Republic vs. Sandiganbayan, G.R. No.

104768, July 21, 2003

Facts:

Immediately upon her assumption to office following the successful EDSA Revolution, then President Corazon C.
Aquino issued Executive Order No. 1 (“EO No. 1”) creating the Presidential Commission on Good Government
(“PCGG”). EO No. 1 primarily tasked the PCGG to recover all ill-gotten wealth of former President Ferdinand E.
Marcos, his immediate family, relatives, subordinates and close associates. Accordingly, the PCGG, through its then
Chairman Jovito R. Salonga, created an AFP Anti-Graft Board (“AFP Board”) tasked to investigate reports of
unexplained wealth and corrupt practices by AFP personnel, whether in the active service or retired.

Based on its mandate, the AFP Board investigated various reports of alleged unexplained wealth of respondent
Major General Josephus Q. Ramas (“Ramas”). Later, the AFP Board issued a Resolution on its findings and
recommendation on the reported unexplained wealth of Ramas.

On 3 March 1986, the Constabulary raiding team served at Dimaano’s residence a search warrant captioned “Illegal
Possession of Firearms and Ammunition.” The raiding team seized the items detailed in the seizure receipt
together with other items not included in the search warrant. The raiding team seized firearms, jewelry, and land
titles.

Thus, on 1 August 1987, the PCGG filed a petition for forfeiture under Republic Act No. 1379 (“RA No.
1379”) against Ramas. The complaint was amended to include Elizabeth Dimaano, the alleged mistress of Ramas, as
co-defendant.

The Amended Complaint further alleged that Ramas “acquired funds, assets and properties manifestly out of
proportion to his salary as an army officer and his other income from legitimately acquired property by taking undue
advantage of his public office and/or using his power, authority and influence as such officer of the Armed Forces of
the Philippines and as a subordinate and close associate of the deposed President Ferdinand Marcos.” The Amended
Complaint prayed for, among others, the forfeiture of respondents’ properties, funds and equipment in favor of the
State.

Trial ensured. However, the Sandiganbayan subsequently dismissed the complaint because there was an illegal
search and seizure of the items confiscated, among others.

Hence, this appeal.

Petitioner wants the Court to take judicial notice that the raiding team conducted the search and seizure “on March
3, 1986 or five days after the successful EDSA revolution.” Petitioner argues that a revolutionary government was
operative at that time by virtue of Proclamation No. 1 announcing that President Aquino and Vice President Laurel
were “taking power in the name and by the will of the Filipino people.” Petitioner asserts that the revolutionary
government effectively withheld the operation of the 1973 Constitution which guaranteed private respondents’
exclusionary right.

Moreover, petitioner argues that the exclusionary right arising from an illegal search applies only beginning 2
February 1987, the date of ratification of the 1987 Constitution. Petitioner contends that all rights under the Bill of
Rights had already reverted to its embryonic stage at the time of the search. Therefore, the government may
confiscate the monies and items taken from Dimaano and use the same in evidence against her since at the time of
their seizure, private respondents did not enjoy any constitutional right.
Issue:

Whether or not the search of Dimaano’s home was legal

Held:

The search and seizure of Dimaano’s home were NOT legal.

The Bill of Rights under the 1973 Constitution was not operative during the interregnum.

The EDSA Revolution took place on 23-25 February 1986. As succinctly stated in President Aquino’s Proclamation
No. 3 dated 25 March 1986, the EDSA Revolution was “done in defiance of the provisions of the 1973
Constitution.“ The resulting government was indisputably a revolutionary government bound by no constitution or
legal limitations except treaty obligations that the revolutionary government, as the de jure government in the
Philippines, assumed under international law.

During the interregnum, the directives and orders of the revolutionary government were the supreme law because no
constitution limited the extent and scope of such directives and orders. With the abrogation of the 1973 Constitution
by the successful revolution, there was no municipal law higher than the directives and orders of the revolutionary
government. Thus, during the interregnum, a person could not invoke any exclusionary right under a Bill of Rights
because there was neither a constitution nor a Bill of Rights during the interregnum.

To hold that the Bill of Rights under the 1973 Constitution remained operative during the interregnum would render
void all sequestration orders issued by the Philippine Commission on Good Government (“PCGG”) before the
adoption of the Freedom Constitution. The sequestration orders, which direct the freezing and even the take-over of
private property by mere executive issuance without judicial action, would violate the due process and search and
seizure clauses of the Bill of Rights.

During the interregnum, the government in power was concededly a revolutionary government bound by no
constitution. No one could validly question the sequestration orders as violative of the Bill of Rights because there
was no Bill of Rights during the interregnum.

The protection accorded to individuals under the International Covenant on Civil and Political Rights (ICCPR)
and the Universal Declaration of Human Rights (UDHR) remained in effect during the interregnum.

Nevertheless, even during the interregnum the Filipino people continued to enjoy, under the ICCPR and the UDHR,
almost the same rights found in the Bill of Rights of the 1973 Constitution.

The revolutionary government, after installing itself as the de jure government, assumed responsibility for the State’s
good faith compliance with the ICCPR to which the Philippines is a signatory. Article 2(1) of the ICCPR requires
each signatory State “to respect and to ensure to all individuals within its territory and subject to its jurisdiction the
rights recognized in the present ICCPR.” Under Article 17(1) of the ICCPR, the revolutionary government had the
duty to insure that “[n]o one shall be subjected to arbitrary or unlawful interference with his privacy, family, home or
correspondence.”

The UDHR, to which the Philippines is also a signatory, provides in its Article 17(2) that “[n]o one shall be
arbitrarily deprived of his property.” Although the signatories to the UDHR did not intend it as a legally binding
document, being only a UDHR, the Court has interpreted the UDHR as part of the generally accepted principles of
international law and binding on the State. Thus, the revolutionary government was also obligated under
international law to observe the rights of individuals under the UDHR.
The revolutionary government did not repudiate the ICCPR or the UDHR during the interregnum. Whether the
revolutionary government could have repudiated all its obligations under the ICCPR or the UDHR is another matter
and is not the issue here. Suffice it to say that the Court considers the UDHR as part of customary international law,
and that Filipinos as human beings are proper subjects of the rules of international law laid down in the ICCPR. The
fact is the revolutionary government did not repudiate the ICCPR or the UDHR in the same way it repudiated the
1973 Constitution. As the de jure government, the revolutionary government could not escape responsibility for the
State’s good faith compliance with its treaty obligations under international law.

