence, the $TB had no
claim to the States immunity from suit. Ee u#hold the C$s afore<uoted
holding.
$hen consi#ere# a suit a%ainst the State.
(. The 3e#u!lic is sued !y name?
8. Suits against an unincor#orated government agency?
-. Suits are against a government official, !ut are such that ultimate
lia!ility shall devolve on the government,
a. Ehen a #u!lic officer acts in !ad faith, or !eyond the sco#e of his
authority, he can !e held #ersonally lia!le for damages.
!. ;4T, 'f he acted #ursuant to his official duties, without malice,
negligence, or !ad faith, he is not #ersonally lia!le, and the suit is
really one against the State.
A((lication / Prohi*ition of the rule.
(. This rule a##lies not only in favor of the Phili##ines !ut also
in favor of the foreign states.
8. The rule likewise #rohi!its a #erson from filing for
inter#leader, with the State as one of the defendants !eing
com#elled to inter#lead.
CAS0S
The 3ice and Corn $dministration 23C$9 is #art of the government
!eing in fact an office under the office of the President and therefore,
cannot !e sued without the consent of the State. The consent to !e
effective must come from the State, acting through a duly enacted
statute. Thus, whatever counsel for defendant 3C$ agreed to had no
!inding force in the government. That was clearly !eyond the sco#e
of his authority 23e#u!lic vs. Purisima, +* SC3$ 5+79.
The ;ureau of Customs cannot !e held lia!le for actual damages that
the #rivate res#ondent sustained with regard to its goods. To #ermit
#rivate res#ondents claim to #ros#er would violate the doctrine of
sovereign immunity. Since it demands that the Commissioner of
Customs !e ordered to #ay for actual damages it sustained, for which
ultimately lia!ility will fall on the government, it is o!vious that this
case has !een converted technically into a suit against the State.
The ;ureau of Customs, along with the ;ureau of 'nternal 3evenue, it
is invested with an inherent #ower of sovereignty, namely, ta"ation
2Carolan vs. CT$, 8(+ SC3$ 8)*9.
't is a##arent from the com#laint that ;radford was sued in her #rivate
or #ersonal ca#acity for acts allegedly done !eyond the sco#e and
even !eyond her #lace of official functions, said com#laint is not then
vulnera!le to a motion to dismiss on the grounds relied u#on !y the
#etitioners !ecause as a conse<uence of the hy#othetical admission
of the truth of the allegations therein, the case falls within the
e"ce#tion to the doctrine of State immunity 24S$ vs. 3eyes, K3
+)8--, March (, ())-9.
Celiciano was holding #ro#erty title to which was evidenced !y an
informacion #osesoria. Proclamation no. )7 of President Magsaysay
included it among #ro#erties for su!division and distri!ution.
Celiciano sued the 3e#u!lic, re#resented !y the Land $uthority, to
recover #ossession of the land. The #laintiff has im#leaded the
3e#u!lic as defendant in an action for recovery of ownershi# and
#ossession of a #arcel of land, !ringing the State to court :ust like any
#rivate #erson who is claimed to !e usur#ing a #iece of #ro#erty. The
State #leaded immunity from suit. The suit against the State which
under settled :uris#rudence is not #ermitted, e"ce#t u#on a showing
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
3
St. Marys College of Tagum College of Law Political Law
that the State has consented to !e sued. 'nformacion #osesoria had
not !een shown to have !een converted into a record of ownershi#.
't is nothing more than #rima facie evidence of #ossession. Celiciano
must #ursue to #rove title. The consent of the State to !e sued must
emanate from statutory authority. Eaiver of State 'mmunity can only
!e made !y an act of legislative !ody 23e#u!lic vs. Celiciano, (5*
SC3$ 5859.
1or's of Consent
(. @"#ress consent
8. 'm#lied consent
0&(ress Consent
(. Ehen he law e"#ressly grants the authority to sue the State or any of
its agencies.
8. @"am#les,
a. $ law creating a government !ody e"#ressly #roviding that
such !ody =may sue or !e sued.>
!. $rt 8(*7 of the Civil Code, which creates lia!ility against the
State when it acts through a s#ecial agent.
CAS0S
3es#ondent Singson cause of action is a money claim against the
government for the #ayment of the alleged !alance of the cost of
s#are #arts su##lied !y him to the ;ureau of Pu!lic /ighways.
$ssuming momentarily the validity of such claim, mandamus is not
remedy to enforce the collection of such claim against the State, !ut
an ordinary action for s#ecific #erformance. The suit is against the
State which cannot #ros#er or !e entertained !y the Court e"ce#t
with the consent of the State. The res#ondent should have filed his
claim with the general auditing office under the #rovision of comm..act
-8+ which #rescri!e the condition under which money claim against
the government may !e filed 2Sayson vs. Singson, A5 SC3$ 8*89.
;y consenting to !e sued, the State sim#ly waives its immunity from
suit. 't does not there!y concede its lia!ility to the #laintiff, or create
any cause of action in its favor, or e"tend its lia!ility to any cause not
#reviously recogniDed. 't merely gives remedy to enforce a #re
e"isting lia!ility and su!mit itself to the :urisdiction of the court.
Su!:ect to its right to inter#ose any lawful defense. The Kovernment
of the Phili##ines is only lia!le for the acts of its agents, officers, and
em#loyees when they act as s#ecial agents. $ s#ecial agent is one
who receives a definite and fi" order or commission, foreign to the
e"ercise of the duties of his office if he is a s#ecial official 2Meritt vs.
Kovernment, -5 Phil -((9.
;y engaging in !usiness through the instrumentality of a cor#oration,
the government divests itself of its sovereign character so as to
render the cor#oration su!:ect to the rules governing the #rivate
cor#orations. Karnishment is a #ro#er remedy for a #revailing #arty
to #roceed against the funds of a cor#orate entity even if owned or
controlled !y the government. 't is well settled that when a
government enters into commercial !usiness it a!andons its
sovereign ca#acity and is to !e treated :ust like any other cor#oration
2PH; vs. C'3, *( SC3$ -(59.
4nder its charter 23$ ((6(, Sec. 5L9 the SSS can sue and !e sued.
So, if assuming that the SSS en:oys immunity from suit as an entity
#erforming governmental functions !y virtue of the e"#licit #rovision
of the ena!ling law, it can !e sued. The government must !e
deemed to have waived immunity in res#ect of the SSS, although it
does not there!y concede its lia!ility 2SSS vs. C$, (87 SC3$ +7+9.
I'(lie# Consent
(. Ehen the State enters into a #rivate contract. The contract must !e
entered into !y the #ro#er officer and within the sco#e of his authority.
4HL@SS, the contract is merely incidental to the #erformance of a
governmental function.
8. Ehen the State enters into a !usiness contract. 4HL@SS, The o#eration
is incidental to the #erformance of a governmental function 2e.g. arrastre
services9. Thus, when the State conduct !usiness o#erations through
KBCC, the latter can !e generally !e sued, even if its charter contains no
e"#ress =sue or !e sued> clause.
2ure Gestionis !y right of economic or !usiness relations, may
!e sued 24S v. Kuinto, (*8 SC3$ 65579?
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
3
St. Marys College of Tagum College of Law Political Law
2ure I'(erii !y right of sovereign #ower, in the e"ercise of
sovereign functions. Ho im#lied consent 24S v. 3uiD, (-6 SC3$
5*+9?
-. Ehen it is a suit against an incor#orated government agency
Unincorporated
a. Performs governmental functions , not sua!le without
State consent even is #erforming #ro#rietary function
incidentally.
!. Performs #ro#rietary functions , sua!le.
5. Ehen the State files suit against a #rivate #arty 4HL@SS, the suit is
entered into only to resist a claim..
CAS0S
Ehen the State files an action, it divests itself of the sovereign
character and shed its immunity from suit, descending to the level of
an ordinary litigant 23P vs. Sandigan!ayan, K3 *A-*5, Ce!ruary 8*,
())79.
The claim for damages for the use of #ro#erty against the intervenor
de#endant 3e#u!lic of the Phili##ines to which it was transferred
cannot !e maintained !ecause of the immunity of the State from suit.
The claim o!viously constitutes a charge against, or financial lia!ility
to, the Kovernment and conse<uently cannot !e entertained !y the
courts e"ce#t with the consent of the government 2Lim vs. ;rownell,
(7+ Phil -559.
Ehen the government enters into a commercial transaction, it
a!andons its sovereign ca#acity and it is to !e treated like any other
cor#oration 2Malong &s. PH3, (-* SC3$ 6-9.
Hational 'rrigation $uthority is a government agency vested with
cor#orate #ersonality se#arate and distinct from the government 2Sec
.(, 3$ -67(9, thus is governed !y the Cor#oration Law. 4nder Sec.
8, PI AA8 H'$ is allowed to collect fees and other charges as may!e
necessary to cover the cost of o#eration, maintenance, and insurance
and to recover the cost of construction, etc. H'$ may also sue and !e
sued in court. 't is authoriDed to e"ercise the #owers of a cor#oration
under the Cor#oration Law, insofar as they are not inconsistent with
the #rovision of H'$ charter 2Contanilla &s. Maliaman, ()5 SC3$
5*69.
The a##lication of the doctrine of immunity from suit has !een
restricted to sovereign or governmental activities 2:ure im#erii9. The
mantel of State immunity cannot !e e"tended to commercial, #rivate
and #ro#rietary acts 2:ure gestionis9. 'f the contract was entered into
the discharge of its governmental functions, the sovereign State
cannot !e deemed to have waived its immunity from suit 2.4SM$K
vs. HL3C, K3 ()**(-, Iec. (A, ())59.
Petitioner filed an action in the CC' of Mam!oanga City for the
revocation of a Ieed of Ionation which he had his wife had made to
the ;ureau of Plant and 'ndustry. /e claimed that the donee failed to
com#ly with the condition of the donation. Brdinarily, a suit of this
nature cannot #ros#er. 't would, however, !e manifestly unfair for the
government, as donee, which is alleged to have violated the condition
under which it received gratuitously certain #ro#erty, to invoke its
immunity. Since it would !e against e<uity and :ustice to allow such
defense in this case, consent to !e sued could !e #resumed
2Santiago vs. 3e#u!lic, *+ SC3$ 8)59.
Ehen the government takes any #ro#erty for #u!lic use, which is
condition u#on the #ayment of :ust com#ensation, to !e :udicially
ascertained, it makes manifest that it su!mits to the :urisdiction of a
court. The Court may #roceed with the com#laint and determine the
com#ensation to which the #etitioner are entitle 2Ministerio vs. CC', 57
SC3$ 5659.
Consent to 0&ecution
Consent to !e sued does not include consent to the e"ecution of :udgment
against it. Such e"ecution will re<uire another waiver, !ecause the #ower of
the court ends when the :udgment is rendered, since government funds and
#ro#erties may not !e seiDed under writs of e"ecution or garnishment, unless
such dis!ursement is covered !y the corres#onding a##ro#riation as re<uired
!y law 23e#u!lic v. &illasor, A5 SC3$ *59.
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
4
St. Marys College of Tagum College of Law Political Law
5ules 5e%ar#in% Garnish'ent or 6ev of Govern'ent 1un#s in
Govern'ent 7e(ositor.
General 5ule, Kovernment funds de#osited with PH; or authoriDed
de#ositories cannot !e su!:ect to garnishment.
0&ce(tions.
Ehere law or ordinance has already !een enacted a##ro#riating a s#ecific
amount to #ay a valid governmental o!ligation 2Munici#ality of San Miguel,
;ulacan v. CernandeD, K3 Ho. L6(+55, .une 8A, ()*59.
Cunds !elonging to government cor#orations which can sue and !e sues that
are de#osited with a !ank 2PH; v. Pa!alan, *- SC3$ A)A9.
5ules 5e%ar#in% Pa'ent of Interests * Govern'ent in Mone
2u#%'ents A%ainst it.
General 5ule, Kovernment cannot !e made to #ay interests?
0&ce(tions.
(. eminent domain?
8. erroneous collection of ta"es? or
-. where government aggress to #ay interest #ursuant to law.
CAS0S
Ehen a munici#ality fails or refuses without :ustifia!le reason to effect
#ayment of a final money :udgment rendered against it, the claimant
may avail of the remedy of mandamus in order to com#el the
enactment and a##roval of the necessary a##ro#riation ordinance
and the corres#onding dis!ursement of munici#al funds 2Munici#ality
of Makati vs. C$, ()7 SC3$ 8769.
The rule is and has always !een that all government funds de#osited
in the PH; or any other official de#ositary of the Phili##ine
Kovernment !y any of its agencies or instrumentalities remain
government funds and may not !e su!:ect to garnishment or levy, in
the a!sence of a corres#onding a##ro#riation as re<uired !y law.
@ven though the rule as to immunity of a state from suit is rela"ed,
the #ower of the courts ends when the :udgment is rendered. The
functions and #u!lic services rendered !y the State cannot !e
allowed to !e #aralyDed or disru#ted !y the diversion of #u!lic funds
from their legitimate and s#ecific o!:ects, as a##ro#riated !y law.
/owever, the rule is not a!solute and admits of a welldefined
e"ce#tion, that it, when there is a corres#onding a##ro#riation is
re<uired !y law. 'n such a case, the monetary :udgment may !e
legally enforced !y :udicial #rocesses 2City of Caloocan vs. $llarde,
K3 (7+8+(, Se#t. (7, 877-9.
Suits a%ainst 1orei%n States / International 8r%ani9ations
CAS0S
The 3e#u!lic of the Phili##ines has accorded the /oly See the status
of a foreign sovereign. The #rivilege of sovereign immunity in this
case was sufficiently esta!lished !y the memorandum and
certification of the Ie#artment of Coreign $ffairs. Ehere the #lea of
immunity is recogniDed and affirmed !y the e"ecutive !ranch, it is the
duty of the courts to acce#t this claim so as not to em!arrass the
e"ecutive arm of the government in conducting the countrys foreign
relations. Pursuant to the ()6( &ienna Convention on Ii#lomatic
3elations, a di#lomatic envoy is granted immunity from the civil and
administrative :urisdiction of the receiving state over any real action
relating to #rivate immova!le #ro#erty situated in the territory of the
receiving state which the envoy holds on !ehalf of the sending state
for the #ur#oses of the mission 2/oly See vs. 3osario, K3 (7()5),
Iecem!er (, ())59.
The traditional rule of State immunity e"em#ts a State from !eing
sued in the courts of another State without its consent or waiver. This
rule is a necessary conse<uence of the #rinci#les of inde#endence
and e<uality of States. /owever, the rules of 'nternational Law are not
#etrified? they are constantly develo#ing and evolving. $nd !ecause
the activities of states have multi#lied, it has !een necessary to
distinguish them N !etween sovereign and governmental acts 2:ure
im#erii9 and #rivate, commercial and #ro#rietary acts 2:ure gestionis9.
The result is that State immunity now e"tends only to acts :ure
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
:
St. Marys College of Tagum College of Law Political Law
im#erii. $ state may !e said to have descended to the level of an
individual and can thus !e deemed to have tacitly given its consent to
!e sued only when it enters intyo !usiness contracts. The rule does
not a##ly where the contract relates to the e"ercise of its sovereign
functions and is not for commercial or !usiness #ur#oses 24S$ vs,
3uiD, (-6 SC3$ 5*+9.
'nternational law is founded largely u#on the #rinci#les of reci#rocity,
comity, inde#endence, and e<uality of States which were ado#ted as
#art of the law of our land under $rt. '', Sec. 8 of the ()*+
Constitution. The rule that a State may not !e sued without its
consent is necessary conse<uence of the #rinci#les and
inde#endence and e<uality of States. /owever, the increasing need
of sovereign States to enter into #urely commercial activities remotely
connected with the discharge of their governmental functions !rought
a!out a new conce#t of sovereign immunity. This conce#t, the
restrictive theory, holds that immunity of the sovereign is recogniDed
only with regard to #u!lic acts or acts :ure im#erii, !ut not with regard
to #rivate acts or :ure gestionis. 's the foreign State engaged in the
regular conduct of !usinessF 'f the foreign State is not engaged
regularly in a !usiness or commercial activity, or if the act is in #ursuit
of a sovereign activity, or an incident thereof, then it is an act :ure
im#erii 23e#u!lic of 'ndonesia vs. &inDon, K3 (A5+7A, .une 8A,
877-9.
