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G.R. No.

L-21484

November 29, 1969

THE AGRICULTURAL CREDIT and COOPERATIVE FINANCING ADMINISTRATION (ACCFA), petitioner, vs. ACCFA SUPERVISORS' ASSOCIATION, ACCFA WORKERS' ASSOCIATION, and THE COURT OF INDUSTRIAL RELATIONS, respondents. Deogracias E. Lerma and Esmeraldo U. Guloy for petitioner Agricultural Credit and Cooperative Financing Administration. Office of the Agrarian Counsel, Department of Justice for petitioner Agricultural Credit Administration J. C. Espinas and Associates for respendents Confederation of Unions in Government Corporations Offices, et al. Mariano B. Tuason for respondent Court of Industrial Relations. MAKALINTAL, J.: These are two separate appeals by certiorari from the decision dated March 25, 1963 (G.R. No. L21484) and the order dated May 21, 1964 (G.R. No. L-23605) as affirmed by the resolutions en banc, of the Court of Industrial Relations, in Cases Nos. 3450-ULP and 1327-MC, respectively. The parties, except the Confederation of Unions in Government Corporations and Offices (CUGCO), being practically the same and the principal issues involved related, only one decision is now rendered in these two cases. The Agricultural Credit and Cooperative Financing Administration (ACCFA) was a government agency created under Republic Act No. 821, as amended. Its administrative machinery was reorganized and its name changed to Agricultural Credit Administration (ACA) under the Land Reform Code (Republic Act No. 3844). On the other hand, the ACCFA Supervisors' Association (ASA) and the ACCFA Workers' Association (AWA), hereinafter referred to as the Unions, are labor organizations composed of the supervisors and the rank-and-file employees, respectively, in the ACCFA (now ACA). G.R. No. L-21484 On September 4, 1961 a collective bargaining agreement, which was to be effective for a period of one (1) year from July 1, 1961, was entered into by and between the Unions and the ACCFA. A few months thereafter, the Unions started protesting against alleged violations and non-implementation of said agreement. Finally, on October 25, 1962 the Unions declared a strike, which was ended when the strikers voluntarily returned to work on November 26, 1962. On October 30, 1962 the Unions, together with its mother union, the Confederation of Unions in Government Corporations and Offices (CUGCO), filed a complaint with the Court of Industrial Relations against the ACCFA (Case No. 3450-ULP) for having allegedly committed acts of unfair labor practice, namely: violation of the collective bargaining agreement in order to discourage the

members of the Unions in the exercise of their right to self-organization, discrimination against said members in the matter of promotions, and refusal to bargain. The ACCFA denied the charges and interposed as affirmative and special defenses lack of jurisdiction of the CIR over the case, illegality of the bargaining contract, expiration of said contract and lack of approval by the office of the President of the fringe benefits provided for therein. Brushing aside the foregoing defenses, the CIR in its decision dated March 25, 1963 ordered the ACCFA: 1. To cease and desist from committing further acts tending to discourage the members of complainant unions in the exercise of their right to self-organization; 2. To comply with and implement the provision of the collective bargaining contract executed on September 4, 1961, including the payment of P30.00 a month living allowance; 3. To bargain in good faith and expeditiously with the herein complainants. The ACCFA moved to reconsider but was turned down in a resolution dated April 25, 1963 of the CIR en banc. Thereupon it brought this appeal by certiorari. The ACCFA raises the following issues in its petition, to wit: 1. Whether or not the respondent court has jurisdiction over this case, which in turn depends on whether or not ACCFA exercised governmental or proprietary functions. 2. Whether or not the collective bargaining agreement between the petitioner and the respondent union is valid; if valid, whether or not it has already lapsed; and if not, whether or not its (sic) fringe benefits are already enforceable. 3. Whether or not there is a legal and/or factual basis for the finding of the respondent court that the petitioner had committed acts of unfair labor practice. 4. Whether or not it is within the competence of the court to enforce the collective bargaining agreement between the petitioner and the respondent unions, the same having already expired. G.R. No. L-23605 During the pendency of the above mentioned case (G.R. No. L-21484), specifically on August 8, 1963, the President of the Philippines signed into law the Agricultural Land Reform Code (Republic Act No. 3844), which among other things required the reorganization of the administrative machinery of the Agricultural Credit and Cooperative Financing Administration (ACCFA) and changed its name to

Agricultural Credit Administration (ACA). On March 17, 1964 the ACCFA Supervisors' Association and the ACCFA Workers' Association filed a petition for certification election with the Court of Industrial Relations (Case No. 1327-MC) praying that they be certified as the exclusive bargaining agents for the supervisors and rankand-file employees, respectively, in the ACA. The trial Court in its order dated March 30, 1964 directed the Manager or Officer-in-Charge of the ACA to allow the posting of said order "for the information of all employees and workers thereof," and to answer the petition. In compliance therewith, the ACA, while admitting most of the allegations in the petition, denied that the Unions represented the majority of the supervisors and rank-and-file workers, respectively, in the ACA. It further alleged that the petition was premature, that the ACA was not the proper party to be notified and to answer the petition, and that the employees and supervisors could not lawfully become members of the Unions, nor be represented by them. However, in a joint manifestation of the Unions dated May 7, 1964, with the conformity of the ACA Administrator and of the Agrarian Counsel in his capacity as such and as counsel for the National Land Reform Council, it was agreed "that the union petitioners in this case represent the majority of the employees in their respective bargaining units" and that only the legal issues raised would be submitted for the resolution of the trial Court. Finding the remaining grounds for ACA's opposition to the petition to be without merit, the trial Court in its order dated May 21, 1964 certified "the ACCFA Workers' Association and the ACCFA Supervisors' Association as the sole and exclusive bargaining representatives of the rank-and-file employees and supervisors, respectively, of the Agricultural Credit Administration." Said order was affirmed by the CIR en banc in its resolution dated August 24, 1964. On October 2, 1964 the ACA filed in this Court a petition for certiorari with urgent motion to stay the CIR order of May 21, 1964. In a resolution dated October 6, 1964, this Court dismissed the petition for "lack of adequate allegations," but the dismissal was later reconsidered when the ACA complied with the formal requirement stated in said resolution. As prayed for, this Court ordered the CIR to stay the execution of its order of May 21, 1964. In this appeal, the ACA in effect challenges the jurisdiction of the CIR to entertain the petition of the Unions for certification election on the ground that it (ACA) is engaged in governmental functions. The Unions join the issue on this single point, contending that the ACA forms proprietary functions. Under Section 3 of the Agricultural Land Reform Code the ACA was established, among other governmental agencies,1 to extend credit and similar assistance to agriculture, in pursuance of the policy enunciated in Section 2 as follows:

SEC. 2. Declaration of Policy. It is the policy of the State: (1) To establish owner-cultivatorships and the economic family-size farm as the basis of Philippine agriculture and, as a consequence, divert landlord capital in agriculture to industrial development; (2) To achieve a dignified existence for the small farmers free from pernicious institutional restraints and practices; (3) To create a truly viable social and economic structure in agriculture conducive to greater productivity and higher farm incomes; (4) To apply all labor laws equally and without discrimination to both industrial and agricultural wage earners; (5) To provide a more vigorous and systematic land resettlement program and public land distribution; and (6) To make the small farmers more independent, self-reliant and responsible citizens, and a source of genuine strength in our democratic society. The implementation of the policy thus enunciated, insofar as the role of the ACA therein is concerned, is spelled out in Sections 110 to 118, inclusive, of the Land Reform Code. Section 110 provides that "the administrative machinery of the ACCFA shall be reorganized to enable it to align its activities with the requirements and objective of this Code and shall be known as the Agricultural Credit Administration." Under Section 112 the sum of P150,000,000 was appropriated out of national funds to finance the additional credit functions of the ACA as a result of the land reform program laid down in the Code. Section 103 grants the ACA the privilege of rediscounting with the Central Bank, the Development Bank of the Philippines and the Philippine National Bank. Section 105 directs the loaning activities of the ACA "to stimulate the development of farmers' cooperatives," including those "relating to the production and marketing of agricultural products and those formed to manage and/or own, on a cooperative basis, services and facilities, such as irrigation and transport systems, established to support production and/or marketing of agricultural products." Section 106 deals with the extension by ACA of credit to small farmers in order to stimulate agricultural production. Sections 107 to 112 lay down certain guidelines to be followed in connection with the granting of loans, such as security, interest and supervision of credit. Sections 113 to 118, inclusive, invest the ACA with certain rights and powers not accorded to non-governmental entities, thus: SEC. 113. Auditing of Operations. For the effective supervision of farmers' cooperatives, the head of the Agricultural Credit Administration shall have the power

to audit their operations, records and books of account and to issue subpoena and subpoena duces tecum to compel the attendance of witnesses and the production of books, documents and records in the conduct of such audit or of any inquiry into their affairs. Any person who, without lawful cause, fails to obey such subpoena or subpoena duces tecum shall, upon application of the head of Agricultural Credit Administration with the proper court, be liable to punishment for contempt in the manner provided by law and if he is an officer of the Association, to suspension or removal from office. SEC. 114. Prosecution of officials. The Agricultural Credit Administration, through the appropriate provincial or city fiscal, shall have the power to file and prosecute any and all actions which it may have against any and all officials or employees of farmers' cooperatives arising from misfeasance or malfeasance in office. SEC. 115. Free Notarial Service. Any justice of the peace, in his capacity as notary ex-officio, shall render service free of charge to any person applying for a loan under this Code either in administering the oath or in the acknowledgment of instruments relating to such loan. SEC. 116. Free Registration of Deeds. Any register of deeds shall accept for registration, free of charge any instrument relative to a loan made under this Code. SEC. 117. Writing-off Unsecured and Outstanding Loans. Subject to the approval of the President upon recommendation of the Auditor General, the Agricultural Credit Administration may write-off from its books, unsecured and outstanding loans and accounts receivable which may become uncollectible by reason of the death or disappearance of the debtor, should there be no visible means of collecting the same in the foreseeable future, or where the debtor has been verified to have no income or property whatsoever with which to effect payment. In all cases, the writing-off shall be after five years from the date the debtor defaults. SEC. 118. Exemption from Duties, Taxes and Levies. The Agricultural Credit Administration is hereby exempted from the payment of all duties, taxes, levies, and fees, including docket and sheriff's fees, of whatever nature or kind, in the performance of its functions and in the exercise of its powers hereunder. The power to audit the operations of farmers' cooperatives and otherwise inquire into their affairs, as given by Section 113, is in the nature of the visitorial power of the sovereign, which only a government agency specially delegated to do so by the Congress may legally exercise.

On March 19, 1964 Executive Order No. 75 was promulgated. It is entitled: "Rendering in Full Force and Effect the Plan of Reorganization Proposed by the Special Committee on Reorganization of Agencies for Land Reform for the Administrative Machinery of the Agricultural Land Reform Code," and contains the following pertinent provisions: Section 3. The Land Reform Project Administration2 shall be considered a single organization and the personnel complement of the member agencies including the legal officers of the Office of the Agrarian Counsel which shall provide legal services to the LRPA shall be regarded as one personnel pool from which the requirements of the operations shall be drawn and subject only to the civil service laws, rules and regulations, persons from one agency may be freely assigned to positions in another agency within the LRPA when the interest of the service so demands. Section 4. The Land Reform Project Administration shall be considered as one organization with respect to the standardization of job descriptions position classification and wage and salary structures to the end that positions involving the same or equivalent qualifications and equal responsibilities and effort shall have the same remuneration. Section 5. The Civil Service laws, rules and regulations with respect to promotions, particularly in the consideration of person next in rank, shall be made applicable to the Land Reform Project Administration as a single agency so that qualified individuals in one member agency must be considered in considering promotion to higher positions in another member agency. The implementation of the land reform program of the government according to Republic Act No. 3844 is most certainly a governmental, not a proprietary, function; and for that purpose Executive Order No. 75 has placed the ACA under the Land Reform Project Administration together with the other member agencies, the personnel complement of all of which are placed in one single pool and made available for assignment from one agency to another, subject only to Civil Service laws, rules and regulations, position classification and wage structures. The appointing authority in respect of the officials and employees of the ACA is the President of the Philippines, as stated in a 1st indorsement by his office to the Chairman of the National Reform Council dated May 22, 1964, as follows: Appointments of officials and employees of the National Land Reform Council and its agencies may be made only by the President, pursuant to the provisions of Section 79(D) of the Revised Administrative Code. In accordance with the policy and practice, such appointments should be

