Haw Pia vs China Banking Corp.
to said bank from its debtors, and paying its creditors, and therefore to
G.R. No. L-554 April 9, 1948
Facts:
Plaintiff-appellants indebtedness to the defendant-appellee China Banking
Corporation in the sum of P5,103.35 by way of overdraft in current account
payable on demand together with its interests, has been completely paid,
on different occasions to the defendant Bank China Banking Corporation
through the defendant Bank of Taiwan, Ltd., that was appointed by the
Japanese Military authorities as liquidator of the China Banking Corporation.
The trial court held that, as there was no evidence presented to show that
the defendant Bank had authorized the Bank of Taiwan, Ltd., to accept the
payment of the plaintiffs debt to the said defendant, and said Bank of
Taiwan, as an agency of the Japanese invading army, was not authorized
under the international law to liquidate the business of the China Banking
Corporation, the payment has not extinguished the indebtedness of the
plaintiff to the said defendant under Article 1162 of the Civil Code.
Issues:
1. Whether or not the Japanese Military Administration had authority to
order the liquidation or winding up of the business of defendant-appellee
China Banking Corporation, and to appoint the Bank of Taiwan liquidator
authorized as such to accept the payment by the plaintiff-appellant to said
defendant-appellee; and
2. Whether or not such payment by the plaintiff-appellant has extinguished
her obligation to said defendant-appellee.
Ruling:
1. YES. The Japanese military authorities had power, under the international
law, to order the liquidation of the China Banking Corporation and to
appoint and authorize the Bank of Taiwan as liquidator to accept the
payment in question, because such liquidation is not confiscation of the
properties of the bank appellee, but a mere sequestration of its assets
which required the liquidation or winding up of the business of said bank.
The sequestration or liquidation of enemy banks in occupied territories is
authorized expressly by the United States Army and Navy Manual of Military
Government and Civil Affairs F.M. 2710 OPNAV 50-E-3.
2. YES. It having been shown above that the Japanese Military Forces had
power to sequestrate and impound the assets or funds of the China Banking
Corporation, and for that purpose to liquidate it by collecting the debts due
appoint the Bank of Taiwan as liquidator with the consequent authority to
make the collection, it follows evidently that the payments by the debtors
to the Bank of Taiwan of their debts to the China Banking Corporation have
extinguished their obligation to the latter. Said payments were made to a
person, the Bank of Taiwan, authorized to receive them in the name of the
bank creditor under article 1162, of the Civil Code. Because it is evident the
words a person authorized to receive it, as used therein, means not only
a person authorized by the same creditor, but also a person authorized by
law to do so, such as guardian, executor or administrator of estate of a
deceased, and assignee or liquidator of a partnership or corporation, as well
as any other who may be authorized to do so by law (Manresa, Civil Code,
4th ed. p. 254.)
The fact that the money with which that debts have been paid were
Japanese war notes does not affect the validity of the payments. The power
of the military governments established in occupied enemy territory to
issue military currency in the exercise of their governmental power is
based, not only on the occupants general power to maintain law and order
recognized in article 43 of the Hague Regulations (Feilchenfeld of
Belligerent Occupation, paragraph 6), but on military necessity as shown by
the history of the use of money or currency in wars.
G.R. No. L-1325 April 7, 1947
GEORGE L. TUBB and WESLEY TEDROW, petitioners,
vs.
THOMAS E. GRIESS, respondent.
Justiniano S. Montano for petitioners.
J. A. Wolfson for respondent.
MORAN, C.J.:
This is a petition for habeas corpus filed by George L. Tubb and Wesley
Tedrow, citizens of the United States but residents of the Philippines, under
written contract of employment with the Army of the United States. It
appears that sometime between January 13, 1947, as appearing in the
"charge sheet" submitted by respondent, the herein petitioners were
apprehended by the authorities of the United States Army and have since
been held in custody. On January 28, 1947, petitioners were formally
charged by said authorities with violations of Articles of War regarding
misappropriation of United States Government property destined for
military use, said acts having been committed within premises occupied by
the United States Army under lease contracts.
Petitioners now come before this Court alleging that they are being
unlawfully deprived of their liberty and that Philippine courts have exclusive
jurisdiction over their arrest, confinement and imprisonment because (1)
they are not persons subject to military laws, (2) martial law is no longer
enforced.
In the contract of employment entered into by petitioners with the United
States Army, it is shown that they voluntarily submitted themselves to
United States military law while serving said contract, thereby submitting
themselves to the full extent of the authority of the United States Army in
this area. This, coupled with the fact that petitioners are American citizens,
makes their position during the subsistence of said contract no different
from that of enlisted men, enlistment after all being nothing more than a
contract of voluntary service in the armed forces of one's country.
Petitioners then, in relation to the United States Army in the Philippines and
during the subsistence of their employment contract, can be deemed to
possess the status of military personnel.
It is a settled principle of International Law that a foreign army allowed to
march through a friendly country or to be stationed in it, by permission of
its government or sovereign, is exempt from the civil and criminal
jurisdiction of the place. In applying this rule in the case of Raquiza vs.
Bradford (75 Phil., 50), this Court held that "if a foreign army permitted to
be stationed in a friendly country, "by permission of its government or
sovereign," is exempt from the civil and criminal jurisdiction of the place,
with much more reason should the Army of the United States which is not
only permitted by the Commonwealth Government to be stationed here but
has come to the islands and stayed in them for the express purpose of
liberating them, and further prosecuting the war to a successful conclusion,
be exempt from the civil and criminal jurisdiction of this place, at least for
the time covered by said agreement of the two Governments. By analogy,
an attempt of our civil courts to exercise jurisdiction over the United States
Army before such period expires, would be considered as a violation of this
country's faith, which this Court should not be the last to keep and uphold.
By exercising it, paraphrasing the foregoing quotation, the purpose for
which the stationing of the army in the islands was requested or agreed
upon may be hampered or prejudiced, and a portion of said military force
would be withdrawn from the control of the sovereign to whom they belong.
And, again, by analogy, the agreement for the stationing of the United
States Army or a part of its forces in the Philippines implies a waiver of all
jurisdiction over their troops during the time covered by such agreement,
and permits the allied general or commander-in-chief to retain that
exclusive control and discipline which the government of his army may
require."
The basis of this ruling is the leading case of The Schooner Exchange vs.
McFadden (7 Cranch, 116) in which the United States Supreme Court
speaking through Chief Justice Marshall, held that "a third case in which a
sovereign is understood to cede a portion of his territorial jurisdiction is,
where he allows the troops of a foreign prince to pass through his
dominions. In such case, without any express declaration waving
jurisdiction over the army to which this right of passage has been granted,
the sovereign who should attempt to exercise it would certainly be
considered as violating his faith. By exercising it, the purpose for which the
free passage was granted would be defeated, and a portion of the military
force of a foreign independent nation would be diverted from those national
objects and duties to which it was applicable, and would be withdrawn from
the control of the sovereign whose power and whose safety might greatly
depend on retaining the exclusive command and disposition of this force.
The grant of a free passage therefore implies a waiver of all jurisdiction
over the troops during their passage, and permits the foreign general to use
that discipline, and to inflict those punishments which the government of
his army may require."
Since then, this principle has been consistently embodied in treaties of
military character among friendly nations and has been accepted by all the
countries of the world. The most authoritative writers on International Law
firmly concur in this rule. To quote
Wheaton. A foreign army or fleet, marching through, sailing over or
stationed in the territory of another State, with whom the foreign sovereign
to whom they belong is in amity, are also, in like manner, exempt from the
civil and criminal jurisdiction of the place. (Elements of International Law,
section 95.)
Hall. Military forces enter the territory of a state in amity with that to
which they belong, either when crossing to and fro between the main part
of their country and an isolated piece of it, or as allies passing through for
the purposes of a campaign, or furnishing garrisons for protection. In cases
of the former kind, the passage of soldiers being frequent, it is usual to
conclude conventions, specifying the line of road to be followed by them,
and regulating their transit so as to make it as little onerous as possible to
the population among whom they are. Under such conventions offenses
committed by soldiers against the inhabitants are dealt with by the military
authorities of the state to which the former belong; and as their general
object in other respects is simply regulatory of details, it is not necessary to
look upon them as intended in any respect to modify the rights of
jurisdiction possessed by the parties to them respectively. There can be no
question that the concession of jurisdiction over passing troops to the local
authorities would be extremely inconvenient; and it is believed that the
commanders, not only of forces in transit through a friendly country with
which no convention exists, but also of forces stationed there, assert
exclusive jurisdiction in principle in respect of offenses committed by
persons under their command, though they may be willing as a matter of
concession to hand over culprits to the civil power when they have
confidence in the courts, and when their stay is likely to be long enough to
allow of the case being watched. The existence of a double jurisdiction in a
foreign country being scarcely compatible with the discipline of an army, it
is evident that there would be some difficulty in carrying out any other
arrangement. (Emphasis supplied; International Law, 7th ed., section 56.)
