Lasco vs UNRFNRE

Case Digest_Eldepio Lasco et al v United Nations Revolving Fund For Natural Resources Exploration (UNRFNRE)
G.R. Nos. 1!!"#1!1$ Fe%ruar& '() 1!!"
Facts* +etitioners ,ere dis-issed .ro- t/eir e-plo&-ent ,it/ private respondent) t/e United Nations Revolving
Fund .or Natural Resources Exploration (UNRFNRE)) ,/ic/ is a special .und and su%sidiar& organ o. t/e United
Nations. 0/e UNRFNRE is involved in a 1oint pro1ect o. t/e +/ilippine Govern-ent and t/e United Nations .or
exploration ,or2 in Dinagat 3sland. +etitioners are t/e co-plainants .or illegal dis-issal and da-ages. +rivate
respondent alleged t/at respondent La%or 4r%iter /ad no 1urisdiction over its personalit& since it en1o&ed diplo-atic
i--unit&.
3ssue* 56N speciali7ed agencies en1o& diplo-atic i--unit&
8eld* +etition is dis-issed. 0/is is not to sa& t/at petitioner /ave no recourse. 9ection (1 o. t/e Convention on t/e
+rivileges and 3--unities o. t/e 9peciali7ed 4gencies o. t/e United Nations states t/at :eac/ speciali7ed agenc&
s/all -a2e a provision .or appropriate -odes o. settle-ent o. (a) disputes arising out o. contracts or ot/er disputes
o. private c/aracter to ,/ic/ t/e speciali7ed agenc& is a part&.; +rivate respondent is not engaged in a co--ercial
venture in t/e +/ilippines. 3ts presence is %& virtue o. a 1oint pro1ect entered into %& t/e +/ilippine Govern-ent and
t/e United Nations .or -ineral exploration in Dinagat 3sland
9E4FDEC < 4=D v. NLRC < G.R. No. >?$$(
Facts*
9out/east 4sian Fis/eries Develop-ent Center#4@uaculture Depart-ent (9E4FDEC#4=D) is a depart-ent o. an
international organi7ation) t/e 9out/east 4sian Fis/eries Develop-ent Center) organi7ed t/roug/ an agree-ent
entered into in Aang2o2) 0/ailand. Buvenal La7aga ,as e-plo&ed as a Researc/ 4ssociate. Lacanilao in /is capacit&
as C/ie. o. 9E4FDEC#4=D sent a notice o. ter-ination to private respondent in.or-ing /i- t/at due to t/e
.inancial constraints %eing experienced %& t/e depart-ent) /is services s/all %e ter-inated. 9E4FDEC#4=DCs
.ailure to pa& La7aga /is separation pa& .orced /i- to .ile a case ,it/ t/e NLRC. 0/e L4 and NLRC ruled in .avor
o. La7aga. 9E4FDEC#4=D clai-ed t/at t/e NLRC /as no 1urisdiction over t/e case.
3ssue* 5DN NLRC /as 1urisdiction over t/e caseE N6
8eld* +etition Granted 9out/east 4sian Fis/eries Develop-ent Center#4@uaculture Depart-ent (9E4FDEC#4=D)
is an international agenc& %e&ond t/e 1urisdiction o. pu%lic respondent NLRC. Aeing an intergovern-ental
organi7ation) 9E4FDEC including its Depart-ents (4=D)) en1o&s .unctional independence and .reedo- .ro-
control o. t/e state in ,/ose territor& its o..ice is located.
C4LL4D6 F9. 3RR3
G.R. No. 1?G>() Ha& '' 1!!") 'GG 9CR4 '1
F4C09*
+etitioner Ernesto Callado ,as e-plo&ed as a driver at t/e 3nternational Rice Researc/ 3nstitute (3RR3). 6n Fe%ruar&
11) 1!!) ,/ile driving an 3RR3 ve/icle on an o..icial trip to t/e Nino& 4@uino 3nternational 4irport and %ac2 to t/e
3RR3) petitioner .igured in an accident. 4.ter evaluating petitionerCs ans,er) explanations and ot/er evidence %&
3RR3Cs 8u-an Resource Develop-ent Depart-ent Hanager) t/e latter issued a Notice o. 0er-ination to petitioner
on Dece-%er $) 1!!.
+etitioner t/en .iled a co-plaint %e.ore t/e La%or 4r%iter .or illegal dis-issal) illegal suspension and inde-nit& pa&
,it/ -oral and exe-plar& da-ages and attorne&Cs .ees. +rivate respondent li2e,ise in.or-ed t/e La%or 4r%iter)
t/roug/ counsel) t/at t/e 3nstitute en1o&s i--unit& .ro- legal process %& virtue o. 4rticle ( o. +residential Decree
No. 1?') and t/at it invo2es suc/ diplo-atic i--unit& and privileges as an international organi7ation in t/e instant
case .iled %& petitioner) not /aving ,aived t/e sa-e.
8o,ever) t/e La%or 4r%iter .inds private respondent 3RR3 to /ave ,aived its i--unit& considered t/e de.ense o.
i--unit& no longer a legal o%stacle in resolving t/e case.
399UE*
5/et/er or not 3RR3 ,aived its i--unit& .ro- suit in t/is dispute ,/ic/ arose .ro- an e-plo&er#e-plo&ee
relations/ip.
8ELD*
0/e Court ruled in t/e negative and vote to dis-iss t/e petition. 0/ereIs no -erit in petitionerCs argu-ents) t/us
3RR3Cs i--unit& .ro- suit is undisputed. +residential Decree No. 1?') 4rticle ( provides*
3--unit& .ro- Legal +rocess. 0/e 3nstitute s/all en1o& i--unit& .ro- an& penal) civil and ad-inistrative
proceedings) except inso.ar as t/at i--unit& /as %een expressl& ,aived %& t/e Director#General o. t/e 3nstitute or
/is aut/ori7ed representatives.
0/e grant o. i--unit& to 3RR3 is clear and une@uivocal and an express ,aiver %& its Director#General is t/e onl&
,a& %& ,/ic/ it -a& relin@uis/ or a%andon t/is i--unit&.
6n t/e -atter o. ,aiving its i--unit& .ro- suit) 3RR3 /ad) earl& on) -ade its position clear. 0/roug/ counsel) t/e
3nstitute ,rote t/e La%or 4r%iter categoricall& in.or-ing /i- t/at t/e 3nstitute ,ill not ,aive its diplo-atic
i--unit&.
FE0ER4N9 H4N+65ER 4ND +R60EC03FE 9ERF3CE9) 3NC. F9. C6UR0 6F 4++E4L9
G.R. No. !1("!) 9epte-%er '" 1!!') '1G 9CR4 '>?
F4C09*
Feterans Hanpo,er and +rotective 9ervices) 3nc. (FH+93) alleges t/at t/e provisions under 9ection G and 1$ o.
Repu%lic 4ct No. "G>$ or t/e +rivate 9ecurit& 4genc& La, violate t/e 1!>$ Constitution against -onopolies) un.air
co-petition and co-%inations in restraint o. trade) and tend to .avor and institutionali7e t/e +/ilippine 4ssociation
o. Detective and +rotective 4genc& 6perators) 3nc. (+4D+46) ,/ic/ is -onopolistic %ecause it /as an interest in
-ore t/an one securit& agenc&.
Respondent FH+93 li2e,ise @uestions t/e validit& o. paragrap/ () su%paragrap/ (g) o. t/e Hodi.&ing Regulations
on t/e 3ssuance o. License to 6perate and +rivate 9ecurit& Licenses and 9peci.&ing Regulations .or t/e 6peration o.
+4D+46 issued %& t/en +C C/ie. Lt. Gen. Fidel F. Ra-os) t/roug/ Col. 9a%as F. Edades) re@uiring t/at Jall private
securit& agenciesDco-pan& securit& .orces -ust register as -e-%ers o. an& +4D+46 C/apter organi7ed ,it/in t/e
Region ,/ere t/eir -ain o..ices are located...K. 4s suc/ -e-%ers/ip re@uire-ent in +4D+46 is co-pulsor& in
nature) it allegedl& violates legal and constitutional provisions against -onopolies) un.air co-petition and
co-%inations in restraint o. trade.
4 He-orandu- o. 4gree-ent ,as executed %& +4D+46 and t/e +C C/ie.) ,/ic/ .ixed t/e -ini-u- -ont/l&
contract rate per guard .or eig/t (>) /ours o. securit& service per da& at +')'"". ,it/in Hetro Hanila and
+')'1". outside o. Hetro Hanila.
6din 9ecurit& 4genc& (6din) .iled a co-plaint ,it/ +4D+46 accusing FH+93 o. cut#t/roat co-petition %&
undercutting its contract rate .or securit& services rendered to t/e Hetropolitan 5ater,or2s and 9e,erage 9&ste-
(H599)) c/arging said custo-er lo,er t/an t/e standard -ini-u- rates provided in t/e He-orandu- o.
4gree-ent dated Ha& 1') 1!>?.
+4D+46 .ound FH+93 guilt& o. cut#t/roat co-petition) /ence) t/e +4D+46 Co--ittee on Discipline
reco--ended t/e expulsion o. FH+93 .ro- +4D+46 and t/e cancellation o. its license to operate a securit&
agenc&. 0/e +C#9U934 a..ir-ed t/e .indings and li2e,ise reco--ended t/e cancellation o. FH+93Is license. 4s a
result) +4D+46 re.used to issue a clearanceDcerti.icate o. -e-%ers/ip to FH+93.
FH+93 -ade a re@uest letter to t/e +C C/ie. to set aside or disregard t/e .indings o. +4D+46 and consider
FH+93Is application .or rene,al o. its license) even ,it/out a certi.icate o. -e-%ers/ip .ro- +4D+46.
