Republic of the Philippines passing along the west side thereof at a speed of ten to twelve miles an hour,
SUPREME COURT upon crossing Taft Avenue and when he was ten feet from the southwestern
Manila
EN BANC
G.R. No. L-11154 March 21, 1916
E. MERRITT, plaintiff-appellant,
vs.
GOVERNMENT OF THE PHILIPPINE ISLANDS, defendant-appellant.
Crossfield and O'Brien for plaintiff.
Attorney-General Avanceña for defendant..
TRENT, J.:
This is an appeal by both parties from a judgment of the Court of First Instance of the city
of Manila in favor of the plaintiff for the sum of P14,741, together with the costs of the
cause.
Counsel for the plaintiff insist that the trial court erred (1) "in limiting the general
damages which the plaintiff suffered to P5,000, instead of P25,000 as claimed in the
complaint," and (2) "in limiting the time when plaintiff was entirely disabled to two
months and twenty-one days and fixing the damage accordingly in the sum of P2,666,
instead of P6,000 as claimed by plaintiff in his complaint."
The Attorney-General on behalf of the defendant urges that the trial court erred: (a) in
finding that the collision between the plaintiff's motorcycle and the ambulance of the
General Hospital was due to the negligence of the chauffeur; (b) in holding that the
Government of the Philippine Islands is liable for the damages sustained by the plaintiff as
a result of the collision, even if it be true that the collision was due to the negligence of
the chauffeur; and (c) in rendering judgment against the defendant for the sum of
P14,741.
The trial court's findings of fact, which are fully supported by the record, are as follows:
It is a fact not disputed by counsel for the defendant that when the plaintiff,
riding on a motorcycle, was going toward the western part of Calle Padre Faura,
intersection of said streets, the General Hospital ambulance, upon reaching said
avenue, instead of turning toward the south, after passing the center thereof, so
that it would be on the left side of said avenue, as is prescribed by the ordinance
and the Motor Vehicle Act, turned suddenly and unexpectedly and long before
reaching the center of the street, into the right side of Taft Avenue, without
having sounded any whistle or horn, by which movement it struck the plaintiff,
who was already six feet from the southwestern point or from the post place
there.
By reason of the resulting collision, the plaintiff was so severely injured that,
according to Dr. Saleeby, who examined him on the very same day that he was
taken to the General Hospital, he was suffering from a depression in the left
parietal region, a would in the same place and in the back part of his head, while
blood issued from his nose and he was entirely unconscious.
The marks revealed that he had one or more fractures of the skull and that the
grey matter and brain was had suffered material injury. At ten o'clock of the
night in question, which was the time set for performing the operation, his pulse
was so weak and so irregular that, in his opinion, there was little hope that he
would live. His right leg was broken in such a way that the fracture extended to
the outer skin in such manner that it might be regarded as double and the would
be exposed to infection, for which reason it was of the most serious nature.
At another examination six days before the day of the trial, Dr. Saleeby noticed
that the plaintiff's leg showed a contraction of an inch and a half and a curvature
that made his leg very weak and painful at the point of the fracture. Examination
of his head revealed a notable readjustment of the functions of the brain and
nerves. The patient apparently was slightly deaf, had a light weakness in his eyes
and in his mental condition. This latter weakness was always noticed when the
plaintiff had to do any difficult mental labor, especially when he attempted to
use his money for mathematical calculations.
According to the various merchants who testified as witnesses, the plaintiff's
mental and physical condition prior to the accident was excellent, and that after
having received the injuries that have been discussed, his physical condition had
undergone a noticeable depreciation, for he had lost the agility, energy, and
ability that he had constantly displayed before the accident as one of the best
constructors of wooden buildings and he could not now earn even a half of the
 income that he had secured for his work because he had lost 50 per cent of his
efficiency. As a contractor, he could no longer, as he had before done, climb up
ladders and scaffoldings to reach the highest parts of the building.
As a consequence of the loss the plaintiff suffered in the efficiency of his work as
a contractor, he had to dissolved the partnership he had formed with the
engineer. Wilson, because he was incapacitated from making mathematical
calculations on account of the condition of his leg and of his mental faculties,
and he had to give up a contract he had for the construction of the Uy Chaco
building."
We may say at the outset that we are in full accord with the trial court to the effect that
the collision between the plaintiff's motorcycle and the ambulance of the General
Hospital was due solely to the negligence of the chauffeur.
The two items which constitute a part of the P14,741 and which are drawn in question by
the plaintiff are (a) P5,000, the award awarded for permanent injuries, and (b) the
P2,666, the amount allowed for the loss of wages during the time the plaintiff was
incapacitated from pursuing his occupation. We find nothing in the record which would
justify us in increasing the amount of the first. As to the second, the record shows, and
the trial court so found, that the plaintiff's services as a contractor were worth P1,000 per
month. The court, however, limited the time to two months and twenty-one days, which
the plaintiff was actually confined in the hospital. In this we think there was error,
because it was clearly established that the plaintiff was wholly incapacitated for a period
of six months. The mere fact that he remained in the hospital only two months and
twenty-one days while the remainder of the six months was spent in his home, would not
prevent recovery for the whole time. We, therefore, find that the amount of damages
sustained by the plaintiff, without any fault on his part, is P18,075.
As the negligence which caused the collision is a tort committed by an agent or employee
of the Government, the inquiry at once arises whether the Government is legally-liable
for the damages resulting therefrom.
Act No. 2457, effective February 3, 1915, reads:
An Act authorizing E. Merritt to bring suit against the Government of the
Philippine Islands and authorizing the Attorney-General of said Islands to appear
in said suit.
Whereas a claim has been filed against the Government of the Philippine Islands
by Mr. E. Merritt, of Manila, for damages resulting from a collision between his
motorcycle and the ambulance of the General Hospital on March twenty-fifth,
nineteen hundred and thirteen;
Whereas it is not known who is responsible for the accident nor is it possible to
determine the amount of damages, if any, to which the claimant is entitled; and
Whereas the Director of Public Works and the Attorney-General recommended
that an Act be passed by the Legislature authorizing Mr. E. Merritt to bring suit in
the courts against the Government, in order that said questions may be decided:
Now, therefore,
By authority of the United States, be it enacted by the Philippine Legislature, that:
SECTION 1. E. Merritt is hereby authorized to bring suit in the Court of First
Instance of the city of Manila against the Government of the Philippine Islands in
order to fix the responsibility for the collision between his motorcycle and the
ambulance of the General Hospital, and to determine the amount of the
damages, if any, to which Mr. E. Merritt is entitled on account of said collision,
and the Attorney-General of the Philippine Islands is hereby authorized and
directed to appear at the trial on the behalf of the Government of said Islands, to
defendant said Government at the same.
SEC. 2. This Act shall take effect on its passage.
Enacted, February 3, 1915.
Did the defendant, in enacting the above quoted Act, simply waive its immunity from suit
or did it also concede its liability to the plaintiff? If only the former, then it cannot be held
that the Act created any new cause of action in favor of the plaintiff or extended the
defendant's liability to any case not previously recognized.
All admit that the Insular Government (the defendant) cannot be sued by an individual
without its consent. It is also admitted that the instant case is one against the
Government. As the consent of the Government to be sued by the plaintiff was entirely
voluntary on its part, it is our duty to look carefully into the terms of the consent, and
render judgment accordingly.
The plaintiff was authorized to bring this action against the Government "in order to fix
the responsibility for the collision between his motorcycle and the ambulance of the
General Hospital and to determine the amount of the damages, if any, to which Mr. E.
Merritt is entitled on account of said collision, . . . ." These were the two questions
submitted to the court for determination. The Act was passed "in order that said
questions may be decided." We have "decided" that the accident was due solely to the
negligence of the chauffeur, who was at the time an employee of the defendant, and we
have also fixed the amount of damages sustained by the plaintiff as a result of the
collision. Does the Act authorize us to hold that the Government is legally liable for that
amount? If not, we must look elsewhere for such authority, if it exists.
The Government of the Philippine Islands having been "modeled after the Federal and
State Governments in the United States," we may look to the decisions of the high courts
of that country for aid in determining the purpose and scope of Act No. 2457.
In the United States the rule that the state is not liable for the torts committed by its
officers or agents whom it employs, except when expressly made so by legislative
enactment, is well settled. "The Government," says Justice Story, "does not undertake to
guarantee to any person the fidelity of the officers or agents whom it employs, since that
would involve it in all its operations in endless embarrassments, difficulties and losses,
which would be subversive of the public interest." (Claussen vs. City of Luverne, 103
Minn., 491, citing U. S. vs. Kirkpatrick, 9 Wheat, 720; 6 L. Ed., 199; and Beers vs. States, 20
How., 527; 15 L. Ed., 991.)
In the case of Melvin vs. State (121 Cal., 16), the plaintiff sought to recover damages from