Lawrence. The universally recognized rule of modern time is that a state
must obtain express permission before its troops can pass through the
territory of another state .. . Permissions may be given as a permanent
privilege by treaty for such a purpose as sending relief to garrisons, or it
may be granted as a special favor for the special occasion on which it is
asked. The agreement for passage generally contains provisions for the
maintenance of order in the force by its own officers, and makes them, and
the state in whose service they are, responsible for the good behavior of
the soldiers towards the inhabitants. In the absence of special agreement
the troops would not be amenable to the local law, but would be under the
jurisdiction and control of their own commanders, as long as they remained
within their own lines or were away on duty, but not otherwise. (Principles
of International Law, 6th ed., section 107, p. 246.)
Oppenhein. Whenever armed forces are on foreign territory in the service
of their home State, they are considered exterritorial and remain, therefore,
under its jurisdiction. A crime committed on foreign territory by a member
of these forces cannot be punished by the local civil or military authorities,
but only by the commanding officer of the forces or by another authorities
of their home State. This rule, however, applies only in case the crime is
committed, either within the place where the force is stationed, or in some
place where the criminal was on duty; it does not apply, if, for example,
soldiers belonging to a foreign garrison of a fortress leave the rayon of the
fortress not on duty but for recreational and pleasure, and then and there
commit a crime. The local authorities are in that case competent to punish
them. (International Law, 4th ed., Vol. I, section 445.)
Westlake affirmed Wheaton's view.
Hyde. Strong grounds of convenience and necessity prevent the exercise
of jurisdiction over a foreign organized military force which, with the
consent of the territorial sovereign, enters its domain. Members of the force
who there commit offenses are dealt with by the military or other
authorities of the State to whose service they belong, unless the offenders
are voluntarily given up. (I International Law, section 247.)
McNair and Lauterpacht. It is a principle of international law that the
armed forces of one State, when crossing the territory of another friendly
country, with the acquiescence of the latter, is not subject to the
jurisdiction of the territorial sovereign, but to that of the officers and
superior authorities of its own command. (Annual of Digest, 1927-1928,
Case No. 114.)
Vattel. . . . the grant of passage includes that of every particular thing
connected with the passage of troops, and of things without which it would
not be practicable; such as the liberty of carrying whatever may be
necessary to an army; that of exercising military discipline on the officers
and soldiers . . .. (III, 8, section 130, as quoted in Woolsey's International
Law, 6th ed., section 68.)
Without applying the recent treaty on military bases concluded between the
governments of the Philippines and the United States, it having reference to
base sites not involved in this case, and considering that a part of the
United States Army is stationed in the Philippines with permission of our
government, and that petitioners who belong to the military personnel of
that army are charged with violations of Articles of War for offenses
committed in areas under the control of the United States Army, thereby
giving said army jurisdiction over their person and the offenses charged,
petition is dismissed, without costs.
Feria, Pablo, Hilado, Bengzon, Briones, Hontiveros, Padilla and Tuason, JJ.,
concur.
PARAS, J.:
I concur in the result.
Separate Opinions
PERFECTO, J., dissenting:
Connected as civilian employees with the Manila Engineer Department of
the United States Army depot at the North Harbor, Manila, petitioners
George L. Tubb and Wesley Tedrow were arrested on January 4, 1947, by
individuals posing as agents of the CID (Criminal Investigation Division) and
since then they were confirmed, restrained and deprived of their liberty.
In their petition filed with this Court, dated February 20, 1947, petitioners
allege that in spite of the fact that they had been detained for more than
one month, no formal complaint or information for any specific violation of
law has been filed against them, nor any judicial writ or order for their
commitment has at any time been issued so far; that they did not commit
any offenses for which they may be arrested, detained or deprived of their
liberty without formal charges or judicial warrant; that, according to
information, they are detained by the United States Army authorities at the
North Habor, Manila, at the behest and alleged order of a certain Cap.
Thomas E. Griess, Security Officer of the Manila Engineer District, whose
office is at Pasay, Rizal; that their detention, according to information was
based on the suspicion of having stolen and disposed of certain
construction materials, explosives, and other miscellaneous items
belonging to the United States Army; that they are not persons subject to
military laws and only a competent court having jurisdiction in the
Philippines can order their arrest, detention, and imprisonment; that there
being no martial law in the Philippines, war having been officially
terminated as of December 31, 1946, and the Constitution in the
Philippines being in full force and operation, the detention and confinement
of petitioners are utterly illegal.
Respondent Thomas E. Griess, Captain, Corps of Engineers, United States
Army, in his return averred that respondent, as an officer of the United
States Army, pursuant to orders issued by his superiors and in his official
capacity as such officer, has in custody the petitioners against each of
whom charges have been filed, which charges are to be tried and heard by
a general court martial; that petitioners are each civilian employees of the
United States Army in the Philippines, Tubb under a written contract of
employment dated January 30, 1946, clause 26 of which, in part, reads:
"The Employee understands he or she is subject to the United States
Military Law while serving under this agreement," and the latter (Tedrow)
under a written contract of employment dated July 29, 1946, clause 9 of
which, in part, reads: "You are subject to military law whenever it is
established by competent authorities;" that part of the United States Army
is stationed in the Philippines by virtue of the laws of the United States
among which is Joint Resolution No. 93, which provides for the mutual
protection of the United States and the Philippines and, petitioners were
engaged as civilian employees of said army; that all persons serving with
the Armies of the United States without the territorial jurisdiction of the
United States are subject to the articles of war of said country; that on
January 28, 1947, formal charges for violation of the 94th Article of War
were filed against petitioner Tubb, and on the same day formal charges for
violation of the 96th Article of War were filed against petitioner Tedrow, and
it is by virtue of aforesaid charges and military orders that respondent has
custody of petitioners; that the place at the North Harbor, Manila where
petitioners are in custody is under the jurisdiction of the United States by
virtue of duly executed leases dated June 14, 1955; that petitioners are not
confined in any prison or jail but are confined under surveillance of
respondent in their living quarters which are situated on the leased
premises.
At the hearing of this case, which took place on March 7, 1947, Atty.
Justiniano S. Montano appeared and argued for petitioners and Atty. J. A.
Wolfson, for respondent. The latter, accompanied by respondent and two-
star generals of the United States Army, garbed in their military uniform,
made the statement that this case has been communicated to Washington
and that the United States Government is interested in its result. The
intimidation implied in the statement compelled counsel for petitioners to
make an impassioned protest against the uncalled-for statement and one of
the Justices made the statement to the effect that this Court shall not allow
any outsider to influence it in deciding this case.
No mention having been made in the decision of the incident,
notwithstanding the fact that it involves a clear attempt to jeopardize the
authority and dignity of this Court, we deem it necessary to state that such
kind of attempts should not be allowed to pass without a rebuke or a more
drastic action. The Supreme Court of the Philippines, if it is to uphold its
dignity and prestige and keep the faith and respect of the people, should
not be slow in repressing, correcting, or punishing any and all bullying
tactics that any litigant or attorney should resort to in a pending litigation. It
is necessary to make of record that in the performance of its official
functions this Supreme Court will not allow any foreign government or all
the combined armies of the world to cow it and to make it deviate even an
iota from its duty. The interest of justice is all-paramount. It is above all
governments and armies, which, after all, if they should serve the political
and ethical purposes for which they are created and established, are but
also instruments to make justice effective.
Upon the undisputed facts in this case, we entertain no doubt that
petitioners are illegally deprived of their personal freedom and, therefore,
are entitled to be immediately released.