399UE*
5/et/er or not FH+93Is co-plaint against t/e +C C/ie. and +C#9U934 is a suit against t/e 9tate ,it/out its
consent.
8ELD*
Les. 4 pu%lic o..icial -a& so-eti-es %e /eld lia%le in /is personal or private capacit& i. /e acts in %ad .ait/) or
%e&ond t/e scope o. /is aut/orit& or 1urisdiction) /o,ever) since t/e acts .or ,/ic/ t/e +C C/ie. and +C#9U934 are
%eing called to account in t/is case) ,ere per.or-ed as part o. t/eir o..icial duties) ,it/out -alice) gross negligence)
or %ad .ait/) no recover& -a& %e /ad against t/e- in t/eir private capacities. Furt/er-ore) t/e 9upre-e Court agrees
,it/ t/e Court o. 4ppeals t/at t/e He-orandu- o. 4gree-ent dated Ha& 1') 1!>? does not constitute an i-plied
consent %& t/e 9tate to %e sued. 0/e consent o. t/e 9tate to %e sued -ust e-anate .ro- statutor& aut/orit&) /ence) a
legislative act) not .ro- a -ere -e-orandu-. 5it/out suc/ consent) t/e trial court did not ac@uired 1urisdiction
over t/e pu%lic respondents. +etition .or revie, is denied and t/e 1udg-ent appealed .ro- is a..ir-ed in toto.
+NA v. C3R
Facts*
+etitionerIs -otion to @uas/ a notice o. garnis/-ent ,as denied .or lac2 o. -erit. 5/at ,as soug/t to %e garnis/ed
,as t/e -one& o. t/e +eopleCs 8o-esite and 8ousing Corporation deposited at petitionerCs %ranc/ in =ue7on Cit&)
to satis.& a decision o. respondent Court ,/ic/ /ad %eco-e .inal and executor&. 4 ,rit o. execution in .avor o.
private respondent Ga%riel F. Hanansala /ad previousl& %een issued. 8e ,as t/e counsel o. t/e prevailing part&) t/e
United 8o-esite E-plo&ees and La%orers 4ssociation. 0/e validit& o. t/e order assailed is c/allenged on t,o
grounds* (1) t/at t/e appoint-ent o. respondent Gil%ert +. Loren7o as aut/ori7ed deput& s/eri.. to serve t/e ,rit o.
execution ,as contrar& to la, and (') t/at t/e .unds su%1ect o. t/e garnis/-ent M-a& %e pu%lic in c/aracter.M0/e
order o. 4ugust '?) 1!$ o. respondent Court den&ing t/e -otion to @uas/) su%1ect o. t/is certiorari proceeding)
reads as .ollo,s*M0/e +/ilippine National Aan2 -oves to @uas/ t/e notice o. garnis/-ent served upon its %ranc/ in
=ue7on Cit& %& t/e aut/ori7ed deput& s/eri.. o. t/is Court. 3t contends t/at t/e service o. t/e notice %& t/e
aut/ori7ed deput& s/eri.. o. t/e court contravenes 9ection11 o. Co--on,ealt/ 4ct No. 1") as a-ended ,/ic/
reads*M C4ll ,rits and processes issued %& t/e Court s/all %e served and executed .ree o. c/arge %& provincial or cit&
s/eri..s) or %& an& person aut/ori7ed %& t/is Court) in t/e sa-e -anner as ,rits and processes o. Courts o. First
3nstance.C Follo,ing t/e la,) t/e Aan2 argues t/at it is t/e 9/eri.. o. =ue7on Cit&) and not t/e Cler2 o. t/is Court
,/o isits Ex#6..icio 9/eri..) t/at /as t/e aut/orit& to serve t/e notice o. garnis/-ent) and t/at t/e actual service %&
t/e latter o..icer o. said notice is t/ere.ore not in order. 0/e Court .inds no -erit in t/is argu-ent. Repu%lic 4ct No.
G'1 /as) since Bune 1!) 1!?") alread& repealed Co--on,ealt/ 4ct No. 1() and under t/is la,) it is no, t/e Cler2
o. t/is Court t/at is at t/e sa-e ti-e t/e Ex#6..icio 9/eri... 4s suc/ Ex#6..icio 9/eri..) t/e Cler2 o. t/is Court /as
t/ere.ore t/e aut/orit& to issue ,rits o. execution and notices o. garnis/-ent in an area enco-passing t/e ,/ole o.
t/e countr&) including =ue7on Cit&) since /is area o. aut/orit& is coter-inous ,it/ t/at o. t/e Court itsel.) ,/ic/ is
national in nature. ... 4t t/is stage) t/e Court notes .ro- t/e record t/at t/e appeal to t/e 9upre-e Court %&
individual e-plo&ees o. +88C ,/ic/ @uestions t/e a,ard o. attorne&Cs .ees to 4tt&. Ga%riel F. Hanansala) /as
alread& %een dis-issed and t/at t/e sa-e %eca-e .inal and executor& on 4ugust !) 1!$. 0/ere is no longer an&
reason) t/ere.ore) .or ,it//olding action in t/is case. N5/ere.oreO) t/e -otion to @uas/ .iled %& t/e +/ilippine
National Aan2 is denied .or lac2 o. -erit. 0/e said Aan2 is t/ere.ore ordered to co-pl& ,it/in .ive da&s .ro-
receipt ,it/ t/e Cnotice o. Garnis/-entC dated Ha& ?) 1!$.M
". 0/ere ,as a -otion .or reconsideration .iled %& petitioner) %ut in a resolution dated 9epte-%er '') 1!$) it ,as
denied. 8ence) t/is certiorari petition.
3ssue* 56N t/e .unds -entioned -a& %e garnis/ed
Ruling* No
Rationale* National 9/ip&ard and 9teel Corporation v. court o. 3ndustrial Relations
? is s@uarel& in point. 4s ,as explicitl& stated in t/e opinion o. t/e t/en Bustice) later C/ie. Bustice) Concepcion*
M0/e allegation to t/e e..ect t/at t/e .unds o. t/e N499C6 are pu%lic .unds o. t/e govern-ent) and t/at) as suc/) t/e
sa-e -a& not %e garnis/ed) attac/ed or levied upon) is untena%le .or) as a govern-ent o,ned and controlled
corporation. t/e N499C6 /as a personalit& o. its o,n) distinct and separate .ro- t/at o. t/e Govern-ent. 3t /as
pursuant to 9ection ' o. Executive 6rder No. ("?) dated 6cto%er '() 1!" ...) pursuant to ,/ic/ t/e N499C6 /as
%een esta%lis/ed P Call t/e po,ers o. a corporation under t/e Corporation La, ...C 4ccordingl&) it -a& sue and %e
sued and -a& %e su%1ected to court processes 1ust li2e an& ot/er corporation (9ection 1() 4ct No. 1G"!)) as
a-ended.M3n a 1!G1 decision)
Hanila 8otel E-plo&ees 4ssociation v. Hanila 8otel Co-pan& > t/is Court) t/roug/ Bustice 67aeta) /eld* M6n t/e
ot/er /and) it is ,ell settled t/at ,/en t/e govern-ent enters into co--ercial %usiness) it a%andons its sovereign
capacit& and is to %e treated li2e an& ot/er corporation. (Aan2 o. t/e United 9tates v. +lantersC Aan2)
! 5/eat) !G) ? L.ed. 'GG). A& engaging in a particular %usiness t/ru t/e instru-entalit& o. a corporation) t/e
govern-ent divests itsel. pro /ac vice o. its sovereign c/aracter) so as to render t/e corporation su%1ect to t/e rules
o. la, governing private corporations.MAot/ t/e +alacio and t/e Co--issioner o. +u%lic 8ig/,a&s decisions)
inso.ar as t/e& reiterate t/e doctrine t/at one o. t/e coronaries o. t/e .unda-ental concept o. non#sua%ilit& is t/at
govern-ental .unds are i--une .ro- garnis/-ent. 3t is an entirel& di..erent -atter i.) according to Bustice9anc/e7
in Ra-os v. Court o. 3ndustrial Relations ) t/e o..ice or entit& is Mpossessed o. a separate and distinct corporate
existence.M 0/en it can sue and %e sued. 0/erea.ter) its .unds -a& %e levied upon or garnis/ed.
999 vs. C4F4C09*
999 and petitioners .iled ,it/ t/e 9ocial 9ecurit& Co--ission see2ing to %e declared as e-plo&ees o. C69H69.
0/e petitioners /ere are peddlers o. Ha.inco. Ha.inco contended t/at t/e& are independent contractors.
399UE*
5DN t/ere exists an e-plo&er#e-plo&ee relations/ip
8ELD*
No. Under t/e peddling contract) Ha.inco ,ould provide t/e peddler ,it/ a deliver& truc2 and t/e peddler is
responsi%le .or co-pensation o. /is driver and /elpers. 3n addition) t/e peddler ,ould also %ear t/e cost o. gasoline
and -aintenance o. t/e truc2 and secure t/eir licenses and per-its. 0/e petitioner ,ould also post a cas/ %ond and
t/e contract -a& %e ter-inated upon " da&s prior notice. 6n t/e %asis o. t/e peddling contract) no e-plo&er#
e-plo&ee relations/ip ,as created. 0/us) t/e petitioner is an independent contractor
R4L6 vs. CF3 o. AUL4C4N
Facts*
1. During t/e /eig/t o. t&p/oon Qading ) t/e National +o,er CorporationIs plant superintendent C/ave7 opened
si-ultaneousl& all t/e t/ree .loodgates o. t/e 4ngat Da-.
'. 4s a direct and i--ediate result) several to,ns in Aulacan ,ere .looded ( particularl& Nor7agara& ). 4%out a
/undred o. its residents died and properties ,ort/ -illion o. pesos ,ere destro&ed.