It was only upon the adoption of the Provisional Constitution on 25 March 1986 that the directives and orders of the
revolutionary government became subject to a higher municipal law that, if contravened, rendered such directives
and orders void. The Provisional Constitution adopted verbatim the Bill of Rights of the 1973 Constitution. The
Provisional Constitution served as a self-limitation by the revolutionary government to avoid abuses of the absolute
powers entrusted to it by the people.

During the interregnum when no constitution or Bill of Rights existed, directives and orders issued by government
officers were valid so long as these officers did not exceed the authority granted them by the revolutionary
government. The directives and orders should not have also violated the ICCPR or the UDHR. In this case, the
revolutionary government presumptively sanctioned the warrant since the revolutionary government did not
repudiate it. The warrant, issued by a judge upon proper application, specified the items to be searched and seized.
The warrant is thus valid with respect to the items specifically described in the warrant.

It is obvious from the testimony of Captain Sebastian that the warrant did not include the monies, communications
equipment, jewelry and land titles that the raiding team confiscated. The search warrant did not particularly describe
these items and the raiding team confiscated them on its own authority. The raiding team had no legal basis to seize
these items without showing that these items could be the subject of warrantless search and seizure. Clearly, the
raiding team exceeded its authority when it seized these items.

The seizure of these items was therefore void, and unless these items are contraband per se, and they are not, they
must be returned to the person from whom the raiding seized them. However, we do not declare that such person is
the lawful owner of these items, merely that the search and seizure warrant could not be used as basis to seize and
withhold these items from the possessor. We thus hold that these items should be returned immediately to Dimaano.

EN BANC

[G.R. No. L-25916. April 30, 1970.]

GAUDENCIO A. BEGOSA, Plaintiff-Appellee, v. CHAIRMAN, PHILIPPINE VETERANS

ADMINISTRATION; and MEMBERS OF THE BOARD OF ADMINISTRATORS, PHILIPPINE
VETERANS ADMINISTRATION, Defendants-Appellants.

Jose V . Rosales for Plaintiff-Appellee.

Solicitor General, for Defendants-Appellants.

SYLLABUS

1. REMEDIAL LAW; PARTIES; DOCTRINE OF NON-SUABILITY OF STATE, EXCEPTION.— It is well

settled that where a litigation may have adverse consequences on the public treasury, whether in the
disbursements of funds or loss of property, the public official proceeded against not being liable in his
personal capacity, then the doctrine of non-suability may appropriately be invoked. It has no application,
however, where the suit against such a functionary had to be instituted because of his failure to comply with
the duty imposed by statute appropriating public funds for the benefit of plaintiff or petitioner

2. ID.; ADMINISTRATIVE LAW; EXHAUSTION OF ADMINISTRATIVE REMEDY UNNECESSARY WHERE

QUESTION IS LEGAL; CASE AT BAR.— It is well established that the principle requiring the previous
exhaustion of administrative remedies is not applicable ‘where the question in dispute is purely a legal one,’ or
where the controverted act is ‘patently illegal’ or was performed without jurisdiction or in excess of jurisdiction, or
where the respondent is a department Secretary, whose acts as an alter-ego of the President bear the implied or
assumed approval of the latter, unless actually disapproved by him, or where there are circumstances indicating the
urgency of judicial intervention. Where there is a stipulation of facts, as in this case, the question before the lower
court being solely one of law and on the face of the decision, the actuation of appellants being patently illegal, the
doctrine of exhaustion of administrative remedies certainly does not come into play.

3. ID.; ID.; FINDINGS OF REGULATORY AGENCIES ENTITLED TO RESPECT.— It has often been
announced, and rightly so, that as much as possible the findings of regulatory agencies which are expected to
acquire expertise by their jurisdiction being confined to specific matters, deserve to be accorded respect and finality.
There is a limit, however, to such a deference paid to the actuations of such bodies. Clearly, where there has been a
failure to interpret and apply the statutory provisions in question, judicial power should assert itself. Under the
theory of separation of powers, it is to the judiciary, and to the judiciary alone, that the final say on questions of law
in appropriate cases coming before it is vested.

DECISION

FERNANDO, J.:

Plaintiff Gaudencio A. Begosa, now appellee, sought the aid of the judiciary to obtain the benefits to which he
believed he was entitled under the Veterans’ Bill of Rights. 1 To such a move, there was an insistent objection, both
vigorous and persistent, on the part of defendants, the chairman and the members of the Philippine Veterans
Administration, now appellants. The lower court, then presided by the then Judge, now Justice of the Court of
Appeals, the Honorable Edilberto Soriano, found for plaintiffs, after a careful and meticulous study of the applicable
statutory provisions. Not being satisfied with such a judgment, defendants appealed, relying once more on the
principal grounds raised below that plaintiff should have exhausted his administrative remedies before coming to
court and that he was in fact suing the State without its consent having been obtained. As neither defense is
sufficiently meritorious, we affirm the lower court decision.