Slandering a #erson could not #ossi!ly !e covered !y the immunity
agreement !ecause our laws do not allow the commission of a crime
in the name of official duty. 't is a wellsettled #rinci#le of law that a
#u!lic official may !e lia!le in his #ersonal #rivate ca#acity for
whatever damage he may have caused !y his actdone with malice or
in !ad faith or !eyond the sco#e of his authority or :urisdiction. 4nder
the &ienna Convention on Ii#lomatic 3elations, the commission of a
crime is not #art of official duty 2Liang vs. Peo#le, K3 (8A*6A,
.anuary 8*, 87789.
Can the Govern'ent of the 5e(u*lic of the Phili((ines *e sue#;
$s a rule, the government of the 3e#u!lic of the Phili##ines cannot !e sued
without its consent. The consent of the State to !e sued may !e given
e"#ressly or im#liedly. @"#ress consent may !e manifested either through a
general law or s#ecial law.
0&(ress Consent
(. There is e"#ress consent when a law e"#ressly grants authority to
sue the State or any of its agencies.
8. $nother e"am#le of e"#ress consent is the law enacted !y the
Phili##ine Legislature authoriDing an individual to sue the Phili##ine
Kovernment for in:uries he had sustained when his motorcycle
collided with a government am!ulance 2Merit vs 3P -5 Phil -((9
I'(lie# Consent
(. Ehen the State enters into a #rivate contract, unless the contract is
only incidental to the #erformance of a government function 2Santos
vs Santos )8 Phil 8*(9
8. Ehen the State enters into an o#eration that is essentially a !usiness
o#eration, unless, the !usiness o#eration is only incidental to the
#erformance of a governmental function. 2Mo!ile Phili##ines vs
Customs $rrastre Services, (* SC3$ ((87, ()669
-. Ehen the State sues a #rivate #arty, the defendant can file a counter
claim against the State, unless the suit is entered into only to resist
claim 2Lim vs ;rownell (7+ Phil -55, ()6)9
$hat is the (roce#ure to (rosecute the clai' of %overn'ent;
Claim against must !e filed first in the commission of audit, which must act
u#on 67 days. 'f re:ected, then through certiorari in the Su#reme Court.
Can the e&(ress consent of the State *e %iven * a 'ere counsel of the
%overn'ent;
'n 3e#u!lic vs Purisima 2+* SC3$ 5+79, the Su#reme Court ruled that the
waiver made !y the lawyer is not !inding u#on the state. The e"#ress consent
of the State to !e sued should, therefore, !e #rovided !y law.
Can the a%encies of the Govern'ent of the Phili((ines *e sue#;
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
7
St. Marys College of Tagum College of Law Political Law
't de#ends on whether the government agency to !e sued is incor#orated or
unincor#orated. 'f it is incor#orated, the rule is that it is sua!le if its charter
says so and regardless of the function it is #erforming.
'f it is unincor#orated, the rule is that it is sua!le if it is #erforming #ro#rietary
functions, and not sua!le if it is #erforming governmental functions.
$hen the State %ives its consent to *e sue#) #oes it also consent to the
e&ecution of the <u#%'ent a%ainst it; =!ee#s further research>
.udgment is one thing and dis!ursement of #u!lic funds to satisfy the said
:udgment is another. The first is well within the sco#e of the #ower and
authority of the court. The second de#ends on whether or not there is a
corres#onding a##ro#riation, as re<uired !y law, to satisfy the :udgment of the
court.
3e#u!lic of the Phili##ines
S?P50M0 C8?5T
Manila
C'3ST I'&'S'BH

G.5. !o. 6@3A3-3 !ove'*er -9) 1973
587?618 C. !I050) #etitioner,
vs.
B8!. C8?5T 81 1I5ST I!STA!C0 81 !0G58S 8CCI70!TA6)
"5A!CB II) 28S0 C. D?IAM"A8) an# 2AIM0 PA558C8) Cit Treasurer
of 6a Carlota Cit) res#ondents.
#edalla<$ava and +ssociates and !ominador Laberinto and +ssociates *or
petitioner.
+ctin% City >iscal 3La Carlota: >ortunato ?. 6in%son, "r. *or respondents.

MACASIA5) J.:
Petitioner 3odulfo C. Hiere filed this #etition for review on certiorari seeking
the reversal of the decision dated Iecem!er 8*, ()6* of the res#ondent
Court.
't is undis#uted that La Carlota City was created !y 3e#u!lic $ct Ho. 5A*A
enacted on .une (), ()6A. Petitioner 3odulfo C. Hiere is a Civil Service
eligi!le, having #assed the ;oard @"aminations for Civil @ngineers in $ugust,
()67 with a rating of +(.)*O. /e entered the government service on Bcto!er
-, ()67 as a civil engineer aide in the Iistrict @ngineerPs Bffice at ;acolod
City at P5.77 a day until he was given a #ermanent a##ointment as such on
Iecem!er (, ()6( at P8A55.77 #er annum. /e was #romoted on Hovem!er
(6, ()68 as :unior civil engineer? on Se#tem!er ), ()6-, as associate civil
engineer? and on Bcto!er 8*, ()65 as civil engineer. Bn .anuary -, ()66, he
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
8
St. Marys College of Tagum College of Law Political Law
was a##ointed city engineer of La Carlota City !y then City Mayor .aime
Marino #ursuant to the #rovisions of Section 8( of 3e#u!lic $ct Ho. 5A*A,
which a##ointment was endorsed to the Commissioner of Civil Service, who
a##roved the same on .anuary (7, ()66. Petitioner thereafter assumed office
as such city engineer of La Carlota City.
$fter the enactment on .uly (+, ()6+ of the IecentraliDation $ct, otherwise
known as 3e#u!lic $ct Ho. A(*A, #rivate res#ondent .ose L. Quiam!ao was
a##ointed on May (5, ()6* !y the President of the Phili##ines as city
engineer of La Carlota City, u#on recommendation of the Commissioner of
Pu!lic /ighways, who, on .une (+, ()6*, officially informed herein #etitioner
of said a##ointment of #rivate res#ondent Quiam!ao, which a##ointment was
duly confirmed !y the Commission on $##ointments, and directed #etitioner
to turn over the office to res#ondent Quiam!ao, who likewise on the same day
.une (+, ()6*, advised #etitioner that he was assuming as city engineer of La
Carlota City.
'n re#ly to #etitionerPs motion for reconsideration of the confirmation of
res#ondent Quiam!ao, the Secretary of the Commission on $##ointments, in
a letter dated .une 8(, ()6*, informed the #etitioner that his said motion was
filed !eyond the reglementary #eriod and that his sole remedy is to file uo
warranto #roceedings in court.
Private res#ondent Quiam!ao graduated cum laude from the Silliman
4niversity in ()A+ with a degree of ;achelor of Science in Civil @ngineering
and #assed the ;oard @"aminations the same year with a rating of *8.5O. /e
entered the government service in ()A+ while he was not yet a registered
engineer in the City @ngineerPs Bffice of Iumaguete City, then as associate
engineer in ()6A in the same office, from which he was #romoted u#on
recommendation of the Commissioner of Pu!lic /ighways as heretofore
intimated, to the #osition of City @ngineer of La Carlota City effective May (5,
()6*.
Petitioner claims that he was legally a##ointed !y the City Mayor of La
Carlota City under Section 8( of 3e#u!lic $ct Ho. 5A*A.
Bn the other hand, res#ondents maintain that the #osition of city engineer,
created in the Charter of La Carlota City 2Secs. () R 8), 3.$. Ho. 5A*A9 which
was enacted on .une (), ()6A and therefore already e"isting at the time of
the a##ointment of #etitioner on .anuary -, ()66, can !e filled u# only !y
a##ointment of the President of the Phili##ines with the confirmation of the
Commission on $##ointments under Section 5 of 3e#u!lic $ct Ho. A(*A,
which e"#ressly e"ce#ts the city, engineer from the a##ointing authority of the
city mayor.
Section 8( of 3e#u!lic $ct Ho. 5A*A #rovides thus,
$##ointment and removal of officials and em#loyees. N The
mayor shall a##oint the city treasurer, the city health officer,
the chief of #olice and fire de#artment, and other heads and
other em#loyees of such city de#artment as may !e created.
Said office shall not !e sus#ended nor removed e"ce#t in the
manner and for causes #rovided !y law, Provided, That
a##ointments of heads and other em#loyees of the city shall
!e limited to civil service eligi!les as may from time to time !e
certified as such !y the Commissioner of Civil Service.
Section 5 of 3e#u!lic $ct Ho. A(*A reads thus,
The City $ssesssor, City $griculturist, City Chief of Police
and City Chief of Cire Ie#artment and other heads of offices
entirely #aid out of city funds and their res#ective assistants
or de#uties shall, su!:ect to civil service law, rules and
regulations, !e a##ointed !y the City Mayor? Provided,
however, that this section shall not a##ly to .udges, $uditors,
Ciscals, City Su#erintendents of Schools, Su#ervisors,
Princi#als, City Treasurers, City /ealth officers and City
@ngineers.
Section (72-9 of $rticle &'' of the ()-A Constitution states,
The President shall nominate and with the consent of the
Commission on $##ointments, shall a##oint the heads of the
e"ecutive de#artments and !ureaus, officers of the $rmy
from the rank of colonel, of the Havy and $ir Corces from the
rank of ca#tain or commander, and all other officers of the
Kovernment whose a##ointments are not herein otherwise
#rovided for, and those whom he may!e authoriDed !y law to
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
9
St. Marys College of Tagum College of Law Political Law
a##oint? !ut the Congress may !y law vest the a##ointment
of inferior officers, in the President alone, in the courts, or in
the heads of de#artments.
The #etition should !e dismissed and the decision of the court a uo must !e
affirmed.
'
/ouse ;ill Ho. )+((, which !ecame 3e#u!lic $ct Ho. 5A*A, originally
e"#ressly included the city engineer as one of those whom the city mayor can
a##oint under Section 8( of 3e#u!lic $ct Ho. 5A*A, !ut during the #eriod of
amendment in the Senate, the #osition of said engineer was deleted in the
final draft of Section 8(. This fact clearly indicates that the intention of the
Legislature was to e"clude from the a##ointing #ower of the mayor the
#osition of the city engineer. This is not an amendment #urely on a matter of
form? !ecause nothing could !e more su!stantial than the vesting of a #ower
to a##oint such an im#ortant city official as the city engineer. PetitionerPs
assertion that Senator Tolentino stated that this amendment is merely one of
form is not accurate? !ecause the records of the Senate session during the
#eriod of amendments, as <uoted !y #etitioner himself, show that,
T/@ P3@S'I@HT P3B T@MPB3@. Ee are in the #eriod of
amendments.
S@H$TB3 TBL@HT'HB. There are committed amendments,
Mr. President, em!odied in the committee 3e#ort. Some of
them are matters of form. The other refers to the allotment of
collection of ta"es. ' move that these committee amendments
!e a##roved.
T/@ P3@S'I@HT P3B T@MPB3@. 's there any o!:ectionF
2Silence9 The Chair hears none. The motion is a##roved. 2P.
87 of Petition? #. -7, rec.? #. 58, #etitionerPs !rief9.
The Committee amendments included,
-. Page --, line 6 .
Ielete the following,
Sthe city engineer,
the city attorney.
S2P. 8( of Petition? #. -(, rec.? #. 5-,
#etitionerPs !rief9.
$s afore<uoted, Senator Tolentino was careful or deli!erate in stating
that some, not all, of the amendments were matters of form. Heither did he
refer e"#ressly to the deletion of the words city en%ineer from Section 8( of
the Charter of La Carlota City as #urely a formal amendment. 'f Congress
wanted to authoriDe the city mayor to a##oint all heads and em#loyees of city
de#artment, it could have easily re#hrased Section 8( of the City Charter to
that effect. That this is a material modification is underscored !y the fact that
the City Charters of Toledo, Cota!ato, Lanlaon, Ia#itan, San Carlos,
Kingoog, Iavao, Taclo!an, Silahis, ;ago, ;acolod, Ce!u, Legas#i and 3o"as
or 3e#u!lic $cts Hos. 86**, 8-65, -55A, -*((, 865-, 866*, -78*, -76*,
5-*8, -*A+, 88-5 and 67- e"#resslly vest the #ower to a##oint the city
de#artment heads, including the city engineer, in the President of the
Phili##ines, who is the re#ository of the a##ointing #ower !y e"#ress
constitutional conferment 2Sec. (72-9, $rt. &'', ()-A Constitution? see
also Sec. (-, $rt. '%, ()+- Constitution9.
''
The clear legislative intendment in e"ce#ting the engineer from the a##ointing
authority of the city mayor under Section 8( of the Charter of La Carlota City
is evident from the #hraseology of the same. Said section e"#ressly limits the
a##ointing authority of the mayor to Sthe city treasurer, the city health officer,
the chief of #olice and fire de#artment, ...S among the heads of the then duly
created and e"isting de#artments, like the city engineer, of the city
government of La Carlota City. The following #hrase in said Section 8( Sand
other heads and other em#loyees of the city de#artments as may !e created,S
whom the mayor can a##oint, refers to heads of city de#artments that may !e
created after the enactment of 3e#u!lic $ct Ho. 5A*A. Btherwise, as
em#hasiDed !y res#ondents, the first con:unction SandS !efore @*ire
department@ in the #receding clause of that same sentence of Section 8(
would !e a su#erfluity, and would have no meaning at all. $s evident from the
construction of the first sentence in said Section 8(, the terminal #hrase @as
may be created@ modi*ies the last clause @and other heads and other
employees o* such department,@ !y all the #rinci#les of logic and synta".
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
1A
St. Marys College of Tagum College of Law Political Law
'''
Since the city mayor under Section 8( is without authority to a##oint the city
engineer, this #rerogative can only !e e"ercised !y the President of the
Phili##ines, who, under Section (72-9 of $rticle &'' of the ()-A Constitution,
shall nominate with the consent of the Commission on $##ointments Sall other
officers of the government whose a##ointments are not herein otherwise
#rovided forS? !ecause Ee ruled in Ramos vs. +lvarez 2)+ Phil. *55, *5)9 that
when a statute does not s#ecify how an officer is to !e a##ointed, the
a##ointment must !e made !y the President with the consent of the
Commission on $##ointments.
The a##ointing #ower is essentially the e"clusive #rerogative of the President.
Conse<uently, any diminution in its sco#e must !e clear and une<uivocal.
This test is not met !y Section 8( of 3e#u!lic $ct Ho. 5A*A so as to remove
the #ower to a##oint the city engineer of La Carlota City from the residual
#ower of a##ointment vested in the President !y Section (72-9 of $rticle &'' of
the ()-A Constitution.
/ence, the a##ointment of #etitioner as city engineer !y then city mayor of La
Carlota City is illegal and therefore null and void. /owever, as conceded !y
res#ondents, #etitioner was a de *acto city engineer during the #eriod of time
that he #erformed the functions of the #osition until he was dis#laced !y
res#ondent Quiam!ao who was validly nominated !y the President of the
Phili##ines and confirmed !y the Commission on $##ointments 2Cordilla vs.
MartineD, ((7 Phil. 85, 8A? 3odrigueD vs. Tan, )( Phil. +85, +8*? Luna vs.
3odrigueD, -+ Phil. *669.
E/@3@CB3@, T/@ $PP@$L@I I@C'S'BH 'S /@3@;T $CC'3M@I, E'T/
CBSTS $K$'HST P@T'T'BH@3.
#akalintal, C."., Castro, ,eehankee, ?s%uerra and #uAoz Palma, "".,
concur.
7i%est.
>acts: $ writ of e"ecution 3a writ to put in *orce the sentence that the law has
%iven: was issued !y the court against the funds of the $rmed Corces of the
Phili##ines to satisfy a :udgment rendered against the Phili##ine Kovernment.