(. 0/e petitioners) ,/o are a-ong t/e un.ortunate victi-s o. t/e -an#caused .lood) .iled several co-plaints .or
da-ages against N+C and t/e plant superintendent.
G. N+C clai-ed) as its de.ense) t/at in t/e operation o. t/e 4ngat Da-) it is per.or-ing apurel& govern-ental
.unction. 0/us) it cannot %e sued ,it/out t/e express consent o. t/e 9tate.
".0/e petitioners opposed t/e clai- o. N+C and clai-ed t/at it is per.or-ing not govern-ental %ut -erel&
proprietar& .unctions and t/at %ased on t/e organic c/arter (c/arter #a legal docu-ent t/at provides .or t/e creation
o. a corporate entit& ) o. N+C) it can %e sued and %e sued in an& court.
3ssue*
5/et/er or not t/e po,er o. N+C to sue and %e sued under its organic c/arter includes t/e po,er to %e sued .or tort.
8eld *
0/e govern-ent /as organi7ed a private corporation) put -one& in it and /as allo,ed it to sue and %e sued in an&
court under its c/arter. N+C) as a govern-ent o,ned and controlled corporation) /as a personalit& o. its o,n
)distinct and separate .ro- t/at o. t/e Govern-ent. 3n an& court) N+C can sue and %e sued .or tort. 0/e petition o.
t/e petitioners ,as granted.
Notes* Govern-ent#o,ned and controlled corporations /ave a personalit& o. t/eir o,n) separate and distinct .ro-
t/e govern-ent. 0/ere.ore) alt/oug/ t/e& are considered to %e pu%lic in c/aracter) t/e& are not exe-pt .ro-
garnis/-ent (legal proceedings)
Halong v. +NR (Consti1)
Halong v. +NR
FR4NC39C6 H4L6NG and R694L3N4 4=U3N6 H4L6NG) petitioners v. +83L3++3NE N4036N4L
R43L54L9 and C6UR0 6F F3R90 3N904NCE 6F +4NG493N4N) Linga&en Aranc/ 11) respondents
En Aanc
Doctrine* i-plied consent
Date* 4ugust $) 1!>"
+onente* Bustice 4@uino
Facts*
0/e Halong spouses alleged in t/eir co-plaint t/at on 6cto%er () 1!$$ t/eir son) Bai-e 4@uino) a pa&ing
passenger) ,as 2illed ,/en /e .ell .ro- a +NR train ,/ile it ,as %et,een 0arlac and Capas. 0/e traged& occurred
%ecause Bai-e /ad to sit near t/e door o. a coac/. 0/e train ,as overloaded ,it/ passengers and %aggage in vie, o.
t/e proxi-it& o. 4ll 9aints Da&. 0/e Halong spouses pra&ed t/at t/e +NR %e ordered to pa& t/e- da-ages totaling
+1(?)($. Upon t/e 9olicitor GeneralCs -otion) t/e trial court dis-issed t/e co-plaint. 3t ruled t/at it /ad no
1urisdiction %ecause t/e +NR) %eing a govern-ent instru-entalit&) t/e action ,as a suit against t/e 9tate (9ec. 1?)
4rt. RF o. t/e Constitution). 0/e Halong spouses appealed to t/is Court pursuant to Repu%lic 4ct No. "GG R.4.
No. "GG c/anged t/e -ode o. appeal .ro- courts o. .irst instance (no, Regional 0rial Courts) to t/e 9upre-e
Court in cases involving onl& @uestions o. la,) or t/e constitutionalit& or validit& o. an& treat&) la,) ordinance) etc.
or t/e legalit& o. an& tax) i-post) assess-ent or toll) etc.) or t/e 1urisdiction o. an& in.erior court) .ro- ordinar&
appeal P i.e.) %& notice o. appeal) record on appeal and appeal %ond) under Rule G1P to appeal %& certiorari) under
Rule G"
3ssueDs*
56N +NR is i--une .ro- suit.
56N t/e 9tate acted in a sovereign capacit& or in a corporate capacit& ,/en it organi7ed t/e +NR .or t/e purpose o.
engaging in transportation
56N t/e 9tate acted di..erentl& ,/en it organi7ed t/e +NR as successor o. t/e Hanila Railroad Co-pan&
8eld* No) +NR is N60 i--une. 0/e 9tate divested itsel. o. its sovereign capacit& ,/en it organi7ed t/e +NR ,/ic/
is no di..erent .ro- its predecessor) t/e Hanila Railroad Co-pan&. 0/e +NR did not %eco-e i--une .ro- suit. 3t
did not re-ove itsel. .ro- t/e operation o. articles 1$(' to 1$?? o. t/e Civil Code on co--on carriers
58EREF6RE) t/e order o. dis-issal is reversed and set aside. 0/e case is re-anded to t/e trial court .or .urt/er
proceedings. Costs against t/e +/ilippine National Rail,a&s.
Ratio*
0/e correct rule is t/at Mnot all govern-ent entities) ,/et/er corporate or non#corporate) are i--une .ro- suits.
3--unit& .ro- suit is deter-ined %& t/e c/aracter o. t/e o%1ects .or ,/ic/ t/e entit& ,as organi7ed.M (Nat. 4irports
Corp. vs. 0eodoro and +/il. 4irlines) 3nc.) !1 +/il. '() '?S 9antos vs) 9antos) !' +/il. '>1) '>"S 8arr& L&ons) 3nc.
vs. U94) 1G +/il. "!(.)
9uits against 9tate agencies ,it/ respect to -atters in ,/ic/ t/e& /ave assu-ed to act in a private or non#
govern-ental capacit& are not suits against t/e 9tate
Li2e an& private co--on carrier) t/e +NR is su%1ect to t/e o%ligations o. persons engaged in t/at private enterprise.
3t is not per.or-ing an& govern-ental .unction
0/e point is t/at ,/en t/e govern-ent enters into a co--ercial %usiness it a%andons its sovereign capacit& and is to
%e treated li2e an& ot/er private corporation (Aan2 o. t/e U.9. vs. +lantersC Aan2) ! 5/eat. !G) ? L. ed. 'GG) cited
in Hanila 8otel E-plo&ees 4ssociation vs. Hanila 8otel Co-pan&) et al.) $( +/il. ($G) (>>).
0/ere is not one la, .or t/e sovereign and anot/er .or t/e su%1ect) %ut ,/en t/e sovereign engages in %usiness and
t/e conduct o. %usiness enterprises) and contracts ,it/ individuals) ,/enever t/e contract in an& .or- co-es %e.ore
t/e courts) t/e rig/ts and o%ligation o. t/e contracting parties -ust %e ad1usted upon t/e sa-e principles as i. %ot/
contracting parties ,ere private persons. Aot/ stand upon e@ualit& %e.ore t/e la,) and t/e sovereign is -erged in t/e
dealer) contractor and suitor (+eople vs. 9tep/ens) $1 N.L. "G!).
Bustice 4%ad 9antos (9eparate 6pinion) * 4ll corporations organi7ed %& t/e govern-ent are its instru-entalit& %& t/e
ver& reason o. t/eir creation. Aut t/at .act alone does not invest t/e- ,it/ i--unit& .ro- suit.
Besus +. Disini vs. 0/e 8onora%le 9andigan%a&an) 0/e Repu%lic o. t/e +/ilippines) as represented %& t/e
+residential Co--ission on Good Govern-ent (+CGG)
G.R. No. 1>"?GS '' Bune '1
Facts* 6n 1? Fe%ruar& 1!>!) t/e Repu%lic o. t/e +/ilippines (Repu%lic) and Besus +. Disini (Disini) entered into an
3--unit& 4gree-ent (t/e 3--unit& 4gree-ent) under ,/ic/ Disini undertoo2 to testi.& .or t/e Repu%lic and
provide its la,&ers ,it/ t/e in.or-ation) a..idavits) and docu-ents t/e& needed in its case against 5esting/ouse
Electric Corporation %e.ore t/e United 9tates District Court o. Ne, Berse& and in t/e ar%itration case t/at
5esting/ouse 3nternational +ro1ects Co-pan& and ot/ers .iled against t/e Repu%lic %e.ore t/e 3nternational
C/a-%er o. Co--erce Court o. 4r%itration. Disini ,or2ed .or /is second cousin) 8er-inio 0. Disini (8er-inio)) as
an executive in t/e latterIs co-panies .ro- 1!$1 to 1!>G. 0/e Repu%lic %elieved t/at t/e 5esting/ouse contract .or
t/e construction o. t/e Aataan Nuclear +o,er +lant) %ro2ered %& one o. 8er-inioIs co-panies) /ad %een attended
%& ano-alies.
3n t/e 3--unit& 4gree-ent) t/e Repu%lic guaranteed t/at) apart .ro- t/e t,o 5esting/ouse cases) it ,ould not
co-pel Disini to testi.& in an& ot/er do-estic or .oreign proceeding %roug/t %& t/e Repu%lic against 8er-inio.