The commitment in their contracts of employment to the effect that they
are subject to military law may not repeal the mandates in the Bill of Rights
of the Constitution. Fundamental rights are not goods of commerce. They
are not proper subjects of contracts. Besides, petitioner's commitment can
never be construed as a renunciation of their constitutional rights. Military
law is not superior nor equal to the supreme law. The constitution is always
paramount.
At the risk of being repetitious, it is necessary to remind that, under the
Constitution, no person shall be deprived of liberty without due process of
law nor shall any person be denied the equal protection of the laws. The
right of the people to be secure in their persons against unreasonable
searches and seizures shall not be violated and no warrant shall be issued
but upon probable cause to be determined by the court after examination
under oath or examination of the complainant and the witnesses he may
produce, particularly describing the place to be searched and the persons
or things to be seized. The liberty of abode and of changing the same
within the limits prescribed by law shall not be impaired. No involuntary
servitude in any form shall exist except for the punishment of crime
whereof the party shall have been duly convicted. No person shall be
allowed to answer for a criminal offense without due process of law. All
persons shall before conviction be bailable. Free access to the courts shall
not be denied to any person by reason of poverty.
All these constitutional guarantees are intended to protect not only Filipino
citizens, but all human beings within the territory of our Republic, including
American citizens and, if need be, even against their own government and
army. The fundamental law does not use the word citizens in the Bill of
Rights. It invariably use the word person. Due process of law by which a
person may be deprived of his liberty contemplates judicial process. And
judicial process can only be had with the intervention of tribunals. Under
Article VIII of the Constitution, the judicial power shall be vested in one
Supreme Court and in such inferior courts as may be established by law.
There cannot be and should not be any question that petitioners'
fundamental rights, as guaranteed by the Constitution of the Philippines,
have been flagrantly violated and this Court will be recreant in not granting
them the expected relief to which they are entitled under the law.
This is one more case in which, by majority vote, this Supreme Court
abdicates its powers, denying the victims of the redress to which they are
entitled. In this case the abdication of judicial power is aggravated by
surrender of the sovereignty of the Filipino people. Without the benefit of
ambassadorial negotiations, of senatorial ratifications, or even of a scrap of
treaty or convention, the majority, in fact, accept and recognize extra-
territoriality, only to wash hands in petitioner's case. No dissent is vigorous
enough against such judicial attitude.
Since International Law has been indiscriminatingly and confusingly
misapplied in support of the glaringly erroneous majority opinion in Co Kim
Cham vs. Valdez Tan Keh and Dizon (75 Phil., 113), many have been misled
to imitating the example to the extent of creating a portentous judicial
vogue. The fashionable is morbidly contagious. It seems that one is liable to
lose his self-respect if he can not invoke international law once in a while,
although to do it he has to hurriedly scratch the surface of the science and
oftenly misread his authors, an unavoidable risk in litigations were there is
no legal issue between nations. How risky it is shown by the hard time
endured by those who supported the majority opinion in the Co Kim Cham
case to explain their international law pronouncements, which shred
counsel for petitioner in Laurel vs. Misa (77 Phil., 856), had invoked as
authority in support of the theory of "suspended allegiance."
Inconsistencies are hard to explain. It is even harder if the only reasonable
explanation that can be given would exact an honest admission of error.
The greatness of soul required to confess an error belongs only to the elite
of moral aristocracy.
Here we have a litigation in which the legal issues are centered on the
question of the personal freedom of two individuals, small civilian
employees in the service of the Unite States Army, and who happen to be
under the territorial jurisdiction of the Republic of the Philippines and under
the pale of our Constitution. The litigation does not raise any question
involving any nation or group of nations. The fact that petitioners are
American citizens is indifferent. Liberty, as one of the fundamental human
rights, is a constitutional issue, and not international. Notwithstanding this
fact, the real and only issue, the constitutional one, is side-stepped by the
majority. International law is used as a bludgeon to blast petitioner's faith in
the inviolability of their constitutional rights.
At the expense of committing tuategory, we are compelled to conclude that
cheap international law has nowadays become a fashion in judicial and
legal circles. Under the spell of international law, the sense of legal values
has suffered and is enduring a moral disturbance, blurring judicial vision.
Swayed by the transient infatuation of the new legal fad, the majority allow
themselves to be blindfolded by the fulgour of the newly found juridical
shibboleth to ignore petitioner's clamors for the vindication of their
constitutional rights, as guaranteed by fundamental law, condemning their
earnest prayers for relief to the futility of "vox clamantis in diserto." Such is
the glamor of the resounding international law that it was able to drown
and obliterate completely the humanitarian and lofty tenets stereotyped in
the Constitution by the will of the sovereign people.
Misunderstood, misinterpreted, misapplied, international law has become a
sort of juridical panacea, a universal thesaurus, always at hand for any
solution that can be desired in any ticklish litigation. It is even recognized
as endowed with aseity.
The root of this awry judicial attitude lies in a glaring misunderstanding and
misconception of section 3, Article VII of the Constitution which says:
The Philippines renounces war as an instrument of national policy, and
adopts the generally accepted principles of international law as part of the
law of the Nation.
There is the mistaken idea that international law had become part of the
Constitution and even superior to the primary principles and fundamental
guarantees expressly enunciated therein. To correct such a mistake, it is
necessary to remember the following basic ideas:
1. That the declaration that the Philippines "adopts the generally accepted
principles of international law as part of the law of the Nation" is an
enunciation of a general national policy but never intended to lay down
specific principles, provisions, or rules superior or even equal to the specific
mandates and guarantees in the fundamental law.
2. That "the generally accepted principles of international law" made part of
our statute books are not placed in a higher legal hierarchy than any other
law that Congress may enact.
3. That said "generally accepted principles of international law" are not
fixed and unchangeable but, on the contrary, may undergo development
and amplification, amendment and repeal, that is, the same biological rules
that govern all laws, including the fundamental one.
4. That the general statement made by the Constitution implies that the
principles of international law which should be considered as part of the law
of the nation are subject to determination by the agencies of our
government, including courts of justice, and once determined they may be
amended, enlarged or repealed, exactly as any act of Congress.
5. That those principles are to be gathered from many sources treaties
and conventions, court decisions, laws enacted by legislatures, treatises,
magazine articles, historical facts and others and the majority of them
must be sifted from conflicting opinions coming from said sources.
6. That the provisions of the Constitution should always be held supreme
and must always prevail over any contrary law without exempting
principles of international law, no matter how generally or universally they
may be accepted.
Under the express provisions of the Constitution, petitioners appear to be
unconstitutionally deprived of their personal liberty and, therefore, are
entitled to be set free.
To deny the petition, the majority invoke international law. In the hypothesis
that there is such a law in support of the majority position, the law must
give way to the supremacy of the Constitution.
The hypothesis happens to be wrong because it is expressly based on
pronouncements made in the case of Raquiza vs. Bradford (75 Phil., 50),
which, as we have shown in our opinion in said case, are completely
mistaken.
Said mistaken pronouncements are made to rely on the opinion of Chief
Justice Marshall in The Schooner Exchange vs. McFadden (7 Cranch, 116)
which, although rendered by one considered to be the greatest luminary
whoever graced the Supreme Court of the United States, was written long
ago, in the horse-and-buggy age, which, from the cultural point of view,
notwithstanding the inverse difference of years, appears to be millennia
behind from our Atomic Age than the Stone Age was from Marshall's time.
But even accepting the validity of Chief Justice Marshall's pronouncement,
there is nothing in them to support the majority position in this case,
because, while the American jurist recognized the jurisdiction of a foreign
army passing through another country over their "troops during their
passage," the majority in this case fail to differentiate petitioners from said
"troops", both parties agreeing that petitioners are civilians, and no one can
pretend that Chief Justice Marshall would commit the lexicographical error
of including "civilians" among the "troops" of an army.
The several quotations in the majority decisions are inapplicable.
Wheaton is quoted by the majority to say that "a foreign army or fleet,
marching through, sailing over, or situated in the territory of another state .
. .are . . . exempt from the civil and criminal jurisdiction of the place." There
is nothing in the words of Wheaton to authorize the majority position. There
is nothing in this case to intimate that this Supreme Court is asked or is
trying to exercise any jurisdiction over the United States Army stationed in
Manila. Petitioners are neither an army nor a fleet. They are just a couple of
American civilians.