As noted in such decision, appellee’s complaint was predicated on his having been "an enlisted man in good
standing of the Philippine Commonwealth Army, inducted in the service of the USAFFE" and having taken "active
participation in the battle of Bataan" as well as the "liberation drive against the enemy" thereafter having become
"permanently incapacitated from work due to injuries he sustained in line of duty . . ." 2 It was likewise asserted in
his complaint that after having submitted all the supporting papers relative to his complaint, there was a disapproval
on the part of defendants on the ground of his having been dishonorably discharged, although such an event did not
take place until almost five years after the end of the war on November 7, 1950 and while he was in the service of a
different organization that such a penalty was imposed on him. 3

Then came the allegation that there was an approval on his claim on September 2, 1964 but effective only as of
October 5 of that year, and for amount much less than that to which he was entitled under the law. 4 The relief
sought was the payment, as of the date to which he believed his right to pension should have been respected, of the
sums, which he felt were legally due and owing to him.chanrobles virtual lawlibrary

The then Judge Soriano noted that there was an admission of certain allegations to the complaint with others being
denied, and that the following affirmative and special defenses were interposed: "Defendants’ answer admits certain
allegations of said complaint, while denying others; set up the following affirmative and special defenses: (1)
payment of disability pension under Republic Act No. 65, as amended, by the Philippine Veterans Administration
commences from the date the proper application therefor is approved; (2) plaintiff has not exhausted all
administrative remedies before resorting to court action, hence the present action is premature; (3) inasmuch as the
instant action pertains to money claim against the Government, it must first be presented before the Auditor General
as provided by existing law on the matter (C.A. 327); and (4) plaintiff’s claim is in reality a suit against the
Government which cannot be entertained by this Court for lack of jurisdiction because the Government has not
given its consent, . . ." 5 The case was then submitted on an agreed statement of facts and the respective memoranda
of the parties.

In the decision now on appeal, the question of when appellee is entitled to his pension as well as how much it would
amount to were fully discussed by the lower court. Thus, as to the former: "From the facts just set out, it will be
noted that plaintiff filed his said claim for disability pension as far back as March 4, 1955; that it was erroneously
disapproved on June 21, 1955, because his dishonorable discharge from the Army was not a good or proper ground
for the said disapproval, and that on reconsideration asked for by him on November 1, 1957, which he continued to
follow up, the Board of Administrators, Philippine Veterans Administration, composed of herein defendants, which
took over the duties of the Philippine Veterans Board, finally approved his claim on September 2, 1964, at the rate of
P30.00 a month." 6 After stating that in fairness and good conscience the said claims could be made effective as of
June 21, 1955, when it was erroneously disapproved by appellants, and not on September 2, 1964 when it was
approved on reconsideration, as appellee should not for obvious reason be made to suffer for the error of another, the
then Judge Soriano observed further: "Had it not been for the said error, it appears that there was no good ground to
deny the said claim, so the latter was valid and meritorious even as of the date of its filing on March 4, 1955, hence
to make the same effective only as of the date of its approval on September 2, 1964 — according to defendant’s
stand —would be greatly unfair and prejudicial to plaintiff. This is especially true in the light of the well-known
intent of the legislature in passing these pension laws of war veterans, and the no less well-known spirit in which
they should be construed or interpreted by the courts in favor of their beneficiaries." 7

On the question of how much plaintiff should receive according to law, the appealed decision contains the following:
"The next question for resolution refers to the monthly rate or amount to which plaintiff is entitled by way of
pension. According to plaintiff, he should be given a disability pension of P50.00 a month from June 21, 1955 (the
effective date of his claim as above found by this Court) until June 21, 1957, and P100.00 a month for life from June
22, 1957 when Section 9 of Republic Act No. 65, as amended by Republic Act No. 1362, was further amended by
Republic Act No. 1920). This contention is well taken because the very letter of the Philippine Veterans
Administration to plaintiff (Annex F of the [Agreed Statements of Facts]) contains the following: ‘Note: Re-rating is
not required, permanent disability.’ By ‘permanent disability’, as this Court understands it, is meant that plaintiff is
permanently incapacitated from work. Under Section 9 of Republic Act No. 65, as amended by Republic Act No.
1362, which was the law in force when plaintiff’s claim for pension should have been approved on June 21, 1955, he
was entitled to a pension of P50.00 a month as such permanently incapacitated person, which monthly rate or
amount was increased to P100.00 a month when the said Section 9 was further amended by Republic Act No. 1920
on June 22, 1957." 8 Why the action of appellants in the form of resolution could not prevail as against the law was
made clear by the decision in this wise: "For one thing, the said resolution may not change or amend the meaning of
the term ‘permanent disability’ as used by Congress itself in enacting the said Section 9 of Republic Act No. 65, as
amended. For another, as of June 21, 1955 and as of June 21, 1957, plaintiff was already entitled to the said pension
of P50.00 and P100.00 a month respectively, and his said right cannot be adversely affected by a resolution which
was allegedly adopted only in 1963." 9 Necessarily, there was in the decision likewise a recognition of the monthly
allowance for each of appellee’s unmarried minor children below 18 years of age at the time he was entitled to the
pension to which under the statute he could validly lay claim.chanroblesvirtuallawlibrary

After rejecting as untenable the defenses that there was no exhaustion of administrative remedies, that the action is
in the nature of money claim which should first be presented before the Auditor General, and that said action is in
reality a suit against the Government without the latter’s consent, the decision concludes with the following:"
[Wherefore], judgment is hereby rendered in accordance with the prayer of plaintiff’s amended complaint, to wit,
that defendants make plaintiff’s pension effective June 21, 1955 at the rate of P50.00 a month up to June 21, 1957 at
the rate of P100.00 a month, plus P10.00 a month each for his four unmarried minor children below 18 years old
from June 22, 1957 up to September 1, 1964; and the difference of P70.00 a month, plus P10.00 for his one
unmarried minor child below 18 years old from September 2, 1954, and thereafter, with costs against said
dependents." 10
Appellants elevated the matter to us. The careful and painstaking way in which the controlling statutory provisions
were considered and applied by the then Judge Soriano must have impelled them to place their faith in the alleged
failure to respect the doctrines of non-suability and exhaustion of administrative remedies to obtain a reversal. The
appealed decision, however, as will now be shown is not subject to such a reproach. The appeal then, as noted at the
outset, is not to be attended with success.