Disini co-plied ,it/ /is underta2ing %ut 1> &ears later) upon t/e Repu%licIs application) t/e 9andigan%a&an issued a
su%poena against Disini) co--anding /i- to testi.& and produce docu-ents %e.ore t/at court in an action t/at t/e
Repu%lic .iled against 8er-inio. Disini -oved to @uas/ t/e su%poena) invo2ing t/e 3--unit& 4gree-ent. 0/e
9andigan%a&an ignored t/e -otion and issued a ne, su%poena directing /i- to testi.& %e.ore it.9u%se@uentl&) t/e
+CGG revo2ed and nulli.ied t/e 3--unit& 4gree-ent inso.ar as it pro/i%ited t/e Repu%lic .ro- re@uiring Disini to
testi.& against 8er-inio. Later on) t/e 9andigan%a&an denied DisiniIs -otion to @uas/ t/e su%poena. Disini) t/us)
%roug/t t/e -atter to t/e 9upre-e Court. 0/e Repu%lic -aintained t/at t/e +CGGIs po,er to grant i--unit& under
9ection " o. Executive 6rder 1G covered onl& i--unit& .ro- civil or cri-inal prosecution and did not cover
i--unit& .ro- providing evidence in court. 0/e Repu%lic argued t/at DisiniIs i--unit& .ro- testi.&ing against
8er-inio contravened t/e stateIspolic& to recover ill#gotten ,ealt/ ac@uired under t/e regi-e o. .or-er +resident
Harcos.0/e Repu%lic .urt/er argued t/at under t/e last sentence o. paragrap/ ( o. t/e 3--unit& 4gree-ent ,/ic/
reads*JNot/ing /erein s/all a..ect Besus +. DisiniIs o%ligation to provide trut/.ul in.or-ation or testi-on&)K Disini)
despite t/e i--unit& given /i- against %eing co-pelled to testi.& in ot/er cases) ,as to Jprovide
trut/.ulin.or-ation or testi-on&K in suc/ ot/er cases.
For /is part) Disini argued t/at t/e Repu%lic) t/roug/ t/e +CGG) ,as estopped .ro- revo2ing t/e @uestioned
i--unit& as it /ad -ade /i- %elieve t/at it /ad t/e aut/orit& to provide suc/ guarantee. 0/e Repu%lic countered %&
invo2ing 9ection 1") 4rticle R3 o. t/e 1!>$ Constitution ,/ic/ provides t/at J(t)/e rig/t o. t/e 9tate to recover
properties unla,.ull& ac@uired %& pu%lic o..icials or e-plo&ees .ro- t/e- or .ro- t/eir no-inees) or trans.erees)
s/all not %e %arred %& prescription) lac/es or estoppel.K
3ssues (as de.ined %& t/e 9upre-e Court)* (1) 5/et/er or not t/e +CGG acted ,it/in its aut/orit& ,/en it revo2ed
and nulli.ied t/e 3--unit& 4gree-entS and (') 5/et/er or not t/e 9andigan%a&an gravel& a%used its discretion
,/en it denied DisiniIs -otion to @uas/ t/e su%poena.
8eld* 0/e language o. 9ection ") Executive 6rder 1G a..ords latitude to t/e +CGG in deter-ining t/e extent o. t/e
cri-inal i--unit& it -a& grant. 3t /as discretion to grant appropriate levels o. cri-inal i--unit& depending on t/e
situation o. t/e ,itness and /is relative i-portance to t/e prosecution o. ill#gotten ,ealt/ cases. 3t can even agree) as
in t/is case) to conditions expressed %& t/e ,itness as su..icient to induce cooperation. 0rusting in t/e Govern-entIs
/onest& and .idelit&) Disini agreed and .ul.illed /is part o. t/e %argain. 9urel&) t/e principle o. .air pla&) ,/ic/ is t/e
essence o. due process) s/ould /old t/e Repu%lic on to its pro-ise. 3. Disini re.uses to testi.& in t/ose ot/er cases as
ordered %& 9andigan%a&an) it ,as certain to result in prosecution .or cri-inal conte-pt (a conduct directed against
t/e aut/orit& and dignit& o. t/e court or a 1udge acting 1udiciall&S an act o%structing t/e ad-inistration o. 1ustice
,/ic/ tends to %ring t/e court into disrepute or disrespect)) punis/a%le %& a .ine or i-prison-ent or %ot/. 3n
cri-inal conte-pt) t/e proceedings are regarded as cri-inal and t/e rules o. cri-inal procedure appl&. 0/e grant)
t/ere.ore) o. i--unit& to Disini against %eing co-pelled to testi.& ,as ulti-atel& a grant o. i--unit& .ro- cri-inal
prosecution) so-et/ing t/at .ell ,it/in t/e express coverage o. t/e i--unit& given /i-. 0/e @uestioned i--unit&
did not contravene t/e stateIs pu%lic polic& respecting t/e recover& o. illegall& ac@uired ,ealt/ under t/e regi-e o.
.or-er +resident Harcos. 0/e aut/orit& t/at adopted suc/ polic&) .or-er +resident Cora7on C. 4@uino) ,as t/e
sa-e aut/orit& t/at gave t/e +CGG t/e po,er to grant i--unit& to ,itnesses ,/o- it -ig/t use to recover illegall&
ac@uired ,ealt/ during t/at regi-e. 3n t/e case o. 0anc/anco vs. 9andigan%a&an (______________)) t/e Court
regarded as valid and %inding on t/e govern-ent t/e i--unit& it gave .or-er National Food 4ut/orit&
4d-inistrator) Besus 0anc/anco) .or all Jculpa%le acts o. /is during /is service in t/e Harcos govern-ent)K ,/ic/
,ould include possi%le prosecution .or an& illegal ,ealt/ t/at /e -ig/t /i-sel. /ave ac@uired during t/at service.
0/e Court did not regard suc/ i--unit& in contravention o. t/e state polic& on recover& o. ill#gotten ,ealt/ under
t/e auspices o. t/e Harcos regi-e. 0/e last sentence in paragrap/ ( o. t/e 3--unit& 4gree-ent t/at en1oined Disini
to Jprovide trut/.ul in.or-ation or testi-on&)K despite t/e guarantee not to %e co-pelled to testi.& against 8er-inio)
-erel& e-p/asi7ed t/e .act t/at suc/ concessions did not a..ect /is o%ligation to Jprovide trut/.ul in.or-ation or
testi-on&K in t/e t,o 5esting/ouse cases. 0/e grant o. i--unit& to Disini against %eing co-pelled to testi.& in
Jot/er casesK against 8er-inio ,as @uite clear and did not need an& interpretation.
0/e estoppel Disini invo2ed did not /ave t/e e..ect) i. recogni7ed) o. den&ing t/e state its rig/t to recover ,/atever
ill#gotten ,ealt/ 8er-inio -a& /ave ac@uired under t/e Harcos regi-e. 0/e action against 8er-inio could
continue) /a-pered onl& %& t/e exclusion o. DisiniIs testi-on&. 4nd t/ere are ot/er ,a&s o. proving t/e existence o.
ill#gotten ,ealt/. 4lt/oug/ t/e govern-ent cannot %e %arred %& estoppel %ased on unaut/ori7ed acts o. pu%lic
o..icers) suc/ principle cannot appl& to t/is case since +CGG acted ,it/in its aut/orit& ,/en it provided Disini ,it/
a guarantee against /aving to testi.& in ot/er cases. 4 contract is t/e la, %et,een t/e partiesS it cannot %e ,it/dra,n
except %& t/eir -utual consent. 0/is applies ,it/ -ore reason in t/is case ,/ere Disini alread& co-plied ,it/ t/e
ter-s o. t/e 3--unit& 4gree-ent. 0o allo, t/e Repu%lic to revo2e t/e 3--unit& 4gree-ent at t/is late stage ,ould
run a.oul o. t/e rule t/at a part& to aco-pro-ise cannot as2 .or a rescission a.ter it /ad en1o&ed its %ene.its.
0/e Court s/ould not allo, t/e Repu%lic) to put it %luntl&) to dou%le cross Disini. 0/e 3--unit& 4gree-ent ,as t/e
result o. a long dra,n out process o. negotiations ,it/ eac/ part& tr&ing to get t/e %est concessions out o. it. 0/e
Repu%lic did not /ave to enter into t/at agree-entS it ,as .ree not to. Aut ,/en it did) it needed to .ul.ill its
o%ligations /onora%l& as Disini did. Hore t/an an& one) t/e govern-ent s/ould %e .air. +CGGIs revocation o. t/e
@uestioned i--unit& and 9andigan%a&anIs denial o. DisiniIs -otion to @uas/ t/e su%poena ,ere %ot/ annulled.
+onente* B. Ro%erto 4. 4%ad
Depart-ent o. 4griculture v. NLRC
Facts* +etitioner Depart-ent o. 4griculture (D4) and 9ultan 9ecurit& 4genc& entered into a contract .or securit&
services to %e provided %& t/e latter to t/e said govern-ental entit&. +ursuant to t/eir arrange-ents) guards ,ere
deplo&ed %& 9ultan 9ecurit& 4genc& in t/e various pre-ises o. t/e D4. 0/erea.ter) several guards .iled a co-plaint
.or underpa&-ent o. ,ages) nonpa&-ent o. 1(t/ -ont/ pa&) uni.or- allo,ances) nig/t s/i.t di..erential pa&) /olida&
pa&) and overti-e pa&) as ,ell as .or da-ages against t/e D4 and t/e securit& agenc&.
0/e La%or 4r%iter rendered a decision .inding t/e D4 1ointl& and severall& lia%le ,it/ t/e securit& agenc& .or t/e
pa&-ent o. -one& clai-s o. t/e co-plainant securit& guards. 0/e D4 and t/e securit& agenc& did not appeal t/e
decision. 0/us) t/e decision %eca-e .inal and executor&. 0/e La%or 4r%iter issued a ,rit o. execution to en.orce and
execute t/e 1udg-ent against t/e propert& o. t/e D4 and t/e securit& agenc&. 0/erea.ter) t/e Cit& 9/eri.. levied on
execution t/e -otor ve/icles o. t/e D4.
3ssue* 5/et/er or not t/e doctrine o. non#sua%ilit& o. t/e 9tate applies in t/e case
8eld* 0/e %asic postulate ens/rined in t/e Constitution t/at Jt/e 9tate -a& not %e sued ,it/out its consentK re.lects
not/ing less t/an a recognition o. t/e sovereign c/aracter o. t/e 9tate and an express a..ir-ation o. t/e un,ritten
rule e..ectivel& insulating it .ro- t/e 1urisdiction o. courts. 3t is %ased on t/e ver& essence o. sovereignt&. 4
sovereign is exe-pt .ro- suit %ased on t/e logical and practical ground t/at t/ere can %e no legal rig/t as against t/e
aut/orit& t/at -a2es t/e la, on ,/ic/ t/e rig/t depends.