Hall is the next authority invoked by the majority. The quotation states that
"offenses committed by soldiers" of passing or stationed military forces
"against the inhabitants are dealt with" under concluded "conventions,"
adding that when there are no such conventions, "it is believed that the
commanders . . . exert exclusive jurisdiction in principle in respect of
offenses committed by persons under their command." It is clear that Hall
offers no support to the majority position. There is absolutely no convention
that the majority may invoke in this case, and what Hall said "it is believed"
cannot seriously be entertained by any court of justice. To accept a
conjecture as an authority or a basis to set a legal rule is below the level of
judicial dignity.
"In the absence of a special agreement the troops would not be amenable
to the local law but would be under the jurisdiction and control of their own
commanders," so says Lawrence, the third authority quoted by the majority.
Considering that petitioners are civilians and cannot be classified within the
designation of "troops," to apply the words of lawrence to the present case
must necessarily be based on a misreading.
The quotation from Oppenheim, the fourth authority invoked by our
brethrens, deals with "soldiers." Has any one in this case pretended that
petitioners are soldiers?
The next authority is Westlake, affirming Wheaton's view, and we have
already shown how this view is absolutely inapplicable to the present case.
The quotation from Hyde, the sixth authority invoked, deals with "organized
military force" and with "members of the force who commit offenses." Here
we have another instance of missing the point, as the words "members" of
an "organized military force" can never be understood to include civilians.
The seventh authority is McNair and Lauterpacht. The quotation deals
exclusively with the jurisdiction on "the armed forces" of a foreign country.
Civilians are not a part of armed forces.
The eight and last authority is Vattel, and the quotation in the majority
opinion contains absolutely no word applicable to the present case. The
nearest are where the author says "that the grant of passage includes . . .
that of excising military discipline on the officers and soldiers." To apply the
quotation to the present case, petitioners must first undergo a
metamorphosis to cease being civilians and, through magic, become
overnight "officers" or "soldiers", so the facts in this case can be made to
conform to the legal theory intended to be applied by the majority.
The above analyses of the very quotations inserted in their majority opinion
show conclusively that the pretended principles of international law invoked
by the majority in support of their position happened to be conclusively
missing in each and everyone of the very quotations inserted in their
opinion. Only the force of an overpowering auto-suggestions can permit one
to read in those quotations what is not written therein.
Proneness to read in the writings of authorities of international law or even
in judicial decisions any ruling, principle, or doctrine that may justify the
trampling down of the fundamental human rights invoked by petitioners,
rights which are specifically guaranteed in our Constitution and in the
constitutions of all democracies and enlightened countries, must have been
corrected once and for all since June 25, 1945, when the Charter of the
United Nations was adopted in San Francisco.
Since then, the principles or rules of international law which may happen to
be incompatible or deviating from the principles and ideals enunciated in
the Charter must be considered obsolete.
In the said Charter, the United Nations asserted their determination:
to save succeeding generations from the scourge of war, which twice in our
lifetime has brought untold sorrow to mankind, and "to reaffirm faith in
fundamental human rights, in the dignity and worth of the human person,
in the equal rights of men and women and of nations large and small, and
to establish conditions under which justice and respect for the obligations
arising from treaties and other sources of international law can be
maintained, and
to promote social progress and better standards of life in larger freedom.
Anybody will notice that "fundamental human rights" and "dignity and
worth of the human person" form part of the supreme concern of the United
Nations. Neither the Philippines nor the United States of America can
honorably ignore the solemn commitments entered into by them as
members of the United Nations. All the agencies of their respective
governments, including tribunals and armies, are duty bound to respect,
obey and make effective those commitments. The preamble of the charter
specifically provides, "that armed forces shall not be used, save in common
interest," the latter comprehending the basic purposes of the organization
of the United Nations, such as "promoting and encouraging respect for
human rights and for fundamental freedoms for all without distinction as to
race, sex, language, or religion."
There is absolutely no reason why we should be afraid, reluctant, or
hesitant in performing our duty to grant petitioners the legal relief to their
illegal and unconstitutional deprivation of personal liberty, because our
action may displease the army or the government of the United States of
America, or because the American army stationed in Manila, may disregard
our decision.
Justice is one of the paramount concerns and ideals of humanity. We cannot
believe that any part of the United States Army stationed in the Philippines
would dare to challenge a final decision of this Supreme Court or of any
court in the Philippines. We cannot believe that any responsible officer or
soldier of that great army will ever commit an act that may tarnish the
record of brilliant and glorious achievements it accomplished in the battle
of the Philippines. That army fought to help us reconquer our freedom from
Japanese slavery and to obtain justice against the criminal invasion of our
soil, and we cannot believe it will ever do anything to obstruct the efficient
functioning of our machinery of justice.
But whether this litigation has been communicated to Washington, or
whether the United States Government is interested in its outcome, or
whether the American army may ignore any decision we may render in
favor of petitioners, or whatever adverse action may be taken by the all-
powerful United States, these are considerations that should not stop us
from doing our duty in the administration of justice. No power in the whole
universe should be allowed to deter us from performing our functions as our
conscience dictates. Others may do as they please, but we cannot have any
other alternative but to keep this tribunal as the veritable bulwark of the
Constitution and of the fundamental rights guaranteed therein. Only by
failing to do so may we merit the sneers of shame, the wrath of our people,
the curse of the present and future generations, the scorn of all humanity.
There is no greater mission in life than justice. There is no greater
responsibility than to administer it.
On February 10, 1947, by unanimous vote of all the members of this Court,
the petition in Martin vs. Ramos (L-1290), was summarily dismissed,
without the need of requiring any answer from the respondent. The legal
question involved appeared so clear to entertain any doubt. All the Justices
in the Court maintained that the Court of First Instance of Ilocos Norte has
jurisdiction to try Felipe Martin, a guard in the service of the United States
Army in Laoag, for killing Pantaleon Tabac while said Martin was in the
performance of his official duties as a guard. Said court denied the petition
of Lt. Walter T. Bartlett to have Martin delivered to the United States Army.
Now the legal position in the Martin case is reversed with the decision in
the present case. The inconsistency is unquestionable. What is the reason
of this change of judicial criterion in two months time? There is no valid
reason. There is no legal justification.
We dissent from such judicial fickleness. The apodeictic self-contradiction
involved in the reversal can not help strengthen popular faith in the
decisions of this Court. Judicial inconsistency is a conclusive evidence that
of two inconsistent decisions one is necessarily wrong and unjust, based on
false theory, founded on fallacious doctrine. Who is going to judge which of
the two contradictory decisions is true to justice? Tribunals enunciate very
often the Latin maxim "falsus in unus, falsus in omnibus." By its
inconsistency, is not this Supreme Court being placed in the quandary of
seeing the logic of that maxim hanging upon it as a sword of Damocles?
We refuse to believe that the fact that respondent, an officer of the United
States Army, is vigorously opposing the petition, and that his attorney
hurled at our face a menacing statement which, unfortunately, has not
been met, either promptly or belatedly, by appropriate action from this
Court, has anything to do with the reversal. But apparently stronger
reasons than the inapplicable quotations on international law made in the
majority opinion must be adduced to allay all suspicion that judicial
supremacy is being abdicated in favor of military omnipotence. A journalist
has recently published this assertion: "Under prevailing judicial policy our
courts are afraid to go against the theoretical independence of each of the
three branches of government, in spite of the judiciary's function as
guardian of the Constitution. That the newspaperman, instead of using
another word, had written "afraid" and once Mr. Justice Ozaeta had to
allude to what he called "judicial timidity" are alarming symptoms that need
be quelled, not by verbal protests, but by positive action, the meaning of
which should be conclusive to everybody.
Large dosage of dynamism and red blood must be injected in judicial
thought so as to free it from all hindering complexities, to emancipate it
from all human frailties, to allow it to loosen all moral shackles that may
keep it from resolutely facing its tasks and acting with Olympian serenity.
Formerly no Justice or judge dared to discuss decisions or methods of their
courts believing it offensive to propriety. On March 16, 1947, we delivered
before the College Editors' Guild a speech discussing some decisions and
methods of the Supreme Court. No one suspected then that we were
starting a revolution in judicial attitude. One week later all our brethen
released public statements to the press, addressed to the people at large,
wherein, trying to answer our speech, they took occasion to expose and
condemn our alleged individual defects and personal conduct, to the extent
of assuming what our sense of righteousness and personal dignity should
counsel us and of suggesting our resignation.