prepared for the signature of the Executive Secretary, "By Authority ofthe President".3 When the Agricultural Reform Code was being considered by the Congress, the nature of the ACA was the subject of the following exposition on the Senate floor: Senator Tolentino: . . . . "The ACA is not going to be a profit making institution. It is supposed to be a public service of the government to the lessees and farmerowners of the lands that may be bought after expropriation from owners. It is the government here that is the lender. The government should not exact a higher interest than what we are telling a private landowner now in his relation to his tenants if we give to their farmers a higher rate of interest . . . ." (pp. 17 & 18, Senate Journal No. 16, July 3, 1963) The reason is obvious, to pinpoint responsibility for many losses in the government, in order to avoid irresponsible lending of government money to pinpoint responsibility for many losses . . . . Senator Manglapus: ". . . But assuming that hypothesis, that is the reason why we are appropriating P150,000,000.00 for the Agricultural Credit Administration which will go to intensified credit operations on the barrio level . . ." (p. 3, Senate Journal No. 7). That it is the reason why we are providing for the expansion of the ACCFA and the weeding out of the cooperative activity of the ACCFA and turning this over to the Agricultural Productivity Commission, so that the Agricultural Credit Administration will concentrate entirely on the facilitation of credit on the barrio level with the massive support of 150 million provided by the government. . . . (pp. 4 & 5 of Senate Journal No. 7, July 3, 1963) . . . But by releasing them from this situation, we feel that we are putting them in a much better condition than that in which they are found by providing them with a business-like way of obtaining credit, not depending on a paternalistic system but one which is business-like that is to say, a government office, which on the barrio level will provide them that credit directly . . . . (p. 40, Senate Journal No. 7, July 3, 1963) (emphasis supplied). The considerations set forth above militate quite strongly against the recognition of collective bargaining powers in the respondent Unions within the context of Republic Act No. 875, and hence against the grant of their basic petition for certification election as proper bargaining units. The ACA is a government office or agency engaged in governmental, not proprietary functions. These functions may not be strictly what President Wilson described as "constituent" (as distinguished from "ministrant"),4 such as those relating to the maintenance of peace and the prevention of crime, those regulating property and property rights,

those relating to the administration of justice and the determination of political duties of citizens, and those relating to national defense and foreign relations. Under this traditional classification, such constituent functions are exercised by the State as attributes of sovereignty, and not merely to promote the welfare, progress and prosperity of the people these letter functions being ministrant he exercise of which is optional on the part of the government. The growing complexities of modern society, however, have rendered this traditional classification of the functions of government quite unrealistic, not to say obsolete. The areas which used to be left to private enterprise and initiative and which the government was called upon to enter optionally, and only "because it was better equipped to administer for the public welfare than is any private individual or group of individuals," 5 continue to lose their well-defined boundaries and to be absorbed within activities that the government must undertake in its sovereign capacity if it is to meet the increasing social challenges of the times. Here as almost everywhere else the tendency is undoubtedly towards a greater socialization of economic forces. Here of course this development was envisioned, indeed adopted as a national policy, by the Constitution itself in its declaration of principle concerning the promotion of social justice. It was in furtherance of such policy that the Land Reform Code was enacted and the various agencies, the ACA among them, established to carry out its purposes. There can be no dispute as to the fact that the land reform program contemplated in the said Code is beyond the capabilities of any private enterprise to translate into reality. It is a purely governmental function, no less than, say, the establishment and maintenance of public schools and public hospitals. And when, aside from the governmental objectives of the ACA, geared as they are to the implementation of the land reform program of the State, the law itself declares that the ACA is a government office, with the formulation of policies, plans and programs vested no longer in a Board of Governors, as in the case of the ACCFA, but in the National Land Reform Council, itself a government instrumentality; and that its personnel are subject to Civil Service laws and to rules of standardization with respect to positions and salaries, any vestige of doubt as to the governmental character of its functions disappears. In view of the foregoing premises, we hold that the respondent Unions are not entitled to the certification election sought in the Court below. Such certification is admittedly for purposes of bargaining in behalf of the employees with respect to terms and conditions of employment, including the right to strike as a coercive economic weapon, as in fact the said unions did strike in 1962 against the ACCFA (G.R. No. L-21824).6 This is contrary to Section 11 of Republic Act No. 875, which provides: SEC. 11. Prohibition Against Strike in the Government The terms and conditions of

employment in the Government, including any political subdivision or instrumentality thereof, are governed by law and it is declared to be the policy of this Act that employees therein shall not strike for the purposes of securing changes or modification in their terms and conditions of employment. Such employees may belong to any labor organization which does not impose the obligation to strike or to join in strike: Provided, However, that this section shall apply only to employees employed in governmental functions of the Government including but not limited to governmental corporations.7 With the reorganization of the ACCFA and its conversion into the ACA under the Land Reform Code and in view of our ruling as to the governmental character of the functions of the ACA, the decision of the respondent Court dated March 25, 1963, and the resolution en banc affirming it, in the unfair labor practice case filed by the ACCFA, which decision is the subject of the present review in G. R. No. L-21484, has become moot and academic, particularly insofar as the order to bargain collectively with the respondent Unions is concerned. What remains to be resolved is the question of fringe benefits provided for in the collective bargaining contract of September 4, 1961. The position of the ACCFA in this regard is that the said fringe benefits have not become enforceable because the condition that they should first be approved by the Office of the President has not been complied with. The Unions, on the other hand, contend that no such condition existed in the bargaining contract, and the respondent Court upheld this contention in its decision. It is to be listed that under Section 3, Article XIV, of the agreement, the same "shall not become effective unless and until the same is duly ratified by the Board of Governors of the Administration." Such approval was given even before the formal execution of the agreement, by virtue of "Resolution No. 67, Regular Meeting No. 7, FY 1960-61, held on August 17, 1961," but with the proviso that "the fringe benefits contained therein shall take effect only if approved by the office of the President." The condition is, therefore, deemed to be incorporated into the agreement by reference. On October 23, 1962 the Office of the President, in a letter signed by the Executive Secretary, expressed its approval of the bargaining contract "provided the salaries and benefits therein fixed are not in conflict with applicable laws and regulations, are believed to be reasonable considering the exigencies of the service and the welfare of the employees, and are well within the financial ability of the particular corporation to bear." On July 1, 1963 the ACCFA management and the Unions entered into an agreement for the implementation of the decision of the respondent Court concerning the fringe benefits, thus:

In the meantime, only Cost of Living Adjustment, Longevity Pay, and Night Differential Benefits accruing from July 1, 1961 to June 30, 1963 shall be paid to all employees entitled thereto, in the following manner: A) The sum of P180,000 shall be set aside for the payment of: 1) Night differential benefits for Security Guards. 2) Cost of Living Adjustment and Longevity Pay. 3) The unpaid balance due employees on Item A (1) and (2) this paragraph shall be paid in monthly installments as finances permit but not beyond December 20, 1963. 3. All benefits accruing after July 1, 1963, shall be allowed to accumulate but payable only after all benefits accruing up to June 30, 1963, as per CIR decision hereinabove referred to shall have been settled in full; provided, however, that commencing July 1, 1963 and for a period of only two (2) months thereafter (during which period the ACCFA and the Unions shall negotiate a new Collective Bargaining Agreement) the provisions of the September 4, 1961 Collective Bargaining Agreement shall be temporarily suspended, except as to Cost of Living Adjustment and "political" or noneconomic privileges and benefits thereunder. On July 24, 1963 the ACCFA Board of Governors ratified the agreement thus entered into, pursuant to the provision thereof requiring such ratification, but with the express qualification that the same was "without prejudice to the pending appeal in the Supreme Court . . . in Case No. 3450-ULP." The payment of the fringe benefits agreed upon, to our mind, shows that the same were within the financial capability of the ACCFA then, and hence justifies the conclusion that this particular condition imposed by the Office of the President in its approval of the bargaining contract was satisfied. We hold, therefore, that insofar as the fringe benefits already paid are concerned, there is no reason to set aside the decision of the respondent Court, but that since the respondent Unions have no right to the certification election sought by them nor, consequently, to bargain collectively with the petitioner, no further fringe benefits may be demanded on the basis of any collective bargaining agreement. The decisions and orders appealed from are set aside and/or modified in accordance with the foregoing pronouncements. No costs. Concepcion, C.J., Reyes, J.B.L., Dizon, Sanchez, Castro, Teehankee and Barredo, JJ., concur. Zaldivar, J., concurs in the result.

Separate Opinions FERNANDO, J., concurring: The decision reached by this Court so ably given expression in the opinion of Justice Makalintal, characterized with vigor, clarity and precision, represents what for me is a clear tendency not to be necessarily bound by our previous pronouncements on what activities partake of a nature that is governmental.1 Of even greater significance, there is a definite rejection of the "constituent-ministrant" criterion of governmental functions, followed in Bacani v. National Coconut Corporation.2 That indeed is cause for gratification. For me at least, there is again full adherence to the basic philosophy of the Constitution as to the extensive and vast power lodged in our government to cope with the social and economic problems that even now sorely beset us. There is therefore full concurrence on my part to the opinion of the Court, distinguished by its high quality of juristic craftsmanship. I feel however that the matter is of such vital importance that a separate concurring opinion is not inappropriate. It will also serve to give expression to my view, which is that of the Court likewise, that our decision today does not pass upon the rights of labor employed in instrumentalities of the state discharging governmental functions. 1. In the above Bacani decision, governmental functions are classified into constituent and ministrant. "The former are those which constitute the very bonds of society and are compulsory in nature; the latter are those that are undertaken only by way of advancing the general interests of society, and are merely optional. President Wilson enumerates the constituent functions as follows: '(1) The keeping of order and providing for the protection of persons and property from violence and robbery. (2) The fixing of the legal relations between man and wife and between parents and children. (3) The regulation of the holding, transmission, and interchange of property, and the determination of its liabilities for debt or for crime. (4) The determination of contract rights between individuals. (5) The definition and punishment of crime. (6) The administration of justice in civil cases. (7) The determination of the political duties, privileges, and relations of citizens. (8) Dealings of the state with foreign powers: the preservation of the state from external danger or encroachment and the advancement of its international interests.' "3 The ministrant functions were then enumerated, followed by a statement of the basis that would justify engaging in such activities. Thus: "The most important of the ministrant functions are: public works, public education, public charity, health and safety regulations, and regulations of trade and industry. The principles determining whether or not a government shall exercise certain of these optional functions are: (1) that a government should do for the public welfare those things which private capital would not naturally undertake and (2) that a government should do these things which

by its very nature it is better equipped to administer for the public welfare than is any private individual or group of individuals."4 Reference is made in the Bacani decision to the first of the many publications of Justice Malcolm on the Philippine government, which appeared in 1916,5 adopting the formulation of the then Professor, later President, Woodrow Wilson of the United States, in a textbook on political science the first edition of which was published in 1898. The Wilson classification reflected the primacy of the dominant laissez-faire concept carried into the sphere of government. A most spirited defense of such a view was given by former President Hadley of Yale in a series of three lectures delivered at Oxford University in 1914. According to President Hadley: "I shall begin with a proposition which may sound somewhat startling, but which I believe to be literally true. The whole American political and social system is based on industrial property right, far more completely than has ever been the case in any European country. In every nation of Europe there has been a certain amount of traditional opposition between the government and the industrial classes. In the United States no such tradition exists. In the public law of European communities industrial freeholding is a comparatively recent development. In the United States, on the contrary, industrial freeholding is the foundation on which the whole social order has been established and built up." 6 The view is widely accepted that such a fundamental postulate did influence American court decisions on constitutional law. As was explicitly stated by Justice Cardozo, speaking of that era: "Laissez-faire was not only a counsel of caution which statesmen would do well to heed. It was a categorical imperative which statesmen as well as judges, must obey."7 For a long time, legislation tending to reduce economic inequality foundered on the rock that was the due process clause, enshrining as it did the liberty of contract. To cite only one instance, the limitation of employment in bakeries to sixty hours a week and ten hours a day under a New York statute was stricken down for being tainted with a due process objection in Lochner v. New York. 8 It provoked one of the most vigorous dissents of Justice Holmes, who was opposed to the view that the United States Constitution did embody laissez-faire. Thus: "General propositions do not decide concrete cases. The decision will depend on a judgment or intuition more subtle than any articulate major premise. But I think that the proposition just stated, if it is accepted, will carry us far toward the end. Every opinion tends to become a law. I think that the word 'liberty,' in the 14th Amendment, is perverted when it is held to prevent the natural outcome of a dominant opinion, unless it can be said that a rational and fair man necessarily would admit that the statute proposed would infringe fundamental principles as they have been understood by the traditions of our people and our law. It does not need research to show that no such sweeping condemnation can be passed upon the statute before us. A reasonable man might think it a proper measure on the score of health.