0/e rule is not reall& a%solute .or it does not sa& t/at t/e 9tate -a& not %e sued under an& circu-stances. 0/e 9tate
-a& at ti-es %e sued. 0/e 9tateIs consent -a& %e given expressl& or i-pliedl&. Express consent -a& %e -ade
t/roug/ a general la, or a special la,. 3-plied consent) on t/e ot/er /and) is conceded ,/en t/e 9tate itsel.
co--ences litigation) t/us opening itsel. to a counterclai-) or ,/en it enters into a contract. 3n t/is situation) t/e
govern-ent is dee-ed to /ave descended to t/e level o. t/e ot/er contracting part& and to /ave divested itsel. o. its
sovereign i--unit&.
Aut not all contracts entered into %& t/e govern-ent operate as a ,aiver o. its non#sua%ilit&S distinction -ust still %e
-ade %et,een one ,/ic/ is executed in t/e exercise o. its sovereign .unction and anot/er ,/ic/ is done in its
proprietar& capacit&. 4 9tate -a& %e said to /ave descended to t/e level o. an individual and can t/is %e dee-ed to
/ave actuall& given its consent to %e sued onl& ,/en it enters into %usiness contracts. 3t does not appl& ,/ere t/e
contract relates to t/e exercise o. its sovereign .unctions.
3n t/e case) t/e D4 /as not pretended to /ave assu-ed a capacit& apart .ro- its %eing a govern-ental entit& ,/en it
entered into t/e @uestioned contractS nor t/at it could /ave) in .act) per.or-ed an& act proprietar& in c/aracter
Aut) %e t/at as it -a&) t/e clai-s o. t/e co-plainant securit& guards clearl& constitute -one& clai-s. 4ct No. (>(
gives t/e consent o. t/e 9tate to %e sued upon an& -one&ed clai- involving lia%ilit& arising .ro- contract) express
or i-plied. +ursuant) /o,ever) to Co--on,ealt/ 4ct ('$) as a-ended %& +D 11G") t/e -one& clai- -ust .irst %e
%roug/t to t/e Co--ission on 4udit.
Repu%lic vs. 9andoval
En Aanc
Ca-pos) Br.) Harc/ 1!) 1!!(
0opic* 9overeignt& # 9uit not against t/e 9tate # Ae&ond t/e 9cope o. 4ut/orit&
Facts*
0/e /eirs o. t/e deceased o. t/e Banuar& '') 1!>$ Hendiola -assacre (%ac2ground* 5i2i)) toget/er ,it/ t/ose
in1ured (Ca&lao group)) instituted t/e petition) see2ing t/e reversal and setting aside o. t/e orders o. respondent
Budge 9andoval (Ha& (1 and 4ug >) 1!>>) in MErlinda Ca&lao) et al. vs. Repu%lic o. t/e +/ilippines) et al.M ,/ic/
dis-issed t/e case against t/e Repu%lic o. t/e +/ilippinesHa& (1 order* Aecause t/e i-pleaded -ilitar& o..icers are
%eing c/arged in t/eir personal and o..icial capacit&) /olding t/e- lia%le) i. at all) ,ould not result in .inancial
responsi%ilit& o. t/e govern-ent 4ug > order* denied t/e -otions .iled %& %ot/ parties .or reconsideration 3n Banuar&
1!>$) .ar-ers and t/eir s&-pat/i7ers presented t/eir de-ands .or ,/at t/e& called Mgenuine agrarian re.or-M 0/e
Qilusang Hag%u%u2id ng +ilipinas (QH+)) led %& Bai-e 0adeo) presented t/eir pro%le-s and de-ands suc/ as*
giving lands .or .ree to .ar-ers 7ero retention o. lands %& landlords stop a-orti7ations o. land pa&-ents Dialogue
%et,een t/e .ar-ers and t/en Hinistr& o. 4grarian Re.or- (H4R) %egan on Banuar& 1") 1!>$ 6n Banuar& ') 1!>$)
0adeo -et ,it/ H4R Hinister 8e/erson 4lvare7 4lvare7 ,as onl& a%le to pro-ise to do /is %est to %ring t/e -atter
to t/e attention o. t/en +resident Cor& 4@uino during t/e Banuar& '1 Ca%inet -eeting tension -ounted t/e next
da&0/e .ar-ers) on t/eir $t/ da& o. enca-p-ent) %arricaded t/e H4R pre-ises and prevented t/e e-plo&ees .ro-
going inside t/eir o..ices
6n Banuar& '') 1!>$) .ollo,ing a /eated discussion %et,een 4lvare7 and 0adeo) 0adeoCs group decided to -arc/ to
Halacanang to air t/eir de-ands 6n t/eir -arc/ to Halacanang) t/e& ,ere 1oined %& Qilusang Ha&o Uno (QHU))
Aagong 4l&ansang Ha2a%a&an (A4L4N)) League o. Filipino 9tudents (LF9)) and Qongreso ng +ag2a2aisa ng
Haralitang Lungsod (Q+HL) Govern-ent intelligent reports ,ere also received t/at t/e QH+ ,as /eavil&
in.iltrated %& C++DN+4 ele-ents) and t/at an insurrection ,as i-pending Govern-ent anti#riot .orces asse-%led at
Hendiola 0/e -arc/ers nu-%ered a%out 1) to 1") at around G*( p- Fro- CH Recto) t/e& proceeded
to,ard t/e police lines. No dialogue too2 placeS Mpande-oniu- %ro2e looseM
4.ter t/e clas/) 1' -arc/ers ,ere o..iciall& con.ir-ed dead (1( according to 0adeo) (! ,ere ,ounded %& guns/ots
and 1' sustained -inor in1uries) all %elonging to t/e group o. -arc/ers 6. t/e police and -ilitar&) ( sustained
guns/ot ,ounds and ' su..ered -inor p/&sical in1uries 0/e MCiti7ensC Hendiola Co--issionM su%-itted its report
on t/e incident on Fe%ruar& '$) 1!>$ as .ollo,s*
0/e -arc/ did not /ave an& per-it
0/e police and -ilitar& ,ere ar-ed ,it/ /andguns pro/i%ited %& la,
0/e securit& -en assigned to protect t/e govern-ent units ,ere in civilian attire (pro/i%ited %& la,)
0/ere ,as unnecessar& .iring %& t/e police and -ilitar&
0/e ,eapons carried %& t/e -arc/ers are pro/i%ited %& la,
3t is not clear ,/o started t/e .iring
0/e ,ater cannons and tear gas ,ere not put into e..ective use to disperse t/e cro,dS t/e ,ater cannons and .ire
truc2s ,ere not put into operation %ecause* t/ere ,as no order to use t/e-) t/e& ,ere incorrectl& prepositioned) t/e&
,ere out o. range o. t/e -arc/ers
0/e Co--ission reco--ended t/e cri-inal prosecution o. .our unidenti.ied) uni.or-ed individuals s/o,n eit/er
on tape or in pictures) .iring at t/e direction o. t/e -arc/ers
0/e Co--ission also reco--ended t/at all t/e co--issioned o..icers o. %ot/ t/e 5estern +olice District (5+D)
and 3ntegrated National +olice (3N+) ,/o ,ere ar-ed %e prosecuted .or violation o. par. G(g) o. t/e +u%lic
4sse-%l& 4ct o. 1!>"
+rosecution o. t/e -arc/ers ,as also reco--ended
3t ,as also reco--ended t/at 0adeo %e prosecuted %ot/ .or /olding t/e rall& ,it/out per-it and .or inciting sedition
4d-inistrative sanctions ,ere reco--ended .or t/e .ollo,ing o..icers .or t/eir .ailure to -a2e e..ective use o. t/eir
s2ill and experience in directing t/e dispersal operations in Hendiola*
Gen. Ra-on E. HontaTo
+olice Gen. 4l.redo 9. Li-
+olice Gen. Edgar Dula 0orres
+olice Ha1. De-etrio dela Cru7
Col. Ce7ar Na7areno
Ha1. File-on Gas-in
Last and -ost i-portant reco--endation* .or t/e deceased and ,ounded victi-s to %e co-pensated %& t/e
govern-ent. 3t ,as t/is portion t/at petitioners (Ca&lao group) invo2e in t/eir clai- .or da-ages .ro- t/e
govern-ent No concrete .or- o. co-pensation ,as received %& t/e victi-s
6n Banuar&) 1!>>) petitioners instituted an action .or da-ages against t/e Repu%lic o. t/e +/ilippines) toget/er ,it/
t/e -ilitar& o..icers) and personnel involved in t/e Hendiola incident 9olicitor general .iled a Hotion to Dis-iss on
t/e ground t/at t/e 9tate cannot %e sued ,it/out its consent. +etitioners said t/at t/e 9tate /as ,aived its i--unit&
.ro- suit. Budge 9andoval dis-issed t/e case on t/e ground t/at t/ere ,as no suc/ ,aiver. Hotion .or
Reconsideration ,as also denied
3ssues* 5/et/er or not t/e 9tate /as ,aived its i--unit& .ro- suit (i.e. 5/et/er or not t/is is a suit against t/e
9tate ,it/ its consent)
+etitioners argue t/at %& t/e reco--endation -ade %& t/e Co--ission .or t/e govern-ent to inde-ni.& t/e /eirs
and victi-s) and %& pu%lic addresses -ade %& +resident 4@uino) t/e 9tate /as consented to %e sued
5/et/er or not t/e case @uali.ies as a suit against t/e 9tate
8olding*No. 0/is is not a suit against t/e 9tate ,it/ its consent.