The freedom of expression of Justices and judges, as one of the
fundamental human rights, achieved a moral victory against the
superstitious fear to offend the dreaded sense of propriety, which, after all,
is nothing basic and is but an expression of collective or individual taste,
highly momentary and changeable as any fashion can be. Now all the
members of the Supreme Court are unanimous in the position that we
should not be afraid to exercise our freedom of expression even outside of
this Court.
Our brethren's branding our conduct as highly improper and inconsistent
with the self-restraint of members of an appellate court can not prevail
upon the significance of their own course of action in releasing their press
statements.
Our duty to interpret, apply and make effective the Constitution must be
performed without any fear nor favor. Must not be deterred by the mistaken
idea that there exists any principle, rule or doctrine of international law that
can supersede, supplant, or overpower the fundamental law. No
consideration, should be allowed to deviate us from that duty.
President Roxas a few days ago made the following statement:
This administration is determined to raise the standard of the judiciary to
the highest level so that the people may have full trust and confidence in
our courts. This objective can only be attained if the judges are men of the
highest integrity and moral character, of unquestioned capacity, and of
broadest human sympathies and understanding. They should not only be
familiar with the law but, above all, they should respect and apply it under
all circumstances and never to sacrifice the same for the sake of
expediency.
The petition in this case, besides invoking the guarantees of the
Constitution, is an appeal to our "broadest human sympathies and
understanding." If, according to President Roxas, judges should respect and
apply the law "under all circumstances and never to sacrifice the same for
the sake of expediency," then there is absolutely no reason why petitioners
should be denied the protection of the law "par excellence," the supreme
law, the Constitution.
Of course, neither the President of the Philippines nor any authority on
earth, except the people from whose sovereignty our powers are derived,
may take any hand on how this Supreme Court is to administer justice, but
the sound that we do not see any reason why it should not be included in
our goals.
The decision in this case has a wider and deeper significance than
superficial observers may gather from the insignificance of the individuals
concerned. It goes down to shake the very foundations of human society
and reaches far to the destiny of civilization. The effectiveness of legal and
constitutional guarantees of human rights is the one in issue. The majority
decide to set at naught that effectiveness. If the law can not afford effective
protection to individual rights, where shall we look for that protection?
Since its more primitive stages, human society has been able to exist
thanks to law as its strongest foundation. The binding force of law unified
the members of a family under its head, patriarch or matriarch; grouped
families into clans and tribes; created towns and cities; consolidated
nations and federations of states. That binding force is the sovereign
talisman that will weld all humanity into the unity essential for the
attainment of the ideal of One World.
There is despair in many hearts. There are many who feel that an upheaval
is going to doom mankind into universal destruction. They think that the
very foundations are falling apart. The harnessing of atomic energy gives
them little consolation. While it is considered as the greatest scientific
triumph, the outstanding milestone in human progress, a source of new
light, new warmth, new freedom, new happiness, it also placed man on the
brink of an abyss where only ruin and chaos can exist. The greatest victory
in the conquest of nature may yet prove to be the unhappiest and last
tragedy for man. But these gloomy premonitions, alarms, fears, and despair
shall be dispelled once we think than eventually all the countries, nations
and peoples of the world will adhere to, abide by, and enforce the principle
of singleness of the law as the only means of ensuring world peace. The
Charter of the United Nations and the Statute of the International Court of
Justice are the first steps in the right direction. They are laws intended for
the majority of the nations of the earth. We hope that in no distant future
will the whole mankind be ruled by the same laws enacted by a single
world authority, representing the world's collective conscience.
But to attain this ideal we strengthen faith in the law, in its effectiveness, in
its vitalizing social function, in its guarantees of human rights. That faith
can not be strengthened by making of the safeguards of the Constitution a
mummery.
The petition must be granted and so we vote.
HERBERT BROWNELL, JR., as Attorney General of the United States
vs.
SUN LIFE ASSURANCE COMPANY OF CANADA
G.R. No. L-5731; June 22, 1954
PONENTE: J. LABRADOR
FACTS: This is a petition instituted in the Court of the First Instance of
Manila under the provisions of the Philippine Property Act of the United
States against the Sun Life Assurance Company of Canada, to compel the
latter to comply with the demand of the former to pay him the sum of
P310.10, which represents one-half of the proceeds of an endowment policy
(No. 757199) which matured on August 20, 1946, and which is payable to
one Naogiro Aihara, a Japanese national.
Under the policy Aihara and his wife, Filomena Gayapan, were insured
jointly for the sum of P1,000, and upon its maturity the proceeds thereof
were payable to said insured, share and share alike, or P310.10 each.
The defenses set up in the court of origin are:
(1) that the immunities provided in section 5 (b) (2) of the Trading With the
Enemy Act of the United States are of doubtful application in the
Philippines, and have never been adopted by any law of the Philippines as
applicable here or obligatory on the local courts;
(2) that the defendant is a trustee of the funds and is under a legal
obligation to see it to that it is paid to the person or persons entitled
thereto, and unless the petitioner executes a suitable discharge and an
adequate guarantee to indemnify and keep it free and harmless from any
further liability under the policy, it may not be compelled to make the
payment demanded. The Court of First Instance of Manila having approved
and granted the petition, the respondent has appealed to this Court,
contending that the Court of origin erred in holding that the Trading With
the Enemy Act of the United States is binding upon the inhabitants of this
country, notwithstanding the attainment of complete independence on July
4, 1946, and in ordering the payment prayed for.
On July 3, 1946, the Congress of the United States passed Public Law 485-
79th Congress, known as the Philippine Property Act of 1946. Section 3
thereof provides that "The Trading with the Enemy Act of October 6, 1917
(40 Stat. 411), as amended, shall continue in force in the Philippines after
July 4, 1946, ...." To implement the provisions of the act, the President of
the United States on July 3, 1946, promulgated Executive Order No. 9747,
"continuing the functions of the Alien Property Custodian and the
Department of the Treasury in the Philippines." Prior to and preparatory to
the approval of said Philippine Property Act of 1946, an agreement was
entered into between President Manuel Roxas of the Commonwealth and U.
S. Commissioner Paul V. McNutt whereby title to enemy agricultural lands
and other properties was to be conveyed by the United States to the
Philippines in order to help the rehabilitation of the latter, but that in order
to avoid complex legal problems in relation to said enemy properties, the
Alien Property Custodian of the United States was to continue operations in
the Philippines even after the latter's independence, that he may settle all
claims that may exist or arise against the above-mentioned enemy
properties, in accordance with the Trading With the Enemy Act of the United
States. (Report of the Committee on Insural Affairs No. 2296 and Senate
Report No. 1578 from the Committee on Territories and Insular Affairs, to
accompany S. 2345, accompanying H. R. 6801, 79th Congress, 2nd
Session.) This purpose of conveying enemy properties to the Philippines
after all claims against them shall have been settled is expressly embodied
in the Philippine Property Act of 1946.
SEC. 3. The Trading With the Enemy Act of October 6, 1917 (40 Stat. 411)
as amended, shall continue in force in the Philippines after July 4, 1946, and
all powers and authority conferred upon the President of the United States
or the Alien Property Custodian by the terms of the said Trading With the
Enemy Act, as amended, with respect to the Philippines, shall continue
thereafter to be exercised by the President of the United States, or such
officer or agency as he may designate: Provided, That all property vested in
or transferred to the President of the United States, the Alien Property
Custodian, or any such officer or agency as the President of the United
States may designate under the Trading With the Enemy Act, as amended,
which was located in the Philippines at the time of such vesting, or the
proceeds thereof, and which shall remain after the satisfaction of any claim
payable under the Trading With the Enemy Act, as amended, and after the
payment of such costs and expenses of administration as may be law be
charged against such property or proceeds, shall be transferred by the
President of the United States to the Republic of the Philippines: Provided
further, That such property, or proceeds thereof, may be transferred by the
President of the United States to the Republic of the Philippines upon
indemnification acceptable to the President of the United States by the
Republic of the Philippines for such claims, costs, and expenses of
administration as may by law be charged against such property or proceeds
thereof before final adjudication of such claims, costs and expenses of
administration. Provided further, That the courts of first instance of the
Republic of the Philippines are hereby given jurisdiction to make and enter
all such rules as to notice or otherwise, and all such orders and decrees and
to issue such process as may be necessary and proper in the premises to
enforce any orders, rules, and regulations issued by the President of the
United States, the Alien Property Custodian, or such officer or agency
designated by the President of the United States pursuant to the Trading
With the Enemy Act, as amended, with such right of appeal therefrom as
may be provided by law: And provided further, That any suit authorized
under the Trading With the Enemy Act, as amended, with respect to
property vested in or transferred to the President of the United States, the
Alien Property Custodian, or any officer or agency designated by the
President of the United States hereunder, which at the time of such vesting
or transfer was located with the Philippines, shall after July 4, 1946, be
brought in the appropriate court of first instance of the Republic of the
Philippines, against the officer or agency hereunder designated by the
President of the United States with right of appeal therefrom as may be
provided by law. In any litigation authorized under this section, the officer
or administrative head of the agency designated hereunder may appear
personally, or through attorneys appointed by him, without regard to the
requirements of law other than this section.