the state for personal injuries received on account of the negligence of the state officers
at the state fair, a state institution created by the legislature for the purpose of improving
agricultural and kindred industries; to disseminate information calculated to educate and
benefit the industrial classes; and to advance by such means the material interests of the
state, being objects similar to those sought by the public school system. In passing upon
the question of the state's liability for the negligent acts of its officers or agents, the court
said:
No claim arises against any government is favor of an individual, by reason of the
misfeasance, laches, or unauthorized exercise of powers by its officers or agents.
(Citing Gibbons vs. U. S., 8 Wall., 269; Clodfelter vs. State, 86 N. C., 51, 53; 41
Am. Rep., 440; Chapman vs. State, 104 Cal., 690; 43 Am. St. Rep., 158; Green vs.
State, 73 Cal., 29; Bourn vs. Hart, 93 Cal., 321; 27 Am. St. Rep., 203; Story on
Agency, sec. 319.)
As to the scope of legislative enactments permitting individuals to sue the state where
the cause of action arises out of either fort or contract, the rule is stated in 36 Cyc., 915,
thus:
By consenting to be sued a state simply waives its immunity from suit. It does
not thereby concede its liability to plaintiff, or create any cause of action in his
favor, or extend its liability to any cause not previously recognized. It merely
gives a remedy to enforce a preexisting liability and submits itself to the
jurisdiction of the court, subject to its right to interpose any lawful defense.
In Apfelbacher vs. State (152 N. W., 144, advanced sheets), decided April 16, 1915, the
Act of 1913, which authorized the bringing of this suit, read:
SECTION 1. Authority is hereby given to George Apfelbacher, of the town of
Summit, Waukesha County, Wisconsin, to bring suit in such court or courts and
in such form or forms as he may be advised for the purpose of settling and
determining all controversies which he may now have with the State of
Wisconsin, or its duly authorized officers and agents, relative to the mill property
of said George Apfelbacher, the fish hatchery of the State of Wisconsin on the
Bark River, and the mill property of Evan Humphrey at the lower end of
Nagawicka Lake, and relative to the use of the waters of said Bark River and
Nagawicka Lake, all in the county of Waukesha, Wisconsin.
In determining the scope of this act, the court said:
Plaintiff claims that by the enactment of this law the legislature admitted liability
on the part of the state for the acts of its officers, and that the suit now stands
just as it would stand between private parties. It is difficult to see how the act
does, or was intended to do, more than remove the state's immunity from suit.
It simply gives authority to commence suit for the purpose of settling plaintiff's
controversies with the estate. Nowhere in the act is there a whisper or
suggestion that the court or courts in the disposition of the suit shall depart from
well established principles of law, or that the amount of damages is the only
question to be settled. The act opened the door of the court to the plaintiff. It
did not pass upon the question of liability, but left the suit just where it would be
in the absence of the state's immunity from suit. If the Legislature had intended
to change the rule that obtained in this state so long and to declare liability on
the part of the state, it would not have left so important a matter to mere
inference, but would have done so in express terms. (Murdock Grate Co. vs.
Commonwealth, 152 Mass., 28; 24 N.E., 854; 8 L. R. A., 399.)
In Denning vs. State (123 Cal., 316), the provisions of the Act of 1893, relied upon and
considered, are as follows:
All persons who have, or shall hereafter have, claims on contract or for
negligence against the state not allowed by the state board of examiners, are
hereby authorized, on the terms and conditions herein contained, to bring suit
thereon against the state in any of the courts of this state of competent
jurisdiction, and prosecute the same to final judgment. The rules of practice in
civil cases shall apply to such suits, except as herein otherwise provided.
And the court said:
This statute has been considered by this court in at least two cases, arising under
different facts, and in both it was held that said statute did not create any
liability or cause of action against the state where none existed before, but
merely gave an additional remedy to enforce such liability as would have existed
if the statute had not been enacted. (Chapman vs. State, 104 Cal., 690; 43 Am.
St. Rep., 158; Melvin vs. State, 121 Cal., 16.)
A statute of Massachusetts enacted in 1887 gave to the superior court "jurisdiction of all
claims against the commonwealth, whether at law or in equity," with an exception not
necessary to be here mentioned. In construing this statute the court, in Murdock Grate
Co. vs. Commonwealth (152 Mass., 28), said:
The statute we are discussing disclose no intention to create against the state a
new and heretofore unrecognized class of liabilities, but only an intention to
provide a judicial tribunal where well recognized existing liabilities can be
adjudicated.
In Sipple vs. State (99 N. Y., 284), where the board of the canal claims had, by the terms of
the statute of New York, jurisdiction of claims for damages for injuries in the management
of the canals such as the plaintiff had sustained, Chief Justice Ruger remarks: "It must be
conceded that the state can be made liable for injuries arising from the negligence of its
agents or servants, only by force of some positive statute assuming such liability."
It being quite clear that Act No. 2457 does not operate to extend the Government's
liability to any cause not previously recognized, we will now examine the substantive law
touching the defendant's liability for the negligent acts of its officers, agents, and
employees. Paragraph 5 of article 1903 of the Civil Code reads:
The state is liable in this sense when it acts through a special agent, but not
when the damage should have been caused by the official to whom properly it
pertained to do the act performed, in which case the provisions of the preceding
article shall be applicable.
The supreme court of Spain in defining the scope of this paragraph said:
That the obligation to indemnify for damages which a third person causes to
another by his fault or negligence is based, as is evidenced by the same Law 3,
Title 15, Partida 7, on that the person obligated, by his own fault or negligence,
takes part in the act or omission of the third party who caused the damage. It
follows therefrom that the state, by virtue of such provisions of law, is not
responsible for the damages suffered by private individuals in consequence of
acts performed by its employees in the discharge of the functions pertaining to
their office, because neither fault nor even negligence can be presumed on the
part of the state in the organization of branches of public service and in the
appointment of its agents; on the contrary, we must presuppose all foresight
humanly possible on its part in order that each branch of service serves the
general weal an that of private persons interested in its operation. Between
these latter and the state, therefore, no relations of a private nature governed
by the civil law can arise except in a case where the state acts as a judicial person
capable of acquiring rights and contracting obligations. (Supreme Court of Spain,
January 7, 1898; 83 Jur. Civ., 24.)
That the Civil Code in chapter 2, title 16, book 4, regulates the obligations which
arise out of fault or negligence; and whereas in the first article thereof. No.
1902, where the general principle is laid down that where a person who by an
act or omission causes damage to another through fault or negligence, shall be
obliged to repair the damage so done, reference is made to acts or omissions of
the persons who directly or indirectly cause the damage, the following articles
refers to this persons and imposes an identical obligation upon those who
maintain fixed relations of authority and superiority over the authors of the
damage, because the law presumes that in consequence of such relations the
evil caused by their own fault or negligence is imputable to them. This legal
presumption gives way to proof, however, because, as held in the last paragraph
of article 1903, responsibility for acts of third persons ceases when the persons
mentioned in said article prove that they employed all the diligence of a good
father of a family to avoid the damage, and among these persons, called upon to
answer in a direct and not a subsidiary manner, are found, in addition to the
mother or the father in a proper case, guardians and owners or directors of an
establishment or enterprise, the state, but not always, except when it acts
through the agency of a special agent, doubtless because and only in this case,
the fault or negligence, which is the original basis of this kind of objections, must
be presumed to lie with the state.
That although in some cases the state might by virtue of the general principle set
forth in article 1902 respond for all the damage that is occasioned to private
parties by orders or resolutions which by fault or negligence are made by
branches of the central administration acting in the name and representation of
the state itself and as an external expression of its sovereignty in the exercise of
its executive powers, yet said article is not applicable in the case of damages said
to have been occasioned to the petitioners by an executive official, acting in the
exercise of his powers, in proceedings to enforce the collections of certain
property taxes owing by the owner of the property which they hold in sublease.
It is, therefore, evidence that the State (the Government of the Philippine Islands) is only
liable, according to the above quoted decisions of the Supreme Court of Spain, for the
acts of its agents, officers and employees when they act as special agents within the
meaning of paragraph 5 of article 1903, supra, and that the chauffeur of the ambulance
of the General Hospital was not such an agent.
For the foregoing reasons, the judgment appealed from must be reversed, without costs
in this instance. Whether the Government intends to make itself legally liable for the
amount of damages above set forth, which the plaintiff has sustained by reason of the
negligent acts of one of its employees, by legislative enactment and by appropriating
sufficient funds therefor, we are not called upon to determine. This matter rests solely
with the Legislature and not with the courts.
Arellano, C. J., Torres, Johnson, and Moreland, JJ., concur.