Men whom I certainly could not pronounce unreasonable would uphold it as a first installment of a general regulation of the hours of work. Whether in the latter aspect it would be open to the charge of inequality I think it unnecessary to discuss." It was not until 1908, in Muller v. Oregon,9 that the American Supreme Court held valid a ten-hour maximum for women workers in laundries and not until 1917 in Bunting v. Oregon10 that such a regulatory ten-hour law applied to men and women passed the constitutional test. Similarly, state legislation fixing minimum wages was deemed offensive to the due process clause in a 1923 decision in Adkins v. Children's Hospital.11 Only in 1937, in the leading case of West Coast Hotel v. Parrish,12 was the Adkins case overruled and a minimum wage law New York statute upheld. The same unsympathetic attitude arising from the laissez-faire concept was manifest in decisions during such period, there being the finely-spun distinctions in the Wolff Packing Co. v. Court of Industrial Relations13 decision, as to when certain businesses could be classified as affected with public interest to justify state regulation as to prices. After eleven years, in 1934, in Nebbia v. New York,14 the air of unreality was swept away by this explicit pronouncement from the United States Supreme Court: "The phrase 'affected with a public interest' can, in the nature of things, mean no more than that an industry, for adequate reason, is subject to control for the public good." It is thus apparent that until the administration of President Roosevelt, the laissez-faire principle resulted in the contraction of the sphere where governmental entry was permissible. The object was to protect property even if thereby the needs of the general public would be left unsatisfied. This was emphatically put forth in a work of former Attorney General, later Justice, Jackson, citing an opinion of Judge Van Orsdel. Thus: "It should be remembered that of the three fundamental principles which underlie government, and for which government exists, the protection of life, liberty, and property, the chief of these is property . . . ."15 The above excerpt from Judge Van Orsdel forms part of his opinion in Children's Hospital v. Adkins, when decided by the Circuit Court of Appeals.16 Nonetheless, the social and economic forces at work in the United States to which the new deal administration of President Roosevelt was most responsive did occasion, as of 1937, greater receptivity by the American Supreme Court to a philosophy less rigid in its obeisance to property rights. Earlier legislation deemed offensive to the laissez-faire concept had met a dismal fate. Their nullity during his first term could, more often than not, be expected.17 As a matter of fact, even earlier, in 1935, Professor Coker of Yale, speaking as a historian, could already discern a contrary drift. Even then he could assert that the range of governmental activity in the United States had indeed expanded. According to him: "Thus both liberals and conservatives approve wide and varied governmental intervention; the latter condemning

it, it is true, when the former propose it, but endorsing it, after it has become a fixed part of the status quo, as so beneficial in its effects that no more of it is needed. Our history for the last halfcentury shows that each important governmental intervention we have adopted has been called socialistic or communistic by contemporary conservatives, and has later been approved by equally conservative men who now accept it both for its proved benefits and for the worthy traditions it has come to represent. Both liberal and conservative supporters of our large-scale business under private ownership advocate or concede the amounts and kinds of governmental limitation and aid which they regard as necessary to make the system work efficiently and humanely. Sooner or later, they are willing to have government intervene for the purpose of preventing the system from being too oppressive to the masses of the people, protecting it from its self-destructive errors, and coming to its help in other ways when it appears not to be able to take care of itself."18 At any rate, by 1943, the United States was reconciled to laissez-faire having lost its dominance. In the language of Justice Jackson in the leading case of West Virginia State Board of Education v. Barnette:19 "We must transplant these rights to a soil in which the laissez-faire concept or principle of non-interference has withered at least as to economic affairs, and social advancements are increasingly sought through closer integration of society and through expanded and strengthened governmental controls." 2. The influence exerted by American constitutional doctrines unavoidable when the Philippines was still under American rule notwithstanding, an influence that has not altogether vanished even after independence, the laissez-faire principle never found full acceptance in this jurisdiction, even during the period of its full flowering in the United States. Moreover, to erase any doubts, the Constitutional Convention saw to it that our fundamental law embodies a policy of the responsibility thrust on government to cope with social and economic problems and an earnest and sincere commitment to the promotion of the general welfare through state action. It would thus follow that the force of any legal objection to regulatory measures adversely affecting property rights or to statutes organizing public corporations that may engage in competition with private enterprise has been blunted. Unless there be a clear showing of any invasion of rights guaranteed by the Constitution, their validity is a foregone conclusion. No fear need be entertained that thereby spheres hitherto deemed outside government domain have been enchroached upon. With our explicit disavowal of the "constituent-ministrant" test, the ghost of the laissez-faire concept no longer stalks the juridical stage. As early as 1919, in the leading case of Rubi V. Provincial Board of Mindoro,20 Justice Malcolm already had occasion to affirm: "The doctrines of laissez-faire and of unrestricted freedom of the individual, as axioms of economic and political theory, are of the past. The modern period has

shown a widespread belief in the amplest possible demonstration of governmental activity. The Courts unfortunately have sometimes seemed to trail after the other two branches of the Government in this progressive march." It was to be expected then that when he spoke for the Court in Government of the Philippine Islands v. Springer,21 a 1927 decision, he found nothing objectionable in the government itself organizing and investing public funds in such corporations as the National Coal Co., the Phil. National Bank, the National Petroleum Co., the National Development Co., the National Cement Co. and the National Iron Co. There was not even a hint that thereby the laissez-faire concept was not honored at all. It is true that Justice Malcolm concurred with the majority in People v. Pomar,22 a 1924 opinion, which held invalid under the due process clause a provision providing for maternity leave with pay thirty days before and thirty days after confinement. It could be that he had no other choice as the Philippines was then under the United States, and only recently the year before, the above-cited case of Adkins v. Children's Hospital,23 in line with the laissez-faire principle, did hold that a statute providing for minimum wages was constitutionally infirm on the same ground. Our constitution which took effect in 1935, upon the inauguration of the Commonwealth of the Philippines, erased whatever doubts there might be on that score. Its philosophy is antithetical to the laissez-faire concept. Delegate, later President, Manuel Roxas, one of the leading members of the Constitutional Convention, in answer precisely to an objection of Delegate Jose Reyes of Sorsogon, who noted the "vast extensions in the sphere of governmental functions" and the "almost unlimited power to interfere in the affairs of industry and agriculture as well as to compete with existing business" as "reflections of the fascination exerted by [the then] current tendencies" in other jurisdictions,24 spoke thus: "My answer is that this constitution has a definite and well defined philosophy, not only political but social and economic. A constitution that in 1776 or in 1789 was sufficient in the United States, considering the problems they had at that time, may not now be sufficient with the growing and ever-widening complexities of social and economic problems and relations. If the United States of America were to call a constitutional convention today to draft a constitution for the United States, does any one doubt that in the provisions of that constitution there will be found definite declarations of policy as to economic tendencies; that there will be matters which are necessary in accordance with the experience of the American people during these years when vast organizations of capital and trade have succeeded to a certain degree to control the life and destiny of the American people? If in this constitution the gentleman will find declarations of economic policy, they are there because they are necessary to safeguard the interests and welfare of the Filipino people because we believe that the days have come when in self-defense, a nation may provide in its constitution those safeguards, the patrimony, the freedom to grow, the freedom to

develop national aspirations and national interests, not to be hampered by the artificial boundaries which a constitutional provision automatically imposes."25 Delegate Roxas continued further: "The government is the creature of the people and the government exercises its powers and functions in accordance with the will and purposes of the people. That is the first principle, the most important one underlying this document. Second, the government established in this document is, in its form, in our opinion, the most adapted to prevailing conditions, circumstances and the political outlook of the Filipino people. Rizal said, 'Every people has the kind of government that they deserve.' That is just another form of expressing the principle in politics enunciated by the French philosophers when they said: 'Every people has the right to establish the form of government which they believe is most conducive to their welfare and their liberty.' Why have we preferred the government that is established in this draft? Because it is the government with which we are familiar. It is the form of government fundamentally such as it exists today; because it is the only kind of government that our people understand; it is the kind of government we have found to be in consonance with our experience, with the necessary modification, capable of permitting a fair play of social forces and allowing the people to conduct the affairs of that government."26 One of the most prominent delegates, a leading intellectual, former President Rafael Palma of the University of the Philippines, stressed as a fundamental principle in the draft of the Constitution the limitation on the right to property. He pointed out that the then prevailing view allowed the accumulation of wealth in one family down to the last remote descendant, resulting in a grave disequilibrium and bringing in its wake extreme misery side by side with conspicuous luxury. He did invite attention to the few millionaires at one extreme with the vast masses of Filipinos deprived of the necessities of life at the other. He asked the Convention whether the Filipino people could long remain indifferent to such a deplorable situation. For him to speak of a democracy under such circumstances would be nothing but an illusion. He would thus emphasize the urgent need to remedy the grave social injustice that had produced such widespread impoverishment, thus recognizing the vital role of government in this sphere.27 Another delegate, Tomas Confesor of Iloilo, was quite emphatic in his assertion for the need of a social justice provision which is a departure from the laissez-faire principle. Thus: "Take the case of the tenancy system in the Philippines. You have a tenant. There are hundreds of thousands of tenants working day in and day out, cultivating the fields of their landlords. He puts all his time, all his energy, the labor and the assistance of his wife and children, in cultivating a piece of ground for his landlord but when the time comes for the partition of the products of his toil what happens? If he produces 25 cavanes of rice, he gets only perhaps

five and the twenty goes to the landlord. Now can he go to court? Has he a chance to go to court in order to secure his just share of the products of his toil? No. Under our present regime of law, under our present regime of justice, you do not give that to the poor tenant. Gentlemen, you go to the Cagayan Valley and see the condition under which those poor farmers are being exploited day in and day out. Can they go to court under our present regime of justice, of liberty, or democracy? The other day, workmen were shot by the police just because they wanted to increase or they desired that their wages be increased from thirty centavos a day to forty or fifty centavos. Is it necessary to spill human blood just to secure an increase of ten centavos in the daily wages of an ordinary laborer? And yet under our present regime of social justice, liberty and democracy, these things are happening; these things, I say, are happening. Are those people getting any justice? No. They cannot get justice now from our courts. For this reason, I say it is necessary that we insert 'social justice' here and that social justice must be established by law. Proper legal provisions, proper legal facilities must be provided in order that there be a regime not of justice alone, because we have that now and we are seeing the oppression arising from such a regime. Consequently, we must emphasize the term 'social justice'."28 Delegate Ventenilla of Pangasinan reflected the attitude of the Convention as to why laissez-faire was no longer acceptable. After speaking of times having changed, he proceeded: "Since then new problems have arisen. The spiritual mission of government has descended to the level of the material. Then its function was primarily to soothe the aching spirit. Now, it appears, it must also appease hunger. Now that we may read history backwards, we know for instance, that the old theory of 'laissez-faire' has degenerated into 'big business affairs' which are gradually devouring the rights of the people the same rights intended to be guarded and protected by the system of constitutional guaranties. Oh, if the Fathers were now alive to see the changes that the centuries have wrought in our life! They might contemplate the sad spectacle of organized exploitation greedily devouring the previous rights of the individual. They might also behold the gradual disintegration of society, the fast disappearance of the bourgeois the middle class, the backbone of the nation and the consequent drifting of the classes toward the opposite extremes the very rich and the very poor."29 Shortly after the establishment of the Commonwealth, the then Justice Jose P. Laurel, himself one of the foremost delegates of the Constitutional Convention, in a concurring opinion, later quoted with approval in the leading case of Antamok Goldfields Mining Co. v. Court of Industrial Relations,30 decided in 1940, explained clearly the need for the repudiation of the laissezfaire doctrine. Thus: "It should be observed at the outset that our Constitution was adopted in the midst of surging unrest and dissatisfaction resulting from economic and social distress which was threatening the stability of governments the world over. Alive to the social and economic forces

at work, the framers of our Constitution boldly met the problems and difficulties which faced them and endeavored to crystallize, with more or less fidelity, the political, social and economic propositions of their age, and this they did, with the consciousness that the political and philosophical aphorism of their generation will, in the language of a great jurist, 'be doubted by the next and perhaps entirely discarded by the third.' . . . Embodying the spirit of the present epoch, general provisions were inserted in the Constitution which are intended to bring about the needed social and economic equilibrium between component elements of society through the application of what may be termed as the justitia communis advocated by Grotius and Leibnits many years ago to be secured through the counterbalancing of economic and social forces and opportunities which should be regulated, if not controlled, by the State or placed, as it were, in custodia societatis. 'The promotion of social justice to insure the well-being and economic security of all the people' was thus inserted as vital principle in our Constitution. ... ."31 In the course of such concurring opinion and after noting the changes that have taken place stressing that the policy of laissez-faire had indeed given way to the assumption by the government of the right to intervene although qualified by the phrase "to some extent", he made clear that the doctrine in People v. Pomar no longer retain, "its virtuality as a living principle."32 3. It must be made clear that the objection to the "constituent-ministrant" classification of governmental functions is not to its formulation as such. From the standpoint of law as logic, it is not without merit. It has neatness and symmetry. There are hardly any loose ends. It has the virtue of clarity. It may be said in its favor likewise that it reflects all-too-faithfully the laissez-faire notion that government cannot extend its operation outside the maintenance of peace and order, protection against external security, and the administration of justice, with private rights, especially so in the case of property, being safeguarded and a hint that the general welfare is not to be entirely ignored. It must not be lost sight of though that logic and jural symmetry while undoubtedly desirable are not the prime consideration. This is especially so in the field of public law. What was said by Holmes, almost nine decades ago, carry greater conviction now. "The life of the law has not been logic; it has been experience. The felt necessities of the time, the prevalent moral and political theories, intuitions of public policy avowed or unconscious, even the prejudices which judges share with their fellow-men, have had a good deal more to do than the syllogism in determining the rules by which men should be governed."33 Then too, there was the warning of Geny cited by Cardozo that undue stress or logic may result in confining the entire system of positive law, "within a limited number of logical categories, predetermined in essence, immovable in basis, governed by inflexible dogmas," thus rendering it incapable of responding to the ever varied and changing exigencies of life. 34,