1. The fourth assignment of error assails what it considers to be the failing of the lower court in not holding
that the complaint in this case is in effect a suit against the State which has not given its consent thereto. We
have recently had occasion to reaffirm the force and primacy of the doctrine of non-suability. 11 It does not
admit of doubt, then, that if the suit were in fact against the State, the lower court should have dismissed the
complaint. Nor is it to be doubted that while ostensibly an action may be against a public official, the
defendant may in reality be the government. As a result, it is equally well-settled that where a litigation may
have adverse consequences on the public treasury, whether in the disbursements of funds or loss of property,
the public official proceeded against not being liable in his personal capacity, then the doctrine of non-
suability may appropriately be invoked. It has no application, however, where the suit against such a
functionary had to be instituted because of his failure to comply with the duty imposed by statute
appropriating public funds for the benefit of plaintiff or petitioner. Such is the present case.chanroblesvirtual|
awlibrary

The doctrine announced by us in Ruiz v. Cabahug 12 finds relevance: "We hold that under the facts and
circumstances alleged in the amended complaint, which should be taken on its face value, the suit is not one
against the Government, or a claim against it, but one against the officials to compel them to act in
accordance with the rights to be established by the contending architects, or to prevent them from making
payment and recognition until the contending architects have established their respective rights and interests
in the funds retained and in the credit for the work done." 13 As a matter of fact, in an earlier case where we
sustained the power of a private citizen claiming title to and right of possession of a certain property to sue an
officer or agent of the government alleged to be illegally withholding the same, we likewise expressed this
caveat: "However, and this is important, where the judgment in such a case would result not only in the
recovery of possession of the property in favor of said citizen but also in a charge against or financial liability
to the Government, then the suit should be regarded as one against the government itself, and, consequently,
it cannot prosper or be validly entertained by the courts except with the consent of said Government." 14

2. Nor is the third assignment of error to the effect that the lower court did not require appellee to exhaust his
administrative remedies before coming to court any more persuasive. An excerpt from the leading case of Gonzales
v. Hechanova, 15 the opinion being penned by the present Chief Justice, clearly demonstrates why appellants’
argument in this respect is unavailing: "Respondents assail petitioner’s right to the reliefs prayed for because he ‘has
not exhausted all administrative remedies available to him before coming to court.’ We have already held, however,
that the principle requiring the previous exhaustion of administrative remedies is not applicable ‘where the question
in dispute is purely a legal one’, or where the controverted act is ‘patently illegal’ or was performed without
jurisdiction or in excess of jurisdiction, or where the respondent is a department secretary, whose acts as an alter-ego
of the President bear the implied or assumed approval of the latter, unless actually disapproved by him, or where
there are circumstances indicating the urgency of judicial intervention." 16 The Gonzales doctrine, it is to be noted,
summarized the views announced in earlier cases. 17 The list of subsequent cases reiterating such a doctrine is quite
impressive. 18 To be more specific, where there is a stipulation of facts, as in this case, the question before the lower
court being solely one of law and on the face of the decision, the actuation of appellants being patently illegal, the
doctrine of exhaustion of administrative remedies certainly does not come into play.

3. The other errors assigned, namely the alleged failure of the lower court to comply with the law in fixing the
amounts to which appellee is entitled instead of following the rules and regulations on veterans’ benefits
promulgated by appellants and the alleged interference with the purely discretionary matter of a coordinate
administrative agent, the Philippine Veterans Administration, can easily be disposed of. It is to be admitted that
appellants as chairman and members of the Philippine Veterans Administration, formerly the Philippine Veterans
Board, are officials of an administrative body. 19 Nor may exception be taken to the general principle that as much
as possible the courts should view with the utmost sympathy the exercise of power of administrative tribunals
whether in its rule-making or adjudicatory capacity. It has often been announced, and rightly so, that as much as
possible the findings of these regulatory agencies which are expected to acquire expertise by their jurisdiction being
confined to specific matters, deserve to be accorded respect and finality. There is a limit, however, to such a
deference paid to the actuations of such bodies. Clearly, where there has been a failure to interpret and apply the
statutory provisions in question, judicial power should assert itself. Under the theory of separation of powers, it is to
the judiciary and to the judiciary alone, that the final say on questions of law appropriate cases coming before it is
vested.chanrobles.com : virtual law library

When the then Judge Soriano, therefore, as he was called upon to do, saw to it that there was strict compliance with
the amounts of pension required by the law to be granted plaintiff and disregarded the regulation promulgated under
the rule-making power of appellants, the effect of which would make appellee suffer the consequences of an error
committed by them, it cannot be truly said that his decision may be assailed as being offensive to authoritative
doctrines. On the contrary, it can stand the test of the utmost scrutiny. Precisely because the commands of the law
were duly carried out, it cannot be set aside.

WHEREFORE, the decision of the then Judge Edilberto Soriano of the Court of First Instance of Manila
promulgated on January 22, 1966, is affirmed. Without pronouncement as to costs.

Concepcion, C.J., Reyes, J .B.L., Dizon, Makalintal, Zaldivar, Castro and Villamor, JJ., concur.

Teehankee, J., concurs in the result.

Barredo, J . is on leave.

REPUBLIC VS FELICIANO
G.R. No. 70853 148 SCRA 424 March 12, 1987
REPUBLIC OF THE PHILIPPINES, petitioner-appellee,
PABLO FELICIANO and INTERMEDIATE APPELLATE COURT, respondents-appellants

Facts:
The appeal was filed by 86 settlers of Barrio of Salvacion, representing the Republic of the Philippines to dismiss
the complaint filed by Feliciano, on the ground that the Republic of the Philippines cannot be sued without its
consent.

Prior to this appeal, respondent Pablo Feliciano filed a complaint with the Court of First Instance against the
Republic of the Philippines, represented by the Land Authority, for the recovery of ownership and possession of a
parcel of land consisting of four lots. The trial court rendered a decision declaring Lot No. 1 to be the private
property of Feliciano and the rest of the property, Lots 2, 3 and 4, reverted to the public domain.