And when the proclamation of the independence of the Philippines by
President Truman was made, said independence was granted "in
accordance with the subject to the reservations provided in the applicable
statutes of the Unites States." The enforcement of the Trading With the
Enemy Act of the United States was contemplated to be made applicable
after independence, within the meaning of the reservations.
On the part of the Philippines, conformity to the enactment of the Philippine
Property Act of 1946 of the United States was announced by President
Manuel Roxas in a joint statement signed by him and by Commissioner
Mcnutt. Ambassador Romulo also formally expressed the conformity of the
Philippines Government to the approval of said act to the American Senate
prior to its approval. And after the grant of independence, the Congress of
the Philippines approved Republic Act No. 8, entitled.
AN ACT TO AUTHORIZE THE PRESIDENT OF THE PHLIPPINES TO ENTER INTO
SUCH CONTRACT OR UNDERTAKINGS AS MAY BE NECESSARY TO
EFFECTUATE THE TRANSFER TO THE REPUBLIC OF THE PHILIPPINES UNDER
THE PHILIPPINES PROPERTY ACT OF NINETEEN HUNDRED AND FORTY-SIX OF
ANY PROPERTY OR PROPERTY RIGHTS OR THE PROCEEDS THEREOF
AUTHORIZED TO BE TRANSFERRED UNDER SAID ACT; PROVIDING FOR THE
ADMINISTRATION AND DISPOSITION OF SUCH PROPERTIES ONCE RECEIVED;
AND APPROPRIATING THE NECESSARY FUND THEREFOR.
The Congress of the Philippines also approved Republic Act No. 7, which
established a Foreign Funds Control Office. After the approval of the
Philippine Property Act of 1946 of the United States, the Philippine
Government also formally expressed, through the Secretary of Foreign
Affairs, conformity thereto. (See letters of Secretary dated August 22, 1946,
and June 3, 1947.) The Congress of the Philippines has also approved
Republic Act No. 477, which provides for the administration and disposition
of properties which have been or may hereafter be transferred to the
Republic of the Philippines in accordance with the Philippines Property Act
of 1946 of the United States.
It is evident, therefore, that the consent of the Philippine Government to the
application of the Philippine Property Act of 1946 to the Philippines after
independence was given, not only by the Executive Department of the
Philippines Government, but also by the Congress, which enacted the laws
that would implement or carry out the benefits accruing from the operation
of the United States law. The respondent-appellant, however, contends that
the operation of the law after independence could not have actually taken,
or may not take place, because both Republic Act No. 8 and Republic Act
No. 477 do not contain any specific provision whereby the Philippine
Property Act of 1946 or its provisions is made applicable to the Philippines.
It is also contended that in the absence of such express provision in any of
the laws passed by the Philippine Congress, said Philippine Property Act of
1946 does not form part of our laws and is not binding upon the courts and
inhabitants of the country.
There is no question that a foreign law may have extraterritorial effect in a
country other than the country of origin, provided the latter, in which it is
sought to be made operative, gives its consent thereto. This principle is
supported by the unquestioned authority.
The jurisdiction of the nation within its territory is necessarily exclusive and
absolute. It is susceptible of no limitation not imposed by itself. Any
restriction upon it, deriving validity from an external source, would imply a
diminution of its sovereignty to the extent of the restriction, and an
investment of that sovereignty to the same extent in that power in which
would impose such restriction. All exceptions, therefore, to the full and
complete power of a nation within its own territories, must be traced up to
the consent of the nation itself. They can flow from no other legitimate
source. This consent may be either express or implied. (Philippine Political
Law by Sinco, pp. 27-28, citing Chief Justice Marshall's statement in the
Exchange, 7 Cranch 116) In the course of his dissenting opinion in the case
of S. S. Lotus, decided by the Permanent Court of International Justice, John
Bassett Moore said:
1. It is an admitted principle of International Law that a nation
possesses and exercises within its own territory an absolute and exclusive
jurisdiction, and that any exception to this right must be traced to the
consent of the nation, either express or implied (Schooner Exchange vs.
McFadden [812], 7 Cranch 116, 136). The benefit of this principle equally
enures to all independent and sovereign States, and is attended with a
corresponding responsibility for what takes place within the national
territory. (Digest of International Law, by Backworth, Vol. II, pp. 1-2)
The above principle is not denied by respondent-appellant. But its
argument on this appeal is that while the acts enacted by the Philippine
Congress impliedly accept the benefits of the operation of the United States
law (Philippine Property Act of 1946), no provision in the said acts of the
Philippine Congress makes said United States law expressly applicable. In
answer to this contention, it must be stated that the consent of a Senate to
the operation of a foreign law within its territory does not need to be
express; it is enough that said consent be implied from its conduct or from
that of its authorized officers.
RULING: N515. No rule of International Law exists which prescribe a
necessary form of ratification. Ratification can, therefore, be given tacitly
as well as expressly. Tacit ratification takes place when a State begins the
execution of a treaty without expressly ratifying it. It is usual for ratification
to take the form of a document duly signed by the Heads of the States
concerned and their Secretaries for Foreign Affairs. It is usual to draft as
many documents as there are parties to the Convention, and to exchange
these documents between the parties. Occasionally the whole of the treaty
is recited verbatim in the ratifying documents, but sometimes only the title,
preamble, and date of the treaty, and the names of the signatory
representatives are cited. As ratification is only the confirmation of an
already existing treaty, the essential requirements in a ratifying document
is merely that it should refer clearly and unmistakably to the treaty to be
ratified. The citation of title, preamble, date, and names of the
representatives is, therefore quite sufficient to satisfy that requirements.
(Oppenheim, pp. 818-819; emphasis ours.)

International Law does not require that agreements between nations must
be concluded in any particular form or style. The law of nations is much
more interested in the faithful performance of international obligations than
in prescribing procedural requirements. (Treaties and Executive
Agreements, by Myers S. McDougal and Asher Lands, Yale Law Journal, Vol.
54, pp. 318-319)
In the case at bar, our ratification of or concurrence to the agreement for
the extension of the Philippine Property Act of 1946 is clearly implied from
the acts of the President of the Philippines and of the Secretary of Foreign
Affairs, as well as by the enactment of Republic Acts Nos. 7, 8, and 477.
We must emphasize the fact that the operation of the Philippine Property
Act of 1946 in the Philippines is not derived from the unilateral act of the
United States Congress, which made it expressly applicable, or from the
saving provision contained in the proclamation of independence. It is well-
settled in the United States that its laws have no extraterritorial effect. The
application of said law in the Philippines is based concurrently on said act
(Philippine Property Act of 1946) and on the tacit consent thereto and the
conduct of the Philippine Government itself in receiving the benefits of its
provisions.
It is also claimed by the respondent-appellant that the trial court erred in
ordering it to pay the petitioner the amount demanded, without the
execution by the petitioner of a deed of discharge and indemnity for its
protection. The Trading With the Enemy Act of the United States, the
application of which was extended to the Philippines by mutual agreement
of the two Governments, contains an express provision to the effect that
delivery of property or interest therein made to or for the account of the
United States in pursuance of the provision of the law, shall be considered
as a full acquittance and discharge for purposes of the obligation of the
person making the delivery or payment. (Section 5(b) (2), Trading With the
Enemy Act.) This express provision of the United States law saves the
respondent-appellant from any further liability for the amount ordered to be
paid to the petitioner, and fully protects it from any further claim with
respect thereto. The request of the respondent-appellant that a security be
granted it for the payment to be made under the law is, therefore,
unnecessary, because the judgment rendered in this case is sufficient to
prove such acquittance and discharge.