)ssue: Ehether or not the writ of e"ecution, issued !y res#ondent :udge, is
valid.
Beld: 't was ruled that #u!lic funds cannot !e the o!:ect of garnishment
#roceedings even if the consent to !e sued had !een #reviously granted and
even if the State lia!ility had !een ad:udged. The universal rule that where the
State gives its consent to !e sued !y #rivate #arties either !y general or
s#ecial law, it may limit claimantPs action Ponly u# to the com#letion of
#roceedings anterior to the stage of e"ecutionP and that the #ower of the
Courts ends when the :udgment is rendered, since government funds and
#ro#erties may not !e seiDed under writs of e"ecution or garnishment to
satisfy such :udgments, is !ased on o!vious considerations of #u!lic #olicy.
Iis!ursements of #u!lic funds must !e covered !y the corres#onding
a##ro#riation as re<uired !y law. The functions and #u!lic services rendered
!y the State cannot !e allowed to !e #aralyDed or disru#ted !y the diversion
of #u!lic funds from their legitimate and s#ecific o!:ects, as a##ro#riated !y
law.
3e#u!lic of the Phili##ines
S?P50M0 C8?5T
Manila
C'3ST I'&'S'BH
G.5. !o. 7A843 March 1-) 1987
50P?"6IC 81 TB0 PBI6IPPI!0S) #etitionera##ellee,
vs.
PA"68 106ICIA!8 an# I!T05M07IAT0 APP066AT0
C8?5T) res#ondentsa##ellants.

$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
11
St. Marys College of Tagum College of Law Political Law
EAP) J.:
Petitioner seeks the review of the decision of the 'ntermediate $##ellate Court
dated $#ril -7, ()*A reversing the order of the Court of Cirst 'nstance of
Camarines Sur, ;ranch &', dated $ugust 8(, ()*7, which dismissed the
com#laint of res#ondent Pa!lo Celiciano for recovery of ownershi# and
#ossession of a #arcel of land on the ground of nonsua!ility of the State.
The !ackground of the #resent controversy may !e !riefly summariDed as
follows,
Bn .anuary 88, ()+7, res#ondent Celiciano filed a com#laint with the then
Court of Cirst 'nstance of Camarines Sur against the 3e#u!lic of the
Phili##ines, re#resented !y the Land $uthority, for the recovery of ownershi#
and #ossession of a #arcel of land, consisting of four 259 lots with an
aggregate area of (,-65.5(++ hectares, situated in the ;arrio of Salvacion,
Munici#ality of Tinam!ac, Camarines Sur. Plaintiff alleged that he !ought the
#ro#erty in <uestion from &ictor Kardiola !y virtue of a Contract of Sale dated
May -(, ()A8, followed !y a Ieed of $!solute Sale on Bcto!er -7, ()A5? that
Kardiola had ac<uired the #ro#erty !y #urchase from the heirs of Crancisco
$!raDado whose title to the said #ro#erty was evidenced !y an in*ormacion
posesoria that u#on #laintiffPs #urchase of the #ro#erty, he took actual
#ossession of the same, introduced various im#rovements therein and
caused it to !e surveyed in .uly ()A8, which survey was a##roved !y the
Iirector of Lands on Bcto!er 85, ()A5? that on Hovem!er (, ()A5, President
3amon Magsaysay issued Proclamation Ho. )7 reserving for settlement
#ur#oses, under the administration of the Hational 3esettlement and
3eha!ilitation $dministration 2H$33$9, a tract of land situated in the
Munici#alities of Tinam!ac and Siruma, Camarines Sur, after which the
H$33$ and its successor agency, the Land $uthority, started su!dividing
and distri!uting the land to the settlers? that the #ro#erty in <uestion, while
located within the reservation esta!lished under Proclamation Ho. )7, was the
#rivate #ro#erty of #laintiff and should therefore !e e"cluded therefrom.
Plaintiff #rayed that he !e declared the rightful and true owner of the #ro#erty
in <uestion consisting of (,-65.5(++ hectares? that his title of ownershi#
!ased onin*ormacion posesoria of his #redecessorininterest !e declared
legal valid and su!sisting and that defendant !e ordered to cancel and nullify
all awards to the settlers.
The defendant, re#resented !y the Land $uthority, filed an answer, raising !y
way of affirmative defenses lack of sufficient cause of action and #rescri#tion.
Bn $ugust 8), ()+7, the trial court, through .udge 3afael S. Sison, rendered
a decision declaring Lot Ho. (, with an area of +7(.)765 hectares, to !e the
#rivate #ro#erty of the #laintiff, S!eing covered !y a #ossessory information
title in the name of his #redecessorininterestS and declaring said lot
e"cluded from the H$33$ settlement reservation. The court declared the rest
of the #ro#erty claimed !y #laintiff, i.e. Lots 8, - and 5, reverted to the #u!lic
domain.
$ motion to intervene and to set aside the decision of $ugust 8), ()+7 was
filed !y eightysi" 2*69 settlers, together with the !arrio council of Pagasay,
alleging among other things that intervenors had !een in #ossession of the
land in <uestion for more than twenty 2879 years under claim of ownershi#.
Bn .anuary 8A, ()+(, the court a uo reconsidered its decision, reo#ened the
case and directed the intervenors to file their corres#onding #leadings and
#resent their evidence? all evidence already #resented were to remain !ut
#laintiff, as well as the 3e#u!lic of the Phili##ines, could #resent additional
evidence if they so desire. The #laintiff #resented additional evidence on .uly
-7, ()+(, and the case was set for hearing for the rece#tion of intervenorsP
evidence on $ugust -7 and $ugust -(, ()+(.
Bn $ugust -7, ()+(, the date set for the #resentation of the evidence for
intervenors, the latter did not a##ear !ut su!mitted a motion for #ost#onement
and resetting of the hearing on the ne"t day, $ugust -(, ()+(. The trial court
denied the motion for #ost#onement and allowed #laintiff to offer his evidence
Sen ausencia,S after which the case would !e deemed su!mitted for decision.
Bn the following day, $ugust -(, ()+(, .udge Sison rendered a decision
reiterating his decision of $ugust 8), ()+7.
$ motion for reconsideration was immediately filed !y the intervenors. ;ut
!efore this motion was acted u#on, #laintiff filed a motion for e"ecution, dated
Hovem!er (*, ()+(. Bn Iecem!er (7, ()+(, the lower court, this time
through .udge Miguel Havarro, issued an order denying the motion for
e"ecution and setting aside the order denying intervenorsP motion for
#ost#onement. The case was reo#ened to allow intervenors to #resent their
evidence. 4na!le to secure a reconsideration of .udge HavarroPs order, the
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
1-
St. Marys College of Tagum College of Law Political Law
#laintiff went to the 'ntermediate $##ellate Court on a #etition for certiorari.
Said #etition was, however, denied !y the 'ntermediate $##ellate Court, and
#etitioners !rought the matter to this Court in K.3. Ho. -6(6-, which was
denied on May -, ()+- Conse<uently, the case was remanded to the court a
uo for further #roceedings.
Bn $ugust -(, ()+7, intervenors filed a motion to dismiss, #rinci#ally on the
ground that the 3e#u!lic of the Phili##ines cannot !e sued without its consent
and hence the action cannot #ros#er. The motion was o##osed !y the
#laintiff.
Bn $ugust 8(, ()*7, the trial court, through .udge @ste!an Lising, issued the
<uestioned order dismissing the case for lack of :urisdiction. 3es#ondent
moved for reconsideration, while the Solicitor Keneral, on !ehalf of the
3e#u!lic of the Phili##ines filed its o##osition thereto, maintaining that the
dismissal was #ro#er on the ground of nonsua!ility of the State and also on
the ground that the e"istence andUor authenticity of the #ur#orted #ossessory
information title of the res#ondentsP #redecessorininterest had not !een
demonstrated and that at any rate, the same is not evidence of title, or if it is,
its efficacy has !een lost !y #rescri#tion and laches.
4#on denial of the motion for reconsideration, #laintiff again went to the
'ntermediate $##ellate Court on #etition for certiorari. Bn $#ril -7, ()*A, the
res#ondent a##ellate court rendered its decision reversing the order of .udge
Lising and remanding the case to the court a uo for further #roceedings.
/ence this #etition.
Ee find the #etition meritorious. The doctrine of nonsua!ility of the State has
#ro#er a##lication in this case. The #laintiff has im#leaded the 3e#u!lic of the
Phili##ines as defendant in an action for recovery of ownershi# and
#ossession of a #arcel of land, !ringing the State to court :ust like any #rivate
#erson who is claimed to !e usur#ing a #iece of #ro#erty. $ suit for the
recovery of #ro#erty is not an action in rem, !ut an action in personam.1 't is
an action directed against a s#ecific #arty or #arties, and any :udgment
therein !inds only such #arty or #arties. The com#laint filed !y #laintiff, the
#rivate res#ondent herein, is directed against the 3e#u!lic of the Phili##ines,
re#resented !y the Land $uthority, a governmental agency created !y
3e#u!lic $ct Ho. -*55.
;y its ca#tion and its allegation and #rayer, the com#laint is clearly a suit
against the State, which under settled :uris#rudence is not #ermitted, e"ce#t
u#on a showing that the State has consented to !e sued, either e"#ressly or
!y im#lication through the use of statutory language too #lain to !e
misinter#reted.
-
There is no such showing in the instant case. Eorse, the
com#laint itself fails to allege the e"istence of such consent. This is a fatal
defect,
3
and on this !asis alone, the com#laint should have !een dismissed.
The failure of the #etitioner to assert the defense of immunity from suit when
the case was tried !efore the court a uo, as alleged !y #rivate res#ondent, is
not fatal. 't is now settled that such defense Smay !e invoked !y the
courts sua sponte at any stage of the #roceedings.S
3
Private res#ondent contends that the consent of #etitioner may !e read from
the Proclamation itself, when it esta!lished the reservation S su!:ect to #rivate
rights, if any there !e. S Ee do not agree. Ho such consent can !e drawn from
the language of the Proclamation. The e"clusion of e"isting #rivate rights from
the reservation esta!lished !y Proclamation Ho. )7 can not !e construed as a
waiver of the immunity of the State from suit. Eaiver of immunity, !eing a
derogation of sovereignty, will not !e inferred lightly. !ut must !e construed
instrictissimi =uris.
4
Moreover, the Proclamation is not a legislative act. The
consent of the State to !e sued must emanate from statutory authority.
Eaiver of State immunity can only !e made !y an act of the legislative !ody.
Heither is there merit in res#ondentPs su!mission, which the res#ondent
a##ellate court sustained, on the !asis of our decision in
the Ce%osa case,
:
that the #resent action is not a suit against the State within
the rule of State immunity from suit, !ecause #laintiff does not seek to divest
the Kovernment of any of its lands or its funds. 't is contended that the
com#laint involves land not owned !y the State, !ut #rivate land !elonging to
the #laintiff, hence the Kovernment is not !eing divested of any of its
#ro#erties. There is some so#histry involved in this argument, since the
character of the land sought to !e recovered still remains to !e esta!lished,
and the #laintiffPs action is directed against the State #recisely to com#el the
latter to litigate the ownershi# and #ossession of the #ro#erty. 'n other words,
the #laintiff is out to esta!lish that he is the owner of the land in <uestion
!ased, incidentally, on an in*ormacion posesoria of du!ious value, and he
seeks to esta!lish his claim of ownershi# !y suing the 3e#u!lic of the
Phili##ines in an action in personam.
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
13
St. Marys College of Tagum College of Law Political Law
The inscri#tion in the #ro#erty registry of an in*ormacion posesoria under the
S#anish Mortgage Law was a means #rovided !y the law then in force in the
Phili##ines #rior to the transfer of sovereignty from S#ain to the 4nited States
of $merica, to record a claimantPs actual #ossession of a #iece of land,
esta!lished through an e' parte#roceeding conducted in accordance with
#rescri!ed rules.
7
Such inscri#tion merely furnishes, at !est, prima
*acie evidence of the fact that at the time the #roceeding was held, the
claimant was in #ossession of the land under a claim of right as set forth in his
a##lication.
8
The #ossessory information could ri#en into a record of
ownershi# after the la#se of 87 years 2later reduced to (7 years9, u#on the
fulfillment of the re<uisites #rescri!ed in $rticle -)- of the S#anish Mortgage
Law.
There is no showing in the case at !ar that the in*ormacion posesoria held !y
the res#ondent had !een converted into a record of ownershi#. Such
#ossessory information, therefore, remained at !est mere prima
*acie evidence of #ossession. 4sing this #ossessory information, the
res#ondent could have a##lied for :udicial confirmation of im#erfect title under
the Pu!lic Land $ct, which is an action in rem. /owever, having failed to do
so, it is rather late for him to #ursue this avenue at this time. 3es#ondent
must also contend, as the records disclose, with the fact admitted !y him and
stated in the decision of the Court a uo that settlers have !een occu#ying
and cultivating the land in <uestion since even !efore the out!reak of the war,
which #uts in grave dou!t his own claim of #ossession.
Eorthy of note is the fact, as #ointed out !y the Solicitor Keneral, that
the in*ormacion posesoria registered in the Bffice of the 3egister of Ieed of
Camarines Sur on Se#tem!er 8-, ()A8 was a SreconstitutedS #ossessory
information? it was Sreconstituted from the du#licate #resented to this office
23egister of Ieeds9 !y Ir. Pa!lo Celiciano,S without the su!mission of #roof
that the alleged du#licate was authentic or that the original thereof was lost.
3econstitution can !e validly made only in case of loss of the
original. 1A These circumstances raise grave dou!ts as to the authenticity and
validity of the Sinformacion #osesoriaS relied u#on !y res#ondent Celiciano.
$dding to the du!iousness of said document is the fact that S#ossessory
information calls for an area of only (77 hectares,S 11 whereas the land
claimed !y res#ondent Celiciano com#rises (,-65.5(++ hectares, later
reduced to +7()765 hectares. Courts should !e wary in acce#ting
S#ossessory information documents, as well as other #ur#ortedly old S#anish
titles, as #roof of alleged ownershi# of lands.
E/@3@CB3@, :udgment is here!y rendered reversing and setting aside the
a##ealed decision of the 'ntermediate $##ellate Court, dated $#ril -7, ()*A,
and affirming the order of the court a uo, dated $ugust 8(, ()*7, dismissing
the com#laint filed !y res#ondent Pa!lo Celiciano against the 3e#u!lic of the
Phili##ines. Ho costs.
SB B3I@3@I.
7IG0ST.
Cacts, Petitioner seeks the review of the decision of the 'ntermediate
$##ellate Court revising the order of the Court of Cirst 'nstance which
dismissed the com#laint of Pa!lo Celiciano for the recovery of ownershi# and
#ossession of a #arcel of land on the ground of nonsua!ility of the State.
Celiciano filed a com#laint with the Court of Cirst 'nstance against the
3e#u!lic of the Phili##ines, re#resented !y the Land $uthority, for the
recovery of ownershi# and #ossession of a #arcel of land consisting of four
259 lots with an aggregated area of (,-65.5(++ hectares, situated in ;arrio of
Salvacion, Munici#ality of Tinam!ac, Camarines Sur. Celiciano alleged that he
!ought the #ro#erty in <uestion for &ictor Kardiola !y virtue of Contract of
Sale and followed !y a Ieed of $!solute Sale? that Kardiola had ac<uired the
#ro#erty !y #urchase from the heirs of Crancisco $!raDado whose title to the
said #ro#erty was evidenced !y an informacion #osesoria that u#on his
#urchase of the #ro#erty, he took actual #ossession of the same, introduced
various im#rovements therein and caused it to !e surveyed in .uly ()A8,
which survey was a##roved !y the Iirector of Lands on Bcto!er 85, ()A5.