Ratio*4rt. R3F) 9ec. () 1!>$ Constitution* 0/e 9tate -a& not %e sued ,it/out its consent
0/e reco--endation %& t/e Co--ission does not in an& ,a& -ean t/at lia%ilit& auto-aticall& attac/es to t/e 9tate
0/e Co--ission ,as si-pl& a .act#.inding %od&S its .indings s/all serve onl& as cause o. action .or litigationS it
does not %ind t/e 9tate i--ediatel&. +resident 4@uinoCs speec/es are li2e,ise not %inding on t/e 9tateS t/e& are not
tanta-ount to a ,aiver %& t/e 9tate 9o-e instances ,/en a suit against t/e 9tate is proper*
5/en t/e Repu%lic is sued %& na-eS
5/en t/e suit is against an unincorporated govern-ent agenc&
5/en t/e suit is on its .ace against a govern-ent o..icer %ut t/e case is suc/ t/at t/e ulti-ate lia%ilit& ,ill %elong
not to t/e o..icer %ut to t/e govern-ent
4lt/oug/ t/e -ilitar& o..icers and personnel ,ere disc/arging t/eir o..icial .unctions during t/e incident) t/eir
.unctions ceased to %e o..icial t/e -o-ent t/e& exceeded t/eir aut/orit&
0/ere ,as lac2 o. 1usti.ication %& t/e govern-ent .orces in t/e use o. .irear-s.
0/eir -ain purpose in t/e rall& ,as to ensure peace and order) %ut t/e& .ired at t/e cro,d instead
No reversi%le error %& t/e respondent Budge .ound. +etitions dis-issed.
Lar2ins vs NLRC
Facts*
6n 4ugust 1') 1!>>) private respondents .iled a co-plaint ,it/ t/e Regional 4r%itration Aranc/ No. 333 o. t/e
NLRC) 9an Fernando) +a-panga .or illegal dis-issal and underpa&-ent o. ,ages.
C/arges ,ere against petitioner
0D9gt 4ldora Lar2ins ,/o ,as a -e-%er o. t/e United 9tates 4ir Force (U94F) assigned to oversee t/e dor-itories
o. t/e 0/ird 4ircra.t Generation 9@uadron (( 4G9) at Clar2 4ir Aase) +a-panga.)
Lt. Col. Fran2/auster) andBoselito Cunanan) t/e ne, contractor (B4C Haintenance 9ervices) e-plo&ed .or ( 4G9.
+etitioner and Lt. Col. Fran2/auser .ailed to ans,er t/e co-plaint and to appear at t/e /earings. 0/e&) li2e,ise)
.ailed to su%-it t/eir position paper ) ,/ic/ t/e La%or 4r%iter dee-ed a ,aiver on t/eir part to do so. 0/e case ,as
t/ere.ore su%-itted .or decision on t/e %asis o. private respondentsC position paper and supporting docu-ents ,/ic/
t/ere.ore on Nove-%er '1) 1!>>) t/e La%or 4r%iter rendered a decision granting all t/e clai-s o. private
respondents. 8e .ound %ot/ Lt. Col. Fran2/auser and petitioner Mguilt& o. illegal dis-issalM and ordered t/e- to
reinstate private respondents ,it/ .ull %ac2 ,ages) or i. t/at is no longer possi%le) to pa& private respondentsC
separation pa&.
+etitioner appealed to t/e NLRC clai-ing t/at t/e La%or 4r%iter never ac@uired 1urisdiction over /er person %ecause
no su--ons or copies o. t/e co-plaints) %ot/ original and a-ended) ,ere ever served on /er. 3n /er M9upple-ental
He-orandu- o. 4ppeal)M petitioner argued t/at t/e atte-pts to serve /er ,it/ notices o. /earing ,ere not in
accordance ,it/ t/e provisions o. t/e
R.+#U.9. Hilitar& Aases 4gree-ent o. 1!G$.
3ssue*
+etitionerCs contention t/at t/e @uestioned resolutions are null and void %ecause respondent La%or 4r%iter did not
ac@uire 1urisdiction to entertain and decide t/e case. +etitioner alleges t/at s/e never received nor ,as served) an&
su--ons or copies o. t/e original and a-ended co-plaints) and t/ere.ore t/e La%or 4r%iter /ad no 1urisdiction over
/er person under 4rticle R3F o. t/e R.+. <U.9. Hilitar& Aases 4gree-ent.
For Re.erence*
R.+. <U.9. Hilitar& Aases 4gree-ent.
M. . . NNOo process) civil or cri-inal) s/all %e served ,it/in an& %ase except ,it/ t/e per-ission o. t/e co--anding
o..icer o. suc/ %aseS %ut s/ould t/e co--anding o..icer re.use to grant suc/ per-ission /e s/all .ort/,it/ ta2e t/e
necessar& steps . . . to serve suc/ process) as t/e case -a& %e) and to provide t/e attendance o. t/e server o. suc/
process %e.ore t/e appropriate court in t/e +/ilippines or procure suc/ server to -a2e t/e necessar& a..idavit or
declaration to prove suc/ service as t/e case -a& re@uire.M
Ruling*
La%or 4r%iter /as no 1urisdiction over t/e case as su--onses and ot/er processes issued %& +/ilippine courts and
ad-inistrative agencies .or United 9tates 4r-ed Forces personnel ,it/in an& U.9. %ase in t/e +/ilippines could %e
served t/erein onl& ,it/ t/e per-ission o. t/e Aase Co--ander. 3. /e ,it//olds giving /is per-ission) /e s/ould
instead designate anot/er person to serve t/e process) and o%tain t/e serverCs a..idavit .or .iling ,it/ t/e appropriate
court. Respondent La%or 4r%iter did not .ollo, said procedure. 8e instead) addressed t/e su--ons to Lt. Col.
Fran2/auser and not t/e Aase Co--ander.
Respondents do not dispute petitionerCs clai- t/at no su--ons ,as ever issued and served on /er. 0/e& contend)
/o,ever) t/at t/e& sent notices o. t/e /earings to /er AU0 as contended notices o. /earing are not su--onses. 0/e
provisions and prevailing 1urisprudence in Civil +rocedure -a& %e applied %& analog& to NLRC
proceedings(Revised Rules o. t/e NLRC) Rule 3) 9ec. (). 3t is %asic t/at t/e La%or 4r%iter cannot ac@uire
1urisdiction over t/e person o. t/e respondent ,it/out t/e latter %eing served ,it/ su--ons (c.. Fda. de Haco& v.
Court o. 4ppeals) '? 9CR4 'GG N1!!'OS Fil-erco Co--ercial Co.) 3nc. v. 3nter-ediate 4ppellate Court ) 1G!
9CR4 1!( N1!>$O). 3n t/e a%sence o. service o. su--ons or a valid ,aiver t/ereo.) t/e /earings and 1udg-ent
rendered %& t/e La%or 4r%iter are null and void.
+etitioner) in t/e case at %enc/) appealed to t/e NLRC and participated in t/e oral argu-ent %e.ore t/e said %od&.
0/is) /o,ever) does not constitute a ,aiver o. t/e lac2 o. su--ons and a voluntar& su%-ission o. /er person to t/e
1urisdiction o. t/e La%or 4r%iter. 9/e -a& /ave raised in /er pleadings grounds ot/er t/an lac2 o. 1urisdiction) %ut
t/ese grounds ,ere discussed in relation to and as a result o. t/e issue o. t/e lac2 o. 1urisdiction. 3n e..ect) petitioner
set .ort/ onl& one issue and t/at is t/e a%sence o. 1urisdiction over /er person. 3. an appearance %e.ore t/e NLRC is
precisel& to @uestion t/e 1urisdiction o. t/e said agenc& over t/e person o. t/e de.endant) t/en t/is appearance is not
e@uivalent to service o. su--ons (De los 9antos v. Hontera) ''19CR4 1" N1!!(O).
Ae t/at as it -a&) on t/e assu-ption t/at petitioner validl& ,aived service o. su--ons on /er) still t/e case could
not prosper. 0/ere is no allegation .ro- t/e pleadings .iled t/at Lt. Col. Fran2/auser and petitioner ,ere %eing sued
in t/eir personal capacities .ortortious acts (United 9tates o. 4-erica v. Guinto) 1>' 9CR4 ?GG N1!!O). 8o,ever)
private respondents na-ed ( 4G9 as one o. t/e respondents in t/eir co-plaint.

3ndeed) assu-ing t/at 1urisdiction ,as ac@uired over t/e United 9tates Govern-ent and t/e -onetar& clai-s o.
private respondents proved) suc/ a,ards ,ill /ave to %e satis.ied not %& Lt. Col. Fran2/auser and petitioner in t/eir
personal capacities) %ut %& t/e United 9tates govern-ent (9andres v. Feridiano 33) 1?' 9CR4 >> N1!>>O).
Herritt v. Repu%lic o. t/e +/ilippines
0/e .acts o. t/e case too2 place in t/e 1!1Is. E. Herritt ,as a constructor ,/o ,as excellent at /is ,or2. 6ne da&)
,/ile /e ,as riding /is -otorc&cle along Calle +adre Faura) /e ,as %u-ped %& a govern-ent a-%ulance. 0/e
driver o. t/e a-%ulance ,as proven to /ave %een negligent. Aecause o. t/e incident) Herritt ,as /ospitali7ed and /e
,as severel& in1ured %e&ond re/a%ilitation so -uc/ so t/at /e could never per.or- /is 1o% t/e ,a& /e used to and
t/at /e cannot even earn at least /al. o. ,/at /e used to earn.
3n order .or Herritt to recover da-ages) /e soug/t to sue t/e govern-ent ,/ic/ later aut/ori7ed Herritt to sue t/e
govern-ent %& virtue o. 4ct 'G"$ enacted %& t/e legislature (4n 4ct aut/ori7ing E. Herritt to %ring suit against t/e
Govern-ent o. t/e +/ilippine 3slands and aut/ori7ing t/e 4ttorne&#General o. said 3slands to appear in said suit).