DISPOSITIVE PORTION: The decision appealed from should be as it is hereby
affirmed, with costs against the respondent-appellant.
PIL - #
Lyons vs. USA (1958)
Doctrine:
The general rule is that States cannot be sued unless it has given
its consent. However, an exception to this is when the state enters into a
contract. In such case, the state may be sued even without its consent. But
before suing the state, administrative remedies shall first be exhausted.
Facts:
1. Harry Lyons, Inc. and USA entered into a contract for stevedoring
service at the US Naval Base in Subic Bay. The said contract is valid until
June 30, 1956, and was entered into pursuant to the provisions of Sec. 2 (c)
(1) of the Armed Services Procurement Act of 1947 of the USA.
2. Harry Lyons Inc., brought this action before the CFI Manila to
collect several sums of money arising from the contract.
3. As a defense, the defendant USA filed a motion to dismiss. It
argued that the CFI has no jurisdiction over the defendant and over the
subject matter of the action since the USA is a sovereign state which
cannot be sued without its consent. USA also argued that Lyons failed to
exhaust the administrative remedies provided for in Art. XXI of the contract.
4. On the other hand, Lyons contends that when a sovereign state
enters into a contract with a private person, the state can be sued upon the
theory that it has descended to the level of an individual from which it can
be implied that it has given its consent to be sued under the contract. Lyons
used the case of Santos vs. Santos (92 Phil 280) as legal basis.
Issue/s:
1. WON the USA as a sovereign state may be sued when it enters
into a contract - Yes
2. WON CFI erred in dismissing the complaint on the ground that
Lyons has failed to comply with the condition presented in the contract
before an action could be taken in court against the US Government - No
Held/Ratio:
1. Where and when the state or its government enters into a
contract, the state itself may be sued even without its consent.
a. As long as the contract is entered into 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.
b. However, this is only an exception. It is still the general rule that a
state cannot be sued without its consent.
c. In the case at bar, the SC held the contract entered into (for
stevedoring and miscellaneous labor services within the Subic Bay area, a
US Navy Reservation) by the US Government, through its agency at Subic
Bay, is a valid one. Thus, Lyons can bring an action before the Philippine
courts for any contractual liability that political entity may assume under
the contract. Therefore, the trial court has jurisdiction over the case.
2. The CFI did not err in dismissing the complaint on the ground that
Lyons has failed to comply with the condition presented in the contract
before an action could be taken in court against the US Government.
a. Art. XXI of the contract (between Lyons & USA) lays down the
procedure to be followed by Lyons should it desire to obtain a remedy under
the contract.
i. It provides that the remedy is to file its claim with the Contracting
Officer who is empowered to act and render a decision. An appeal may be
filed to the Secretary of the Navy where the plaintiff will be afforded an
opportunity to be heard & present evidence. This decision by the Secretary
of the Navy shall be final unless a court of competent jurisdiction finds that
the decision is fraudulent, arbitrary, capricious or so grossly erroneous. In
other words, it is only after the claim has been decided on appeal by the
secretary that Lyons can resort to a court of competent jurisdiction.
b. It is clear that Lyons did not follow this provision/procedure, thus
his failure to exhaust administrative remedies against USA. The CFI decision
is thus affirmed.
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.

M.H. Wylie v Rarang
G.R. No. 74135, May 28, 1992
FACTS:
Petitioner M.H. Wylie was the assistant administrativeofficer while petitioner
Capt. James Williams was the commanding officer of the US Naval Base in
Subic Bay, Olongapo City. Private Respondent (PR) Aurora Rarang was
assigned as merchandise control guard in the Office of the Provost Marshal
M.H. Wylie, in his capacity as asst. admin. Officer, supervised the
publication of the so-called Plan of the Day (POD) published daily by the
US Naval Base Station. The POD featured important announcements,
necessary precautions and general matters of interest to military
personnel. One of the regular features of the POD was the action line
inquiry (NAVSTA ACTION LINEINQUIRY), a telephone answering device in
the Office of the Admin Asst intended to provide personnel access to the
Commanding Officer on matters they feel should be brought to his attention
for correction or investigation. On February 3, 1978, the POD under the
(NAVSTA) action line inquiry, published and mentioned a certain AURING
as a disgrace to her division and to the Office of the Provost Marshal.
The same article explicitly implied that Auring was consuming and
appropriating for herself confiscated items like like cigarettes and
foodstuffs. The PR was the only one who was named Auring in the Office
of the Provost Marshal. As a result thereof, she was investigated by her
superior. The PR commenced an ACTION FOR DAMAGES in the CFI of
Zambales against M.H. Wylie, Capt. James Williams and the US Naval Base
alleging that the article constituted false, injurious, and malicious
defamation and libel tending to impeach her honesty, virtue and reputation
exposing her to public hatred, contempt and ridicule. The TC ruled in favour
of the PR and dismissed the suit against the US Naval Base. The IAC
(now,CA) affirmed the judgment of the TC with modifications as to the
amount of damages awarded.
ISSUE:
Whether or not the American naval officers (such as Wylie and Capt.
Williams) who commit a crime or tortious act while discharging official
functions still covered by the principle of state immunity from suit. Does the
grant of rights, power, and authority to the US under the RP-US Bases
Treaty cover immunity of its officers from crimes and torts?
HELD:
The general rule is that public officials can be held personally accountable
for acts claimed to have been performed in connection with official duties
where they have acted ultra vires or where there is showing of bad faith
(Chavez v. Sandiganbayan).It may be argued, as a general rule, that Capt.
Williams as commanding officer of the naval base was far removed in the
chain of command from the offensive publication and it would be asking too
much to hold him responsible for everything which goes wrong on the base.
However, in this particular case, the records show that the offensive
publication was sent to the commanding officer for approval and that he
approved it. ART. 2176, CC prescribes a civil liability for damages caused
by a persons act or omission constituting fault or negligence, stating that,
Whoever by act or omission, causes damage to another, there being fault
or negligence, is obliged to pay for the damage done. Such fault or
negligence,.. Moreover, ART. 2219(7), Civil Code provides that moral
damages may be recovered in case of libel, slander or any other form of
defamation.Indeed, the imputation of theft contained in the POD was a
defamation against the character and reputation of the PR. Petitioner Wylie
himself admitted that the Office of the Provost Marshal explicitly
recommended the deletion of the name Auring if the article will be
published. The petitioners, however, were NEGLIGENTbecause under their
direction, they issued thepublication without deleting the said name. Such
act or omission was ULTRA VIRES and CANNOT be deemed part of official
duty. It was a TORTIOUS ACT which ridiculed the PR. As a result of
petitioners act, PR suffered besmirched reputation, serious anxiety,
wounded feelings and social humiliation, especially so, since the article was
baseless and false. The petitioners, alone, in their personal capacities, are
liable for the damages they caused the Private Respondent
UNITED STATES OF AMERICA vs. REYES
Petition for Certiorari to Annul & Set Aside RTC Cavite Branch 22
Resolution, 1993
FACTS:
Respondent Nelia Montoya, an American Citizen, worked as an ID checker
at the US Navy Exchange (NEX) at the US Military Assistance Group
(JUSMAG) headquarters in Quezon City. Shes married to Edgardo Montoya,
a Filipino-American serviceman employed by the US Navy & stationed in
San Francisco.
Petitioner Maxine is an American Citizen employed at the JUSMAG
headquarters as the activity exchange manager.
Jan. 22, 1987 Montoya bought some items from the retail store Bradford
managed, where she had purchasing privileges. After shopping & while she
was already at the parking lot, Mrs. Yong Kennedy, a fellow ID checker
approached her & told her that she needed to search her bags upon
Bradfords instruction. Montoya approached Bradford to protest the search
but she was told that it was to be made on all JUSMAG employees on that
day. Mrs. Kennedy then performed the search on her person, bags & car in
front of Bradford & other curious onlookers. Nothing irregular was found
thus she was allowed to leave afterwards.
Montoya learned that she was the only person subjected to such search
that day & she was informed by NEX Security Manager Roynon that NEX
JUSMAG employees are not searched outside the store unless there is a
strong evidence of a wrong-doing. Montoya cant recall any circumstance
that would trigger suspicion of a wrong-doing on her part. She is aware of
Bradfords propensity to suspect Filipinos for theft and/or shoplifting.