It is cause enough for concern if the objection to the Bacani decision were to be premised on the score alone that perhaps there was fidelity to the requirements of logic and jural symmetry carried to excess. What appears to me much more deplorable is that it did fail to recognize that there was a repudiation of the laissez-faire concept in the Constitution. As was set forth in the preceding pages, the Constitution is distinguished precisely by a contrary philosophy. The regime of liberty if provided for, with the realization that under the then prevalent social and economic conditions, it may be attained only through a government with its sphere of activity ranging far and wide, not excluding matters hitherto left to the operation of free enterprise. As rightfully stressed in our decision today in line with what was earlier expressed by Justice Laurel, the government that we have established has as a fundamental principle the promotion of social justice.35 The same jurist gave it a comprehensive and enduring definition as the "promotion of the welfare of all the people, the adoption by the government of measures calculated to insure economic stability of all the component elements of society, through the maintenance of a proper economic and social equilibrium in the interrelations of the members of the community, constitutionally, through the adoption of measures legally justifiable, or extraconstitutionally, through the exercise of powers underlying the existence of all governments in the time honored principle of salus populi estsuprema lex."36 There is thus from the same distinguished pen, this time writing for the Court, a reiteration of the view of the laissez-faire doctrine being repugnant to the fundamental law. It must be added though that the reference to extra-constitutional measures being allowable must be understood in the sense that there is no infringement of specific constitutional guarantees. Otherwise, the judiciary will be hard put to sustain their validity if challenged in an appropriate legal proceeding. The regime of liberty contemplated in the Constitution with social justice as a fundamental principle to reinforce the pledge in the preamble of promoting the general welfare reflects traditional concepts of a democratic policy infused with an awareness of the vital and pressing need for the government to assume a much more active and vigorous role in the conduct of public affairs. The framers of our fundamental law were as one in their strongly-held belief that thereby the grave and serious infirmity then confronting our bodypolitic, on the whole still with us now, of great inequality of wealth and mass poverty, with the great bulk of our people ill-clad, ill-housed, ill-fed, could be remedied. Nothing else than communal effort, massive in extent and earnestly engaged in, would suffice. To paraphrase Laski, with the necessary modification in line with such worthy constitutional ends, we look upon the state as an organization to promote the happiness of individuals, its authority as a power bound by subordination to that purpose, liberty while to be viewed negatively as absence of restraint impressed

with a positive aspect as well to assure individual self-fulfillment in the attainment of which greater responsibility is thrust on government; and rights as boundary marks defining areas outside its domain.37 From which it would follow as Laski so aptly stated that it is the individual's "happiness and not its well-being [that is] the criterion by which its behavior [is] to be judged. His interests, and not its power, set the limits to the authority it [is] entitled to exercise."38 We have under such a test enlarged its field of competence. 4. With the decision reached by us today, the government is freed from the compulsion exerted by the Bacani doctrine of the "constituent-ministrant" test as a criterion for the type of activity in which it may engage. Its constricting effect is consigned to oblivion. No doubts or misgivings need assail us that governmental efforts to promote the public weal, whether through regulatory legislation of vast scope and amplitude or through the undertaking of business activities, would have to face a searching and rigorous scrutiny. It is clear that their legitimacy cannot be challenged on the ground alone of their being offensive to the implications of the laissez-faire concept. Unless there be a repugnancy then to the limitations expressly set forth in the Constitution to protect individual rights, the government enjoys a much wider latitude of action as to the means it chooses to cope with grave social and economic problems that urgently press for solution. For me, at least, that is to manifest deference to the philosophy of our fundamental law. Hence my full concurrence, as announced at the outset. 5. The opinion of Justice Makalintal contains this footnote: "It must be stated, however, that we do not here decide the question not at issue in this case of whether or not a labor organization composed employees discharging governmental functions, which is allowed under the legal provision just quoted, provided such organization does not impose the obligation to strike or to join in strike, may petition for a certification election and compel the employer to bargain collectively with it for purposes other than to secure changes or conditions in the terms and conditions of employment." With such an affirmation as to the scope of our decision there being no holding on the vexing question of the effects on the rights of labor in view of the conclusion reached that the function engaged in is governmental in character, I am in full agreement. The answer to such a vital query must await another day.

G.R. No. L-31890 May 29, 1987 PEOPLE'S HOMESITE AND HOUSING CORPORATION, petitioner, vs. COURT OF INDUSTRIAL RELATIONS, FELICIDAD ALICE, BERGIDA APOSTLE, LUZ ALCORAN, SOLICIDAD ANDRADE, AUREA ABAS, GENEROSA ABONGAN, MACARIA ABERION, ARCADIA ABAJAC, ANTONIA ARNIBAL, PACENCIA ACODESIN, ESPERANZA ALVAREZ,

10

DEMETRIA ALVAREZ, JUSTINA AQUINO, TRINIDAD AGUIRRE, FRANCIA ABOGADO, CRETALINA AUDENCIAL, NAZARIA ANTARAN, LELIA AGUIRRE, OLIMPIA ADONES, ELPIDIA AMOR, IREANA ANDA, ADIA ABDOL, FLORA AMOLINO, RICARDO ALBA, CANOTO ARGUELLES, FEDERICO AQUINO, RODOLFO AUDENCIAL, TEOFILO ABAWAG, LORENZO ALMORPE, DENETRIO AMITA, JULIAN ADAR, EFREN ANCHETA, ENIEGO ASPA, HENRY ABONG, GABRIEL ABALOS, GENEROSO AMARA JR., FRANCISCO ANSELMO, DOMINGO ALVAREZ, LEONARDO AGBAY, FRANCISCO AREDENCIAL, MACARIA ABERIO, LEONILA ARAGON, FLORENCIO ABELLA, FAUSTINA ARGUELLES, MAXIMA BALLOS, ANGELINA BONDOC, ADELA BAUTISTA, LEA BAUTISTA, TERESITA BENITEZ, BENEDICTA BALINO, VICTORIA BALUYA, VIOLETA BANANA, FELISA BOSE, FELISA BALDONADA, CORAZON BAUTISTA, ANTONIA BACQUIAL, PLACIDA BADAL, NENITA BELARMINO, MAXIMA BATOGAN, LEONORA BURGOS, AMADA BERTOS, SOCORRO BENJAMIN, VIRGINIA BALUYA, MARCELA BATASLAC, LORENZO BARTOLOME, ORLANDO LOITA, PAQUITO BALDONADO, RAMOS BENIDO, ODAINO BALDOMER, SATURNINO BALIBALOS, DIONISIO BALDONADO, ROLANDO BON, CRISANTO BORBON, ANASTACIO BOLANTE, MERCEDES BUEN, ASUNCION BACONAWA, CELSO BADOL, RODOLFO BAYRON, VICTORIA CABOBOY, CLEMENTINA CAPUNGCOL, BONIFACIA CABOBOY, GLORIA CABRALES, VICTORIA CARILLO, FLORENTINA CONDE, MARCIANA CABUGAYAN, VEROMINCA CENON, FLORA CASTILLO, ASUZENA COQUIA, ENES CATAYONG, CARMELITA CONDES, ADELA GACHARO, SEMIONA COTEJAR, DIOSDADA CADORNA, REMEDIOS CATALAN, MARIA CHUA, VIRGINIA CAJEPE, ROSITA CANGAS, ADORACION CALMANTE, MARIVIC CHAVEZ, ENECITO CAPALARAN, RICARDO COLLADO, VIRGILIO CAJEPE, ISIDRO COBER, MARCELINO CATARA, ANECITO COMPIO, NECASIO CAPUNGGOL, MAXIMO CANALES, CRESENCIO CASAUL, DOMINADOR CASAUL, CALIXTO CARDOVA, BERNARDO CASIGURAN, JUANITO CAZATE, GIL CORDOVA, ROQUE CONDE, JR., TONY CRUZ, ERNESTO CAPIZ, ERNESTO CANIZA, DOMINADOR COQUIA, ELPIDIO CANONIGO, ISIDRO CASTILLO, DOMINADOR CASTRO, ANDRES CARETO, VALENTINA CORDERO, BOY CINEZA, ZENAIDA DIZON, AURORA DAEP, EUNES DE DIOS, PAULINA DE PAZ, MILAGROS DEMATERA, LORNA DURAN, GIMINE DE LA CRUZ, LOURDES DELANTAR, JUANITA DAZO, CRISTITA DERPO, MONSUERTA DALISAY, TERESE DE LOS SANTOS, MARTA DELFIN, REMEDIOS DELA ROSA, CONCEPCION DEL MONTE, LOURDES DELA CRUZ, DOMINADOR DELA CRUZ, MARIA DE VERA, GREGORIA DIOLA, SILVINA DE VERA, FLORENTINA DELA CRUZ, ELADIA DALMACIO, FLORENTINA DAVID, REYMUNDO DE VERA, ELPIDIO DIACLES, RICARDO DELA CRUZ, CERILO DADO, JERMINIAS DOBLE, DELFIN DIACLES, LAURA DE LEON, JESUS DE VERA, MAXIMO DIOCSON, CESAR DE JESUS, MIGUEL DE GUZMAN, PRUDENCIO DUCABO, TOMAS DESABELLE, ILUMINADO DE VERA,

NARCISO DANTES, MARGARITA DE GUZMAN, REBECCA DECORO, JESUS DE LA TORRE, FILOMENA ENCENARES, GREGORIA ESPALGO, SALVACION ESCOLIN, MAGDALENA EVANGELISTA, ROBERTO ENCENARES, ENRICO ELLEN, ELBERTO ESPATERO, SEMEON ESPERAME, SEMEON IGNACIO, ABRAHAM ESPERITO, ALFONSO EVASCO DOROTEO ELIYAY, TERESITA EUGENIO, JOSE ENRIQUEZ, FORTUNATA FURNES, JACINTA FLORES, NORMA FRANCISCO, CARLITO FERNANDEZ, REYMUNDO FONTANILLA, SANTIAGO FEGOROA, NAPOLEON FERNANDEZ, CRESTETA GOTEB, LEONCIA GARCIA, AQUILINA GLORIOSO, ROBERTA GABRINO, JULIANA GAGALANG, ANTONINA GALLETES, NELLY GELOGO CORAZON, GILDOC ENCARNACION, GOJE CRUZ, ROBERTO GALLARDO, LUCIO GONZALES, TARCILA GONZAGA, ROSALINA GARCIA, VICTORIO GUBAT, CARLITO GADORES, MARCELINO GREFIEL, CRISTINA HAWAC, JOSEFA IGLESIA, FELOMINA ISIDRO, ELENITA INVETADO, ALICIA JAIME, RAFAEL JAIME, DOMINGO JADOC, JESUS JINAYON, ELEUTERIO JADOC ,ANTERO JAMERO, CONSTANCIA LERIOS, SAMUEL LERIOS, VICENTE LERIOS, PRICELA LAGIJNSAD, CELERINA LACHEGA, FILOMENA LECHAUCO, EULALIA LEON, ASUNCION LESABA, EXALTACION LUBA, NATIVIDAD LOTO, SEVERA LEPATA, MARCIANA LOGARTO, CARIDAD LANIOHAN, FELISA LABRADOR, ALBERTO LARENIO, DANILO LABRADOR, FE TRAQUINA, NATIVIDAD LOLA, RICARDO LEGASPI, ASUNCION MAGBUHOS, MAXIMA MOSCARE, MEDELINA KANDAL, LEONILA MERGAL,SILVERIA MESIAS, LOURDES MURILLO, NATIVIDAD MANIANO SOLIDAD, MELLANA, FELISIDAD MENDOZA, FRANCISCO MONTILLA, CORNELIO MONTILLA, VICTORIA MALO, MARCIANA MEJENIO, ESTELITA MISLOS, SUSANA MAGAYONES, CORAZON MEITALPIS, RODORA MANUEL, VIRGINIA MENDOZA, ERLINDA MORALES, TERESITA MENDOZA, CERELINA MINERVA, CONSOLACION MALLIO, GODOFREDO IABUHAY, PERFECTO MARTINEZ, VICENTE MARAVILLA, MANUEL MARAVILLA, ARTURO MERGAL, SEGUNDO MERLAPIS, VICTOR MENDEZ, RODOLFO MIRANDA, GENEROSO MACALLA, FLORENDO MEDELO, JAIME MANALAC, OLIMPIO MONTILLA, ESTEBAN MENDIOLA, ANTONIO MENDOZA, RAMON MARALIT, DOMINGO MARQUEZ, ENGRACIA MOLATO, VICTORIA MARALIT, INCINCIA MONTECLARO, WILLIE MURCIA, LEONARDO MARIANO, AMELIA NABUA, AMELIA NATIVIDAD, FILOMENA NOVILLA, EFIPANIA NOTARTE, ROLANDO NATALIO, LEONARDO NABUA, VICTORIANO NAVAJAS, FLORENTINO NAVARETTE, FEDERICO NOBLE, CARMELITA OMEGA, ANDREA OBIEN, FARESTA OLAS, ARCADIA OMEGA, VICENTE OQRIENDO, MATEO ORTEGA, CARMEN PARANAS, SOLEDAD PALOMARES, FELICIDAD PENAFLOR, CERIACA PREMARIYAS, LADISLAO PERALTA, LUCRECIO PECORRO, FRANCISCO PLAZA, ROBERTO PANGANOS, GONZALO PORE, CALIXTO PAGARA, PAREDES PASCUAL, RAUL PACADAR, ANICETO PACADOR, GUADALUPE PEREZ, RODRIGO, PANGANOD, CRISANTO PRINCIPE,

