USAFFE Veterans Association, Inc.

vs Treasurer of the Philippines

FACTS:

In October 1954, the USAFFE Veterans Associations Inc. (Usae), prayed in its
complaint before the Manila court of rst instance that the Romulo-Snyder
Agreement (1950) whereby the Philippine Government undertook to return to the
United States Government in ten annual installments, a total of about 35-million
dollars advanced by the United States to, but unexpanded by, the National Defense
Forces of the Philippines be annulled, that payments thereunder be declared illegal
and that defendants as ocers of the Philippine Republic be restrained from
disbursing any funds in the National Treasury in pursuance of said Agreement. Said
Usae Veterans further asked that the moneys available, instead of being remitted
to the United States, should be turned over to the Finance Service of the Armed
Forces of the Philippines for the payment of all pending claims of the veterans
represented by plainti. The complaint rested on plainti's three propositions: rst,
that the funds to be "returned" under the Agreement were funds appropriated by
the American Congress for the Philippine army, actually delivered to the Philippine
Government and actually owned by said Government; second, that U.S. Secretary
Snyder of the Treasury, had no authority to retake such funds from the P.I.
Government; and third, that Philippine foreign Secretary Carlos P. Romulo had no
authority to return or promise to return the aforesaid sums of money through the
so-called Romulo-Snyder Agreement.

ISSUES

Basic issue: Validity of the Romulo-Snyder Agreement Court cant pass judgment

1. WON there is obligation to repay - YES

2. WON the ocers who promised to repay had authority to bind this Govt YES

Held:

1. Note that the $269M appropriated in Public Law 353 expressly said that the
money is to be handed to the RP Govt either in advance of or in reimbursement
thereof. In any system of accounting, advances of funds for expenditures
contemplate disbursements to be reported, & credited if approved, against such
advances, the unexpended sums to be returned later. Congressional law itself
required accounting in the manner prescribed by US Pres - & said Pres in EO 9011,
outlined the procedure whereby advanced funds shall be accounted for. It also
requires as a condition sine qua non that all expenditures shall rst be approved by
the USAFFE Commanding Gen. These ideas of funds advanced to meet
expenditures of the Phil Army as may be approved by the USAFFE Comm-Gen, in
connection w/ the accounting requirement, evidently contradict appellants thesis
that the moneys represented straight payments to RP Govt for its armed services, &
passed into the absolute control of such Govt. Instead of returning such amount into
one lump sum, our Exec Department arranged for its repayment in 10 annual
installments. Prima facie such arrangement should raise no valid objection, given
the obligation to return.

2. There is no doubt Pres Quirino approved the negotiations. And he had the power
to contract budgetary loans under RA 213, amending RA 16. The most important
argument, however, rests on the lack of ratication of the Agreement by RP Senate
to make it binding on the Govt.

The explanation of the defendant was considered persuasive by the Court

The agreement is not a treaty as that term is used in CONSTI. However, a treaty is
not the only form that an international agreement may assume. For the grant of
treaty making power to the Executive & the Senate does not exhaust the power of
the government over international relations.

Executive agreements may be entered into with other states & are eective even
without concurrence of Senate.

-In intl law, there is no dierence between treaties & executive agreements in their
binding eect upon states concerned as long as the negotiating functionaries have
remained w/n their powers.

-The distinction between executive agreements & treaties is purely a constitutional

one & has not intl legal signicance.

-Altman v. US: An intl compact negotiated between the reps of 2 sovereign nations
& made in the name or behalf of the contracting parties & dealing with important
commercial relations between the 2 countries, is a treaty both internationally
although as an executive agreement it is not technically a treaty requiring the
advice & consent of the Senate

-2 classes of Executive Agreements: 1) agreements made purely as executive acts

aecting external relations & independent of or without legislative authorization,
which may be termed as presidential agreements; 2) agreements entered into in
pursuance of acts of Cong, which have been designated as Congressional-Executive
Agreements

-The Romulo-Snyder Agreement may fall under any of these 2 classes for on Sept
18, 1946, RP Congress authorized the RP Pres to obtain such loans or incur such
indebtedness with the US.

-Even granting there is no legal authorization, the Agreement was legally & validly
entered into to conform to the 2nd category, namely, as agreements entered into
purely as executive acts without leg authorization, which usually includes money
agreements.

-The Agreement was not submitted to the US Senate either. But the Phil Senates
Resolution No. 15 practically admits the validity & binding force of such Agreement.

Further, the acts of Congress appropriating funds for the yearly installments
necessary to comply w/ such Agreement constitute a ratication thereof, WHICH
PLACES THE QUESTION OF VALIDITY OUT OF THE COURTS REACH, NO
CONSTITUTIONAL PRINCIPLE HAVING BEEN INVOKED TO RESTRICT CONGRESS
PLENARY POWER TO APPROPRIATE FUNDS LOAN OR NO LOAN.