That the responsibility of the state is limited by article 1903 to the case wherein
it acts through a special agent(and a special agent, in the sense in which these
words are employed, is one who receives a definite and fixed order or
commission, foreign to the exercise of the duties of his office if he is a special
official) so that in representation of the state and being bound to act as an agent
thereof, he executes the trust confided to him. This concept does not apply to
any executive agent who is an employee of the acting administration and who
on his own responsibility performs the functions which are inherent in and
naturally pertain to his office and which are regulated by law and the
regulations." (Supreme Court of Spain, May 18, 1904; 98 Jur. Civ., 389, 390.)

That according to paragraph 5 of article 1903 of the Civil Code and the principle
laid down in a decision, among others, of the 18th of May, 1904, in a damage
case, the responsibility of the state is limited to that which it contracts through a
special agent, duly empowered by a definite order or commission to perform
some act or charged with some definite purpose which gives rise to the claim,
and not where the claim is based on acts or omissions imputable to a public
official charged with some administrative or technical office who can be held to
the proper responsibility in the manner laid down by the law of civil
responsibility. Consequently, the trial court in not so deciding and in sentencing
the said entity to the payment of damages, caused by an official of the second
class referred to, has by erroneous interpretation infringed the provisions of
articles 1902 and 1903 of the Civil Code. (Supreme Court of Spain, July 30, 1911;
122 Jur. Civ., 146.)
 Republic of the Philippines Authority, started sub-dividing and distributing the land to the settlers; that the property
SUPREME COURT in question, while located within the reservation established under Proclamation No. 90,
Manila was the private property of plaintiff and should therefore be excluded therefrom. Plaintiff
prayed that he be declared the rightful and true owner of the property in question
FIRST DIVISION consisting of 1,364.4177 hectares; that his title of ownership based on informacion
posesoria of his predecessor-in-interest be declared legal valid and subsisting and that
G.R. No. 70853 March 12, 1987 defendant be ordered to cancel and nullify all awards to the settlers.