Bn Hovem!er (, ()A5, President 3amon Magsaysay issued a Proclamation
Ho. )7 reserving for settlement #ur#oses, under the administration of te
Hational 3esettlement and 3eha!ilitation $dministration 2H$33$9, a tract of
land situated in the Munici#alities of Tinam!ac and Siruma, Camarines Sur,
after which the H$33$ and its successor agen!y, the Land $uthority, started
su!dividing and distri!uting the land to the settlers? that the #ro#erty in
<uestion, while located within the reservation esta!lished under Proclamation
Ho. )7, was the #rivate #ro#erty of Celiciano and should therefore !e
e"cluded. Celiciano #rayed that he !e declared the rightful and true owner of
the #ro#erty in <uestion? that his title of ownershi# !ased on the informacion
#osesoria of his #redecessorininterest !e declared legal valid and su!sisting
and that defendant !e ordered to cancel and nullify all awards to the settlers.
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
13
St. Marys College of Tagum College of Law Political Law
'SS4@, Can the State !e sued for recovery and #ossession of a #arcel of
landF
34L'HK, Ho, the suit against the State, under settled :uris#rudence is not
#ermitted, e"ce#t u#on a showing that the State has consented to !e sued,
either e"#ressly of !y im#lication through the use of statutory language too
#lain to !e misinter#reted. 't may !e invoked !y the courts at any stage of the
#roceedings. Eaiver of immunity, will not !e inferred lightly, !ut must !e
construed strictly. Moreover, the Proclamation is not the legislative act. The
consent of the State to !e sued must emanate from statutory authority.
Eaiver of State immunity can only !e made !y act of the legislative !ody.
5e(u*lic of the Phili((ines
S?P50M0 C8?5T
Manila
0! "A!C
G.5. !o. 7::A7 1e*ruar -:) 199A
?!IT07 STAT0S 81 AM05ICA) 150705ICC M. SM8?S0 A!7 EV8!!0
500V0S) (etitioners)
vs.
B8!. 06I87858 ". G?I!T8) Presi#in% 2u#%e) "ranch 6VII) 5e%ional
Trial Court) An%eles Cit) 58"05T8 T. VA60!CIA) 0M050!CIA!A C.
TA!G6A8) A!7 PA"68 C. 706 PI6A5) res(on#ents.
C34M, ".:
These cases have !een consolidated !ecause they all involve the doctrine of
state immunity. The 4nited States of $merica was not im#leaded in the
com#laints !elow !ut has moved to dismiss on the ground that they are in
effect suits against it to which it has not consented. 't is now contesting the
denial of its motions !y the res#ondent :udges.
'n K.3. Ho. +667+, the #rivate res#ondents are suing several officers of the
4.S. $ir Corce stationed in Clark $ir ;ase in connection with the !idding
conducted !y them for contracts for !ar!er services in the said !ase.
Bn Ce!ruary 85, ()*6, the Eestern Pacific Contracting Bffice, Bkinawa $rea
@"change, 4.S. $ir Corce, solicited !ids for such contracts through its
contracting officer, .ames C. Shaw. $mong those who su!mitted their !ids
were #rivate res#ondents 3o!erto T. &alencia, @merenciana C. Tanglao, and
Pa!lo C. del Pilar. &alencia had !een a concessionaire inside Clark for -5
years? del Pilar for (8 years? and Tanglao for A7 years.
The !idding was won !y 3amon IiDon, over the o!:ection of the #rivate
res#ondents, who claimed that he had made a !id for four facilities, including
the Civil @ngineering $rea, which was not included in the invitation to !id.
The #rivate res#ondents com#lained to the Phili##ine $rea @"change
2P/$%9. The latter, through its re#resentatives, #etitioners Tvonne 3eeves
and Crederic M. Smouse e"#lained that the Civil @ngineering concession had
not !een awarded to IiDon as a result of the Ce!ruary 85, ()*6 solicitation.
IiDon was already o#erating this concession, then known as the HCB clu!
concession, and the e"#iration of the contract had !een e"tended from .une
-7, ()*6 to $ugust -(, ()*6. They further e"#lained that the solicitation of the
C@ !ar!ersho# would !e availa!le only !y the end of .une and the #rivate
res#ondents would !e notified.
Bn .une -7, ()*6, the #rivate res#ondents filed a com#laint in the court
!elow to com#el P/$% and the individual #etitioners to cancel the award to
defendant IiDon, to conduct a re!idding for the !ar!ersho# concessions and
to allow the #rivate res#ondents !y a writ of #reliminary in:unction to continue
o#erating the concessions #ending litigation.
(
4#on the filing of the com#laint, the res#ondent court issued an e' parte order
directing the individual #etitioners to maintain the status uo.
Bn .uly 88, ()*6, the #etitioners filed a motion to dismiss and o##osition to
the #etition for #reliminary in:unction on the ground that the action was in
effect a suit against the 4nited States of $merica, which had not waived its
nonsua!ility. The individual defendants, as official em#loyees of the 4.S. $ir
Corce, were also immune from suit.
Bn the same date, .uly 88, ()*6, the trial court denied the a##lication for a
writ of #reliminary in:unction.
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
14
St. Marys College of Tagum College of Law Political Law
Bn Bcto!er (7, ()**, the trial court denied the #etitionersP motion to dismiss,
holding in #art as follows,
Crom the #leadings thus far #resented to this Court !y the
#arties, the CourtPs attention is called !y the relationshi#
!etween the #laintiffs as well as the defendants, including the
4S Kovernment, in that #rior to the !idding or solicitation in
<uestion, there was a !inding contract !etween the #laintiffs
as well as the defendants, including the 4S Kovernment. ;y
virtue of said contract of concession it is the CourtPs
understanding that neither the 4S Kovernment nor the herein
#rinci#al defendants would !ecome the em#loyerUs of the
#laintiffs !ut that the latter are the em#loyers themselves of
the !ar!ers, etc. with the em#loyer, the #laintiffs herein,
remitting the sti#ulated #ercentage of commissions to the
Phili##ine $rea @"change. The same circumstance would
!ecome in effect when the Phili##ine $rea @"change o#ened
for !idding or solicitation the <uestioned !ar!er sho#
concessions. To this e"tent, therefore, indeed a commercial
transaction has !een entered, and for #ur#oses of the said
solicitation, would necessarily !e entered !etween the
#laintiffs as well as the defendants.
The Court, further, is of the view that $rticle %&''' of the 3P
4S ;ases $greement does not cover such kind of services
falling under the concessionaireshi#, such as a !ar!er sho#
concession.
8
Bn Iecem!er ((, ()*6, following the filing of the herein #etition
for certiorari and #rohi!ition with #reliminary in:unction, we issued a tem#orary
restraining order against further #roceedings in the court !elow.
-
'n K.3. Ho. +)5+7, Ca!ian Kenove filed a com#laint for damages against
#etitioners $nthony Lamachia, Eilfredo ;elsa, 3ose Cartalla and Peter
Brascion for his dismissal as cook in the 4.S. $ir Corce 3ecreation Center at
the .ohn /ay $ir Station in ;aguio City. 't had !een ascertained after
investigation, from the testimony of ;elsa Cartalla and Brascion, that Kenove
had #oured urine into the sou# stock used in cooking the vegeta!les served
to the clu! customers. Lamachia, as clu! manager, sus#ended him and
thereafter referred the case to a !oard of ar!itrators conforma!ly to the
collective !argaining agreement !etween the Center and its em#loyees. The
!oard unanimously found him guilty and recommended his dismissal. This
was effected on March A, ()*6, !y Col. Iavid C. Lim!all, Commander of the
-rd Com!at Su##ort Krou#, P$C$C Clark $ir Corce ;ase. KenovePs reaction
was to file Ms com#laint in the 3egional Trial Court of ;aguio City against the
individual #etitioners.
5
Bn March (-, ()*+, the defendants, :oined !y the 4nited States of $merica,
moved to dismiss the com#laint, alleging that Lamachia, as an officer of the
4.S. $ir Corce stationed at .ohn /ay $ir Station, was immune from suit for the
acts done !y him in his official ca#acity. They argued that the suit was in
effect against the 4nited States, which had not given its consent to !e sued.
This motion was denied !y the res#ondent :udge on .une 5, ()*+, in an order
which read in #art,
't is the understanding of the Court, !ased on the allegations
of the com#laint N which have !een hy#othetically admitted
!y defendants u#on the filing of their motion to dismiss N
that although defendants acted initially in their official
ca#acities, their going !eyond what their functions called for
!rought them out of the #rotective mantle of whatever
immunities they may have had in the !eginning. Thus, the
allegation that the acts com#lained of were illegal, done. with
e"treme !ad faith and with #reconceived sinister #lan to
harass and finally dismiss the #laintiff, gains significance.
A
The #etitioners then came to this Court seeking certiorari and #rohi!ition with
#reliminary in:unction.
'n K.3. Ho. *77(*, Luis ;autista, who was em#loyed as a !arracks !oy in
Cam# BP Ionnell, an e"tension of Clark $ir ;ase, was arrested following a
!uy!ust o#eration conducted !y the individual #etitioners herein, namely,
Tomi .. Ling, Iarrel I. Iye and Ste#hen C. ;ostick, officers of the 4.S. $ir
Corce and s#ecial agents of the $ir Corce Bffice of S#ecial 'nvestigators
2$CBS'9. Bn the !asis of the sworn statements made !y them, an information
for violation of 3.$. 658A, otherwise known as the Iangerous Irugs $ct, was
filed against ;autista in the 3egional Trial Court of Tarlac. The a!ovenamed
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
1:
St. Marys College of Tagum College of Law Political Law
officers testified against him at his trial. $s a result of the filing of the charge,
;autista was dismissed from his em#loyment. /e then filed a com#laint for
damages against the individual #etitioners herein claiming that it was !ecause
of their acts that he was removed.
6
Iuring the #eriod for filing of the answer, Mariano T. Havarro a s#ecial
counsel assigned to the 'nternational Law Iivision, Bffice of the Staff .udge
$dvocate of Clark $ir ;ase, entered a s#ecial a##earance for the defendants
and moved for an e"tension within which to file an Sanswer andUor other
#leadings.S /is reason was that the $ttorney Keneral of the 4nited States had
not yet designated counsel to re#resent the defendants, who were !eing sued
for their official acts. Eithin the e"tended #eriod, the defendants, without the
assistance of counsel or authority from the 4.S. Ie#artment of .ustice, filed
their answer. They alleged therein as affirmative defenses that they had only
done their duty in the enforcement of the laws of the Phili##ines inside the
$merican !ases #ursuant to the 3P4S Military ;ases $greement.
Bn May +, ()*+, the law firm of Luna, Sison and Manas, having !een
retained to re#resent the defendants, filed with leave of court a motion to
withdraw the answer and dismiss the com#laint. The ground invoked was that
the defendants were acting in their official ca#acity when they did the acts
com#lained of and that the com#laint against them was in effect a suit against
the 4nited States without its consent.
The motion was denied !y the res#ondent :udge in his order dated Se#tem!er
((, ()*+, which held that the claimed immunity under the Military ;ases
$greement covered only criminal and not civil cases. Moreover, the
defendants had come under the :urisdiction of the court when they su!mitted
their answer.
+
Collowing the filing of the herein #etition for certiorari and #rohi!ition with
#reliminary in:unction, we issued on Bcto!er (5, ()*+, a tem#orary
restraining order.
*
'n K.3. Ho. *78A*, a com#laint for damages was filed !y the #rivate
res#ondents against the herein #etitioners 2e"ce#t the 4nited States of
$merica9, for in:uries allegedly sustained !y the #laintiffs as a result of the
acts of the defendants.
)
There is a conflict of factual allegations here.
$ccording to the #laintiffs, the defendants !eat them u#, handcuffed them and
unleashed dogs on them which !it them in several #arts of their !odies and
caused e"tensive in:uries to them. The defendants deny this and claim the
#laintiffs were arrested for theft and were !itten !y the dogs !ecause they
were struggling and resisting arrest, The defendants stress that the dogs were
called off and the #laintiffs were immediately taken to the medical center for
treatment of their wounds.
'n a motion to dismiss the com#laint, the 4nited States of $merica and the
individually named defendants argued that the suit was in effect a suit against
the 4nited States, which had not given its consent to !e sued. The
defendants were also immune from suit under the 3P4S ;ases Treaty for
acts done !y them in the #erformance of their official functions.
The motion to dismiss was denied !y the trial court in its order dated $ugust
(7, ()*+, reading in #art as follows,
The defendants certainly cannot correctly argue that they are
immune from suit. The allegations, of the com#laint which is
sought to !e dismissed, had to !e hy#othetically admitted
and whatever ground the defendants may have, had to !e
ventilated during the trial of the case on the merits. The
com#laint alleged criminal acts against the individually
named defendants and from the nature of said acts it could
not !e said that they are $cts of State, for which immunity
should !e invoked. 'f the Cili#inos themselves are duty !ound
to res#ect, o!ey and su!mit themselves to the laws of the
country, with more reason, the mem!ers of the 4nited States
$rmed Corces who are !eing treated as guests of this country
should res#ect, o!ey and su!mit themselves to its laws.
(7
and so was the motion for reconsideration. The defendants su!mitted their
answer as re<uired !ut su!se<uently filed their #etition for certiorari and
#rohi!ition with #reliminary in:unction with this Court. Ee issued a tem#orary
restraining order on Bcto!er 8+, ()*+.
((
''
The rule that a state may not !e sued without its consent, now e"#ressed in
$rticle %&', Section -, of the ()*+ Constitution, is one of the generally
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
17
St. Marys College of Tagum College of Law Political Law
acce#ted #rinci#les of international law that we have ado#ted as #art of the
law of our land under $rticle '', Section 8. This latter #rovision merely
reiterates a #olicy earlier em!odied in the ()-A and ()+- Constitutions and
also intended to manifest our resolve to a!ide !y the rules of the international
community.
@ven without such affirmation, we would still !e !ound !y the generally
acce#ted #rinci#les of international law under the doctrine of incor#oration.
4nder this doctrine, as acce#ted !y the ma:ority of states, such #rinci#les are
deemed incor#orated in the law of every civiliDed state as a condition and
conse<uence of its mem!ershi# in the society of nations. 4#on its admission
to such society, the state is automatically o!ligated to com#ly with these
#rinci#les in its relations with other states.
$s a##lied to the local state, the doctrine of state immunity is !ased on the
:ustification given !y .ustice /olmes that Sthere can !e no legal right against
the authority which makes the law on which the right de#ends.S
(8
There are
other #ractical reasons for the enforcement of the doctrine. 'n the case of the
foreign state sought to !e im#leaded in the local :urisdiction, the added
inhi!ition is e"#ressed in the ma"im par in parem, non habet imperium. $ll
states are sovereign e<uals and cannot assert :urisdiction over one another. $
contrary dis#osition would, in the language of a cele!rated case, Sunduly ve"
the #eace of nations.S
(-
Ehile the doctrine a##ears to #rohi!it only suits against the state without its
consent, it is also a##lica!le to com#laints filed against officials of the state for
acts allegedly #erformed !y them in the discharge of their duties. The rule is
that if the :udgment against such officials will re<uire the state itself to #erform
an affirmative act to satisfy the same, such as the a##ro#riation of the amount
needed to #ay the damages awarded against them, the suit must !e regarded
as against the state itself although it has not !een formally im#leaded.
(5
'n
such a situation, the state may move to dismiss the com#laint on the ground
that it has !een filed without its consent.
The doctrine is sometimes derisively called Sthe royal #rerogative of
dishonestyS !ecause of the #rivilege it grants the state to defeat any legitimate
claim against it !y sim#ly invoking its nonsua!ility. That is hardly fair, at least
in democratic societies, for the state is not an unfeeling tyrant unmoved !y the
valid claims of its citiDens. 'n fact, the doctrine is not a!solute and does not
say the state may not !e sued under any circumstance. Bn the contrary, the
rule says that the state may not !e sued without its consent, which clearly
im#orts that it may !e sued if it consents.
The consent of the state to !e sued may !e manifested e"#ressly or im#liedly.
@"#ress consent may !e em!odied in a general law or a s#ecial law. Consent
is im#lied when the state enters into a contract or it itself commences
litigation.
The general law waiving the immunity of the state from suit is found in $ct Ho.