11

JUANITO PEGULAYAN, GALICANO QUIJADA, BARTOLOME QUIJADA, JULILIE QUIZON, PEREMIA RESULTA, SEGUNDINA REDONIA, JUANITA REGODOS, WAHINE ROLON, SERVIDAD ROSA, RUFINA RECARTE, SUZANA REYNA, ANACORETA REFORZADA, MARTE RANELLE, RODRIGO ROMA, ANTONIO ROCE MACARIO REYES, ANTONIO RIVERA, HONORIO ROMAMALE, MARCELINO REBOSO, MARIANITO RUMITMAN, CIPRIANO REGAJAL, JOSE ROBESENCIO, JOSE SYCHANCO, ROSITA SANTOS, PELAGIA SANTOS, MIGUELA SINGSON, JUANA SIMANES, LUX SUAREZ, LEONARDO SALVADO, DEMETRIA SILVERIANO, DOMINGA SALAZAR, EXELSA SAIMOREN, MARTA SAN ANDRES, MARINA SALCEDO, OFELIA SANCHEZ, MARIA SEMON, LUZ SUMAYA, LOURDES SERRANO, YASOL SOSTENES, BENJAMIN SAIMORIN, FILES SALVADO, EDGARDO SALVADO, SOZIMO SALARDA, MARCELINO SATOL, RICARDO SETOSIA, ANTONIO SAN JUAN, JACINTO SORIANO, LEONILA SELFA, AMPARO SAN JUAN, AMADO SANTOS, GONZALO SALVO, REYNALDO SIMBOLAN, MARTIN SAMSON, ZOSIMA TABONARES, SALVADORA TABULOG, LEOCADIA TARCE, INCENCIA TIBOS, ADORACION TUGBE, EMERGENCIA TIBOS, ULDARICA TANGOG, GLORIA TARQUATOR, ROSA TORRES, ANGEL TALAGAY, MANOLITO TEVES, MEGUEL TALVO, BASILIO TOBIAS, RAMON TURQUATOR, PACIFICO TALA, ISAGANI TESORO, DONATO TRELIPAT, FEDERICO TIPANAO, ROLANDO TALBO, MIGUEL TESORO, ROLANDO TIPANAO, ROBERTO TUPAS, VICTORIA TIBOS, EUFRACIO TUBIAS, SOLIDAD URSULA, ROSENDA VELLAREAL, ANASTACIA VILLANUEVA, TERESE VELLERUZ, PELLAR VILLEGAS, AURELIA VILLAVER, ESTELITA VILLAFRANCIA, FELIPA VELASQUEZ, GENEROSA VILLENA, GORGONIA VERSOSA, SATURNINO VARONA, ROLANDO VILLANUEVA, CRISENCIA YAP, CECILIA YUMAG, AGAPITA VENTOROSA, SOLIDAD ALBERTO, FE BANANA, REYNALDO CONDE, FE DELA CRUZ, SEVERA DOMINGUEZ, JOSEF DONATO, JOVITA EBANEZ DOLORES ENRIQUEZ, MARCELA ESTOPEREZ, SALVACION FEGUROA, FLORANTE GUMATAY, EUDECIA JATICO, GUILLERMA LAGUNSAD, TITA LADO, SALVACION MAQUIRANG, JUANITA MUTANEZ, MEDINA NABUA, NINETA PUNDIDO, DIONISIO PARANAS, ROSA ROMAGAS, BENEDICTO NAAGAS, PRIMITIVA ABAS, ROSA ABELLOS, EDIZA ABADILLOS, JUANITA ABARECIO, ESTELITA ABRILLO, GREGORIA ABADE, PROSERFINA ALBANO, FERNANDO ACAL, CRESTETA ADONA, AGAPITA ANPON, SULFECIA ARES, ESPERANZA ACRIESCADO, BELINA ALCANTARA, SUZANA ARENSOL, DEMETRIA ANTONIO, FELOMINA AGANA, WILFREDO ANDICOY, JOSE ALBA, BETY ARCELI, VALERIANA ABADIANO, ALBERT BANDOY, GREGORIA BANDOY, CLEOTILDE BAAFDE, BABIANA BANGA, RICARDO BAARDE, HERMOGENES BOCO, GREGORIO BAYAN, PABLO BATAN, MARTINA BARTIDO, ROSARIO BAYADOG, T T MANUEL BOTE, ROSALIA BULACAN, GUADALUPE BALALA, NORMA BAUMUNDO, ERLINDA BUEZA, WILFREDO BALALA, RODOLFO BALITACION, VIRGILIO BANES, AGUINALDO BERSAMINA, NENITA

BANADO, LEONIDES BACLO, LEONILA BENAVEDEZ, EVANGELINA BEROL, LUCIANA BONQUA, MARCELINO BUEZA, RICARDO BALTAR, TRINIDAD BELMONTE, ADELAIDA BAUTISTA, LUIS CABALLERO, SALVADOR CABALES, PACIENSIA CAMELON, MELANIA CABALE, FELISA CABALE, TERESITA CASINGAL, CESARIA CALASTE, ANTONIO CAMARA, JOSE DELA CRUZ, NATIVIDAD CAMA, FELISIDAD CANBO, FELIO COLASTE, FLORENTINO CRUZ, ONASIMA COLLANTES, IRIBERTA CANTEL, MELCHOR CEBRIANO, OFELIZ CEPRIANO, DAMIANA DOMINGUEZ, ROSALINA DIZON, FLORENCIA DOBLE, DIONICIA DULA, VIOLETA DOMINGO, PILAR DOMINGO, RAMON DEMASUNID, PACENCIA DECOTON, MARCELINO DIEGO, JR., VICTOR DOMINGO, RICARDO DOMINGO, JUANITO ESTEBAN, ADORACION ESPINA, WILFREDO ESPINA, DIOMICIA ENERES, ROMEO ESPINA, JUANITA ESTIPONA, LEONA ELAYA, BENITO ELPA, ADILA FRANCISCO, BEATRIZ FLORES, NENITA FELIZARDO, EMILIO FERNANDO, MARGARITA FLORES, MAGDALENA DE GUZMAN, LOLITA GABOSA, CONDEDA GABON, LOLITA GUADIANO, DAYLINDA GONZALES, PRECILA GABITAN, ESPERANZA GARCIA, AVELINA GRIEGO, LAUREANO GABITAN, EDUARDO GODOY, ESCA GAHE, SEVERINA GIPAGA, GERARDA GARDUQUE, MONICO GILARDO, FLORENTINO GALINO, NORA GATBONTON, DIONICIA GELLAMERA, BONIFACIO UBAN, SANTIAGO HIBAQUE, CRESTETA HILARIO, JUELY HILARIO, ALFONSO HERMANOS, REMEDIOS HERMIAS, WILMER INABORE, SUSANA ISIDRO, JULIO JACOB, MELY LOBO, GODOFREDO LUSANTA, ROGELIO LUSANTA, PACIFICO LIGO, LUIS LEON, DOMINGO LAO, LEONARDO MARIANO, MATILDE MACALALAG, SEVERINA MANGUERA, CIFREANA MADI, RONCLO MAMING, LEONARDO MUSADA, ANA MARCELO, ESTELITA MERCAIDA, GAVINO MACABENTA, ANGELITA MAMENG, ADELINA MARZAN, ALBINO MELGAR, MARTA MOLAR, PIO MALAQUENO, HONORIO MOCONI, CEZAR NAVARRO, FRANCISCO NAVALES, LETICIA NAVARRO, VITO NAVALES, FELISA OBIERNE, ADORACION OCAMPO, FELISA ORAYANE, PEDRO ONTAYEN, EGRACIA ODTTORAN, CONSTANCIA PILAPIL, APOLONIA PUDASAS, MARINA PAQUET, ADRIANO PORTEZ, MARIA PALLE, DOLORES PARIENTE, EUSTAQUIO PALLE, CARMELITA PELANO, GREGORIA PELANTE, VICITACION PERDEZ, MARIO PASCUAL, AUREA PALMA, LUCILA DE LA PEA, ERIBERTO PORTUGAL, ALFONSA QUIMADA, LIBERTAD RIVERO, TOMAS RENYS, VICENTE RAPORNA, JOSEFINA RUES, CRESENCIO RIVERO, SANTOS RELATA, FLORENCIA REBOSE, LUCIO ROSALIE, EMERITA RESARDE, ELY DEL ROMO, GENEROSO RICARDE, DOUGLAS REYES, CONCEPCION ROSALES, FELOMINA SEPANA, SALVADOR SALAZAR, JOSEFINA SALEBIO, FEDILA SEVERINO, VALENTIN DE LOS SANTOS, EDGARDO SARTORIO, FRANCISCO SOLIDOR, PURIFICACION SONORA, ERLINDA SANEZ, ANICETA SEROY, OFELIA SUFINA, SELVINA SIAPNO, FELOMINA SEDAN, VALENTINA SALIDA, GLORIA SARCILLA, ERLINDA TIBULE,

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LEONIDES TRIYO, FELIPA TAYCO, ALFREDO TAMBONG, IGNACIO TABOR, JOVITO TABORDA, FLORDELISA TOMBOKON, DEMETRIO VIPINASO, MARIA YERRO, BENITO ELFA, RODOLFO ARELLANO, TEOTIMO ADAY, ROBERTO ADAY, PATRICIA BAUTISTA, PAULINA BOHOL, FELICISIMO BAUTISTA, RODRIGO BANDOY, NATIVIDAD CABAOBAO, GERUNDIO CONAL, ADELA CACHARO, ANGELINA DELFIN, LUCITA DELFIN, JOSE DAINO, HAMPRELIO DOMINGO, VICTORIA ELMEDO, ADELA FRANCISCO, LEON GALOSO, ARSENIO GUELAS, CONCHITA GUERERO, VICENTE HANDOMON, ERNESTO LACINIA, GIL IBIT, RODRIGO MANAHAN, RENATO GONZALO, ANGELA MUPAL, GLORIA MALIHAN, ALFONSO MACALALAD, ALFONSO MONTALLA, JOSEFA MENCOTE, ESTELITA MALIHAN, ASUNCION RAMONS, ALEJANDRO RESURRECCION, AURORA ROEL, DAVID SAMOPEZ, ALEJANDRO SOLIS, JR., PANTALEON ABRANO, FELIPA PASCUAL, VERERO CRISTINA, TERESA VELLAROS, NATIVIDAD ALBINA, MENECIA ARUTA, ROSARIO BUSA, DOLORES BONDOY, ANGELINA BARRIENTOS, SEVERA BANICO, SOFRONIA BACSAL, FELISA BELARMINO, FLORENTINA BANDOY, ANACITA CANOSA, GLECERIA CANDOG, ABADISA COLANGOY, PRIMITIVA CASTILLO, ANACLITA CANIJOS, MARIA DUINOG, GREGORIA DIANAN, CARINA ESQUERA, MARIA FRANCISCO, REMEDIOS FERNANDEZ, LOURDES FEGUEROA, FRANCISCO JIMENEZ, MARIA ESPERAGOZA, DOLORES GALLARDO, MAMERTA LAZARO, MAURECIA LINDAYA, LEONCIA LOPEZ, TERESA LACADANGDANG, LETECIA MAGNO, FELISA PEDRO, CORAZON PABILLARE, TERESA QUINA, NELIA QUIRINO, EMILDA REYES, ROSALICA SALAZAR, MARIETA SOLIDOR, JUAN DELA PEA, MARIA TOLENTINO, VIOLETA TOLIBAS, LEVITAS TOMAS, ELENA TABARNILLO, ADELAIDA TAYCO, SEGUNDINA FACIAL, VIRGINIA VILLA, ERLINDA VELOSO, ISABEL PRESADO, ALICIA VECINAS and VICITACION YAYAFRANCA. The Government Corporate counsel for petitioner. Armando V. Ampil for private respondents.