The trial court reopened the case due to the filing of a motion to intervene and to set aside the decision of the trial
court by 86 settlers, alleging that they had been in possession of the land for more than 20 years under claim of
ownership. The trial court ordered the settlers to present their evidence but they did not appear at the day of
presentation of evidence. Feliciano, on the other hand, presented additional evidence. Thereafter, the case was
submitted for decision and the trial court ruled in favor of Feliciano.
The settlers immediately filed a motion for reconsideration. The case was reopened to allow them to present their
evidence. But before this motion was acted upon, Feliciano filed a motion for execution with the Appellate Court but
it was denied.

The settlers filed a motion to dismiss on the ground that the Republic of the Philippines cannot be sued without its
consent and hence the action cannot prosper. The motion was opposed by Feliciano.

Issue/s:
Whether or not the state can be sued for recovery and possession of a parcel of land.

Discussions:
A suit against the State, under settled jurisprudence is not permitted, except upon a showing that the State has
consented to be sued, either expressly or by implication through the use of statutory language too plain to be
misinterpreted. It may be invoked by the courts sua sponte at any stage of the proceedings.

Waiver of immunity, being a derogation of sovereignty, will not be inferred lightly. but must be construed in
strictissimi juris (of strictest right). Moreover, the Proclamation is not a legislative act. The consent of the State to
be sued must emanate from statutory authority. Waiver of State immunity can only be made by an act of the
legislative body.

Ruling/s:
No. The doctrine of non-suability of the State has proper application in this case. The plaintiff has impleaded the
Republic of the Philippines as defendant in an action for recovery of ownership and possession of a parcel of land,
bringing the State to court just like any private person who is claimed to be usurping a piece of property. A suit for
the recovery of property is not an action in rem, but an action in personam. It is an action directed against a specific
party or parties, and any judgment therein binds only such party or parties. The complaint filed by plaintiff, the
private respondent herein, is directed against the Republic of the Philippines, represented by the Land Authority, a
governmental agency created by Republic Act No. 3844.

The complaint is clearly a suit against the State, which under settled jurisprudence is not permitted, except upon a
showing that the State has consented to be sued, either expressly or by implication through the use of statutory
language too plain to be misinterpreted. There is no such showing in the instant case. Worse, the complaint itself
fails to allege the existence of such consent.

MERRIT VS. GOVT. OF THE PHIL. ISLANDS

FACTS: Merrit was riding a motorcycle along Padre Faura Street when he was bumped by the ambulance of the
General Hospital. Merrit sustained severe injuries rendering him unable to return to work. The legislature later
enacted Act 2457 authorizing Merritt to file a suit against the Government in order to fix the responsibility for the
collision between his motorcycle and the ambulance of the General Hospital, and to determine the amount of the
damages, if any, to which he is entitled. After trial, the lower court held that the collision was due to the negligence
of the driver of the ambulance. It then determined the amount of damages and ordered the government to pay the
same.

ISSUES:

1. Did the Government, in enacting the Act 2457, simply waive its immunity from suit or did it also concede its
liability to the plaintiff?

2. Is the Government liable for the negligent act of the driver of the ambulance?

HELD:

1. By consenting to be sued a state simply waives its immunity from suit. It does not thereby concede its liability to
plaintiff, or create any cause of action in his favor, or extend its liability to any cause not previously recognized. It
merely gives a remedy to enforce a preexisting liability and submits itself to the jurisdiction of the court, subject to
its right to interpose any lawful defense.

2. Under the Civil Code, the state is liable when it acts through a special agent, but not when the damage should
have been caused by the official to whom properly it pertained to do the act performed. A special agent is one who
receives a definite and fixed order or commission, foreign to the exercise of the duties of his office if he is a special
official. This concept does not apply to any executive agent who is an employee of the acting administration and
who on his own responsibility performs the functions which are inherent in and naturally pertain to his office and
which are regulated by law and the regulations. The driver of the ambulance of the General Hospital was not a
special agent; thus the Government is not liable. (Merritt vs Government of the Philippine Islands, G.R. No. L-
11154, March 21 1916, 34 Phil. 311)

NOTE:

■ 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. (Art. 2180 par. 6, Civil Code)

■ The state is not responsible for the damages suffered by private individuals in consequence of acts performed by
its employees in the discharge of the functions pertaining to their office, because neither fault nor even negligence
can be presumed on the part of the state in the organization of branches of public service and in the appointment of
its agents. (Merritt vs. Government of the Philippine Islands)

■ The State is not liable for the torts committed by its officers or agents whom it employs, except when expressly
made so by legislative enactment. The government does not undertake to guarantee to any person the fidelity of the
officers or agents whom it employs since that would involve it in all its operations in endless embarrassments,
difficulties and losses, which would be subversive of the public interest. (Merritt vs. Government of the Philippine
Islands)

Santos v. Santos92 Phil. 281 November 26, 1952

Facts:

An undivided parcel of land situated in the Municipality of Las Piñas, Province of Rizal with an area
of 21,577 square meters was owned by the petitioners and the respondent in the proportion of 1/7 undivided share
for Teodora Santos and 1/14 undivided share each for Josefina Santos and Emiliana Santos and 5/7 undivided share
for Leoncio Santos. Petitioners complained that from 1945 to 1949 Leoncio Santos collected from
the Army of the United States of America rentals for the use and occupation of a parcel of land and later sold the lot
the Administrator of the Civil Aeronautics Administration on or about 13 May 1949. Petitioners demand for the
accounting of the payments for the rentals of the lot and to give to the portion of the
f r u i t s o f t h e r e n t a l s according to their portion of the said lot. They also prayed to restore to their ownership
the portions of the said land that belongs to them contending that the said contract of sale is null and
void because it is performed w i t h o u t t h e i r c o n s e n t a n d t o p a y t h e p e t i t i o n e r s f o r d a m a g e s
a n d c o s t . T h e A d m i n i s t r a t o r o f t h e C i v i l Aeronautics Administration moved to dismiss the
complaint for lack of jurisdiction and insufficiency of the complaint against him. This motion was
granted on the ground that the Civil Aeronautics Administration not b e i n g a j u r i d i c a l p e r s o n h a s
n o c a p a c i t y t o s u e a n d b e s u e d a n d f o r t h a t r e a s o n i t c a n n o t c o m e u n d e r t h e jurisdiction of
the court.