-7*-, under which the Phili##ine government Sconsents and su!mits to !e
sued u#on any moneyed claim involving lia!ility arising from contract, e"#ress
or im#lied, which could serve as a !asis of civil action !etween #rivate
#arties.S 'n #erritt v. Dovernment o* the Philippine )slands,
(A
a s#ecial law
was #assed to ena!le a #erson to sue the government for an alleged tort.
Ehen the government enters into a contract, it is deemed to have descended
to the level of the other contracting #arty and divested of its sovereign
immunity from suit with its im#lied consent.
(6
Eaiver is also im#lied when the
government files a com#laint, thus o#ening itself to a counterclaim.
(+
The a!ove rules are su!:ect to <ualification. @"#ress consent is effected only
!y the will of the legislature through the medium of a duly enacted
statute.
(*
Ee have held that not all contracts entered into !y the government
will o#erate as a waiver of its nonsua!ility? distinction must !e made !etween
its sovereign and #ro#rietary acts.
()
$s for the filing of a com#laint !y the
government, sua!ility will result only where the government is claiming
affirmative relief from the defendant.
87
'n the case of the 4nited States of $merica, the customary rule of
international law on state immunity is e"#ressed with more s#ecificity in the
3P4S ;ases Treaty. $rticle ''' thereof #rovides as follows,
't is mutually agreed that the 4nited States shall have the
rights, #ower and authority within the !ases which are
necessary for the esta!lishment, use, o#eration and defense
thereof or a##ro#riate for the control thereof and all the rights,
#ower and authority within the limits of the territorial waters
and air s#ace ad:acent to, or in the vicinity of, the !ases
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
18
St. Marys College of Tagum College of Law Political Law
which are necessary to #rovide access to them or a##ro#riate
for their control.
The #etitioners also rely heavily on Caer v. ,izon,
8(
along with several other
decisions, to su##ort their #osition that they are not sua!le in the cases
!elow, the 4nited States not having waived its sovereign immunity from suit. 't
is em#hasiDed that in ;aer, the Court held,
The invocation of the doctrine of immunity from suit of a
foreign state without its consent is a##ro#riate. More
s#ecifically, insofar as alien armed forces is concerned, the
starting #oint is Rauiza v. Crad*ord, a ()5A decision. 'n
dismissing a ha!eas cor#us #etition for the release of
#etitioners confined !y $merican army authorities, .ustice
/ilado s#eaking for the Court, cited Coleman v. ,ennessee,
where it was e"#licitly declared, P't is well settled that a
foreign army, #ermitted to march through a friendly country or
to !e stationed in it, !y #ermission of its government or
sovereign, is e"em#t from the civil and criminal :urisdiction of
the #lace.P Two years later, in Tu!! and Tedrow v. Kriess,
this Court relied on the ruling in 3a<uiDa v. ;radford and cited
in su##ort thereof e"cer#ts from the works of the following
authoritative writers, &attel, Eheaton, /all, Lawrence,
B##enheim, Eestlake, /yde, and McHair and Lauter#acht.
$ccuracy demands the clarification that after the conclusion
of the Phili##ine$merican Military ;ases $greement, the
treaty #rovisions should control on such matter, the
assum#tion !eing that there was a manifestation of the
su!mission to :urisdiction on the #art of the foreign #ower
whenever a##ro#riate. More to the #oint is 6yuia v. +lmeda
Lopez, where #laintiffs as lessors sued the Commanding
Keneral of the 4nited States $rmy in the Phili##ines, seeking
the restoration to them of the a#artment !uildings they owned
leased to the 4nited States armed forces stationed in the
Manila area. $ motion to dismiss on the ground of non
sua!ility was filed and u#held !y res#ondent .udge. The
matter was taken to this Court in a mandamus #roceeding. 't
failed. 't was the ruling that res#ondent .udge acted correctly
considering that the 5 action must !e considered as one
against the 4.S. Kovernment. The o#inion of .ustice
Montemayor continued, P't is clear that the courts of the
Phili##ines including the Munici#al Court of Manila have no
:urisdiction over the #resent case for unlawful detainer. The
<uestion of lack of :urisdiction was raised and inter#osed at
the very !eginning of the action. The 4.S. Kovernment has
not given its consent to the filing of this suit which is
essentially against her, though not in name. Moreover, this is
not only a case of a citiDen filing a suit against his own
Kovernment without the latterPs consent !ut it is of a citiDen
firing an action against a foreign government without said
governmentPs consent, which renders more o!vious the lack
of :urisdiction of the courts of his country. The #rinci#les of
law !ehind this rule are so elementary and of such general
acce#tance that we deem it unnecessary to cite authorities in
su##ort thereof then came #arvel Cuildin% Corporation v.
Philippine (ar !ama%e Commission, where res#ondent, a
4nited States $gency esta!lished to com#ensate damages
suffered !y the Phili##ines during Eorld Ear '' was held as
falling within the a!ove doctrine as the suit against it would
eventually !e a charge against or financial lia!ility of the
4nited States Kovernment !ecause ... , the Commission has
no funds of its own for the #ur#ose of #aying money
:udgments.P The Sy<uia ruling was again e"#licitly relied u#on
in #aruez Lim v. $elson, involving a com#laint for the
recovery of a motor launch, #lus damages, the s#ecial
defense inter#osed !eing Pthat the vessel !elonged to the
4nited States Kovernment, that the defendants merely acted
as agents of said Kovernment, and that the 4nited States
Kovernment is therefore the real #arty in interest.P So it was
in Philippine +lien Property +dministration v. Castelo, where
it was held that a suit against $lien Pro#erty Custodian and
the $ttorney Keneral of the 4nited States involving vested
#ro#erty under the Trading with the @nemy $ct is in
su!stance a suit against the 4nited States. To the same
effect is Parreno v. #cDranery, as the following e"cer#t from
the o#inion of :ustice TuaDon clearly shows, P't is a widely
acce#ted #rinci#le of international law, which is made a #art
of the law of the land 2$rticle '', Section - of the Constitution9,
that a foreign state may not !e !rought to suit !efore the
courts of another state or its own courts without its consent.P
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
19
St. Marys College of Tagum College of Law Political Law
Cinally, there is "ohnson v. ,urner, an a##eal !y the
defendant, then Commanding Keneral, Phili##ine Command
2$ir Corce, with office at Clark Cield9 from a decision ordering
the return to #laintiff of the confiscated military #ayment
certificates known as scri# money. 'n reversing the lower
court decision, this Tri!unal, through .ustice Montemayor,
relied on 6yuia v. +lmeda Lopez, e"#laining why it could not
!e sustained.
't !ears stressing at this #oint that the a!ove o!servations do not confer on
the 4nited States of $merica a !lanket immunity for all acts done !y it or its
agents in the Phili##ines. Heither may the other #etitioners claim that they are
also insulated from suit in this country merely !ecause they have acted as
agents of the 4nited States in the discharge of their official functions.
There is no <uestion that the 4nited States of $merica, like any other state,
will !e deemed to have im#liedly waived its nonsua!ility if it has entered into
a contract in its #ro#rietary or #rivate ca#acity. 't is only when the contract
involves its sovereign or governmental ca#acity that no such waiver may !e
im#lied. This was our ruling in Enited 6tates o* +merica v. Ruiz,
88
where the
transaction in <uestion dealt with the im#rovement of the wharves in the naval
installation at Su!ic ;ay. $s this was a clearly governmental function, we held
that the contract did not o#erate to divest the 4nited States of its sovereign
immunity from suit. 'n the words of .ustice &icente $!ad Santos,
The traditional rule of immunity e"em#ts a State from !eing
sued in the courts of another State without its consent or
waiver. This rule is a necessary conse<uence of the
#rinci#les of inde#endence and e<uality of States. /owever,
the rules of 'nternational Law are not #etrified? they are
constantly develo#ing and evolving. $nd !ecause the
activities of states have multi#lied, it has !een necessary to
distinguish them N !etween sovereign and governmental
acts 2:ure im#erii9 and #rivate, commercial and #ro#rietary
acts 2:ure gestionis9. The result is that State immunity now
e"tends only to acts :ure im#erii The restrictive a##lication of
State immunity is now the rule in the 4nited States, the
4nited kingdom and other states in Eestern @uro#e.
""" """ """
The restrictive a##lication of State immunity is #ro#er only
when the #roceedings arise out of commercial transactions of
the foreign sovereign, its commercial activities or economic
affairs. Stated differently, a State may !e said to have
descended to the level of an individual and can thus !e
deemed to have tacitly given its consent to !e sued only
when it enters into !usiness contracts. 't does not a##ly
where the contract relates to the e"ercise of its sovereign
functions. 'n this case the #ro:ects are an integral #art of the
naval !ase which is devoted to the defense of !oth the 4nited
States and the Phili##ines, indis#uta!ly a function of the
government of the highest order? they are not utiliDed for nor
dedicated to commercial or !usiness #ur#oses.
The other #etitioners in the cases !efore us all aver they have acted in the
discharge of their official functions as officers or agents of the 4nited States.
/owever, this is a matter of evidence. The charges against them may not !e
summarily dismissed on their mere assertion that their acts are im#uta!le to
the 4nited States of $merica, which has not given its consent to !e sued. 'n
fact, the defendants are sought to !e held answera!le for #ersonal torts in
which the 4nited States itself is not involved. 'f found lia!le, they and they
alone must satisfy the :udgment.
'n >este=o v. >ernando,
8-
a !ureau director, acting without any authority
whatsoever, a##ro#riated #rivate land and converted it into #u!lic irrigation
ditches. Sued for the value of the lots invalidly taken !y him, he moved to
dismiss the com#laint on the ground that the suit was in effect against the
Phili##ine government, which had not given its consent to !e sued. This Court
sustained the denial of the motion and held that the doctrine of state immunity
was not a##lica!le. The director was !eing sued in his #rivate ca#acity for a
#ersonal tort.
Eith these considerations in mind, we now #roceed to resolve the cases at
hand.
'''
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
-A
St. Marys College of Tagum College of Law Political Law
't is clear from a study of the records of K.3. Ho. *77(* that the individually
named #etitioners therein were acting in the e"ercise of their official functions
when they conducted the !uy!ust o#eration against the com#lainant and
thereafter testified against him at his trial. The said #etitioners were in fact
connected with the $ir Corce Bffice of S#ecial 'nvestigators and were charged
#recisely with the function of #reventing the distri!ution, #ossession and use
of #rohi!ited drugs and #rosecuting those guilty of such acts. 't cannot for a
moment !e imagined that they were acting in their #rivate or unofficial
ca#acity when they a##rehended and later testified against the com#lainant. 't
follows that for discharging their duties as agents of the 4nited States, they
cannot !e directly im#leaded for acts im#uta!le to their #rinci#al, which has
not given its consent to !e sued. $s we o!served in 6anders v. &eridiano,
85
Kiven the official character of the a!ovedescri!ed letters, we
have to conclude that the #etitioners were, legally s#eaking,
!eing sued as officers of the 4nited States government. $s
they have acted on !ehalf of that government, and within the
sco#e of their authority, it is that government, and not the
#etitioners #ersonally, that is res#onsi!le for their acts.
The #rivate res#ondent invokes $rticle 8(*7 of the Civil Code which holds the
government lia!le if it acts through a s#ecial agent. The argument, it would
seem, is #remised on the ground that since the officers are designated
Ss#ecial agents,S the 4nited States government should !e lia!le for their torts.
There seems to !e a failure to distinguish !etween sua!ility and lia!ility and a
misconce#tion that the two terms are synonymous. Sua!ility de#ends on the
consent of the state to !e sued, lia!ility on the a##lica!le law and the
esta!lished facts. The circumstance that a state is sua!le does not
necessarily mean that it is lia!le? on the other hand, it can never !e held lia!le
if it does not first consent to !e sued. Lia!ility is not conceded !y the mere
fact that the state has allowed itself to !e sued. Ehen the state does waive its
sovereign immunity, it is only giving the #laintiff the chance to #rove, if it can,
that the defendant is lia!le.
The said article esta!lishes a rule of liability, not sua!ility. The government
may !e held lia!le under this rule only if it first allows itself to !e sued through
any of the acce#ted forms of consent.
Moreover, the agent #erforming his regular functions is not a s#ecial agent
even if he is so denominated, as in the case at !ar. Ho less im#ortant, the
said #rovision a##ears to regulate only the relations of the local state with its
inha!itants and, hence, a##lies only to the Phili##ine government and not to
foreign governments im#leaded in our courts.
Ee re:ect the conclusion of the trial court that the answer filed !y the s#ecial
counsel of the Bffice of the Sheriff .udge $dvocate of Clark $ir ;ase was a
su!mission !y the 4nited States government to its :urisdiction. $s we noted
in Republic v. Purisima,
8A
e"#ress waiver of immunity cannot !e made !y a
mere counsel of the government !ut must !e effected through a dulyenacted
statute. Heither does such answer come under the im#lied forms of consent
as earlier discussed.
;ut even as we are certain that the individual #etitioners in K.3. Ho. *77(*
were acting in the discharge of their official functions, we hesitate to make the
same conclusion in K.3. Ho. *78A*. The contradictory factual allegations in
this case deserve in our view a closer study of what actually ha##ened to the
#laintiffs. The record is too meager to indicate if the defendants were really
discharging their official duties or had actually e"ceeded their authority when
the incident in <uestion occurred. Lacking this information, this Court cannot
directly decide this case. The needed in<uiry must first !e made !y the lower
court so it may assess and resolve the conflicting claims of the #arties on the
!asis of the evidence that has yet to !e #resented at the trial. Bnly after it
shall have determined in what ca#acity the #etitioners were acting at the time
of the incident in <uestion will this Court determine, if still necessary, if the
doctrine of state immunity is a##lica!le.
'n K.3. Ho. +)5+7, #rivate res#ondent Kenove was em#loyed as a cook in
the Main Clu! located at the 4.S. $ir Corce 3ecreation Center, also known as
the B#en Mess Com#le", at .ohn /ay $ir Station. $s manager of this
com#le", #etitioner Lamachia is res#onsi!le for eleven diversified activities
generating an annual income of V8 million. 4nder his e"ecutive management
are three service restaurants, a cafeteria, a !akery, a Class &' store, a coffee
and #antry sho#, a main cashier cage, an administrative office, and a
decentraliDed warehouse which maintains a stock level of V877,777.77 #er
month in resale items. /e su#ervises (6+ em#loyees, one of whom was
Kenove, with whom the 4nited States government has concluded a collective
!argaining agreement.
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
-1
St. Marys College of Tagum College of Law Political Law
Crom these circumstances, the Court can assume that the restaurant services
offered at the .ohn /ay $ir Station #artake of the nature of a !usiness
enter#rise undertaken !y the 4nited States government in its #ro#rietary
ca#acity. Such services are not e"tended to the $merican servicemen for free
as a #er<uisite of mem!ershi# in the $rmed Corces of the 4nited States.
Heither does it a##ear that they are e"clusively offered to these servicemen?
on the contrary, it is well known that they are availa!le to the general #u!lic
as well, including the tourists in ;aguio City, many of whom make it a #oint to
visit .ohn /ay for this reason. $ll #ersons availing themselves of this facility
#ay for the #rivilege like all other customers as in ordinary restaurants.
$lthough the #rices are concededly reasona!le and relatively low, such
services are undou!tedly o#erated for #rofit, as a commercial and not a
governmental activity.
The conse<uence of this finding is that the #etitioners cannot invoke the
doctrine of state immunity to :ustify the dismissal of the damage suit against
them !y Kenove. Such defense will not #ros#er even if it !e esta!lished that
they were acting as agents of the 4nited States when they investigated and
later dismissed Kenove. Cor that matter, not even the 4nited States
government itself can claim such immunity. The reason is that !y entering into
the em#loyment contract with Kenove in the discharge of its #ro#rietary
functions, it im#liedly divested itself of its sovereign immunity from suit.
;ut these considerations notwithstanding, we hold that the com#laint against
the #etitioners in the court !elow must still !e dismissed. Ehile sua!le, the
#etitioners are nevertheless not lia!le. 't is o!vious that the claim for damages
cannot !e allowed on the strength of the evidence !efore us, which we have
carefully e"amined.