REPUBLIC OF THE PHILIPPINES, petitioner-appellee, The defendant, represented by the Land Authority, filed an answer, raising by way of
vs. affirmative defenses lack of sufficient cause of action and prescription.
PABLO FELICIANO and INTERMEDIATE APPELLATE COURT, respondents-appellants.
On August 29, 1970, the trial court, through Judge Rafael S. Sison, rendered a decision
declaring Lot No. 1, with an area of 701.9064 hectares, to be the private property of the
plaintiff, "being covered by a possessory information title in the name of his predecessor-
in-interest" and declaring said lot excluded from the NARRA settlement reservation. The
YAP, J.:
court declared the rest of the property claimed by plaintiff, i.e. Lots 2, 3 and 4, reverted
to the public domain.
Petitioner seeks the review of the decision of the Intermediate Appellate Court dated
April 30, 1985 reversing the order of the Court of First Instance of Camarines Sur, Branch
A motion to intervene and to set aside the decision of August 29, 1970 was filed by
VI, dated August 21, 1980, which dismissed the complaint of respondent Pablo Feliciano
eighty-six (86) settlers, together with the barrio council of Pag-asay, alleging among other
for recovery of ownership and possession of a parcel of land on the ground of non-
things that intervenors had been in possession of the land in question for more than
suability of the State.
twenty (20) years under claim of ownership.
The background of the present controversy may be briefly summarized as follows:
On January 25, 1971, the court a quo reconsidered its decision, reopened the case and
directed the intervenors to file their corresponding pleadings and present their evidence;
On January 22, 1970, respondent Feliciano filed a complaint with the then Court of First
all evidence already presented were to remain but plaintiff, as well as the Republic of the
Instance of Camarines Sur against the Republic of the Philippines, represented by the
Philippines, could present additional evidence if they so desire. The plaintiff presented
Land Authority, for the recovery of ownership and possession of a parcel of land,
additional evidence on July 30, 1971, and the case was set for hearing for the reception of
consisting of four (4) lots with an aggregate area of 1,364.4177 hectares, situated in the intervenors' evidence on August 30 and August 31, 1971.
Barrio of Salvacion, Municipality of Tinambac, Camarines Sur. Plaintiff alleged that he
bought the property in question from Victor Gardiola by virtue of a Contract of Sale dated
On August 30, 1971, the date set for the presentation of the evidence for intervenors, the
May 31, 1952, followed by a Deed of Absolute Sale on October 30, 1954; that Gardiola
latter did not appear but submitted a motion for postponement and resetting of the
had acquired the property by purchase from the heirs of Francisco Abrazado whose title
hearing on the next day, August 31, 1971. The trial court denied the motion for
to the said property was evidenced by an informacion posesoria that upon plaintiff's
postponement and allowed plaintiff to offer his evidence "en ausencia," after which the
purchase of the property, he took actual possession of the same, introduced various
case would be deemed submitted for decision. On the following day, August 31, 1971,
improvements therein and caused it to be surveyed in July 1952, which survey was
Judge Sison rendered a decision reiterating his decision of August 29, 1970.
approved by the Director of Lands on October 24, 1954; that on November 1, 1954,
President Ramon Magsaysay issued Proclamation No. 90 reserving for settlement
purposes, under the administration of the National Resettlement and Rehabilitation A motion for reconsideration was immediately filed by the intervenors. But before this
Administration (NARRA), a tract of land situated in the Municipalities of Tinambac and motion was acted upon, plaintiff filed a motion for execution, dated November 18, 1971.
Siruma, Camarines Sur, after which the NARRA and its successor agency, the Land On December 10, 1971, the lower court, this time through Judge Miguel Navarro, issued
an order denying the motion for execution and setting aside the order denying
intervenors' motion for postponement. The case was reopened to allow intervenors to
present their evidence. Unable to secure a reconsideration of Judge Navarro's order, the
plaintiff went to the Intermediate Appellate Court on a petition for certiorari. Said
petition was, however, denied by the Intermediate Appellate Court, and petitioners
brought the matter to this Court in G.R. No. 36163, which was denied on May 3, 1973
Consequently, the case was remanded to the court a quo for further proceedings.
On August 31, 1970, intervenors filed a motion to dismiss, principally on the ground that
the Republic of the Philippines cannot be sued without its consent and hence the action
cannot prosper. The motion was opposed by the plaintiff.
On August 21, 1980, the trial court, through Judge Esteban Lising, issued the questioned
order dismissing the case for lack of jurisdiction. Respondent moved for reconsideration,
while the Solicitor General, on behalf of the Republic of the Philippines filed its opposition
thereto, maintaining that the dismissal was proper on the ground of non-suability of the
State and also on the ground that the existence and/or authenticity of the purported
possessory information title of the respondents' predecessor-in-interest had not been
demonstrated and that at any rate, the same is not evidence of title, or if it is, its efficacy
has been lost by prescription and laches.
Upon denial of the motion for reconsideration, plaintiff again went to the Intermediate
Appellate Court on petition for certiorari. On April 30, 1985, the respondent appellate
court rendered its decision reversing the order of Judge Lising and remanding the case to
the court a quo for further proceedings. Hence this petition.
We find the petition meritorious. The doctrine of non-suability of the State has proper
application in this case. The plaintiff has impleaded the Republic of the Philippines as
defendant in an action for recovery of ownership and possession of a parcel of land,
bringing the State to court just like any private person who is claimed to be usurping a
piece of property. A suit for the recovery of property is not an action in rem, but an
action in personam. 1 It is an action directed against a specific party or parties, and any
judgment therein binds only such party or parties. The complaint filed by plaintiff, the
private respondent herein, is directed against the Republic of the Philippines, represented
by the Land Authority, a governmental agency created by Republic Act No. 3844.
By its caption and its allegation and prayer, the complaint is clearly a suit against the
State, which under settled jurisprudence is not permitted, except upon a showing that
the State has consented to be sued, either expressly or by implication through the use of
statutory language too plain to be misinterpreted.2 There is no such showing in the
instant case. Worse, the complaint itself fails to allege the existence of such consent. This
is a fatal defect, 3 and on this basis alone, the complaint should have been dismissed.
The failure of the petitioner to assert the defense of immunity from suit when the case
was tried before the court a quo, as alleged by private respondent, is not fatal. It is now
settled that such defense "may be invoked by the courts sua sponte at any stage of the
proceedings." 4
Private respondent contends that the consent of petitioner may be read from the
Proclamation itself, when it established the reservation " subject to private rights, if any
there be. " We do not agree. No such consent can be drawn from the language of the
Proclamation. The exclusion of existing private rights from the reservation established by
Proclamation No. 90 can not be construed as a waiver of the immunity of the State from
suit. Waiver of immunity, being a derogation of sovereignty, will not be inferred lightly.
but must be construed in strictissimi juris. 5Moreover, the Proclamation is not a legislative
act. The consent of the State to be sued must emanate from statutory authority. Waiver
of State immunity can only be made by an act of the legislative body.
Neither is there merit in respondent's submission, which the respondent appellate court
sustained, on the basis of our decision in the Begosa case, 6 that the present action is not
a suit against the State within the rule of State immunity from suit, because plaintiff does
not seek to divest the Government of any of its lands or its funds. It is contended that the
complaint involves land not owned by the State, but private land belonging to the
plaintiff, hence the Government is not being divested of any of its properties. There is
some sophistry involved in this argument, since the character of the land sought to be
recovered still remains to be established, and the plaintiff's action is directed against the
State precisely to compel the latter to litigate the ownership and possession of the
property. In other words, the plaintiff is out to establish that he is the owner of the land
in question based, incidentally, on an informacion posesoria of dubious value, and he
seeks to establish his claim of ownership by suing the Republic of the Philippines in an
action in personam.
The inscription in the property registry of an informacion posesoria under the Spanish
Mortgage Law was a means provided by the law then in force in the Philippines prior to
the transfer of sovereignty from Spain to the United States of America, to record a
claimant's actual possession of a piece of land, established through an ex
parte proceeding conducted in accordance with prescribed rules. 7 Such inscription
merely furnishes, at best, prima facieevidence of the fact that at the time the proceeding
was held, the claimant was in possession of the land under a claim of right as set forth in
his application. 8 The possessory information could ripen into a record of ownership after
the lapse of 20 years (later reduced to 10 years), upon the fulfillment of the requisites
prescribed in Article 393 of the Spanish Mortgage Law.