Montoya filed a formal protest w/Mr. Roynon but no action was taken.
Montoya filed a suit against Bradford for damages due to the oppressive
& discriminatory acts committed by petitioner in excess of her authority as
store manager. She claims that she has been exposed to contempt &
ridicule causing her undue embarrassment & indignity. She further claims
that the act was not motivated by any other reason aside from racial
discrimination in our own land w/c is a blow to our national pride & dignity.
She seeks for moral damages of P500k and exemplary damages of P100k.
May 13, 1987 Summons & complaint were served on Bradford but
instead of filing an answer, she along with USA government filed a motion
to dismiss on grounds that: (1) this is a suit against US w/c is a foreign
sovereign immune from suit w/o its consent and (2) Bradford is immune
from suit for acts done in the performance of her official functions under
Phil-US Military Assistance Agreement of 1947 & Military Bases Agreement
of 1947. They claim that US has rights, power & authority w/in the bases,
necessary for the establishment, use & operation & defense thereof. It will
also use facilities & areas w/in bases & will have effective command over
the facilities, US personnel, employees, equipment & material. They further
claim that checking of purchases at NEX is a routine procedure observed at
base retail outlets to protect & safeguard merchandise, cash & equipment
pursuant to par. 2 & 4(b) of NAVRESALEACT SUBIC INST. 5500.1.
July 6, 1987 Montoya filed a motion for preliminary attachment claiming
that Bradford was about to leave the country & was removing & disposing
her properties w/intent to defraud her creditors. Motion granted by RTC.
July 14, 1987 Montoya opposed Bradfords motion to dismiss. She claims
that: (1) search was outside NEX JUSMAG store thus its improper, unlawful
& highly-discriminatory and beyond Bradfords authority; (2) due to excess
in authority and since her liability is personal, Bradford cant rely on
sovereign immunity; (3) Bradfords act was committed outside the military
base thus under the jurisdiction of Philippine courts; (4) the Court can
inquire into the factual circumstances of case to determine WON Bradford
acted w/in or outside her authority.
RTC granted Montoyas motion for the issuance of a writ of preliminary
attachment and later on issued writ of attachment opposed by Bradford.
Montoya allowed to present evidence & Bradford declared in default for
failure to file an answer. RTC ruled in favor of Montoya claiming that search
was unreasonable, reckless, oppressive & against Montoyas liberty
guaranteed by Consti. She was awarded P300k for moral damages, P100k
for exemplary damages & P50k for actual expenses. Bradford filed a
Petition for Restraining Order. SC granted TRO enjoining RTC from enforcing
decision.
Montoya claims that Bradford was acting as a civilian employee thus not
performing governmental functions. Even if she were performing
governmental acts, she would still not be covered by the immunity since
she was acting outside the scope of her authority. She claims that criminal
acts of a public officer/employee are his private acts & he alone is liable for
such acts. She believes that this case is under RP courts jurisdiction
because act was done outside the territorial control of the US Military
Bases, it does not fall under offenses where US has been given right to
exercise its jurisdiction and Bradford does not possess diplomatic immunity.
She further claims that RP courts can inquire into the factual circumstances
& determine WON Bradford is immune.
ISSUES/RATIO:
1. WON the case is under the RTCs jurisdiction - YES
Intervention of a third party is discretionary upon the Court. US did not
obtain leave of court (something like asking for Courts permission) to
intervene in the present case. Technically, it should not be allowed to
intervene but since RTC entertained its motion to dismiss, it is deemed to
have allowed US to intervene. By voluntarily appearing, US must be
deemed to have subjected itself to RTCs jurisdiction.
2. WON RTC committed a grave abuse of discretion in denying Bradfords
motion to dismiss. - NO
Petitioners failed to specify any grounds for a motion to dismiss
enumerated in Sec. 1, Rule 16, Rules of Court. Thus, it actually lacks cause
of action. A cause of action is necessary so that Court would be able to
render a valid judgment in accordance with the prayer in the complaint. A
motion to dismiss w/c fails to state a cause of action hypothetically admits
the truth of the allegations in the complaint. RTC should have deferred the
resolution instead of denying it for lack of merit. But this is immaterial at
this time since petitioners have already brought this petition to the SC.
3. WON case at bar is a suit against the State. - NO
Doctrine of state immunity is expressed in Art. XVI, Sec. 3 of the 1987
Constitution. This immunity also applies to complaints filed against officials
of the state for acts allegedly performed by them in discharge of their
duties since it will require the state to perform an affirmative act such as
appropriation of amount to pay damages. This will be regarded as a case
against the state even if it has not be formally impleaded. But this is not all
encompassing. Its a different matter where the public official is made to
account in his capacity as such for acts contrary to law & injurious to rights
of plaintiff. State authorizes only legal acts by its officers. Action against
officials by one whose rights have been violated by such acts is not a suit
against the State w/in the rule of immunity of the State from suit. The
doctrine of state immunity cannot be used as an instrument for
perpetrating an injustice. It will not apply & may not be invoked where the
public official is being sued in his private & personal capacity as an ordinary
citizen. This usually arises where the public official acts w/o authority or in
excess of the powers vested in him. A public official is liable if he acted
w/malice & in bad faith or beyond the scope of his authority or jurisdiction.
(Shauf vs. CA) Also, USA vs. Guinto declared that USA is not conferred with
blanket immunity for all acts done by it or its agents in the Philippines
merely because they have acted as agents of the US in the discharge of
their official functions. In this case, Bradford was sued in her
private/personal capacity for acts done beyond the scope & place of her
official function, thus, it falls w/in the exception to the doctrine of state
immunity.
4. WON Bradford enjoys diplomatic immunity. - NO
First of all, she is not among those granted diplomatic immunity under Art.
16(b) of the 1953 Military Assistance Agreement creating the JUSMAG.
Second, even diplomatic agents who enjoy immunity are liable if they
perform acts outside their official functions (Art. 31, Vienna Convention on
Diplomatic Relations).
HELD: Petition denied. TRO lifted.
JUSMAG Philippines vs. NLRC (Article XVI Sec. 3) (Foreign
Government)
Facts: Florencio Sacramento (private respondent) was one of the 74
security assistance support personnel (SASP) working at the Joint
United States Military Assistance Group to the Philippines (JUSMAG-
Phils.). He had been with JUSMAG from 1969-1992. When dismissed, he
held the position of Illustrator 2 and incumbent Pres. of JUSMAG
Phils.- Filipino Civilian Employees Assoc., a labor org. duly
registered with DOLE. His services were terminated allegedly due to
the abolition of his position.
Sacramento filed complaint w/ DOLE on the ground that he
was illegally suspended and dismissed from service by JUSMAG. He
asked for reinstatement. JUSMAG filed Motion to Dismiss invoking
immunity from suit. Labor arbiter Cueto in an Order dismissed the
complaint "for want of jurisdiction". Sacramento appealed to
NLRC.
NLRC reversed the ruling of the labor arbiter and held that
petitioner had lost its right not to be sued bec. (1) the principle
of estoppel-that JUSMAG failed to refute the existence of employer-
employee rel. (2)JUSMAG has waived its right to immunity from suit
when it hired the services of private respondent. Hence, this
petition.
Issue:W/N JUSMAG has immunity from suit
Held: Yes. When JUSMAG took the services of private respondent, it
was performing a governmental function on behalf of the United
States pursuant to the Military Assistance Agreement between the
Phils. and America* JUSMAG consists of Air, Naval and Army group
and its primary task was to advise and assist the Phils. on air
force, army and naval matters. A suit against JUSMAG is one against
the United States government, and in the absence of any waiver or
consent of the latter to the suit, the complaint against JUSMAG
cannot prosper.
Immunity of State from suit is one of the universally
recognized principles of international law that the Phils.
recognizes and adopts as part of the law of the land. Immunity is
commonly understood as the exemption of the state and its organs
from the judicial jurisdiction of another state and anchored on the
principle of the sovereign equality of states under which one state
cannot assert jurisdiction over another in violation of the maxim
par in parem non habeat imperium (an equal has no power over an
equal)
As it stands now, the application of the doctrine of
immunity from suit has been restricted to sovereign or governmental
activities and does not extend to commercial, private and
proprietary acts.