Until the efforts of the various Government Agencies concerned have been successful in developing and executing the overall plan for the Sapang Palay resettlement area, substantial employment must be found for the majority of the squatter families at present living there. The People's Homesite and Housing Corporation, hereafter referred to as PHHC is proposing a self-help project to be undertaken by the squatter families for the construction of two earth dams (which will involve the moving of 44,165 cu. meters of earth roads of 850 meters long . . . and 17 kilometers of associate drainage and irrigation channels; at the same time a number of existing roads in the area will be improved by the construction of 42 kilometers of dams and ditches which will involve the removal of 75,600 cu. meters of earth. The undertaking will provide water for the irrigation of more than 100 hectares of land to be used for additional food production, the reservoir will provide non-drinking water for domestic purposes and will be stocked with fish. WFP has been asked to supply the food for a basic ration for the 500 settlers participating in this scheme, and for their 2,000 dependents for a period of 560 days. The food ration will supplement a cash incentive of One Half Peso (0.50) per participant per day. (Exh. "1"). In recruiting participants to the program, application forms entitled WFP Self Help Community Project Information Sheet," (Exh. "2") were issued, mentioning the voluntary nature of the work to be rendered. Although the participants were assigned to work on canals and roads, the projects agreed upon between the PHHC and the World Food Program were never fully implemented. The PHHC ordered the participants to accomplish a time sheet which formed the basis for the payment of P0.50 per day and the weekly food ration. A division chief was also assigned to administer and manage the Sapang Palay project. The agency provided the participants with work tools and equipment such as spades, rakes, shovels, picks and axes. A PHHC employee acted as "work supervisor:" he designated the area to be worked on by the participants pursuant to a predetermined program made by the PHHC; and he also conducted ocular inspection in the area. Complaining about their work and compensation, the participants went to the Department of Labor.

CORTES, J.: In this petition for certiorari, the People's Homesite and Housing Corporation (PHHC) seeks a reversal of the Resolution of the Court of Industrial Relations (CIR) en banc dated February 23, 1970 ordering the PHHC to pay private respondents * wage differentials for work rendered from July 25, 1967 to February, 1968. In 1967, the Philippine government and the World Food program WFP entered into an agreement which provided that xxx xxx xxx

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After investigation, Secretary Ople sent to the PHHC General Manager the following message: FINDINGS ON WORKERS SAPANG PALAY PROJECT REVEAL VIOLATIONS OF LABOR LAWS STOP SUGGEST LABORERS BE PAID IN ACCORDANCE WITH MINIMUM WAGELAW PHHC thereafter suspended work. And the participants instituted the present action in the Court of Industrial Relations against the PHHC praying for the payment of the difference between the minimum wage (which was P6.00 at that time) and the P0.50 paid to them, overtime compensation, and also for reinstatement. In its answer, PHHC claimed, among others, that it was exercising governmental functions; that it did not employ private respondents herein; and that the CIR had no jurisdiction over PHHC, and over the subject matter of the action. After trial, the Court a quo ruled that since there was no evidence that private respondents rendered overtime work, their claim was reduced to a mere money claim over which the regular courts, not the CIR, had jurisdiction. It thus dismissed the action. On motion for reconsideration, the Court of Industrial Relations en banc reversed the order of dismissal and ordered the PHHC to pay wage differentials to the claimants; but denied the claims for reinstatement and overtime compensation. From that resolution, PHHC brought the case to Us on certiorari, raising the following issues: I WHETHER OR NOT THE CIR HAS JURISDICTION OVER PHHC, A GOVERNMENT OWNED AND/OR CONTROLLED CORPORATION PERFORMING GOVERNMENTAL FUNCTIONS II WHETHER OR NOT (THE) CIR HAS JURISDICTION OVER THOSE CASES WHERE THERE EXIST(S) NO EMPLOYER- EMPLOYEE RELATIONSHIP III WHETHER OR NOT (THE) CIR HAS JURISDICTION OVER CASES FOR MERE MONEY CLAIMS WHERE NO REINSTATEMENT IS SOUGHT IV WHETHER OR NOT THERE EXISTS (AN) EMPLOYER EMPLOYEE (RELATIONSHIP) CONSIDERING THE FACTUAL CIRCUMSTANCES We vote to grant the petition. The jurisdiction of the then Court of Industrial Relations is set forth in Section I of Commonwealth Act No. 103, as amended. Construing this provision of law, We have ruled that the CIR has

jurisdiction over labor disputes involving government-owned or controlled corporations performing basically proprietary functions, (GSIS v. Castillo, 98 Phil. 876 [1956]; GSIS v. GSIS Employees Assn., 119 Phil. 524 [1964]; SSS Employees Assn. v. Soriano, 117 Phil. 1038 [1963]) but not those performing governmental functions (University of the Philippines and Anonas v. CIR, 107 Phil. 848 [1960]). It has not always been easy determining which functions are governmental in nature and which are proprietary. The characterization of functions performed by the government has evolved from the traditional "constituent- administrant" classification (as enunciated in the case of Bacani v. National Coconut Corporation (100 Phil. 468 [1956]) to its disavowal in the case of ACCFA v. CUGCO et. al (No. L-221484, November 29, 1969, 30 SCRA 649) where, considering the social justice provision of the 1935 Constitution, We said that the "constituent-ministrant" classification had become unrealistic, if not obsolete. There, We gave our assent to a socio-political philosophy espousing a greater socialization of economic forces. We found nothing objectionable in government undertaking in its sovereign capacity activities which, by the constituent-ministrant test would have been considered as merely optional. We, thus, ruled in said case that the Agricultural Credit Administration, tasked as it was with the implementation of the land reform program of the government was an agency performing governmental functions. Coming now to the case at bar. We note that since 1941 when the National Housing Commission (predecessor of PHHC, which is now known as the National housing Authority [NHA]) was created, the Philippine government has pursued a mass housing and resettlement program to meet the needs of Filipinos for decent housing. The agency tasked with implementing such governmental program was the PHHC. These can be gleaned from the provisions of Commonwealth Act 648, the charter of said agency. We rule that the PHHC is a governmental institution performing governmental functions. This is not the first time We are ruling on the proper characterization of housing as an activity of government, In the 1985 case of National Housing Corporation v. Juco and the NLRC (No. L-64313, January 17, 1985, 134 SCRA 172), We ruled that housing is a governmental function. A perusal of the functions of the PHHC and the NHC indicates that both perform substantially the same functions. Commonwealth Act No. 648, as amended, provides: Section 2. The purposes for which the (People's Homesite and Housing Corporation) is created are:

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a) The acquisition, development, improvement, construction, leasing and selling of lands and buildings or any interest therein in the cities and populous towns of the Philippines, with the object of providing decent housing for those who may be found unable otherwise to provide themselves therewith; b) The promotion of the physical, social and economic betterment of the inhabitants of the cities and populous towns of the Philippines, by eliminating therefrom slums and dwelling places which are unhygienic or unsanitary and by providing homes at low cost to replace those which may be so eliminated; and, c) The provision of community and institutional housing for destitute individuals and families and for paupers. On the other hand, the articles of incorporation of the NHC provide: SECOND. That the purpose for which the corporation is organized is to assist and carry out the coordinated massive housing program of the government, principally but not limited to low-cost housing with the integration, cooperation and assistance of all governmental agencies concerned, through the carrying on of any or all the following activities: 1) The acquisition, development or reclamation of lands for the purpose of construction and building therein preferably low-cost housing so as to provide decent and durable dwelling for the greatest number of inhabitants in the country; 2) The promotion and development of physical social and economic community growth through the establishment of general physical plans for urban, suburban and metropolitan areas to be characterized by efficient land use patterns; 3) The coordination and implementation of an projects of the government for the establishment of nationwide and massive low-cost housing; 4) The undertaking and conducting of research and technical studies of the development and promotion of construction of houses and buildings of sound standards of design liability, durability, safety, comfort and size for improvement of the architectural and engineering designs and utility of houses and buildings with the utilization of new and) or native materials economics (sic) in material and construction, distribution, assembly and construction and of applying advanced housing and building technology. 5) Construction and installation in these projects of low-cost housing privately or cooperatively owned water and sewerage system or waste

disposal facilities, and the formulation of a unified or officially coordinated urban transportation system as a part of a comprehensive development plan in these areas. In the Juco case, We ruled that the NHC, as it was established as an "instrumentality of government to accomplish governmental policies and objectives and extend essential services to the people," performs governmental and not proprietary functions. It thus comes under the jurisdiction of the Civil Service Commission and not the Ministry of Labor and Employment (supra, 134 SCRA 172, 180, 181). We see no reason for departing from that ruling now. The Court of Industrial Relations had no jurisdiction over the dispute involving the PHHC and the private respondents. In view of the foregoing, We deem it unnecessary to pass upon the other issues raised. WHEREFORE, the petition is granted. The assailed resolution of the Court of Industrial Relations is SET ASIDE. Fernan (Chairman), Gutierrez, Jr., Paras, Padilla and Bidin JJ., concur.

G.R. No. L-55963 December 1, 1989 SPOUSES JOSE FONTANILLA AND VIRGINIA FONTANILLA, petitioners, vs. HONORABLE INOCENCIO D. MALIAMAN and NATIONAL IRRIGATION ADMINISTRATION, respondents. G.R. No. L-61045 December 1, 1989 NATIONAL IRRIGATION ADMINISTRATION, appellant, vs. SPOUSES JOSE FONTANILLA and VIRGINIA FONTANILLA, appellees PARAS, J.:

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In G.R. No. L-55963, the petition for review on certiorari seeks the affirmance of the decision dated March 20, 1980 of the then Court of First Instance of Nueva Ecija, Branch VIII, at San Jose City and its modification with respect to the denial of petitioner's claim for moral and exemplary damages and attorneys fees. In G.R. No. 61045, respondent National Irrigation Administration seeks the reversal of the aforesaid decision of the lower court. The original appeal of this case before the Court of Appeals was certified to this Court and in the resolution of July 7, 1982, it was docketed with the aforecited number. And in the resolution of April 3, this case was consolidated with G.R. No. 55963. It appears that on August 21, 1976 at about 6:30 P.M., a pickup owned and operated by respondent National Irrigation Administration, a government agency bearing Plate No. IN-651, then driven officially by Hugo Garcia, an employee of said agency as its regular driver, bumped a bicycle ridden by Francisco Fontanilla, son of herein petitioners, and Restituto Deligo, at Maasin, San Jose City along the Maharlika Highway. As a result of the impact, Francisco Fontanilla and Restituto Deligo were injured and brought to the San Jose City Emergency Hospital for treatment. Fontanilla was later transferred to the Cabanatuan Provincial Hospital where he died. Garcia was then a regular driver of respondent National Irrigation Administration who, at the time of the accident, was a licensed professional driver and who qualified for employment as such regular driver of respondent after having passed the written and oral examinations on traffic rules and maintenance of vehicles given by National Irrigation Administration authorities. The within petition is thus an off-shot of the action (Civil Case No. SJC-56) instituted by petitionersspouses on April 17, 1978 against respondent NIA before the then Court of First Instance of Nueva Ecija, Branch VIII at San Jose City, for damages in connection with the death of their son resulting from the aforestated accident. After trial, the trial court rendered judgment on March 20, 1980 which directed respondent National Irrigation Administration to pay damages (death benefits) and actual expenses to petitioners. The dispositive portion of the decision reads thus: . . . . . Judgment is here rendered ordering the defendant National Irrigation Administration to pay to the heirs of the deceased P12,000.00 for the death of Francisco Fontanilla; P3,389.00 which the parents of the deceased had spent for the hospitalization and burial of the deceased Francisco Fontanilla; and to pay the costs. (Brief for the petitioners spouses Fontanilla, p. 4; Rollo, p. 132)