There is no showing in the case at bar that the informacion posesoria held by the
respondent had been converted into a record of ownership. Such possessory information,
therefore, remained at best mere prima facie evidence of possession. Using this
possessory information, the respondent could have applied for judicial confirmation of
imperfect title under the Public Land Act, which is an action in rem. However, having
failed to do so, it is rather late for him to pursue this avenue at this time. Respondent
must also contend, as the records disclose, with the fact admitted by him and stated in
the decision of the Court a quo that settlers have been occupying and cultivating the land
in question since even before the outbreak of the war, which puts in grave doubt his own
claim of possession.

Worthy of note is the fact, as pointed out by the Solicitor General, that the informacion
posesoria registered in the Office of the Register of Deed of Camarines Sur on September
23, 1952 was a "reconstituted" possessory information; it was "reconstituted from the
duplicate presented to this office (Register of Deeds) by Dr. Pablo Feliciano," without the
submission of proof that the alleged duplicate was authentic or that the original thereof
was lost. Reconstitution can be validly made only in case of loss of the original. 10 These
circumstances raise grave doubts as to the authenticity and validity of the "informacion
posesoria" relied upon by respondent Feliciano. Adding to the dubiousness of said Republic of the Philippines
document is the fact that "possessory information calls for an area of only 100 SUPREME COURT
hectares," 11 whereas the land claimed by respondent Feliciano comprises 1,364.4177 Manila
hectares, later reduced to 701-9064 hectares. Courts should be wary in accepting
"possessory information documents, as well as other purportedly old Spanish titles, as EN BANC
proof of alleged ownership of lands.
G.R. No. L-23052 January 29, 1968
WHEREFORE, judgment is hereby rendered reversing and setting aside the appealed
decision of the Intermediate Appellate Court, dated April 30, 1985, and affirming the
CITY OF MANILA, petitioner,
order of the court a quo, dated August 21, 1980, dismissing the complaint filed by
vs.
respondent Pablo Feliciano against the Republic of the Philippines. No costs.
GENARO N. TEOTICO and COURT OF APPEALS, respondents.