The dismissal of the #rivate res#ondent was decided u#on only after a
thorough investigation where it was esta!lished !eyond dou!t that he had
#olluted the sou# stock with urine. The investigation, in fact, did not sto#
there. Ies#ite the definitive finding of KenovePs guilt, the case was still
referred to the !oard of ar!itrators #rovided for in the collective !argaining
agreement. This !oard unanimously affirmed the findings of the investigators
and recommended KenovePs dismissal. There was nothing ar!itrary a!out the
#roceedings. The #etitioners acted <uite #ro#erly in terminating the #rivate
res#ondentPs em#loyment for his un!elieva!ly nauseating act. 't is sur#rising
that he should still have the temerity to file his com#laint for damages after
committing his utterly disgusting offense.
Concerning K.3. Ho. +667+, we also find that the !ar!ersho#s su!:ect of the
concessions granted !y the 4nited States government are commercial
enter#rises o#erated !y #rivate #ersonPs. They are not agencies of the 4nited
States $rmed Corces nor are their facilities demanda!le as a matter of right
!y the $merican servicemen. These esta!lishments #rovide for the grooming
needs of their customers and offer not only the !asic haircut and shave 2as
re<uired in most military organiDations9 !ut such other amenities as sham#oo,
massage, manicure and other similar indulgences. $nd all for a fee.
'nterestingly, one of the concessionaires, #rivate res#ondent &alencia, was
even sent a!road to im#rove his tonsorial !usiness, #resuma!ly for the
!enefit of his customers. Ho less significantly, if not more so, all the
!ar!ersho# concessionaires are under the terms of their contracts, re<uired to
remit to the 4nited States government fi"ed commissions in consideration of
the e"clusive concessions granted to them in their res#ective areas.
This !eing the case, the #etitioners cannot #lead any immunity from the
com#laint filed !y the #rivate res#ondents in the court !elow. The contracts in
<uestion !eing decidedly commercial, the conclusion reached in the Enited
6tates o* +merica v. Ruiz case cannot !e a##lied here.
The Court would have directly resolved the claims against the defendants as
we have done in K.3. Ho. +)5+7, e"ce#t for the #aucity of the record in the
case at hand. The evidence of the alleged irregularity in the grant of the
!ar!ersho# concessions is not !efore us. This means that, as in K.3. Ho.
*78A*, the res#ondent court will have to receive that evidence first, so it can
later determine on the !asis thereof if the #laintiffs are entitled to the relief
they seek. $ccordingly, this case must also !e remanded to the court !elow
for further #roceedings.
'&
There are a num!er of other cases now #ending !efore us which also involve
the <uestion of the immunity of the 4nited States from the :urisdiction of the
Phili##ines. This is cause for regret, indeed, as they mar the traditional
friendshi# !etween two countries long allied in the cause of democracy. 't is
ho#ed that the socalled SirritantsS in their relations will !e resolved in a s#irit
of mutual accommodation and res#ect, without the inconvenience and
as#erity of litigation and always with :ustice to !oth #arties.
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
--
St. Marys College of Tagum College of Law Political Law
E/@3@CB3@, after considering all the a!ove #remises, the Court here!y
renders :udgment as follows,
(. 'n K.3. Ho. +667+, the #etition is I'SM'SS@I and the
res#ondent :udge is directed to #roceed with the hearing and
decision of Civil Case Ho. 5++8. The tem#orary restraining
order dated Iecem!er ((, ()*6, is L'CT@I.
8. 'n K.3. Ho. +)5+7, the #etition is K3$HT@I and Civil
Case Ho. *8)328)*9 is I'SM'SS@I.
-. 'n K.3. Ho. *77(*, the #etition is K3$HT@I and Civil
Case Ho. ((AC*+ is I'SM'SS@I. The tem#orary
restraining order dated Bcto!er (5, ()*+, is made
#ermanent.
5. 'n K.3. Ho. *78A*, the #etition is I'SM'SS@I and the
res#ondent court is directed to #roceed with the hearing and
decision of Civil Case Ho. 5))6. The tem#orary restraining
order dated Bcto!er 8+, ()*+, is L'CT@I.
$ll without any #ronouncement as to costs.
SB B3I@3@I.
7IG0ST.
1ACTS. These cases have !een consolidated !ecause they all
involve the doctrine of state immunity. 'n K3 Ho. +667+, The #rivate
res#ondents are suing several officers of the 4S $ir Corce in Clark $ir ;ase in
connection with the !idding conducted !y them for contracts for !ar!er
services in the said !ase which was won !y a certain IiDon. The
res#ondents wanted to cancel the award to the !id winner !ecause they
claimed that IiDon had included in his !id an area not included in the
invitation to !id, and su!se<uently, to conduct a re!idding.
'n K3 Ho. +)5+7, Ca!ian Kenove filed a com#laint for damages
against #etitioners Lamachia, ;elsa, Cartalla and Brascion for his dismissal
as cook in the 4S $ir Corce 3ecreation Center at Cam# .ohn /ay $ir Station
in;aguioCity. 't had !een ascertained after investigation, from the testimony
of ;elsa, Cartalla and Brascion, that Kenove had #oured urine into the sou#
stock used in cooking the vegeta!les served to the clu! customers.
Lamachia, as clu! manager, sus#ended him and thereafter referred the case
to a !oard of ar!itrators conforma!ly to the collective !argaining agreement
!etween the center and its em#loyees. The !oard unanimously found him
guilty and recommended his dismissal. Kenoves reaction was to file his
com#laint against the individual #etitioners.

'n K3 Ho. *77(*, Luis ;autista, who was em#loyed as a !arracks
!oy in Cano B Ionnell, an e"tension of Clark $ir ;as, was arrested following
a !uy!ust o#eration conducted !y the individual #etitioners who are officers
of the 4S $ir Corce and s#ecial agents of the $ir Corce Bffice of S#ecial
'nvestigators. Bn the !asis of the sworn statements made !y them, an
information for violation of 3.$. 658A, otherwise known as the Iangerous
Irugs $ct, was filed against ;autista in the 3TC of Tarlac. Said officers
testified against him at his trial. ;autista was dismissed from his em#loyment.
/e then filed a com#laint against the individual #etitioners claiming that it was
!ecause of their acts that he was removed.
'n K3 Ho. *78A*, a com#laint for damages was filed !y the #rivate
res#ondents against the herein #etitioners 2e"ce#t the4S9, for in:uries
sustained !y the #laintiffs as a result of the acts of the defendants. There is a
conflict of factual allegations here. $ccording to the #laintiffs, the defendants
!eat them u#, handcuffed them and unleashed dogs on them which !it them
in several #arts of their !odies and caused e"tensive in:uries to them. The
defendants deny this and claim that #laintiffs were arrested for theft and were
!itten !y the dogs !ecause they were struggling and resisting arrest. 'n a
motion to dismiss the com#laint, the4S and the individually named
defendants argued that the suit was in effect a suit against the4S, which had
not given its consent to !e sued.
ISS?0. Ehether the defendants were also immune from suit under the 3P
4S ;ases Treaty for acts done !y them in the #erformance of their official
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
-3
St. Marys College of Tagum College of Law Political Law
duties.
B067. The rule that a State may not !e sued without its consent is one of the
generally acce#ted #rinci#les of international law that were have ado#ted as
#art of the law of our land. @ven without such affirmation, we would still !e
!ound !y the generally acce#ted #rinci#les of international law under the
doctrine of incor#oration. 4nder this doctrine, as acce#ted !y the ma:ority of
the states, such #rinci#les are deemed incor#orated in the law of every
civiliDed state as a condition and conse<uence of its mem!ershi# in the
society of nations. $ll states are sovereign e<uals and cannot assert
:urisdiction over one another.
Ehile the doctrine a##ears to #rohi!it only suits against the state
without its consent, it is also a##lica!le to com#laints filed against officials of
the states for acts allegedly #erformed !y them in the discharge of their
duties. The rule is that if the :udgment against such officials will re<uire the
state itself to #erform an affirmative act to satisfy the same, the suit must !e
regarded as against the state although it has not !een formally im#leaded.

Ehen the government enters into a contract, it is deemed to have
descended to the level of the other contracting #arty and divested of its
sovereign immunity from suit with its im#lied consent. 'n the case o4S, the
customary law of international law on state immunity is e"#ressed with more
s#ecificity in the 3P4S ;ases Treaty. There is no <uestion that the4S, like
any other state, will !e deemed to have im#liedly waived its nonsua!ility if it
has entered into a contract in its #ro#rietory or #rivate ca#acity. 't is only when
the contract involves its sovereign or governmental ca#acity that no such
waiver may !e im#lied.
't is clear from a study of the records of K3 Ho. *77(* that the
#etitioners therein were acting in the e"ercise of their official functions when
they conducted the !uy!ust o#erations against the com#lainant and
thereafter testified against him at his trial. 't follows that for discharging their
duties as agents of the4S, they cannot !e directly im#leaded for acts
im#uta!le to their #rinci#al, which has not given its consent to !e sued.
$s for K3 Ho. *77(*, the record is too meager to indicate what really
ha##ened. The needed in<uiry first !e made !y the lower court so it may
assess and resolve the conflicting claims of the #arties on the !asis of
evidence that has yet to !e #resented at the trial.
5ulin%
1) 4S &S K4'HTB 2K3 Ho +667+9
The court finds the !ar!ersho#s su!:ect to the concessions granted
!y the 4S government to !e commercial enter#rises o#erated !y #rivate
#ersons. The #etitioners cannot #lead any immunity from the com#laint, the
contract in <uestion !eing decidedly commercial. Thus, the #etition is
I'SM'SS@I and the lower court directed to #roceed with the hearing and
decision of the case.
2) 4S &S 3BI3'KB 2K3 Ho +)5+79
The restaurant services offered at the .ohn /ay Station o#erated for
#rofit as a commercial and not a government activity. The #etitioners cannot
invoke the doctrine of self immunity to :ustify the dismissal of the damage suit
filed !y Kenove. Hot even the 4S government can claim such immunity
!ecause !y entering into the em#loyment contract with Keneove in the
discharge of its #ro#rietary functions, it im#liedly divested itself of its
sovereign immunity from suit.
Still, the court holds that the com#laint against #etitioners in the lower
court !e dismissed. There was nothing ar!itrary a!out the #roceedings in the
dismissal of Kenove, the #etitioner acted <uite #ro#erly in terminating the
#rivate res#ondents em#loyment for his un!elieva!ly nauseating act of
#olluting the sou# stock with urine.
3) 4S &S C@;$LLBS 2K3 Ho *77(*9
't was clear that the individuallynamed #etitioners were acting in the
e"ercise of their official functions when they conducted the !uy!ust o#eration
and thereafter testified against the com#lainant. Cor discharging their duties
as agents of the 4nited States, thay cannot !e directly im#leaded for acts
im#uta!le to their #rinci#al, which has not given its consent to !e sued. The
conclusion of the trial court that the answer filed !y the s#ecial counsel of
Clark $ir ;ase was a su!mission of the 4S government to its :urisdiction is
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
-3
St. Marys College of Tagum College of Law Political Law
re:ected. @"#ress waiver cannot !e made !y a mere counsel of the
government !ut must !e effected through a dulyenacted statute. Heither
does it come under the im#lied form of consent. Thus, the #etition is granted
and the civil case filed in the lower court dismissed.
4) 4S &S $L$3CBH &@3K$3$ 2K3 Ho *78A*9
The contradictory factual allegations in this case need a closer study
of what actually ha##ened. The record were too meager to indicate that the
defendants were really discharging their official duties or had actually
e"ceeded their authority when the incident occurred. Bnly after the lower
court shall have determined in what ca#acity the #etitioners were acting will
the court determine, if still necessary, if the doctrine of state immunity is
a##lica!le.
3e#u!lic of the Phili##ines
S?P50M0 C8?5T
Manila
S@CBHI I'&'S'BH
G.5. !o. 6@449:3 7ece'*er 1) 1989
SP8?S0S 28S0 18!TA!I66A A!7 VI5GI!IA 18!TA!I66A) #etitioners,
vs.
B8!85A"60 I!8C0!CI8 7. MA6IAMA! an# !ATI8!A6 I55IGATI8!
A7MI!IST5ATI8!) res#ondents.
G.5. !o. 6@:1A34 7ece'*er 1) 1989
!ATI8!A6 I55IGATI8! A7MI!IST5ATI8!) a##ellant,
vs.
SP8?S0S 28S0 18!TA!I66A an# VI5GI!IA 18!TA!I66A) a##ellees.
Cecilio &. 6uarez, "r. *or 6pouses >ontanilla.
>elicisimo C. &illa*lor *or $)+.

PA5AS) J.:
'n K.3. Ho. LAA)6-, the #etition for review on certiorari seeks the affirmance
of the decision dated March 87, ()*7 of the then Court of Cirst 'nstance of
Hueva @ci:a, ;ranch &''', at San .ose City and its modification with res#ect to
the denial of #etitionerPs claim for moral and e"em#lary damages and
attorneys fees.
'n K.3. Ho. 6(75A, res#ondent Hational 'rrigation $dministration seeks the
reversal of the aforesaid decision of the lower court. The original a##eal of
this case !efore the Court of $##eals was certified to this Court and in the
resolution of .uly +, ()*8, it was docketed with the aforecited num!er. $nd in
the resolution of $#ril -, this case was consolidated with K.3. Ho. AA)6-.
't a##ears that on $ugust 8(, ()+6 at a!out 6,-7 P.M., a #icku# owned and
o#erated !y res#ondent Hational 'rrigation $dministration, a government
agency !earing Plate Ho. 'H6A(, then driven officially !y /ugo Karcia, an
em#loyee of said agency as its regular driver, !um#ed a !icycle ridden !y
Crancisco Contanilla, son of herein #etitioners, and 3estituto Ieligo, at
Maasin, San .ose City along the Maharlika /ighway. $s a result of the
im#act, Crancisco Contanilla and 3estituto Ieligo were in:ured and !rought to
the San .ose City @mergency /os#ital for treatment. Contanilla was later
transferred to the Ca!anatuan Provincial /os#ital where he died.
Karcia was then a regular driver of res#ondent Hational 'rrigation
$dministration who, at the time of the accident, was a licensed #rofessional
driver and who <ualified for em#loyment as such regular driver of res#ondent
after having #assed the written and oral e"aminations on traffic rules and
maintenance of vehicles given !y Hational 'rrigation $dministration
authorities.
The within #etition is thus an offshot of the action 2Civil Case Ho. S.CA69
instituted !y #etitionerss#ouses on $#ril (+, ()+* against res#ondent H'$
!efore the then Court of Cirst 'nstance of Hueva @ci:a, ;ranch &''' at San
.ose City, for damages in connection with the death of their son resulting from
the aforestated accident.
$fter trial, the trial court rendered :udgment on March 87, ()*7 which directed
res#ondent Hational 'rrigation $dministration to #ay damages 2death !enefits9
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
-4
St. Marys College of Tagum College of Law Political Law
and actual e"#enses to #etitioners. The dis#ositive #ortion of the decision
reads thus,
. . . . . .udgment is here rendered ordering the defendant
Hational 'rrigation $dministration to #ay to the heirs of the
deceased P(8,777.77 for the death of Crancisco Contanilla?
P-,-*).77 which the #arents of the deceased had s#ent for
the hos#italiDation and !urial of the deceased Crancisco
Contanilla? and to #ay the costs. 2;rief for the #etitioners
s#ouses Contanilla, #. 5? 3ollo, #. (-89
3es#ondent Hational 'rrigation $dministration filed on $#ril 8(, ()*7, its
motion for reconsideration of the aforesaid decision which res#ondent trial
court denied in its Brder of .une (-, ()*7. 3es#ondent Hational 'rrigation
$dministration thus a##ealed said decision to the Court of $##eals 2C.$.K.3.
Ho. 6+8-+ 39 where it filed its !rief for a##ellant in su##ort of its #osition.
'nstead of filing the re<uired !rief in the aforecited Court of $##eals case,
#etitioners filed the instant #etition with this Court.