Respondent National Irrigation Administration filed on April 21, 1980, its motion for reconsideration of the aforesaid decision which respondent trial court denied in its Order of June 13, 1980. Respondent National Irrigation Administration thus appealed said decision to the Court of Appeals (C.A.-G.R. No. 67237- R) where it filed its brief for appellant in support of its position. Instead of filing the required brief in the aforecited Court of Appeals case, petitioners filed the instant petition with this Court. The sole issue for the resolution of the Court is: Whether or not the award of moral damages, exemplary damages and attorney's fees is legally proper in a complaint for damages based on quasidelict which resulted in the death of the son of herein petitioners. Petitioners allege: 1. The award of moral damages is specifically allowable. under paragraph 3 of Article 2206 of the New Civil Code which provides that the spouse, legitimate and illegitimate descendants and ascendants of the deceased may demand moral damages for mental anguish by reason of the death of the deceased. Should moral damages be granted, the award should be made to each of petitioners-spouses individually and in varying amounts depending upon proof of mental and depth of intensity of the same, which should not be less than P50,000.00 for each of them. 2. The decision of the trial court had made an impression that respondent National Irrigation Administration acted with gross negligence because of the accident and the subsequent failure of the National Irrigation Administration personnel including the driver to stop in order to give assistance to the, victims. Thus, by reason of the gross negligence of respondent, petitioners become entitled to exemplary damages under Arts. 2231 and 2229 of the New Civil Code. 3. Petitioners are entitled to an award of attorney's fees, the amount of which (20%) had been sufficiently established in the hearing of May 23, 1979. 4. This petition has been filed only for the purpose of reviewing the findings of the lower court upon which the disallowance of moral damages, exemplary damages and attorney's fees was based and not

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for the purpose of disturbing the other findings of fact and conclusions of law. The Solicitor General, taking up the cudgels for public respondent National Irrigation Administration, contends thus: 1. The filing of the instant petition is rot proper in view of the appeal taken by respondent National Irrigation Administration to the Court of Appeals against the judgment sought to be reviewed. The focal issue raised in respondent's appeal to the Court of Appeals involves the question as to whether or not the driver of the vehicle that bumped the victims was negligent in his operation of said vehicle. It thus becomes necessary that before petitioners' claim for moral and exemplary damages could be resolved, there should first be a finding of negligence on the part of respondent's employee-driver. In this regard, the Solicitor General alleges that the trial court decision does not categorically contain such finding. 2. The filing of the "Appearance and Urgent Motion For Leave to File Plaintiff-Appellee's Brief" dated December 28, 1981 by petitioners in the appeal (CA-G.R. No. 67237-R; and G. R. No.61045) of the respondent National Irrigation Administration before the Court of Appeals, is an explicit admission of said petitioners that the herein petition, is not proper. Inconsistent procedures are manifest because while petitioners question the findings of fact in the Court of Appeals, they present only the questions of law before this Court which posture confirms their admission of the facts. 3. The fact that the parties failed to agree on whether or not negligence caused the vehicular accident involves a question of fact which petitioners should have brought to the Court of Appeals within the reglementary period. Hence, the decision of the trial court has become final as to the petitioners and for this reason alone, the petition should be dismissed. 4. Respondent Judge acted within his jurisdiction, sound discretion and in conformity with the law. 5. Respondents do not assail petitioners' claim to moral and exemplary damages by reason of the shock and subsequent illness they

suffered because of the death of their son. Respondent National Irrigation Administration, however, avers that it cannot be held liable for the damages because it is an agency of the State performing governmental functions and driver Hugo Garcia was a regular driver of the vehicle, not a special agent who was performing a job or act foreign to his usual duties. Hence, the liability for the tortious act should. not be borne by respondent government agency but by driver Garcia who should answer for the consequences of his act. 6. Even as the trial court touched on the failure or laxity of respondent National Irrigation Administration in exercising due diligence in the selection and supervision of its employee, the matter of due diligence is not an issue in this case since driver Garcia was not its special agent but a regular driver of the vehicle. The sole legal question on whether or not petitioners may be entitled to an award of moral and exemplary damages and attorney's fees can very well be answered with the application of Arts. 2176 and 2180 of theNew Civil Code. Art. 2176 thus provides: Whoever by act omission causes damage to another, there being fault or negligence, is obliged to pay for damage done. Such fault or negligence, if there is no pre-existing cotractual relation between the parties, is called a quasi-delict and is governed by the provisions of this Chapter Paragraphs 5 and 6 of Art. 21 80 read as follows: Employers shall be liable for the damages caused by their employees and household helpers acting within the scope of their assigned tasks, even the though the former are not engaged in any business or industry. The State is responsible in like manner when it acts through a special agent.; but not when the damage has been caused by the official to whom the task done properly pertains, in which case what is provided in Art. 2176 shall be applicable. The liability of the State has two aspects. namely:

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1. Its public or governmental aspects where it is liable for the tortious acts of special agents only. 2. Its private or business aspects (as when it engages in private enterprises) where it becomes liable as an ordinary employer. (p. 961, Civil Code of the Philippines; Annotated, Paras; 1986 Ed. ). In this jurisdiction, the State assumes a limited liability for the damage caused by the tortious acts or conduct of its special agent. Under the aforequoted paragrah 6 of Art. 2180, the State has voluntarily assumed liability for acts done through special agents. The State's agent, if a public official, must not only be specially commissioned to do a particular task but that such task must be foreign to said official's usual governmental functions. If the State's agent is not a public official, and is commissioned to perform non-governmental functions, then the State assumes the role of an ordinary employer and will be held liable as such for its agent's tort. Where the government commissions a private individual for a special governmental task, it is acting through a special agent within the meaning of the provision. (Torts and Damages, Sangco, p. 347, 1984 Ed.) Certain functions and activities, which can be performed only by the government, are more or less generally agreed to be "governmental" in character, and so the State is immune from tort liability. On the other hand, a service which might as well be provided by a private corporation, and particularly when it collects revenues from it, the function is considered a "proprietary" one, as to which there may be liability for the torts of agents within the scope of their employment. The National Irrigation Administration is an agency of the government exercising proprietary functions, by express provision of Rep. Act No. 3601. Section 1 of said Act provides: Section 1. Name and domicile.-A body corporate is hereby created which shall be known as the National Irrigation Administration, hereinafter called the NIA for short, which shall be organized immediately after the approval of this Act. It shall have its principal seat of business in the City of Manila and shall have representatives in all provinces for the proper conduct of its business. Section 2 of said law spells out some of the NIA's proprietary functions. ThusSec. 2. Powers and objectives.-The NIA shall have the following powers and objectives: (a) x x x x x x x x x x x x x x x x x x

(b) x x x x x x x x x x x x x x x x x x (c) To collect from the users of each irrigation system constructed by it such fees as may be necessary to finance the continuous operation of the system and reimburse within a certain period not less than twentyfive years cost of construction thereof; and (d) To do all such other tthings and to transact all such business as are directly or indirectly necessary, incidental or conducive to the attainment of the above objectives. Indubitably, the NIA is a government corporation with juridical personality and not a mere agency of the government. Since it is a corporate body performing non-governmental functions, it now becomes liable for the damage caused by the accident resulting from the tortious act of its driver-employee. In this particular case, the NIA assumes the responsibility of an ordinary employer and as such, it becomes answerable for damages. This assumption of liability, however, is predicated upon the existence of negligence on the part of respondent NIA. The negligence referred to here is the negligence of supervision. At this juncture, the matter of due diligence on the part of respondent NIA becomes a crucial issue in determining its liability since it has been established that respondent is a government agency performing proprietary functions and as such, it assumes the posture of an ordinary employer which, under Par. 5 of Art. 2180, is responsible for the damages caused by its employees provided that it has failed to observe or exercise due diligence in the selection and supervision of the driver. It will be noted from the assailed decision of the trial court that "as a result of the impact, Francisco Fontanilla was thrown to a distance 50 meters away from the point of impact while Restituto Deligo was thrown a little bit further away. The impact took place almost at the edge of the cemented portion of the road." (Emphasis supplied,) [page 26, Rollo] The lower court further declared that "a speeding vehicle coming in contact with a person causes force and impact upon the vehicle that anyone in the vehicle cannot fail to notice. As a matter of fact, the impact was so strong as shown by the fact that the vehicle suffered dents on the right side of the radiator guard, the hood, the fender and a crack on the radiator as shown by the investigation report (Exhibit "E"). (Emphasis supplied) [page 29, Rollo] It should be emphasized that the accident happened along the Maharlika National Road within the city limits of San Jose City, an urban area. Considering the fact that the victim was thrown 50 meters away from the point of impact, there is a strong indication that driver Garcia was

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driving at a high speed. This is confirmed by the fact that the pick-up suffered substantial and heavy damage as above-described and the fact that the NIA group was then "in a hurry to reach the campsite as early as possible", as shown by their not stopping to find out what they bumped as would have been their normal and initial reaction. Evidently, there was negligence in the supervision of the driver for the reason that they were travelling at a high speed within the city limits and yet the supervisor of the group, Ely Salonga, failed to caution and make the driver observe the proper and allowed speed limit within the city. Under the situation, such negligence is further aggravated by their desire to reach their destination without even checking whether or not the vehicle suffered damage from the object it bumped, thus showing imprudence and reckelessness on the part of both the driver and the supervisor in the group. Significantly, this Court has ruled that even if the employer can prove the diligence in the selection and supervision (the latter aspect has not been established herein) of the employee, still if he ratifies the wrongful acts, or take no step to avert further damage, the employer would still be liable. (Maxion vs. Manila Railroad Co., 44 Phil. 597). Thus, too, in the case of Vda. de Bonifacio vs. B.L.T. Bus Co. (L-26810, August 31, 1970, 34 SCRA 618), this Court held that a driver should be especially watchful in anticipation of others who may be using the highway, and his failure to keep a proper look out for reasons and objects in the line to be traversed constitutes negligence. Considering the foregoing, respondent NIA is hereby directed to pay herein petitioners-spouses the amounts of P12,000.00 for the death of Francisco Fontanilla; P3,389.00 for hospitalization and burial expenses of the aforenamed deceased; P30,000.00 as moral damages; P8,000.00 as exemplary damages and attorney's fees of 20% of the total award. SO ORDERED. Padilla, Sarmiento and Regalado, JJ., concur. Melencio- Herrera (Chairperson,), J., is on leave.

(COMELEC) refused to give due course to petitioners Certificate of Candidacy in its Resolution No. 6558 dated January 17, 2004. The decision, however, was not unanimous since Commissioners Luzviminda G. Tancangco and Mehol K. Sadain voted to include petitioner as they believed he had parties or movements to back up his candidacy. On January 15, 2004, petitioner moved for reconsideration of Resolution No. 6558. Petitioners Motion for Reconsideration was docketed as SPP (MP) No. 04-001. The COMELEC, acting on petitioners Motion for Reconsideration and on similar motions filed by other aspirants for national elective positions, denied the same under the aegis of Omnibus Resolution No. 6604 dated February 11, 2004. The COMELEC declared petitioner and thirty-five (35) others nuisance candidates who could not wage a nationwide campaign and/or are not nominated by a political party or are not supported by a registered political party with a national constituency. Commissioner Sadain maintained his vote for petitioner. By then, Commissioner Tancangco had retired. In this Petition For Writ of Certiorari, petitioner seeks to reverse the resolutions which were allegedly rendered in violation of his right to "equal access to opportunities for public service" under Section 26, Article II of the 1987 Constitution,1 by limiting the number of qualified candidates only to those who can afford to wage a nationwide campaign and/or are nominated by political parties. In so doing, petitioner argues that the COMELEC indirectly amended the constitutional provisions on the electoral process and limited the power of the sovereign people to choose their leaders. The COMELEC supposedly erred in disqualifying him since he is the most qualified among all the presidential candidates, i.e., he possesses all the constitutional and legal qualifications for the office of the president, he is capable of waging a national campaign since he has numerous national organizations under his leadership, he also has the capacity to wage an international campaign since he has practiced law in other countries, and he has a platform of government. Petitioner likewise attacks the validity of the form for the Certificate of Candidacy prepared by the COMELEC. Petitioner claims that the form does not provide clear and reasonable guidelines for determining the qualifications of candidates since it does not ask for the candidates bio-data and his program of government. First, the constitutional and legal dimensions involved. Implicit in the petitioners invocation of the constitutional provision ensuring "equal access to opportunities for public office" is the claim that there is a constitutional right to run for or hold public office and, particularly in his case, to seek the presidency. There is none. What is recognized is merely a privilege subject to limitations imposed by law. Section 26, Article II of the Constitution neither bestows such a right nor elevates the privilege to the level of an enforceable right. There

G.R. No. 161872

April 13, 2004

REV. ELLY CHAVEZ PAMATONG, ESQUIRE, petitioner, vs. COMMISSION ON ELECTIONS, respondent. RESOLUTION TINGA, J.: Petitioner Rev. Elly Velez Pamatong filed his Certificate of Candidacy for President on December 17, 2003. Respondent Commission on Elections