SO ORDERED.
City Fiscal Manuel T. Reyes for petitioner.
Sevilla, Daza and Associates for respondents.
Narvasa, Cruz, Feliciano, Gancayco and Sarmiento, JJ., concur.
CONCEPCION, C.J.:
Melencio-Herrera, J., is on leave.
Appeal by certiorari from a decision of the Court of Appeals.
On January 27, 1958, at about 8:00 p.m., Genaro N. Teotico was at the corner of the Old
Luneta and P. Burgos Avenue, Manila, within a "loading and unloading" zone, waiting for a
jeepney to take him down town. After waiting for about five minutes, he managed to hail
a jeepney that came along to a stop. As he stepped down from the curb to board the
jeepney, and took a few steps, he fell inside an uncovered and unlighted catch basin or
manhole on P. Burgos Avenue. Due to the fall, his head hit the rim of the manhole
breaking his eyeglasses and causing broken pieces thereof to pierce his left eyelid. As
blood flowed therefrom, impairing his vision, several persons came to his assistance and
pulled him out of the manhole. One of them brought Teotico to the Philippine General
Hospital, where his injuries were treated, after which he was taken home. In addition to
the lacerated wound in his left upper eyelid, Teotico suffered contusions on the left thigh,
the left upper arm, the right leg and the upper lip apart from an abrasion on the right
infra-patella region. These injuries and the allergic eruption caused by anti-tetanus
injections administered to him in the hospital, required further medical treatment by a
private practitioner who charged therefor P1,400.00.
As a consequence of the foregoing occurrence, Teotico filed, with the Court of First
Instance of Manila, a complaint — which was, subsequently, amended — for damages
against the City of Manila, its mayor, city engineer, city health officer, city treasurer and
chief of police. As stated in the decision of the trial court, and quoted with approval by
the Court of Appeals,
At the time of the incident, plaintiff was a practicing public accountant, a
businessman and a professor at the University of the East. He held responsible
positions in various business firms like the Philippine Merchandising Co., the A.U.
Valencia and Co., the Silver Swan Manufacturing Company and the Sincere
Packing Corporation. He was also associated with several civic organizations such
as the Wack Wack Golf Club, the Chamber of Commerce of the Philippines, Y's
Men Club of Manila and the Knights of Rizal. As a result of the incident, plaintiff
was prevented from engaging in his customary occupation for twenty days.
Plaintiff has lost a daily income of about P50.00 during his incapacity to work.
Because of the incident, he was subjected to humiliation and ridicule by his
business associates and friends. During the period of his treatment, plaintiff was
under constant fear and anxiety for the welfare of his minor children since he
was their only support. Due to the filing of this case, plaintiff has obligated
himself to pay his counsel the sum of P2,000.00.
On the other hand, the defense presented evidence, oral and documentary, to
prove that the Storm Drain Section, Office of the City Engineer of Manila,
received a report of the uncovered condition of a catchbasin at the corner of P.
Burgos and Old Luneta Streets, Manila, on January 24, 1958, but the same was
covered on the same day (Exhibit 4); that again the iron cover of the same catch
basin was reported missing on January 30, 1958, but the said cover was replaced
the next day (Exhibit 5); that the Office of the City Engineer never received any
report to the effect that the catchbasin in question was not covered between
January 25 and 29, 1968; that it has always been a policy of the said office, which
is charged with the duty of installation, repair and care of storm drains in the
City of Manila, that whenever a report is received from whatever source of the
loss of a catchbasin cover, the matter is immediately attended to, either by
immediately replacing the missing cover or covering the catchbasin with steel
matting that because of the lucrative scrap iron business then prevailing, stealing
of iron catchbasin covers was rampant; that the Office of the City Engineer has
filed complaints in court resulting from theft of said iron covers; that in order to
prevent such thefts, the city government has changed the position and layout of
catchbasins in the City by constructing them under the sidewalks with concrete
cement covers and openings on the side of the gutter; and that these changes
had been undertaken by the city from time to time whenever funds were
available.
After appropriate proceedings the Court of First Instance of Manila rendered the
aforementioned decision sustaining the theory of the defendants and dismissing the
amended complaint, without costs.
On appeal taken by plaintiff, this decision was affirmed by the Court of Appeals, except
insofar as the City of Manila is concerned, which was sentenced to pay damages in the
aggregate sum of P6,750.00. 1 Hence, this appeal by the City of Manila.
The first issue raised by the latter is whether the present case is governed by Section 4 of
Republic Act No. 409 (Charter of the City of Manila) reading:
The city shall not be liable or held for damages or injuries to persons or property
arising from the failure of the Mayor, the Municipal Board, or any other city
officer, to enforce the provisions of this chapter, or any other law or ordinance,
or from negligence of said Mayor, Municipal Board, or other officers while
enforcing or attempting to enforce said provisions.
or by Article 2189 of the Civil Code of the Philippines which provides:
Provinces, cities and municipalities shall be liable for damages for the death of,
or injuries suffered by, any person by reason of defective conditions of road,
 streets, bridges, public buildings, and other public works under their control or
supervision.
Manila maintains that the former provision should prevail over the latter, because
Republic Act 409, is a special law, intended exclusively for the City of Manila, whereas the
Civil Code is a general law, applicable to the entire Philippines.
The Court of Appeals, however, applied the Civil Code, and, we think, correctly. It is true
that, insofar as its territorial application is concerned, Republic Act No. 409 is a special law
and the Civil Code a general legislation; but, as regards the subject-matter of the
provisions above quoted, Section 4 of Republic Act 409 establishes a general rule
regulating the liability of the City of Manila for: "damages or injury to persons or property
arising from the failure of" city officers "to enforce the provisions of" said Act "or any
other law or ordinance, or from negligence" of the city "Mayor, Municipal Board, or other
officers while enforcing or attempting to enforce said provisions." Upon the other hand,
Article 2189 of the Civil Code constitutes a particular prescription making "provinces,
cities and municipalities . . . liable for damages for the death of, or injury suffered by any
person by reason" — specifically — "of the defective condition of roads, streets, bridges,
public buildings, and other-public works under their control or supervision." In other
words, said section 4 refers to liability arising from negligence, in general, regardless of
the object thereof, whereas Article 2189 governs liability due to "defective streets," in
particular. Since the present action is based upon the alleged defective condition of a
road, said Article 2189 is decisive thereon.
It is urged that the City of Manila cannot be held liable to Teotico for damages: 1) because
the accident involving him took place in a national highway; and 2) because the City of
Manila has not been negligent in connection therewith.
As regards the first issue, we note that it is based upon an allegation of fact not made in
the answer of the City. Moreover, Teotico alleged in his complaint, as well as in his
amended complaint, that his injuries were due to the defective condition of a street
which is "under the supervision and control" of the City. In its answer to the amended
complaint, the City, in turn, alleged that "the streets aforementioned were and have been
constantly kept in good condition and regularly inspected and the storm drains and
manholes thereof covered by the defendant City and the officers concerned" who "have
been ever vigilant and zealous in the performance of their respective functions and duties
as imposed upon them by law." Thus, the City had, in effect, admitted that P. Burgos
Avenue was and is under its control and supervision.
Moreover, the assertion to the effect that said Avenue is a national highway was made,
for the first time, in its motion for reconsideration of the decision of the Court of Appeals.
Such assertion raised, therefore, a question of fact, which had not been put in issue in the
trial court, and cannot be set up, for the first time, on appeal, much less after the
rendition of the decision of the appellate court, in a motion for the reconsideration
thereof.
At any rate, under Article 2189 of the Civil Code, it is not necessary for the liability therein
established to attach that the defective roads or streets belong to the province, city or
municipality from which responsibility is exacted. What said article requires is that the
province, city or municipality have either "control or supervision" over said street or road.
Even if P. Burgos Avenue were, therefore, a national highway, this circumstance would
not necessarily detract from its "control or supervision" by the City of Manila, under
Republic Act 409. In fact Section 18(x) thereof provides:
Sec. 18. Legislative powers. — The Municipal Board shall have the following
legislative powers:
xxx xxx xxx
(x) Subject to the provisions of existing law to provide for the laying out,
construction and improvement, and to regulate the use of streets, avenues,
alleys, sidewalks, wharves, piers, parks, cemeteries, and other public places; to
provide for lighting, cleaning, and sprinkling of streets and public places; . . . to
provide for the inspection of, fix the license fees for and regulate the openings in
the same for the laying of gas, water, sewer and other pipes, the building and
repair of tunnels, sewers, and drains, and all structures in and under the same
and the erecting of poles and the stringing of wires therein; to provide for and
regulate cross-works, curbs, and gutters therein, . . . to regulate traffic and sales
upon the streets and other public places; to provide for the abatement of
nuisances in the same and punish the authors or owners thereof; to provide for
the construction and maintenance, and regulate the use, of bridges, viaducts
and culverts; to prohibit and regulate ball playing, kite-flying, hoop rolling, and
other amusements which may annoy persons using the streets and public places,
or frighten horses or other animals; to regulate the speed of horses and other
animals, motor and other vehicles, cars, and locomotives within the limits of the
city; to regulate the lights used on all vehicles, cars, and locomotives; . . . to
provide for and change the location, grade, and crossing of railroads, and compel
any such railroad to raise or lower its tracks to conform to such provisions or
changes; and to require railroad companies to fence their property, or any part
 thereof, to provide suitable protection against injury to persons or property, and
to construct and repair ditches, drains, sewers, and culverts along and under
their tracks, so that the natural drainage of the streets and adjacent property
shall not be obstructed.