The sole issue for the resolution of the Court is, Ehether or not the award of
moral damages, e"em#lary damages and attorneyPs fees is legally #ro#er in a
com#laint for damages !ased on <uasidelict which resulted in the death of
the son of herein #etitioners.
Petitioners allege,
(. The award of moral damages is s#ecifically allowa!le.
under #aragra#h - of $rticle 8876 of the Hew Civil Code
which #rovides that the s#ouse, legitimate and illegitimate
descendants and ascendants of the deceased may demand
moral damages for mental anguish !y reason of the death of
the deceased. Should moral damages !e granted, the award
should !e made to each of #etitioners
s#ouses individually and in varying amounts de#ending u#on
#roof of mental and de#th of intensity of the same, which
should not !e less than PA7,777.77 for each of them.
8. The decision of the trial court had made an im#ression that
res#ondent Hational 'rrigation $dministration acted with gross
negligence !ecause of the accident and the su!se<uent
failure of the Hational 'rrigation $dministration #ersonnel
including the driver to sto# in order to give assistance to the,
victims. Thus, !y reason of the gross negligence of
res#ondent, #etitioners !ecome entitled to e"em#lary
damages under $rts. 88-( and 888) of the Hew Civil Code.
-. Petitioners are entitled to an award of attorneyPs fees, the
amount of which 287O9 had !een sufficiently esta!lished in
the hearing of May 8-, ()+).
5. This #etition has !een filed only for the #ur#ose of
reviewing the findings of the lower court u#on which the
disallowance of moral damages, e"em#lary damages and
attorneyPs fees was !ased and not for the #ur#ose of
distur!ing the other findings of fact and conclusions of law.
The Solicitor Keneral, taking u# the cudgels for #u!lic res#ondent Hational
'rrigation $dministration, contends thus,
(. The filing of the instant #etition is rot #ro#er in view of the
a##eal taken !y res#ondent Hational 'rrigation $dministration
to the Court of $##eals against the :udgment sought to !e
reviewed. The focal issue raised in res#ondentPs a##eal to
the Court of $##eals involves the <uestion as to whether or
not the driver of the vehicle that !um#ed the victims was
negligent in his o#eration of said vehicle. 't thus !ecomes
necessary that !efore #etitionersP claim for moral and
e"em#lary damages could !e resolved, there should first !e a
finding of negligence on the #art of res#ondentPs em#loyee
driver. 'n this regard, the Solicitor Keneral alleges that the
trial court decision does not categorically contain such
finding.
8. The filing of the S$##earance and 4rgent Motion Cor Leave
to Cile Plaintiff$##elleePs ;riefS dated Iecem!er 8*, ()*( !y
#etitioners in the a##eal 2C$K.3. Ho. 6+8-+3? and K. 3.
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
-:
St. Marys College of Tagum College of Law Political Law
Ho.6(75A9 of the res#ondent Hational 'rrigation
$dministration !efore the Court of $##eals, is an e"#licit
admission of said #etitioners that the herein #etition, is not
#ro#er. 'nconsistent #rocedures are manifest !ecause while
#etitioners <uestion the findings of fact in the Court of
$##eals, they #resent only the <uestions of law !efore this
Court which #osture confirms their admission of the facts.
-. The fact that the #arties failed to agree on whether or not
negligence caused the vehicular accident involves a <uestion
of fact which #etitioners should have !rought to the Court of
$##eals within the reglementary #eriod. /ence, the decision
of the trial court has !ecome final as to the #etitioners and for
this reason alone, the #etition should !e dismissed.
5. 3es#ondent .udge acted within his :urisdiction, sound
discretion and in conformity with the law.
A. 3es#ondents do not assail #etitionersP claim to moral and
e"em#lary damages !y reason of the shock and su!se<uent
illness they suffered !ecause of the death of their son.
3es#ondent Hational 'rrigation $dministration, however,
avers that it cannot !e held lia!le for the damages !ecause it
is an agency of the State #erforming governmental functions
and driver /ugo Karcia was a regular driver of the vehicle,
not a s#ecial agent who was #erforming a :o! or act foreign to
his usual duties. /ence, the lia!ility for the tortious act
should. not !e !orne !y res#ondent government agency !ut
!y driver Karcia who should answer for the conse<uences of
his act.
6. @ven as the trial court touched on the failure or la"ity of
res#ondent Hational 'rrigation $dministration in e"ercising
due diligence in the selection and su#ervision of its
em#loyee, the matter of due diligence is not an issue in this
case since driver Karcia was not its s#ecial agent !ut a
regular driver of the vehicle.
The sole legal <uestion on whether or not #etitioners may !e entitled to an
award of moral and e"em#lary damages and attorneyPs fees can very well !e
answered with the a##lication of $rts. 8(+6 and 8(*7 of theHew Civil Code.
$rt. 8(+6 thus #rovides,
Ehoever !y act omission causes damage to another, there
!eing fault or negligence, is o!liged to #ay for damage done.
Such fault or negligence, if there is no #ree"isting cotractual
relation !etween the #arties, is called a <uasidelict and is
governed !y the #rovisions of this Cha#ter
Paragra#hs A and 6 of $rt. 8( *7 read as follows,
@m#loyers shall !e lia!le for the damages caused !y their
em#loyees and household hel#ers acting within the sco#e of
their assigned tasks, even the though the former are not
engaged in any !usiness or industry.
The State is res#onsi!le in like manner when it acts through a
s#ecial agent.? !ut not when the damage has !een caused !y
the official to whom the task done #ro#erly #ertains, in which
case what is #rovided in $rt. 8(+6 shall !e a##lica!le.
The lia!ility of the State has two as#ects. namely,
(. 'ts #u!lic or governmental as#ects where it is lia!le for the
tortious acts of s#ecial agents only.
8. 'ts #rivate or !usiness as#ects 2as when it engages in
#rivate enter#rises9 where it !ecomes lia!le as an ordinary
em#loyer. 2#. )6(, Civil Code of the Phili##ines? $nnotated,
Paras? .-74 ?d. 9.
'n this :urisdiction, the State assumes a limited lia!ility for the damage caused
!y the tortious acts or conduct of its s#ecial agent.
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
-7
St. Marys College of Tagum College of Law Political Law
4nder the afore<uoted #aragrah 6 of $rt. 8(*7, the State has voluntarily
assumed lia!ility for acts done through s#ecial agents. The StatePs agent, if a
#u!lic official, must not only !e s#ecially commissioned to do a #articular task
!ut that such task must !e foreign to said officialPs usual governmental
functions. 'f the StatePs agent is not a #u!lic official, and is commissioned to
#erform nongovernmental functions, then the State assumes the role of an
ordinary em#loyer and will !e held lia!le as such for its agentPs tort. Ehere
the government commissions a #rivate individual for a s#ecial governmental
task, it is acting through a s#ecial agent within the meaning of the #rovision.
2Torts and Iamages, Sangco, #. -5+, ()*5 @d.9
Certain functions and activities, which can !e #erformed only !y the
government, are more or less generally agreed to !e SgovernmentalS in
character, and so the State is immune from tort lia!ility. Bn the other hand, a
service which might as well !e #rovided !y a #rivate cor#oration, and
#articularly when it collects revenues from it, the function is considered a
S#ro#rietaryS one, as to which there may !e lia!ility for the torts of agents
within the sco#e of their em#loyment.
The Hational 'rrigation $dministration is an agency of the government
e"ercising #ro#rietary functions, !y e"#ress #rovision of 3e#. $ct Ho. -67(.
Section ( of said $ct #rovides,
Section (. Hame and domicile.$ body corporate is here!y
created which shall !e known as the Hational 'rrigation
$dministration, hereinafter called the H'$ for short, which
shall !e organiDed immediately after the a##roval of this $ct.
't shall have its #rinci#al seat of !usiness in the City of Manila
and shall have re#resentatives in all #rovinces for the #ro#er
conduct of its !usiness.
Section 8 of said law s#ells out some of the H'$Ps #ro#rietary functions. Thus
Sec. 8. Powers and ob=ectives.The H'$ shall have the
following #owers and o!:ectives,
2a9 " " " " " " " " " " " " " " " " " "
2!9 " " " " " " " " " " " " " " " " " "
2c9 To collect from the users of each irrigation system
constructed !y it such fees as may !e necessary to finance
the continuous o#eration of the system and reim!urse within
a certain #eriod not less than twentyfive years cost of
construction thereof? and
2d9 To do all such other tthings and to transact all such
!usiness as are directly or indirectly necessary, incidental or
conducive to the attainment of the a!ove o!:ectives.
'ndu!ita!ly, the H'$ is a government cor#oration with :uridical #ersonality and
not a mere agency of the government. Since it is a cor#orate !ody #erforming
nongovernmental functions, it now !ecomes lia!le for the damage caused !y
the accident resulting from the tortious act of its driverem#loyee. 'n this
#articular case, the H'$ assumes the res#onsi!ility of an ordinary em#loyer
and as such, it !ecomes answera!le for damages.
This assum#tion of lia!ility, however, is #redicated u#on the e"istence of
negligence on the #art of res#ondent H'$. The negligence referred to here is
the negligence of su#ervision.
$t this :uncture, the matter of due diligence on the #art of res#ondent H'$
!ecomes a crucial issue in determining its lia!ility since it has !een
esta!lished that res#ondent is a government agency #erforming #ro#rietary
functions and as such, it assumes the #osture of an ordinary em#loyer which,
under Par. A of $rt. 8(*7, is res#onsi!le for the damages caused !y its
em#loyees #rovided that it has failed to o!serve or e"ercise due diligence in
the selection and su#ervision of the driver.
't will !e noted from the assailed decision of the trial court that Sas a result of
the im#act, Crancisco Contanilla wasthrown to a distance 20 meters away
*rom the point o* impact while 3estituto Ieligo was thrown a little !it further
away. The im#act took #lace almost at the edge of the cemented #ortion of
the road.S 2@m#hasis su##lied,9 0#age 86, 3ollo1
The lower court further declared that Sa s#eeding vehicle coming in contact
with a #erson causes force and im#act u#on the vehicle that anyone in the
vehicle cannot fail to notice. $s a matter of fact, the im#act was so strong as
shown !y the fact that the vehicle su**ered dents on the ri%ht side o* the
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
-8
St. Marys College of Tagum College of Law Political Law
radiator %uard, the hood, the *ender and a crack on the radiator as shown by
the investi%ation report 2@"hi!it S@S9. 2@m#hasis su##lied9 0#age 8), 3ollo1
't should !e em#hasiDed that the accident ha##ened along the Maharlika
Hational 3oad within the city limits of San .ose City, an ur!an area.
Considering the fact that the victim was thrown A7 meters away from the #oint
of im#act, there is a strong indication that driver Karcia was driving at a high
s#eed. This is confirmed !y the fact that the #icku# suffered su!stantial and
heavy damage as a!ovedescri!ed and the fact that the H'$ grou# was then
Sin a hurry to reach the cam#site as early as #ossi!leS, as shown !y their not
sto##ing to find out what they !um#ed as would have !een their normal and
initial reaction.
@vidently, there was negligence in the su#ervision of the driver for the reason
that they were travelling at a high s#eed within the city limits and yet the
su#ervisor of the grou#, @ly Salonga, failed to caution and make the driver
o!serve the #ro#er and allowed s#eed limit within the city. 4nder the
situation, such negligence is further aggravated !y their desire to reach their
destination without even checking whether or not the vehicle suffered damage
from the o!:ect it !um#ed, thus showing im#rudence and reckelessness on
the #art of !oth the driver and the su#ervisor in the grou#.
Significantly, this Court has ruled that even if the em#loyer can #rove the
diligence in the selection and su#ervision 2the latter as#ect has not !een
esta!lished herein9 of the em#loyee, still if he ratifies the wrongful acts, or
take no ste# to avert further damage, the em#loyer would still !e lia!le.
2Ma"ion vs. Manila 3ailroad Co., 55 Phil. A)+9.
Thus, too, in the case of &da. de ;onifacio vs. ;.L.T. ;us Co. 2L86*(7,
$ugust -(, ()+7, -5 SC3$ 6(*9, this Court held that a driver should !e
es#ecially watchful in antici#ation of others who may !e using the highway,
and his failure to kee# a #ro#er look out for reasons and o!:ects in the line to
!e traversed constitutes negligence.
Considering the foregoing, res#ondent H'$ is here!y directed to #ay herein
#etitionerss#ouses the amounts of P(8,777.77 for the death of Crancisco
Contanilla? P-,-*).77 for hos#italiDation and !urial e"#enses of the
aforenamed deceased? P-7,777.77 as moral damages? P*,777.77 as
e"em#lary damages and attorneyPs fees of 87O of the total award.
SB B3I@3@I.
7IG0ST.
C$CTS, Hational 'rrigation $dministration 2H'$9, a government agency, was
held lia!le for damages resulting to the death of the son of herein #etitioner
s#ouses caused !y the fault andUor negligence of the driver of the said
agency. H'$ maintains that it is not lia!le for the act of its driver !ecause the
former does not #erform #rimarily #ro#rietorshi# functions !ut governmental
functions.
'SS4@, Ehether or not H'$ may !e held lia!le for damages caused !y its
driver.
/@LI, Tes. H'$ is a government agency with a cor#orate #ersonality
se#arate and distinct from the government, !ecause its community services
are only incidental functions to the #rinci#al aim which is irrigation of lands,
thus, making it an agency with #ro#rietary functions governed !y Cor#oration
Law and is lia!le for actions of their em#loyees.
TBI57 7IVISI8!
FG.5. !o. 1493A-) 1e*ruar -3) -A11G
AI5 T5A!SP85TATI8! 811IC0) P0TITI8!05) VS. SP8?S0S
7AVI7
H
A!7 06IS0A 5AM8S) 50SP8!70!TS.
7 0 C I S I 8 !
"05SAMI!) 2..
The StatePs immunity from suit does not e"tend to the #etitioner !ecause it is
an agency of the State engaged in an enter#rise that is far from !eing the
StatePs e"clusive #rerogative.
4nder challenge is the decision #romulgated on May (5, 877-,
0(1
!y which the
Court of $##eals 2C$9 affirmed with modification the decision rendered on
Ce!ruary 8(, 877( !y the 3egional Trial Court, ;ranch 6( 23TC9, in ;aguio
City in favor of the res#ondents.
081
Antece#ents
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
-9
St. Marys College of Tagum College of Law Political Law
S#ouses Iavid and @lisea 3amos 2res#ondents9 discovered that a #ortion of
their land registered under Transfer Certificate of Title Ho. TA**)5 of the
;aguio City land records with an area of )*A s<uare meters, more or less,
was !eing used as #art of the runway and running shoulder of the Loakan
$ir#ort !eing o#erated !y #etitioner $ir Trans#ortation Bffice 2$TB9. Bn
$ugust ((, ())A, the res#ondents agreed after negotiations to convey the
affected #ortion !y deed of sale to the $TB in consideration of the amount of
P++*,(A7.77. /owever, the $TB failed to #ay des#ite re#eated ver!al and
written demands.
Thus, on $#ril 8), ())*, the res#ondents filed an action for collection against
the $TB and some of its officials in the 3TC 2docketed as Civil Case Ho.
57(+3 and entitled 6pouses !avid and ?lisea Ramos v. +ir ,ransportation
;**ice, Capt. Pan*ilo &illaruel, Den. Carlos ,ane%a, and #r. Cesar de "esus9.
'n their answer, the $TB and its codefendants invoked as an affirmative
defense the issuance of Proclamation Ho. (-A*, where!y President Marcos
had reserved certain #arcels of land that included the res#ondentsP affected
#ortion for use of the Loakan $ir#ort. They asserted that the 3TC had no
:urisdiction to entertain the action without the StatePs consent considering that
the deed of sale had !een entered into in the #erformance of governmental
functions.
Bn Hovem!er (7, ())*, the 3TC denied the $TBPs motion for a #reliminary
hearing of the affirmative defense.
$fter the 3TC likewise denied the $TBPs motion for reconsideration on
Iecem!er (7, ())*, the $TB commenced a s#ecial civil action
for certiorari in the C$ to assail the 3TCPs orders. The C$ dismissed the
#etition for certiorari, however, u#on its finding that the assailed orders were
not tainted with grave a!use of discretion.