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is nothing in the plain language of the provision which suggests such a thrust or justifies an interpretation of the sort. The "equal access" provision is a subsumed part of Article II of the Constitution, entitled "Declaration of Principles and State Policies." The provisions under the Article are generally considered not selfexecuting,2 and there is no plausible reason for according a different treatment to the "equal access" provision. Like the rest of the policies enumerated in Article II, the provision does not contain any judicially enforceable constitutional right but merely specifies a guideline for legislative or executive action. 3 The disregard of the provision does not give rise to any cause of action before the courts.4 An inquiry into the intent of the framers5 produces the same determination that the provision is not self-executory. The original wording of the present Section 26, Article II had read, "The State shall broaden opportunities to public office and prohibit public dynasties."6 Commissioner (now Chief Justice) Hilario Davide, Jr. successfully brought forth an amendment that changed the word "broaden" to the phrase "ensure equal access," and the substitution of the word "office" to "service." He explained his proposal in this wise: I changed the word "broaden" to "ENSURE EQUAL ACCESS TO" because what is important would be equal access to the opportunity. If you broaden, it would necessarily mean that the government would be mandated to create as many offices as are possible to accommodate as many people as are also possible. That is the meaning of broadening opportunities to public service. So, in order that we should not mandate the State to make the government the number one employer and to limit offices only to what may be necessary and expedient yet offering equal opportunities to access to it, I change the word "broaden."7 (emphasis supplied) Obviously, the provision is not intended to compel the State to enact positive measures that would accommodate as many people as possible into public office. The approval of the "Davide amendment" indicates the design of the framers to cast the provision as simply enunciatory of a desired policy objective and not reflective of the imposition of a clear State burden. Moreover, the provision as written leaves much to be desired if it is to be regarded as the source of positive rights. It is difficult to interpret the clause as operative in the absence of legislation since its effective means and reach are not properly defined. Broadly written, the myriad of claims that can be subsumed under this rubric appear to be entirely open-ended.8 Words and phrases such as "equal access," "opportunities," and "public service" are susceptible to countless interpretations owing to their inherent impreciseness. Certainly, it was not the intention of the framers to inflict on the people an operative but amorphous foundation from

which innately unenforceable rights may be sourced. As earlier noted, the privilege of equal access to opportunities to public office may be subjected to limitations. Some valid limitations specifically on the privilege to seek elective office are found in the provisions9 of the Omnibus Election Code on "Nuisance Candidates" and COMELEC Resolution No. 645210 dated December 10, 2002 outlining the instances wherein the COMELEC may motu proprio refuse to give due course to or cancel a Certificate of Candidacy. As long as the limitations apply to everybody equally without discrimination, however, the equal access clause is not violated. Equality is not sacrificed as long as the burdens engendered by the limitations are meant to be borne by any one who is minded to file a certificate of candidacy. In the case at bar, there is no showing that any person is exempt from the limitations or the burdens which they create. Significantly, petitioner does not challenge the constitutionality or validity of Section 69 of the Omnibus Election Code and COMELEC Resolution No. 6452 dated 10 December 2003. Thus, their presumed validity stands and has to be accorded due weight. Clearly, therefore, petitioners reliance on the equal access clause in Section 26, Article II of the Constitution is misplaced. The rationale behind the prohibition against nuisance candidates and the disqualification of candidates who have not evinced a bona fide intention to run for office is easy to divine. The State has a compelling interest to ensure that its electoral exercises are rational, objective, and orderly. Towards this end, the State takes into account the practical considerations in conducting elections. Inevitably, the greater the number of candidates, the greater the opportunities for logistical confusion, not to mention the increased allocation of time and resources in preparation for the election. These practical difficulties should, of course, never exempt the State from the conduct of a mandated electoral exercise. At the same time, remedial actions should be available to alleviate these logistical hardships, whenever necessary and proper. Ultimately, a disorderly election is not merely a textbook example of inefficiency, but a rot that erodes faith in our democratic institutions. As the United States Supreme Court held: [T]here is surely an important state interest in requiring some preliminary showing of a significant modicum of support before printing the name of a political organization and its candidates on the ballot the interest, if no other, in avoiding confusion, deception and even frustration of the democratic [process].11 The COMELEC itself recognized these practical considerations when it promulgated Resolution No. 6558 on 17 January 2004, adopting the study

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Memorandum of its Law Department dated 11 January 2004. As observed in the COMELECs Comment: There is a need to limit the number of candidates especially in the case of candidates for national positions because the election process becomes a mockery even if those who cannot clearly wage a national campaign are allowed to run. Their names would have to be printed in the Certified List of Candidates, Voters Information Sheet and the Official Ballots. These would entail additional costs to the government. For the official ballots in automated counting and canvassing of votes, an additional page would amount to more or less FOUR HUNDRED FIFTY MILLION PESOS (P450,000,000.00). xxx[I]t serves no practical purpose to allow those candidates to continue if they cannot wage a decent campaign enough to project the prospect of winning, no matter how slim.12 The preparation of ballots is but one aspect that would be affected by allowance of "nuisance candidates" to run in the elections. Our election laws provide various entitlements for candidates for public office, such as watchers in every polling place,13 watchers in the board of canvassers,14 or even the receipt of electoral contributions.15 Moreover, there are election rules and regulations the formulations of which are dependent on the number of candidates in a given election. Given these considerations, the ignominious nature of a nuisance candidacy becomes even more galling. The organization of an election with bona fide candidates standing is onerous enough. To add into the mix candidates with no serious intentions or capabilities to run a viable campaign would actually impair the electoral process. This is not to mention the candidacies which are palpably ridiculous so as to constitute a one-note joke. The poll body would be bogged by irrelevant minutiae covering every step of the electoral process, most probably posed at the instance of these nuisance candidates. It would be a senseless sacrifice on the part of the State. Owing to the superior interest in ensuring a credible and orderly election, the State could exclude nuisance candidates and need not indulge in, as the song goes, "their trips to the moon on gossamer wings." The Omnibus Election Code and COMELEC Resolution No. 6452 are cognizant of the compelling State interest to ensure orderly and credible elections by excising impediments thereto, such as nuisance candidacies that distract and detract from the larger purpose. The COMELEC is mandated by the Constitution with the administration of elections16 and endowed with considerable latitude in adopting means and methods that will ensure the promotion of free, orderly and honest elections.17 Moreover, the Constitution guarantees that only bona fide

candidates for public office shall be free from any form of harassment and discrimination.18 The determination of bona fide candidates is governed by the statutes, and the concept, to our mind is, satisfactorily defined in the Omnibus Election Code. Now, the needed factual premises. However valid the law and the COMELEC issuance involved are, their proper application in the case of the petitioner cannot be tested and reviewed by this Court on the basis of what is now before it. The assailed resolutions of the COMELEC do not direct the Court to the evidence which it considered in determining that petitioner was a nuisance candidate. This precludes the Court from reviewing at this instance whether the COMELEC committed grave abuse of discretion in disqualifying petitioner, since such a review would necessarily take into account the matters which the COMELEC considered in arriving at its decisions. Petitioner has submitted to this Court mere photocopies of various documents purportedly evincing his credentials as an eligible candidate for the presidency. Yet this Court, not being a trier of facts, can not properly pass upon the reproductions as evidence at this level. Neither the COMELEC nor the Solicitor General appended any document to their respective Comments. The question of whether a candidate is a nuisance candidate or not is both legal and factual. The basis of the factual determination is not before this Court. Thus, the remand of this case for the reception of further evidence is in order. A word of caution is in order. What is at stake is petitioners aspiration and offer to serve in the government. It deserves not a cursory treatment but a hearing which conforms to the requirements of due process. As to petitioners attacks on the validity of the form for the certificate of candidacy, suffice it to say that the form strictly complies with Section 74 of the Omnibus Election Code. This provision specifically enumerates what a certificate of candidacy should contain, with the required information tending to show that the candidate possesses the minimum qualifications for the position aspired for as established by the Constitution and other election laws. IN VIEW OF THE FOREGOING, COMELEC Case No. SPP (MP) No. 04-001 is hereby remanded to the COMELEC for the reception of further evidence, to determine the question on whether petitioner Elly Velez Lao Pamatong is a nuisance candidate as contemplated in Section 69 of the Omnibus Election Code. The COMELEC is directed to hold and complete the reception of evidence and report its findings to this Court with deliberate dispatch. SO ORDERED.

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Davide, Jr., Puno, Vitug*, Panganiban, Quisumbing, Ynares-Santiago, Sandoval-Gutierrez, Carpio, Austria-Martinez, Corona, Carpio-Morales, Callejo, Sr., and Azcuna, JJ., concur.

there can be no legal right as against the authority that makes the law on which the right depends." 5 This is not to deny that while indeed logical and far from impractical the doctrine does give rise to problems considering how widely immersed in matters hitherto deemed outside its sphere the government is at present. Nor is it likely considering its expanding role, demanded by the times and warranted by the Constitution, that a halt would be called to many of its activities, at times unavoidably adversely affecting private rights. Nonetheless, a continued adherence to the doctrine of non-suability is not to be deplored for as against the inconvenience that may be caused private parties, the loss of governmental efficiency and the obstacle to the performance of its multifarious functions are far greater if such a fundamental principle were abandoned and the availability of judicial remedy were not thus restricted. With the well known propensity on the part of our people to go to court, at the least provocation, the loss of time and energy required to defend against law suits, in the absence of such a basic principle that constitutes such an effective obstacle could very well be imagined. 1awphl.nt At any rate, in case of a money claim arising from contract, express or implied, which could serve as a basis for civil action between private, parties, such a consent has been given by a statute enacted by the Philippine legislature, even before the Constitution took effect and still applicable at present. 6 The procedure provided for in such a statute 7 was made more expeditious by a Commonwealth Act, enabling the party or entity, who feels aggrieved by the final decision of the Auditor General required to decide the claim within sixty days, having the right to go to this Court for final adjudication. 8 It is worthy of note likewise that in the pursuit of its activities affecting business, the government has increasingly relied on private corporations possessing the power to sue and be sued. 9 Thus the doctrine of non-suability of the government without its consent, as it has operated in practice, hardly lends itself to the charge that it could be the fruitful parent of injustice, considering the vast and ever-widening scope of state activities at present being undertaken. Whatever difficulties for private claimants may still exist, is, from an objective appraisal of all factors, minimal. In the balancing of interests, so unavoidable in the determination of what. principles must prevail if government is to satisfy the public weal, the verdict must be, as it has been these so many years, for its continuing recognition as a fundamental postulate of constitutional law. WHEREFORE, the order of dismissal of the lower court of May 23, 1966 is affirmed. With costs against plaintiff-appellant. Concepcion, C.J., Dizon, Makalintal, Zaldivar, Sanchez, Castro, Capistrano and Teehankee, JJ., concur. Barredo, J., took no part. Reyes, J.B.L., J., is on leave.

G.R. No. L-26386

September 30, 1969

PROVIDENCE WASHINGTON INSURANCE CO., plaintiff-appellant, vs. REPUBLIC OF THE PHILIPPINES and BUREAU OF CUSTOMS, defendants-appellees. FERNANDO, J.: Providence Washington Insurance Co. filed, on October 21, 1966, its brief as appellant against an order of the lower court dismissing its suit for the non-delivery of thirty cases of steel files, which cargo was insured by it against loss and damage, naming as defendants the Republic of the Philippines and the Bureau of Customs as the operator of the arrastre service, thus rendering unavoidable the invocation of the well-settled doctrine of non-suability of the government. Less than two months later, on December 17, 1966, our decision in Mobil Philippines Exploration, Inc. v. Customs Arrastre Service was promulgated. 1 We there explicitly held: "The Bureau of Customs, acting as part of the machinery of the national government in the operation of the arrastre service, pursuant to express legislative mandate and as a necessary incident of its prime governmental function, is immune from suit, there being no statute to the contrary." As of this date, thirty-six subsequent cases, certainly a figure far from unimpressive, have been similarly decided expressly reaffirming the above ruling of governmental immunity from suit without its consent. 2 The futility of this appeal is quite apparent. We affirm the lower court order of dismissal. The doctrine of non-suability thus holds undisputed sway. Its primacy appears to be undeniable. For a suit of this character to prosper, there must be a showing of consent either in express terms or by implication through the use of statutory language too plain to be misinterpreted. Its absence being obvious, the lower court acted correctly. Nor did the Mobil decision blaze a new trail. So it has been from the time the Constitution took effect in 1935. Bull v. Yatco, a 1939 decision during the Commonwealth, spoke to that effect. 3 Adherence to such a view is reflected in the various cases decided after independence before the Mobil Exploration case. 4 The classic formulation of Holmes of this doctrine of non-suability thus bears restatement: "A sovereign is exempt from suit, not because of any formal conception or obsolete theory, but on the logical and practical round that

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