Issue:

whether or not the petitioners can sue the Civil Aeronautics Administration who is not a juridical entity.

Held:

An obligation or liability of the state created by statute is enforceable against the officer or agent charged with the
duty to execute the law. If there should be anything demandable which had been paid or delivered to or collected by
officers or agents of the state without the authority of law, the action would not be against the state but against the
responsible officers or agents who received what was not due the state or made the unauthorized collection.
Punishable acts or omissions committed by officers or agents of the state are crimes and violations of law
perpetuated by such officers or agents and not by the state. The same postulate may be applied to torts committed by
officers or agents of the state. Nevertheless, if, where and when the state or its government enters into a
contract, through its officers or agents, in furtherance of a legitimate aim and purpose and pursuant
to constitutional legislative authority, whereby mutual or reciprocal benefits accrue and rights and
obligations arise therefrom, and if the law granting the authority to enter into such contract does not
provide for or name the officer against whom action may be brought in the event of a breach thereof,
the state itself may be sued even without its consent , because by entering into a contract the
sovereign state has descended to the level of the citizen and its consent to be used is implied from the very act of
entering into such contract. If the dignity of the state, the sacredness of the institution, the respect
for the government are to be preserved and the dragging of its name in a suit to be prevented, the legislative
department should name the officer or agent against whom the action may be brought in the event of breach of the
contract entered into under its name and authority. And the omission or failure of the legislative department to do so
is no obstacle or impediment for an individual or citizen, who is aggrieved by the breach of the contract, to bring an
action against the state itself for the reasons already adverted to, to wit; the descent of the sovereign state to the
level of the individual or citizen with whom it entered into a contract and its consent to be sued
implied from the act of entering into such contract. The Civil Aeronautics Administration, even if it is not a
juridical entity, cannot legally prevent a party or parties from enforcing their propriety rights under the cloak
or shield of lack of juridical personality, because it took o v e r a l l t h e p o w e r s a n d a s s u m e d a l l
t h e o b l i g a t i o n s o f t h e d e f u n c t c o r p o r a t i o n w h i c h h a d e n t e r e d i n t o t h e contract in question. In
National Airports Corporation vs. Teodoro

*
, G.R. No. L-5122, 30 April 1952, we heldthat the Civil Aeronautics Administration may be sued and that the
principle of state immunity from suit doesnot apply to it. The order appealed from dismissing the complaint as to
the Civil Aeronautics Administration isreversed and the case remanded to the lower court for further proceedings in
accordance with law. No cost shall be taxed.
Caption: USA VS RUIZ
G.R. No. L-35645 136 scra 487 May 22, 1985
UNITED STATES OF AMERICA, CAPT. JAMES E. GALLOWAY, WILLIAM I. COLLINS and ROBERT
GOHIER, petitioners,
vs.
HON. V. M. RUIZ, Presiding Judge of Branch XV, Court of First Instance of Rizal and ELIGIO DE GUZMAN &
CO., INC., respondents.

Facts:
This is a petition to review, set aside certain orders and restrain perpetually the proceedings done by Hon. Ruiz for
lack of jurisdiction on the part of the trial court.

The United States of America had a naval base in Subic, Zambales. The base was one of those provided in the
Military Bases Agreement between the Philippines and the United States. Sometime in May, 1972, the United States
invited the submission of bids for a couple of repair projects. Eligio de Guzman land Co., Inc. responded to the
invitation and submitted bids. Subsequent thereto, the company received from the US two telegrams requesting it to
confirm its price proposals and for the name of its bonding company. The company construed this as an acceptance
of its offer so they complied with the requests. The company received a letter which was signed by William I.
Collins of Department of the Navy of the United States, also one of the petitioners herein informing that the
company did not qualify to receive an award for the projects because of its previous unsatisfactory performance
rating in repairs, and that the projects were awarded to third parties. For this reason, a suit for specific performance
was filed by him against the US.

Issues:
Whether or not the US naval base in bidding for said contracts exercise governmental functions to be able to invoke
state immunity.

Discussions:
The traditional role of the state immunity exempts a state from being sued in the courts of another state without its
consent or waiver. This rule is necessary consequence of the principle of independence and equality of states.
However, the rules of international law are not petrified; they are continually and evolving and because the activities
of states have multiplied. It has been necessary to distinguish them between sovereign and governmental acts (jure
imperii) and private, commercial and proprietary acts (jure gestionis). The result is that State immunity now extends
only to acts jure imperil. The restrictive application of State immunity is now the rule in the United States, the
United Kingdom and other states in western Europe.

Rulings:
Yes. The Supreme Court held that the contract relates to the exercise of its sovereign functions. In this case the
projects are an integral part of the naval base which is devoted to the defense of both the United States and the
Philippines, indisputably a function of the government of the highest order, they are not utilized for nor dedicated to
commercial or business purposes.
The restrictive application of state immunity is proper only when the proceedings arise out of commercial
transactions of the foreign sovereign. Its commercial activities of economic affairs. A state may be descended to the
level of an individual and can thus be deemed to have tacitly given its consent to be sued. Only when it enters into
business contracts.

MOBIL PHIL INC VS CUSTOM ARRASTRE SERVICE

G.R. No. L-23139 18 SCRA 1120 December 17, 1966
MOBIL PHILIPPINES EXPLORATION, INC., plaintiff-appellant,
vs.
CUSTOMS ARRASTRE SERVICE and BUREAU of CUSTOMS, defendants-appellees

Facts:
This case was filed by Mobil Phil Exploration Inc. against the Customs Arrastre Service and the Bureau of Customs
to recover the value of the undelivered case of rotary drill parts.