0-1
Su!se<uently, Ce!ruary 8(, 877(, the 3TC rendered its decision on the
merits,
051
dis#osing,
E/@3@CB3@, the :udgment is rendered B3I@3'HK the defendant $ir
Trans#ortation Bffice to #ay the #laintiffs I$&'I and @L'S@$ 3$MBS the
following, 2(9 The amount of P++*,(A7.77 !eing the value of the #arcel of land
a##ro#riated !y the defendant $TB as em!odied in the Ieed of Sale, #lus an
annual interest of (8O from $ugust ((, ())A, the date of the Ieed of Sale
until fully #aid? 289 The amount of P(A7,777.77 !y way of moral damages and
P(A7,777.77 as e"em#lary damages? 2-9 the amount of PA7,777.77 !y way of
attorneyPs fees #lus P(A,777.77 re#resenting the (7, more or less, court
a##earances of #laintiffPs counsel? 259 The costs of this suit.
SB B3I@3@I.
'n due course, the $TB a##ealed to the C$, which affirmed the 3TCPs
decision on May (5, 877-,
0A1
viz,
'H &'@E BC $LL T/@ CB3@KB'HK, the a##ealed decision is here!y
$CC'3M@I, with MBI'C'C$T'BH that the awarded cost therein is deleted,
while that of moral and e"em#lary damages is reduced to P-7,777.77 each,
and attorneyPs fees is lowered to P(7,777.77.
Ho cost.
SB B3I@3@I.
/ence, this a##eal !y #etition for review on certiorari.
Issue
The only issue #resented for resolution is whether the $TB could !e sued
without the StatePs consent.
5ulin%
The #etition for review has no merit.
The immunity of the State from suit, known also as the doctrine of sovereign
immunity or nonsua!ility of the State, is e"#ressly #rovided in $rticle %&' of
the ()*+ Constitution, viz,
Section -. The State may not !e sued without its consent.
The immunity from suit is !ased on the #olitical truism that the State, as a
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
3A
St. Marys College of Tagum College of Law Political Law
sovereign, can do no wrong. Moreover, as the eminent .ustice /olmes said
inKawananakoa v. Polyblank:
061
The territory 0of /awaii1, of course, could waive its e"em#tion 2Smith v.
3eeves, (+* 4S 5-6, 55 L ed ((57, 87 Su#. Ct. 3e#. )()9, and it took no
o!:ection to the #roceedings in the cases cited if it could have done so. """
;ut in the case at !ar it did o!:ect, and the <uestion raised is whether the
#laintiffs were !ound to yield. Some dou!ts have !een e"#ressed as to the
source of the immunity of a sovereign #ower from suit without its own
#ermission, !ut the answer has !een #u!lic #ro#erty since !efore the days of
/o!!es. Leviathan, cha#. 86, 8. A soverei%n is e&e'(t fro' suit) not
*ecause of an for'al conce(tion or o*solete theor) *ut on the lo%ical
an# (ractical %roun# that there can *e no le%al ri%ht as a%ainst the
authorit that 'a+es the la, on ,hich the ri%ht #e(en#s. SCar on peut
bien recevoir loy dFautruy, mais il est impossible par nature de se donner loy.S
;odin, Republiue, (, cha#. *, ed. (68), #. (-8? Sir .ohn @liot, !e "ure
#aiestatis, cha#. -. $emo suo statuto li%atur necessitative. ;aldus, !e Le%.
et Const. !i%na &o', 8. ed. (5)6, fol. A(!, ed. (A-), fol. 6(.
0+1
Practical considerations dictate the esta!lishment of an immunity from suit in
favor of the State. Btherwise, and the State is sua!le at the instance of every
other individual, government service may !e severely o!structed and #u!lic
safety endangered !ecause of the num!er of suits that the State has to
defend against.
0*1
Several :ustifications have !een offered to su##ort the
ado#tion of the doctrine in the Phili##ines, !ut that offered in Providence
(ashin%ton )nsurance Co. v. Republic o* the Philippines
0)1
is Sthe most
acce#ta!le e"#lanation,S according to Cather ;ernas, a recogniDed
commentator on Constitutional Law,
0(71
to wit,
0$1 continued adherence to the doctrine of nonsua!ility is not to !e de#lored
for as against the inconvenience that may !e caused #rivate #arties, the loss
of governmental efficiency and the o!stacle to the #erformance of its
multifarious functions are far greater if such a fundamental #rinci#le were
a!andoned and the availa!ility of :udicial remedy were not thus restricted.
Eith the wellknown #ro#ensity on the #art of our #eo#le to go to court, at the
least #rovocation, the loss of time and energy re<uired to defend against law
suits, in the a!sence of such a !asic #rinci#le that constitutes such an
effective o!stacle, could very well !e imagined.
$n unincor#orated government agency without any se#arate :uridical
#ersonality of its own en:oys immunity from suit !ecause it is invested with an
inherent #ower of sovereignty. $ccordingly, a claim for damages against the
agency cannot #ros#er? otherwise, the doctrine of sovereign immunity is
violated.
0((1
/owever, the need to distinguish !etween an unincor#orated
government agency #erforming governmental function and one #erforming
#ro#rietary functions has arisen. The immunity has !een u#held in favor of the
former !ecause its function is governmental or incidental to such function?
0(81
it
has not !een u#held in favor of the latter whose function was not in #ursuit of
a necessary function of government !ut was essentially a !usiness.
0(-1
Should the doctrine of sovereignty immunity or nonsua!ility of the State !e
e"tended to the $TBF
'n its challenged decision,
0(51
the C$ answered in the negative, holding,
Bn the first assignment of error, a##ellants seek to im#ress u#on 4s that the
su!:ect contract of sale #artook of a governmental character. +propos, the
lower court erred in a##lying the /igh CourtPs ruling in $ational +irports
Corporation vs. ,eodoro 2-. Phil. /01 0.-2/19, arguing that in ,eodoro, the
matter involved the collection of landing and #arking fees which is a
#ro#rietary function, while the case at !ar involves the maintenance and
o#eration of aircraft and air navigational facilities and services which are
governmental functions.
Ee are not #ersuaded.
Contrary to a##ellantsP conclusions, it was not merely the collection of landing
and #arking fees which was declared as #ro#rietary in nature !y the /igh
Court in ,eodoro, !ut management and maintenance of air#ort o#erations as
a whole, as well. Thus, in the much later case of Civil +eronautics
+dministration vs. Court o* +ppeals 3.45 6CR+ /7 8.-779:, the Su#reme
Court, reiterating the #ronouncements laid down in,eodoro, declared that the
C$$ 2#redecessor of +,;9 is an agency not immune from suit, it !eing
engaged in functions #ertaining to a #rivate entity. 't went on to e"#lain in this
wise,
" " "
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
31
St. Marys College of Tagum College of Law Political Law
The Civil $eronautics $dministration comes under the category of a #rivate
entity. $lthough not a !ody cor#orate it was created, like the Hational $ir#orts
Cor#oration, not to maintain a necessary function of government, !ut to run
what is essentially a !usiness, even if revenues !e not its #rime o!:ective !ut
rather the #romotion of travel and the convenience of the travelling #u!lic. 't
is engaged in an enter#rise which, far from !eing the e"clusive #rerogative of
state, may, more than the construction of #u!lic roads, !e undertaken !y
#rivate concerns. 0Hational $ir#orts Cor#. v. Teodoro,supra, #. 87+.1
" " "
True, the law #revailing in ()A8 when the ,eodorocase was #romulgated was
@"ec. Brder -6A 23eorganiDing the Civil $eronautics $dministration and
$!olishing the Hational $ir#orts Cor#oration9. 3e#u!lic $ct Ho. ++6 2Civil
$eronautics $ct of the Phili##ines9, su!se<uently enacted on .une 87, ()A8,
did not alter the character of the C$$Ps o!:ectives under @"ec. Brder -6A.
The #ertinent #rovisions cited in the ,eodoro case, #articularly Secs. - and 5
of @"ec. Brder -6A, which led the Court to consider the C$$ in the category
of a #rivate entity were retained su!stantially in 3e#u!lic $ct ++6, Sec. -82859
and 28A9. Said $ct #rovides,
Sec. -8. Powers and !uties o* the +dministrator. Su!:ect to the general
control and su#ervision of the Ie#artment /ead, the $dministrator shall have
among others, the following #owers and duties,
" " "
2859 ,o administer, operate, mana%e, control, maintain and develop the
#anila )nternational +irport and all %overnment<owned aerodromes e"ce#t
those controlled or o#erated !y the $rmed Corces of the Phili##ines including
such #owers and duties as, 2a9 to #lan, design, construct, e<ui#, e"#and,
im#rove, re#air or alter aerodromes or such structures, im#rovement or air
navigation facilities? 2!9 to enter into, make and e"ecute contracts of any kind
with any #erson, firm, or #u!lic or #rivate cor#oration or entity? ...
28A9 To determine, fi", im#ose, collect and receive landing fees, #arking
s#ace fees, royalties on sales or deliveries, direct or indirect, to any aircraft for
its use of aviation gasoline, oil and lu!ricants, s#are #arts, accessories and
su##lies, tools, other royalties, fees or rentals for the use of any of the
#ro#erty under its management and control.
" " "
Crom the foregoing, it can !e seen that the C$$ is tasked with #rivate or non
governmental functions which o#erate to remove it from the #urview of the
rule on State immunity from suit. Cor the correct rule as set forth in
the ,eodoro case states,
" " "
Hot all government entities, whether cor#orate or noncor#orate, are immune
from suits. )mmunity *rom suits is determined by the character o* the ob=ects
*or which the entity was or%anized. The rule is thus stated in Cor#us .uris,
Suits against State agencies with relation to matters in which they have
assumed to act in #rivate or nongovernmental ca#acity, and various suits
against certain cor#orations created !y the state for #u!lic #ur#oses, !ut to
engage in matters #artaking more of the nature of ordinary !usiness rather
than functions of a governmental or #olitical character, are not regarded as
suits against the state. The latter is true, although the state may own stock or
#ro#erty of such a cor#oration for !y engaging in !usiness o#erations through
a cor#oration, the state divests itself so far of its sovereign character, and !y
im#lication consents to suits against the cor#oration. 2A) C..., -(-9 0Hational
$ir#orts Cor#oration v. Teodoro, supra,##. 87687+? 'talics su##lied.1
This doctrine has !een reaffirmed in the recent case of #alon% v. Philippine
$ational Railways 0K.3. Ho. L5))-7, $ugust +, ()*A, (-* SC3$ 6-1, where
it was held that the Phili##ine Hational 3ailways, although owned and
o#erated !y the government, was not immune from suit as it does not
e"ercise sovereign !ut #urely #ro#rietary and !usiness functions.
$ccordingly, as the C$$ was created to undertake the management of air#ort
o#erations which #rimarily involve #ro#rietary functions, it cannot avail of the
immunity from suit accorded to government agencies #erforming strictly
governmental functions.
0(A1
'n our view, the C$ there!y correctly a##reciated the :uridical character of the
$TB as an agency of the Kovernment not per*ormin% a purely %overnmental
or soverei%n *unction, !ut was instead involved in the management and
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
3-
St. Marys College of Tagum College of Law Political Law
maintenance of the Loakan $ir#ort, an activity that was not the e"clusive
#rerogative of the State in its sovereign ca#acity. /ence, the $TB had no
claim to the StatePs immunity from suit. Ee u#hold the C$Ps afore<uoted
holding.
Ee further o!serve the doctrine of sovereign immunity cannot !e successfully
invoked to defeat a valid claim for com#ensation arising from the taking
without :ust com#ensation and without the #ro#er e"#ro#riation #roceedings
!eing first resorted to of the #laintiffsP #ro#erty.
0(61
Thus, in !e los 6antos v.
)ntermediate +ppellate Court,
0(+1
the trial courtPs dismissal !ased on the
doctrine of nonsua!ility of the State of two cases 2one of which was for
damages9 filed !y owners of #ro#erty where a road ) meters wide and (8*.+7
meters long occu#ying a total area of (,(6A s<uare meters and an artificial
creek 8-.87 meters wide and (8*.6) meters long occu#ying an area of 8,)76
s<uare meters had !een constructed !y the #rovincial engineer of 3iDal and a
#rivate contractor without the ownersP knowledge and consent was reversed
and the cases remanded for trial on the merits. The Su#reme Court ruled that
the doctrine of sovereign immunity was not an instrument for #er#etrating any
in:ustice on a citiDen. 'n e"ercising the right of eminent domain, the Court
e"#lained, the State e"ercised its =us imperii, as distinguished from its
#ro#rietary rights, or =us %estionis? yet, even in that area, where #rivate
#ro#erty had !een taken in e"#ro#riation without :ust com#ensation !eing
#aid, the defense of immunity from suit could not !e set u# !y the State
against an action for #ayment !y the owners.
Lastly, the issue of whether or not the $TB could !e sued without the StatePs
consent has !een rendered moot !y the #assage of 3e#u!lic $ct Ho.
)5)+,otherwise known as the Civil +viation +uthority +ct o* /007.
3.$. Ho. )5)+ a!olished the $TB, to wit,
Section 5. Creation o* the +uthority. There is here!y created an inde#endent
regulatory !ody with <uasi:udicial and <uasilegislative #owers and
#ossessing cor#orate attri!utes to !e known as the Civil $viation $uthority of
the Phili##ines 2C$$P9, herein after referred to as the S$uthorityS attached to
the Ie#artment of Trans#ortation and Communications 2IBTC9 for the
#ur#ose of #olicy coordination. 1or this (ur(ose) the e&istin% Air
trans(ortation 8ffice create# un#er the (rovisions of 5e(u*lic Act !o.
77:) as a'en#e# is here* a*olishe#.
" " "
4nder its Transitory Provisions, 3.$. Ho. )5)+ esta!lished in #lace of the
$TB the Civil $viation $uthority of the Phili##ines 2C$$P9, which there!y
assumed all of the $TBPs #owers, duties and rights, assets, real and #ersonal
#ro#erties, funds, and revenues, viz,
C/$PT@3 %''
T3$HS'TB3TT P3B&'S'BHS
Section *A. +bolition o* the +ir ,ransportation ;**ice. The $ir Trans#ortation
Bffice 2$TB9 created under 3e#u!lic $ct Ho. ++6, a sectoral office of the
Ie#artment of Trans#ortation and Communications 2IBTC9, is here!y
a!olished.
All (o,ers) #uties an# ri%hts vested !y law and e"ercised * the
AT8 is here!y transferre# to the Authorit.
All assets) real an# (ersonal (ro(erties) fun#s an# revenues owned !y or
vested in the different offices of the AT8 are transferre# to the
Authorit. All contracts) recor#s an# #ocu'ents relatin% to the
o(erations of the a*olishe# a%encand its offices and !ranches are
likewise transferre# to the Authorit. An real (ro(ert o,ne# * the
national %overn'ent or %overn'ent@o,ne# cor(oration or
authoritwhich is *ein% use# an# utili9e# as office or facility * the
AT8shall !e transferre# an# title# in favor of the Authorit.
Section 8- of 3.$. Ho. )5)+ enumerates the cor#orate #owers vested in the
C$$P, including the #ower to sue and !e sued, to enter into contracts of
every class, kind and descri#tion, to construct, ac<uire, own, hold, o#erate,
maintain, administer and lease #ersonal and real #ro#erties, and to settle,
under such terms and conditions most advantageous to it, any claim !y or
against it.
0(*1
Eith the C$$P having legally succeeded the $TB #ursuant to 3.$. Ho. )5)+,
the o!ligations that the $TB had incurred !y virtue of the deed of sale with the
3amos s#ouses might now !e enforced against the C$$P.
$B0501850, the Court denies the #etition for review on certiorari, and
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
33
St. Marys College of Tagum College of Law Political Law
affirms the decision #romulgated !y the Court of $##eals.
Ho #ronouncement on costs of suit.
S8 8570507.
$
d

$
u
"
i
l
i
u
m

&
o
c
a
t
u
s

G

S
.
;
P
r
i
o
r
33