0/e lo,er court t/en deter-ined t/e a-ount o. da-ages and ordered t/e govern-ent to pa& t/e sa-e.
399UE* 5/et/er or not t/e govern-ent is lia%le .or t/e negligent act o. t/e driver o. t/e a-%ulance.
8ELD* No. A& consenting to %e sued a state si-pl& ,aives its i--unit& .ro- suit. 3t does not t/ere%& concede its
lia%ilit& to plainti..) or create an& cause o. action in /is .avor) or extend its lia%ilit& to an& cause not previousl&
recogni7ed. 3t -erel& gives a re-ed& to en.orce a preexisting lia%ilit& and su%-its itsel. to t/e 1urisdiction o. t/e
court) su%1ect to its rig/t to interpose an& la,.ul de.ense. 3t .ollo,s t/ere .ro- t/at t/e state) %& virtue o. suc/
provisions o. la,) is not responsi%le .or t/e da-ages su..ered %& private individuals in conse@uence o. acts
per.or-ed %& its e-plo&ees in t/e disc/arge o. t/e .unctions pertaining to t/eir o..ice) %ecause neit/er .ault nor even
negligence can %e presu-ed on t/e part o. t/e state in t/e organi7ation o. %ranc/es o. pu%lic service and in t/e
appoint-ent o. its agents. 0/e 9tate can onl& %e lia%le i. it acts t/roug/ a special agent (and a special agent) in t/e
sense in ,/ic/ t/ese ,ords are e-plo&ed) is one ,/o receives a de.inite and .ixed order or co--ission) .oreign to
t/e exercise o. t/e duties o. /is o..ice i. /e is a special o..icial) so t/at in representation o. t/e state and %eing %ound
to act as an agent t/ereo.) /e executes t/e trust con.ided to /i-.
3n t/e case at %ar) t/e a-%ulance driver ,as not a special agent nor ,as a govern-ent o..icer acting as a special
agent /ence) t/ere can %e no lia%ilit& .ro- t/e govern-ent. J0/e Govern-ent does not underta2e to guarantee to
an& person t/e .idelit& o. t/e o..icers or agents ,/o- it e-plo&s) since t/at ,ould involve it in all its operations in
endless e-%arrass-ents) di..iculties and losses) ,/ic/ ,ould %e su%versive o. t/e pu%lic interest.K
+eople vs. +urisi-a) No. L #G$$"$#?1) Banuar& '>) 1!>
F4C09* 3n.or-ation ,as .iled to '? individuals .ro- Hanila and 9a-ar) individuall& and separatel&) %e.ore t/e
Courts o. First 3nstance o. Hanila and 9a-ar .or illegal possession o. deadl& ,eapon or violation o. +residential
Decree No. ! pursuant to +rocla-ation No. 1>1 dated 9ept '1 and '() 1!$(. 6n t/e -otion to @uas/ %& t/e
accused) t/e t/ree respondent 1udges* Budge +urisi-a and Budge Hacaren) %ot/ o. CF3 o. HanilaS and Budge +olo o.
CF3 o. 9a-ar) issued in t/e respective cases .iled %e.ore t/e- an order to @uas/ or dis-iss t/e in.or-ations on a
co--on ground < Lac2 o. essential ele-ents to constitute an o..ense penali7ed %& +D No. !. 0/e respondent 1udges
stated t/at to constitute t/e said o..ense) t,o ele-ents -ust %e presentS (1) possession o. an& %laded) %lunt or
pointed ,eapon outside o. residence as stated in par (S (') and intended to use it to co--it or a%et su%version)
re%ellion) etc as stated in t/e prea-%le o. t/e said +D. 0/e +eople) as petitioners) t/ru t/e 9olicitor General)
contended t/at t/e pro/i%ited acts need not %e related to su%versive activities and t/e intent o. t/e accused are
irrelevant since its is a statutor& o..ense and punis/ing t/e possession o. suc/ deadl& ,eapon is not onl& to eradicate
su%versive acts %ut also cri-inalit& in general. 0/e petitioners also argued t/at t/e prea-%le is not an essential part
o. an act and cannot prevail over t/e text o. t/e la, itsel..
399UE* 5/et/er or not t/e petitionersI argu-ents as to t/e intention and scope o. +D No. ! (() correctE
8ELD* N6. 0/e 9upre-e Court sa&s t/at t/e intention o. +D No. ! (() is to penali7e t/e acts ,/ic/ are t/ose
related to t/e desired result o. +roc. No. 1>1 and Gen. 6rders Nos. ? and $ ,/ic/ are to suppress t/ose ,/o
co--it or a%et la,lessness) re%ellion) su%versive acts and t/e li2e. 0/e prea-%le o. +D No. ! also clearl& concurs
to t/at) t/oug/ t/e prea-%le is not a part o. t/e statute) it is t/e 2e& to deter-ine ,/at is t/e intent and spirit o. t/e
decree and deter-ine ,/at acts .all ,it/in t/e purvie, o. a penal statute.
Froilan v +an 9/ipping (1!"G)
F4C09*
6n Fe%ruar& () 1!"1) plainti..#appellee) Fernando 4. Froilan) .iled a co-plaint against t/e de.endant#appellant) +an
6riental 9/ipping Co.) alleging t/at /e purc/ased .ro- t/e 9/ipping Co--ission t/e vessel F9#1!$ .or +'))
pa&ing +") do,n and agreeing to pa& t/e %alance in install-entsS t/at to secure t/e pa&-ent o. t/e %alance o.
t/e purc/ase price) /e executed a c/attel -ortgage o. said vessel in .avor o. t/e 9/ipping Co--issionS t/at .or
various reasons) a-ong t/e- t/e non#pa&-ent o. t/e install-ents) t/e 9/ipping Co--ission tool possession o. said
vessel and considered t/e contract o. sale cancelledS t/at t/e 9/ipping Co--ission c/artered and delivered said
vessel to t/e de.endant#appellant +an 6riental 9/ippingCo. su%1ect to t/e approval o. t/e +resident o. t/e
+/ilippinesS t/at /e appealed t/e action o. t/e 9/ipping Co--ission to t/e +resident o. t/e +/ilippines and) in its
-eeting on 4ugust '") 1!")t/e Ca%inet restored /i- to all /is rig/ts under /is original contract ,it/ t/e 9/ipping
Co--issionS t/at /e /ad repeatedl& de-anded .ro- t/e +an 6riental 9/ipping Co. t/e possession o. t/e vessel in
@uestion %ut t/e latter re.used to do so. 8e) t/ere.ore) pra&ed t/at) upon t/e approval o. t/e %ond acco-pan&ing /is
co-plaint) a ,rit o. replevin %e issued .or t/e sei7ure o. said vessel ,it/ all its e@uip-ent and appurtenances) and
t/at a.ter /earing) /e %e ad1udged to /ave t/e rig/t.ul possession t/ereo. 6n Fe%ruar& () 1!"1) t/e lo,er court issued
t/e ,rit o. replevin pra&ed .or %& Froilan and %& virtue t/ereo. t/e +an 6riental 9/ipping Co. ,as divested o. its
possession o. said vessel. 6n Harc/ 1) 1!"1) +an 6riental 9/ipping Co. .iled its ans,er den&ing t/e rig/t o. Froilan
to t/e possession o. t/e said vesselS it alleged t/at t/e action o. t/e Ca%inet on 4ugust '") 1!") restoring Froilan to
/is rig/ts under /is original contract ,it/ t/e 9/ipping Co--ission ,as null and voidS t/at) in an& event) Froilan
/ad not co-plied ,it/ t/e condition precedent i-posed %& t/e Ca%inet .or t/e restoration o. /is rig/ts to t/e vessel
under t/e original contractS t/at it su..ered da-ages in t/e a-ount o. +'') $?G."! .or ,rong.ul replevin in t/e -ont/
o. Fe%ruar&) 1!"1) and t/e su- o. +1$)?"1.>G a -ont/ as da-ages su..ered .or ,rong.ul replevin .ro- Harc/ 1)
1!"1S it is alleged t/at it /as incurred necessar& and use.ul expenses on t/e vessel a-ounting to +1'$)"$.(1 and
clai-ed t/e rig/t to retain said vessel until its use.ul and necessar& expenses /ad %een rei-%ursed(Rec. on 4pp. pp.