Four cases of rotary drill parts were shipped from abroad, consigned to Mobil Philippines Exploration, Inc. The
shipment was discharged to the custody of the Customs Arrastre Service, the unit of the Bureau of Customs then
handling arrastre operations therein. The Customs Arrastre Service later delivered to the broker of the consignee
three cases only of the shipment. Mobil Philippines Exploration, Inc filed suit in the Court of First Instance of
Manila against the Customs Arrastre Service and the Bureau of Customs to recover the value of the undelivered case
plus other damages.

Defendants filed a motion to dismiss the complaint on the ground that not being persons under the law, defendants
cannot be sued. Appellant contends that not all government entities are immune from suit; that defendant Bureau
of Customs as operator of the arrastre service at the Port of Manila, is discharging proprietary functions and as such,
can be sued by private individuals.

Issues:
Whether or not both Customs Arrastre Service and the Bureau of Customs can invoke state immunity.

Discussions:
The Bureau of Custom, is a part of Department of Finance. It does not have a separate juridical personality of its
own apart from that of the national government. Its primary function is governmental, that of assessing and
collecting lawful revenues from imported articles and all other tariff and customs duties, fees, charges, fines and
penalties (Sec. 602, R.A. 1937). To this function, arrastre service is a necessary incident. As stated in the law,
agencies of the government is not suable if it is performing governmental functions and if it an unincorporated
government entity without a separate juridical personality.
Rulings:
Yes. The Supreme Court ruled that the Bureau of Customs cannot be sued for recovery of money and damages
involving arrastre services, considering that said arrastre function may be deemed proprietary, because it is a
necessary incident of the primary and governmental function of the Bureau of Customs. The Court ruled that the fact
that a non-corporate government entity performs a function proprietary in nature does not necessarily result in its
being suable. If said non-governmental function is undertaken as an incident to its governmental function, there is no
waiver thereby of the sovereign immunity from suit extended to such government entity. The Supreme Court ruled
that the plaintiff should have filed its present claim to the General Auditing Office, it being for money under the
provisions of Commonwealth Act 327, which state the conditions under which money claims against the
Government may be filed.

Holy See vs Rosario

G.R. No. 101949
238 SCRA 524
December 1, 1994

FACTS: Petition arose from a controversy over a parcel of land. Lot 5-A,
registered under the name Holy See, was contiguous to Lot 5-B and 5-D under
the name of Philippine Realty Corporation (PRC). The land was donated by the
Archdiocese of Manila to the Papal Nuncio, which represents the Holy See, who
exercises sovereignty over the Vatican City, Rome, Italy, for his residence.

Said lots were sold through an agent to Ramon Licup who assigned his rights to
respondents Starbright Sales Enterprises, Inc.

When the squatters refuse to vacate the lots, a dispute arose between the two
parties because both were unsure whose responsibility was it to evict the
squatters from said lots. Respondent Starbright Sales Enterprises Inc. insists that
Holy See should clear the property while Holy See says that respondent
corporation should do it or the earnest money will be returned. With this, Msgr.
Cirilios, the agent, subsequently returned the P100,000 earnest money.
The same lots were then sold to Tropicana Properties and Development
Corporation.

Starbright Sales Enterprises, Inc. filed a suit for annulment of the sale, specific
performance and damages against Msgr. Cirilios, PRC as well as
Tropicana Properties and Development Corporation. The Holy See and Msgr.
Cirilos moved to dismiss the petition for lack of jurisdiction based on sovereign
immunity from suit. RTC denied the motion on ground that petitioner already
"shed off" its sovereign immunity by entering into a business contract. The
subsequent Motion for Reconsideration was also denied hence this special civil
action for certiorari was forwarded to the Supreme Court.

ISSUE: Whether or not Holy See can invoke sovereign immunity.

HELD: The Court held that Holy See may properly invoke sovereign immunity
for its non-suability. As expressed in Sec. 2 Art II of the 1987 Constitution,
generally accepted principles of International Law are adopted by our Courts
and thus shall form part of the laws of the land as a condition and consequence
of our admission in the society of nations.

It was noted in Article 31(A) of the 1961 Vienna Convention on Diplomatic

Relations that diplomatic envoy shall be granted immunity from civil and
administrative jurisdiction of the receiving state over any real action relating to
private immovable property. The Department of Foreign Affairs (DFA) certified
that the Embassy of the Holy See is a duly accredited diplomatic missionary to
the Republic of the Philippines and is thus exempted from local jurisdiction and
is entitled to the immunity rights of a diplomatic mission or embassy in this
Court.

Furthermore, it shall be understood that in the case at bar, the petitioner has
bought and sold lands in the ordinary course of real estate business, surely, the
said transaction can be categorized as an act jure gestionis. However, petitioner
has denied that the acquisition and subsequent disposal of the lot were made
for profit but claimed that it acquired said property for the site of its mission or
the Apostolic Nunciature in the Philippines.

The Holy See is immune from suit because the act of selling the lot of concern is
non-propriety in nature. The lot was acquired through a donation from the
Archdiocese of Manila, not for a commercial purpose, but for the use of
petitioner to construct the official place of residence of the Papal Nuncio thereof.
The transfer of the property and its subsequent disposal are likewise clothed
with a governmental (non-proprietal) character as petitioner sold the lot not for
profit or gain rather because it merely cannot evict the squatters living in said
property.

In view of the foregoing, the petition is hereby GRANTED and the complaints
were dismissed accordingly.

Liang vs. People

FACTS: Petitioner Jeffrey Liang, an economist working with the Asian Development Bank (ADB) , was charged
before the MeTC of Mandaluyong with two counts of grave oral defamation for allegedly uttering defamatory words
against a fellow ADB worker. Liang was arrested but later released. The next day, the judge received an "office of
protocol" from the Department of Foreign Affairs (DFA) stating that Liang is covered by immunity from legal
process under Section 45 of the Agreement between the ADB and the Philippine Government. Based on the said
protocol communication, the judge, without notice to the prosecution, dismissed the two criminal cases. The RTC set
aside the MeTC ruling and ordered the latter court to enforce the warrant of arrest it earlier issued. Liang appealed
arguing that he is covered by immunity under the Agreement.

