DEPARTMENT OF AGRICULTURE vs THE NATIONAL

LABOR RELATIONS COMMISSION HELD:

GR 104269 | November 11, 1993  No. The basic postulate of Article XVI, Section 3
Topic: State Immunity and its exception (The State may not be sued without its consent)
Ponente: Vitug, J. is not absolute. It does not say that the State may
not be sued under any circumstances. Therefore, it
Short Summary: The case is regarding a money claim
may at times be sued. The consent of the state may
against Department of Agriculture as filed and requested
be given either expressly (general law/special law)
by National Labor Relations Commissions.
or impliedly (State itself commences
Doctrine: Justice Holmes- “A sovereign is exempt from suit litigation/when it enters into a contract).
because there can be no legal right as against the authority a. Expressly- Act No. 3803 (“consents and
that makes the law on which the right depends”. submits to be sued upon any money claim
involving liability arising from contract,
FACTS express or implied, which could serve as a
basis for civil action between private
 The Department of Agriculture (herein petitioner)
parties”)
and Sultan Security Agency (SSA) entered into a
b. Impliedly- descended to level of other
contract for security services for the security
contracting party
services to be provided by the latter to the said
governmental entity. Four months later, several  Effect of consent: When State gives it consent to be
guards of the SSA filed a complaint for sued, it just gives other party an opportunity to
underpayment of wages, non-payment of 13th prove, if it can, that the State has a liability
month pay, uniform allowances, night shift, a. “…power of the Courts ends when the
differential pay, holiday pay and overtime pay, as judgment is rendered, since government
well as for damages before Regional Arbitration funds and properties may not be seized
Branch X against Department of Agriculture. under writs of execution…” (Republic vs.
Villasor)
 The Executive Labor Arbiter rendered a decision
finding herein petitioner jointly and severally*  Not all contracts entered into by the
liable with SSA for the payment of the money government operate as a waiver of non-
claims (P266, 483.91) of complainant security suability; distinction must be made between one
guards. Petitioner and SSA did not appeal decision, executed of its sovereign functions and another
so this became final and executory. Almost 2 done in proprietary capacity (US vs Ruiz). In this
months later, Labor Arbiter issued writ of case, the DoA has not pretended to have assumed
execution which resulted in the property of the capacity apart from being a governmental entity
petitioner being levied. when it entered into questioned contract (the
projects are an integral part of the naval base
 Petitioner then filed a petition with NLRC for
which is devoted to the defense of both the United
injunction, prohibition and mandamus alleging
States and the Philippines, indisputably a function
that the writ issued by Labor Arbiter was null and
of the government of the highest order). Restriction
void and that the seizure of its property would
on State immunity is proper when there are
threaten governmental functions of which may
commercial transactions of the foreign sovereign
prejudice public good.
or business purposes.
 The assailed resolution by NLRC temporarily
 It was also recognized that the claims by
suspended writ for a period of two months,
respondent were money claims (which the State
ordered petitioner to source out funds together
may be held liable and be sued, according to Act
with SSA, and that the petition is dismissed for
3803). However, pursuant to COMMONWEALTH
lack of basis.
ACT 327 (amended by PD 1445*), money claim
 Petition for certiorari- petitioner charges the
should first be brought to the Commission on
NLRC with grave abuse of discretion for refusing
Audit.
to quash the writ of execution. It claims that
herein respondent disregarded the cardinal rule RULING:
on non-suability of the State. WHEREFORE, petition is GRANTED. Resolution of NLRC is
 Respondents argue that petitioner impliedly REVERSED AND SET ASIDE. Writ of execution is nullified
waived immunity from suit by concluding service and
contract with SSA.
ISSUE(S)
 Whether or not doctrine of non-suability of the
State may be applied in this case.
Jointly and severally-one of the attorneys can sign a document or dispose of an asset without the signature of the other(s) or alternatively every Attorney can sign
PD 1445- Section 26 (general jurisdiction)