>#"().6n Nove-%er 1) 1!"1) a.ter t/e leave o. t/e lo,er court /ad %een o%tained) t/e intervenor#appellee)
Govern-ent o. t/e Repu%lic o. t/e +/ilippines) .iled a co-plaint in intervention alleging t/at Froilan /ad .ailed to
pa& to t/e 9/ipping Co--ission (,/ic/ na-e ,as later c/anged to 9/ipping 4d-inistration) t/e %alance due on t/e
purc/ase price o. t/e vessel in @uestion) t/e interest excluding t/e dr&#doc2ing expenses incurred on said vessel %&
t/e session o. t/e said vessel eit/er under t/e ter-s o. t/e original contract as supple-ented %& FroilanCs letter dated
Banuar& '>) 1!G!) or in order t/at it -a& cause t/e extra1udicial sale t/ereo. under t/e C/attel Hortgage La,. 3t)
t/ere.ore) pra&ed t/at Froilan %e declared to %e ,it/out an& rig/ts on said vessel and t/e a-ounts /e paid t/ereon
.or.eited or alternatel& t/at t/e said vessel %e delivered to t/e Aoard o. Li@uidators in order t/at t/e intervener -a&
/ave its c/attel -ortgage extra1udiciall& .oreclosed in accordance ,it/ t/e provisions o. t/e C/attel Hortgage La,S
and t/at pending t/e /earing on t/e -erits) t/e said vessel %e delivered to its o,ner 6n Nove-%er '!) 1!"1) t/e +an
6riental 9/ipping Co. .iled an ans,er to t/e co-plaint in intervention alleging t/at t/e Govern-ent o. t/e Repu%lic
o. t/e +/ilippines ,as o%ligated to deliver t/e vessel in @uestion to it %& virtue o. a contract o. %are%oat c/arter ,it/
option to purc/ase executed on Bune 1?) 1!G!) %& t/e latter in .avor o. t/e .or-erS it also alleged t/at it /ad -ade
necessar& and use.ul expenses o. t/e vessel and clai-ed t/e rig/t o. retention o. t/e vessel. 3t) t/ere.ore) pra&ed t/at)
i. t/e Repu%lic vessel) to co-pl& ,it/ its o%ligations o. delivering to it(+an 6riental 9/ipping Co.) or causing its
deliver& %& recovering it .ro- Froilan 6n Nove-%er '!) 1!"1) Froilan tendered to t/e Aoard o. Li@uidators) ,/ic/
,as li@uidating t/e a..airs o. t/e 9/ipping 4d-inistration) a c/ec2 in t/e a-ount o. +1?')"$?.!? in pa&-ent o. /is
o%ligation to t/e 9/ipping 4d-inistration .or t/e said vessel as clai-ed in t/e co-plaint in intervention o. t/e
Govern-ent o. t/e Repu%lic o. t/e +/ilippines. 0/e Aoard o. Li@uidators issued an o..icial report t/ere.ore stating
t/at it ,as a Cdeposit pending t/e issuance o. an order o. t/e Court o. First 3nstance o. HanilaI 6n Dece-%er $)
1!"1) t/e Govern-ent o. t/e Repu%lic o. t/e +/ilippines %roug/t t/e -atter o. said pa&-ent and t/e circu-stances
surrounding it to t/e attention o. t/e lo,er court Cin order t/at t/e& -a& %e ta2en into account %& t/is 8onora%le
Court in connection ,it/ @uestion t/at are no, pending %e.ore it .or deter-inationI 6n Fe%ruar& () 1!"') t/e lo,er
court /eld t/at t/e pa&-ent %& Froilan o. t/e a-ount o. +1?')"$?.!? 6n Nove-%er '!) 1!"1) to t/e Aoard o.
Li@uidators constituted a pa&-ent and a disc/arge o. FroilanCs o%ligation to t/e Govern-ent o. t/e Repu%lic o. t/e
+/ilippines and ordered t/e dis-issal o. t/e latterCs co-plaint in intervention. 3n t/e sa-e order) t/e lo,er court
-ade it ver& clear t/at said order did not pre#1udge t/e @uestion involved %et,een Froilan and t/e 6riental 9/ipping
Co. ,/ic/ ,as also pending deter-ination in said court . 0/is order dis-issing t/e co-plaint in intervention) %ut
reserving .or .uture ad1udication t/e controvers& %et,een Froilan and t/e +an 6riental 9/ipping Co. /ad alread&
%eco-e .inal since neit/er t/e Govern-ent o. t/e Repu%lic o. t/e +/ilippines nor t/e +an 6riental 9/ipping Co. /ad
appealed t/ere.ro-. 6n Ha& 1) 1!"') t/e Govern-ent o. t/e Repu%lic o. t/e +/ilippines .iled a -otion to dis-iss
t/e counterclai- o. t/e +an 6riental 9/ipping Co. against it on t/e ground t/at t/e purpose o. said counterclai- ,as
to co-pel t/e Govern-ent o. t/e Repu%lic o. t/e +/ilippines to deliver t/e vessel to it (+an 6riental 9/ipping Co.)
in t/e event t/at t/e Govern-ent o. t/e Repu%lic o. t/e +/ilippines recovers t/e vessel in @uestion .ro- Froilan. 3n
vie,) /o,ever) o. t/e order o. t/e order o. t/e lo,er court dated Fe%ruar& () 1!"') /olding t/at t/e pa&-ent -ade
%& FroilanCso%ligation to t/e 9/ipping 4d-inistration) ,/ic/ order /ad alread& %eco-e .inal) t/e counter clai- o.
t/e +an 6riental 9/ipping Co. against t/e Repu%lic o. t/e +/ilippines ,as no longer .easi%le) said counterclai- ,as
%arred %& prior 1udg-ent and stated no cause o. action. 3t ,as also alleged t/at -ovant ,as not su%1ect to t/e
1urisdiction o. t/e court in connection ,it/ t/e counterclai-. 0/is -otion ,as opposed %& t/e +an 6riental 9/ipping
Co. in its ,ritten opposition dated Bune G)1!"' .
399UE* 5/et/er or not t/e R+ o. t/e +/ilippines is i--une .ro- suit.
8ELD* N6U %ecause %& .iling its co-plaint in intervention t/e Govern-ent in e..ect ,aived its rig/t o.
nonsua%ilit&.M0/e i--unit& o. t/e state .ro- t/e suits does not deprive it o. t/e rig/t to sue private parties in its o,n
courts. 0/e state as plainti.. -a& avail itsel. o. t/e di..erent .or-s o. actions open to private litigants. 3n s/ort) %&
ta2ing t/e initiative in an action against a private part&) t/e state surrenders its privileged position and co-es do,n
to t/e level o. t/e de.endant. 0/e latter auto-aticall& ac@uires) ,it/in certain li-its) t/e rig/t to set up ,/atever
clai-s and ot/er de.ense /e -ig/t /ave against t/e state. 0/e United 9tates 9upre-e Court t/us explains* No direct
suit can %e -aintained against t/e United 9tates. Aut ,/en an action is %roug/t %& t/e United 9tates to recover
-one& in t/e /ands o. a part& ,/o /as a legal clai- against t/e-) it ,ould %e a ver& rigid principle to den& to /i-
t/e rig/t o. setting up suc/ clai- in a court o. 1ustice) and turn /i- around to an application to Congress.CM.3t is
/o,ever) contended .or t/e intervener t/at) i. t/ere ,as at all an& ,aiver) it ,as in .avor o. t/e plainti.. against
,/o- t/e co-plainant in intervention ,as directed. 0/is contention is untena%le. 4s alread& stated) t/e co-plaint in
intervention ,as in a sense in derogation o. t/e de.endantIs clai- over t/e possession o. t/e vessel in @uestion.
Hunicipalit& o. 9an Higuel) Aulacan v. Fernande7
No. L#?1$GG Bune '") 1!>G
F4C09*
3n Civil Case No. ?G#A) entitled MHargarita D. Fda. De 3-perio) et al. v. Hunicipal Govern-ent o. 9an Higuel)
Aulacan) et al.M dated 4pril '>) 1!$>) under presiding Budge 6scar C. Fernande7) rendered 1udge-ent in .avour o.
t/e plainti..s and against t/e de.endant Hunicipal Govern-ent o. 9an Higuel) Aulacan) represented %& Ha&or Har
Harcelo G. 4ure and its Hunicipal 0reasurer. 0/e court ordered t/e de.endant -unicipalit& to pa& t/e plainti..s t/e
su- o. +/p?G)GG. corresponding to t/e rentals collected .ro- t/e tenants .ro- 1!$ up to and including 1!$"
plus interest t/ereon at t/e legal rate .ro- Banuar& 1!$ until .ull& paid. 3n addition to t/is) t/e de.endant
-unicipalit& -ust pa& t/e plainti..s t/e su- o. +/p(). .or attorne&Cs .ees and to pa& t/e cost o. suit. 0/erea.ter)
t/e private respondents -oved .or issuance o. t/e ,rit o. execution .or t/e satis.action o. t/e said 1udge-ent)
/o,ever) petitioner) on Bul& () 1!>') .iled a Hotion to =uas/ t/e ,rit o. execution on t/e ground t/at t/e
-unicipalit&Cs propert& or .unds are all pu%lic .unds exe-pt .ro- execution. 0/e said Hotion ,as t/en denied %& t/e
respondent 1udge in an order dated 4ugust '() 1!>' and t/e ,rit o. execution still stands in .ull .orce and e..ect.
399UE*
5/et/er or not t/e .unds o. t/e Hunicipalit& o. 9an Higuel) Aulacan) in t/e possession o. t/e provincial and
-unicipal treasurers o. Aulacan and 9an Higuel) respectivel&) are pu%lic .unds ,/ic/ are exe-pt .ro- execution .or
t/e satis.action o. t/e -one& 1udge-ent in Civil Case No. ?G#A.
8ELD*
Les) all t/e .unds o. t/e -unicipalit& in t/e possession o. t/e Hunicipal 0reasurer o. 9an Higuel and o. Aulacan) are
pu%lic .unds ,/ic/ are exe-pt .ro- execution as stated under +residential Decree No. G$$) M0/e Decree on Local
Fiscal 4d-inistrationM) 9ection ') paragrap/ (a)* No -one& s/all %e paid out o. t/e treasur& except in pursuance o. a
la,.ul appropriation or ot/er speci.ic statutor& aut/orit&. Furt/er-ore) t/ere -ust %e an ordinance dul& passed %&
t/e 9angguniang Aa&an containing t/e corresponding appropriation .or t/e .unds %e.ore an& -one& o. t/e
-unicipalit& -a& %e paid out.
Unli2e t/e 9tate ,/ic/ /as t/e i--unit& o. not %eing sued ,it/out its consent) 4 -unicipal corporation is an
exa-ple o. an incorporated agenc& ,/ic/ /as a c/arter o. its o,n t/at grants t/e- t/e co-petence to sue and %e
sued. 8o,ever) -unicipal govern-ent is generall& not lia%le .or torts co--itted during t/e disc/arge o. its
govern-ental .unctions. 3t can %e /eld lia%le onl& i. it /as %een proven t/at t/e& ,ere acting in a proprietar&
.unction. Failing to do t/is) t/e clai-ant cannot recover.