ISSUES:

1. Was the judge correct in dismissing the cases on the basis the protocol communication without notice to the
prosecution?

2. Is Liang covered with immunity from legal process under Section 45 of the Agreement between the ADB and the
Philippine Government?

HELD:

1. No. Courts cannot blindly adhere and take on its face the communication from the DFA that petitioner is covered
by any immunity. The DFA's determination that a certain person is covered by immunity is only preliminary which
has no binding effect in courts. In receiving ex-parte the DFA's advice and in motu proprio dismissing the two
criminal cases without notice to the prosecution, the latter's right to due process was violated. It should be noted that
due process is a right of the accused as much as it is of the prosecution. The needed inquiry in what capacity
petitioner was acting at the time of the alleged utterances requires for its resolution evidentiary basis that has yet to
be presented at the proper time. At any rate, it has been ruled that the mere invocation of the immunity clause does
not ipso facto result in the dropping of the charges.

2. No.

Under Section 45 of the Agreement which provides:

"Officers and staff of the Bank including for the purpose of this Article experts and consultants performing missions
for the Bank shall enjoy the following privileges and immunities:
a.)....... immunity from legal process with respect to acts performed by them in their official capacity except when
the Bank waives the immunity."
the immunity mentioned therein is not absolute, but subject to the exception that the act was done in " official
capacity." It is therefore necessary to determine if petitioners case falls within the ambit of Section 45(a). Thus, the
prosecution should have been given the chance to rebut the DFA protocol and it must be accorded the opportunity to
present its controverting evidence, should it so desire.

Likewise, slandering a person could not possibly be covered by the immunity agreement because our laws do not
allow the commission of a crime, such as defamation, in the name of official duty. It is well-settled principle of law
that a public official may be liable in his personal private capacity for whatever damage he may have caused by his
act done with malice or in bad faith or beyond the scope of his authority or jurisdiction.

Moreover, under the Vienna Convention on Diplomatic Relations, a diplomatic agent, assuming petitioner is such,
enjoys immunity from criminal jurisdiction of the receiving state except in the case of an action relating to any
professional or commercial activity exercised by the diplomatic agent in the receiving state outside his official
functions. As already mentioned above, the commission of a crime is not part of official duty. (Liang vs
People, G.R. No. 125865, January 28, 2000)

ERNESTO CALLADO vs. INTERNATIONAL RICE RESEARCH INSTITUTE (IRRI)

G.R. No. 106483 May 22, 1995/ ROMERO, J.:

Facts: Ernesto Callado, petitioner, was employed as a driver at the IRRI. One day while driving an IRRI vehicle on
an official trip to the NAIA and back to the IRRI, petitioner figured in an accident.

Petitioner was informed of the findings of a preliminary investigation conducted by the IRRI's Human Resource
Development Department Manager. In view of the findings, he was charged with:

(1) Driving an institute vehicle while on official duty under the influence of liquor;

(2) Serious misconduct consisting of failure to report to supervisors the failure of the vehicle to start because of a
problem with the car battery, and

(3) Gross and habitual neglect of duties.

Petitioner submitted his answer and defenses to the charges against him. However, IRRI issued a Notice of
Termination to petitioner.

Thereafter, petitioner filed a complaint before the Labor Arbiter for illegal dismissal, illegal suspension and
indemnity pay with moral and exemplary damages and attorney's fees.

IRRI wrote the Labor Arbiter to inform him that the Institute enjoys immunity from legal process by virtue of Article
3 of Presidential Decree No. 1620, 5 and that it invokes such diplomatic immunity and privileges as an international
organization in the instant case filed by petitioner, not having waived the same.

While admitting IRRI's defense of immunity, the Labor Arbiter, nonetheless, cited an Order issued by the Institute
to the effect that "in all cases of termination, respondent IRRI waives its immunity," and, accordingly, considered the
defense of immunity no longer a legal obstacle in resolving the case.

The NLRC found merit in private respondent's appeal and, finding that IRRI did not waive its immunity, ordered the
aforesaid decision of the Labor Arbiter set aside and the complaint dismissed.
In this petition petitioner contends that the immunity of the IRRI as an international organization granted by Article
3 of Presidential Decree No. 1620 may not be invoked in the case at bench inasmuch as it waived the same by virtue
of its Memorandum on "Guidelines on the handling of dismissed employees in relation to P.D. 1620."

Issue: Did the (IRRI) waive its immunity from suit in this dispute which arose from an employer-employee
relationship?

Held: No.

P.D. No. 1620, Article 3 provides:

Art. 3. Immunity from Legal Process. The Institute shall enjoy immunity from any penal, civil and administrative
proceedings, except insofar as that immunity has been expressly waived by the Director-General of the Institute or
his authorized representatives.

The SC upholds the constitutionality of the aforequoted law. There is in this case "a categorical recognition by the
Executive Branch of the Government that IRRI enjoys immunities accorded to international organizations, which
determination has been held to be a political question conclusive upon the Courts in order not to embarass a political
department of Government.

It is a recognized principle of international law and under our system of separation of powers that diplomatic
immunity is essentially a political question and courts should refuse to look beyond a determination by the executive
branch of the government, and where the plea of diplomatic immunity is recognized and affirmed by the executive
branch of the government as in the case at bar, it is then the duty of the courts to accept the claim of immunity upon
appropriate suggestion by the principal law officer of the government or other officer acting under his direction.

The raison d'etre for these immunities is the assurance of unimpeded performance of their functions by the agencies
concerned.

The grant of immunity to IRRI is clear and unequivocal and an express waiver by its Director-General is the only
way by which it may relinquish or abandon this immunity.

In cases involving dismissed employees, the Institute may waive its immunity, signifying that such waiver is
discretionary on its part.