This authority has been neither withdrawn nor restricted by Republic Act No. 917 and
Republic of the Philippines
Executive Order No. 113, dated May 2, 1955, upon which the City relies. Said Act governs
SUPREME COURT
the disposition or appropriation of the highway funds and the giving of aid to provinces,
Manila
chartered cities and municipalities in the construction of roads and streets within their
respective boundaries, and Executive Order No. 113 merely implements the provisions of
said Republic Act No. 917, concerning the disposition and appropriation of the highway EN BANC
funds. Moreover, it provides that "the construction, maintenance and improvement of
national primary, national secondary and national aid provincial and city roads shall be G.R. No. L-35645 May 22, 1985
accomplished by the Highway District Engineers and Highway City Engineers under the
supervision of the Commissioner of Public Highways and shall be financed from such UNITED STATES OF AMERICA, CAPT. JAMES E. GALLOWAY, WILLIAM I. COLLINS and ROBERT
appropriations as may be authorized by the Republic of the Philippines in annual or GOHIER, petitioners,
special appropriation Acts." vs.
HON. V. M. RUIZ, Presiding Judge of Branch XV, Court of First Instance of Rizal and ELIGIO
Then, again, the determination of whether or not P. Burgos Avenue is under the control DE GUZMAN & CO., INC., respondents.
or supervision of the City of Manila and whether the latter is guilty of negligence, in
connection with the maintenance of said road, which were decided by the Court of Sycip, Salazar, Luna & Manalo & Feliciano Law for petitioners.
Appeals in the affirmative, is one of fact, and the findings of said Court thereon are not
subject to our review. Albert, Vergara, Benares, Perias & Dominguez Law Office for respondents.

WHEREFORE, the decision appealed from should be as it is hereby affirmed, with costs
against the City of Manila. It is so ordered.1äwphï1.ñët
ABAD SANTOS, J.:
Reyes, J.B.L., Dizon, Makalintal, Bengzon, J.P., Zaldivar, Sanchez, Castro, Angeles and
Fernando, JJ., concur. This is a petition to review, set aside certain orders and restrain the respondent judge
from trying Civil Case No. 779M of the defunct Court of First Instance of Rizal.

The factual background is as follows:

At times material to this case, 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 the following
projects
1. Repair offender system, Alava Wharf at the U.S. Naval Station Subic Bay, Philippines.
2. Repair typhoon damage to NAS Cubi shoreline; repair typhoon damage to shoreline
revetment, NAVBASE Subic; and repair to Leyte Wharf approach, NAVBASE Subic Bay,
Philippines.
Eligio de Guzman & Co., Inc. responded to the invitation and submitted bids. Subsequent
thereto, the company received from the United States two telegrams requesting it to
confirm its price proposals and for the name of its bonding company. The company
complied with the requests. [In its complaint, the company alleges that the United States
had accepted its bids because "A request to confirm a price proposal confirms the
acceptance of a bid pursuant to defendant United States' bidding practices." (Rollo, p.
30.) The truth of this allegation has not been tested because the case has not reached the
trial stage.]
In June, 1972, the company received a letter which was signed by Wilham I. Collins,
Director, Contracts Division, Naval Facilities Engineering Command, Southwest Pacific,
Department of the Navy of the United States, who is one of the petitioners herein. The
letter said that the company did not qualify to receive an award for the projects because
of its previous unsatisfactory performance rating on a repair contract for the sea wall at
the boat landings of the U.S. Naval Station in Subic Bay. The letter further said that the
projects had been awarded to third parties. In the abovementioned Civil Case No. 779-M,
the company sued the United States of America and Messrs. James E. Galloway, William I.
Collins and Robert Gohier all members of the Engineering Command of the U.S. Navy. The
complaint is to order the defendants to allow the plaintiff to perform the work on the
projects and, in the event that specific performance was no longer possible, to order the
defendants to pay damages. The company also asked for the issuance of a writ of
preliminary injunction to restrain the defendants from entering into contracts with third
parties for work on the projects.
The defendants entered their special appearance for the purpose only of questioning the
jurisdiction of this court over the subject matter of the complaint and the persons of
defendants, the subject matter of the complaint being acts and omissions of the
individual defendants as agents of defendant United States of America, a foreign
sovereign which has not given her consent to this suit or any other suit for the causes of
action asserted in the complaint." (Rollo, p. 50.)
Subsequently the defendants filed a motion to dismiss the complaint which included an
opposition to the issuance of the writ of preliminary injunction. The company opposed
the motion. The trial court denied the motion and issued the writ. The defendants moved
twice to reconsider but to no avail. Hence the instant petition which seeks to restrain
perpetually the proceedings in Civil Case No. 779-M for lack of jurisdiction on the part of
the trial court.
The petition is highly impressed with merit.
The traditional rule of State immunity exempts a State from being sued in the courts of
another State without its consent or waiver. This rule is a necessary consequence of the
principles of independence and equality of States. However, the rules of International
Law are not petrified; they are constantly developing 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. (See Coquia and Defensor
Santiago, Public International Law, pp. 207-209 [1984].)
The respondent judge recognized the restrictive doctrine of State immunity when he said
in his Order denying the defendants' (now petitioners) motion: " A distinction should be
made between a strictly governmental function of the sovereign state from its private,
proprietary or non- governmental acts (Rollo, p. 20.) However, the respondent judge also
said: "It is the Court's considered opinion that entering into a contract for the repair of
wharves or shoreline is certainly not a governmental function altho it may partake of a
public nature or character. As aptly pointed out by plaintiff's counsel in his reply citing the
ruling in the case of Lyons, Inc., [104 Phil. 594 (1958)], and which this Court quotes with
approval, viz.:
It is however contended 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. ...
xxx xxx xxx
We agree to the above contention, and considering that the United
States government, through its agency at Subic Bay, entered into a
contract with appellant for stevedoring and miscellaneous labor
services within the Subic Bay Area, a U.S. Naval Reservation, it is evident
that it can bring an action before our courts for any contractual liability
 that that political entity may assume under the contract. The trial court,
therefore, has jurisdiction to entertain this case ... (Rollo, pp. 20-21.)
The reliance placed on Lyons by the respondent judge is misplaced for the following
reasons:
In Harry Lyons, Inc. vs. The United States of America, supra, plaintiff brought suit in the
Court of First Instance of Manila to collect several sums of money on account of a
contract between plaintiff and defendant. The defendant filed a motion to dismiss on the
ground that the court had no jurisdiction over defendant and over the subject matter of
the action. The court granted the motion on the grounds that: (a) it had no jurisdiction
over the defendant who did not give its consent to the suit; and (b) plaintiff failed to
exhaust the administrative remedies provided in the contract. The order of dismissal was
elevated to this Court for review.
In sustaining the action of the lower court, this Court said:
It appearing in the complaint that appellant has not complied with the
procedure laid down in Article XXI of the contract regarding the
prosecution of its claim against the United States Government, or,
stated differently, it has failed to first exhaust its administrative
remedies against said Government, the lower court acted properly in
dismissing this case.(At p. 598.)
It can thus be seen that the statement in respect of the waiver of State immunity from
suit was purely gratuitous and, therefore, obiter so that it has no value as an imperative
authority.
The restrictive application of State immunity is proper only when the proceedings arise
out of commercial transactions of the foreign sovereign, its commercial activities or
economic affairs. Stated differently, a State may be said to have 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. It does not apply where 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.
That the correct test for the application of State immunity is not the conclusion of a
contract by a State but the legal nature of the act is shown in Syquia vs. Lopez, 84 Phil.
312 (1949). In that case the plaintiffs leased three apartment buildings to the United
States of America for the use of its military officials. The plaintiffs sued to recover
possession of the premises on the ground that the term of the leases had expired. They
also asked for increased rentals until the apartments shall have been vacated.
The defendants who were armed forces officers of the United States moved to dismiss
the suit for lack of jurisdiction in the part of the court. The Municipal Court of Manila
granted the motion to dismiss; sustained by the Court of First Instance, the plaintiffs went
to this Court for review on certiorari. In denying the petition, this Court said:
On the basis of the foregoing considerations we are of the belief and
we hold that the real party defendant in interest is the Government of
the United States of America; that any judgment for back or Increased
rentals or damages will have to be paid not by defendants Moore and
Tillman and their 64 co-defendants but by the said U.S. Government.
On the basis of the ruling in the case of Land vs. Dollar already cited,
and on what we have already stated, the present action must be
considered as one against the U.S. Government. It is clear hat the
courts of the Philippines including the Municipal Court of Manila have
no jurisdiction over the present case for unlawful detainer. The
question of lack of jurisdiction was raised and interposed at the very
beginning of the action. The U.S. Government has not , given its
consent to the filing of this suit which is essentially against her, though
not in name. Moreover, this is not only a case of a citizen filing a suit
against his own Government without the latter's consent but it is of a
citizen filing an action against a foreign government without said
government's consent, which renders more obvious the lack of
jurisdiction of the courts of his country. The principles of law behind
this rule are so elementary and of such general acceptance that we
deem it unnecessary to cite authorities in support thereof. (At p. 323.)
In Syquia,the United States concluded contracts with private individuals but the contracts
notwithstanding the States was not deemed to have given or waived its consent to be
sued for the reason that the contracts were for jure imperii and not for jure gestionis.
WHEREFORE, the petition is granted; the questioned orders of the respondent judge are
set aside and Civil Case No. is dismissed. Costs against the private respondent.
Teehankee, Aquino, Concepcion, Jr., Melencio-Herrera, Plana, * Escolin, Relova, Gutierrez,
Jr., De la Fuente, Cuevas and Alampay, JJ., concur.
Fernando, C.J., took no part. Quisumbing, Sycip, Quisumbing and Salazar, for appellant.
Ernesto Zaragoza for appellee.
Hilarion U. Jarencio for the intervenor.

PARAS, C.J.:

The factual antecedents of this case are sufficiently recited in the brief filed by the
intervenor-appellee as follows:

1. On February 3, 1951, plaintiff-appellee, Fernando A. Froilan, filed a complaint

against the defendant-appellant, Pan Oriental Shipping Co., alleging that he
purchased from the Shipping Commission the vessel FS-197 for P200,000, paying
P50,000 down and agreeing to pay the balance in installments; that to secure
the payment of the balance of the purchase price, he executed a chattel
mortgage of said vessel in favor of the Shipping Commission; that for various
reason, among them the non-payment of the installments, the Shipping
Commission took possession of said vessel and considered the contract of sale
cancelled; that the Shipping Commission chartered and delivered said vessel to
the defendant-appellant Pan Oriental Shipping Co. subject to the approval of the
President of the Philippines; that he appealed the action of the Shipping
Commission to the President of the Philippines and, in its meeting on August 25,
1950, the Cabinet restored him to all his rights under his original contract with
the Shipping Commission; that he had repeatedly demanded from the Pan
Oriental Shipping Co. the possession of the vessel in question but the latter
refused to do so. He, therefore, prayed that, upon the approval of the bond
accompanying his complaint, a writ of replevin be issued for the seizure of said
vessel with all its equipment and appurtenances, and that after hearing, he be
Republic of the Philippines adjudged to have the rightful possession thereof (Rec. on App. pp. 2-8).
SUPREME COURT
Manila 2. On February 3, 1951, the lower court issued the writ of replevin prayed for by
Froilan and by virtue thereof the Pan Oriental Shipping Co. was divested of its
EN BANC possession of said vessel (Rec. on App. p. 47).

G.R. No. L-6060 September 30, 1954 3. On March 1, 1951, Pan Oriental Shipping Co. filed its answer denying the right
of Froilan to the possession of the said vessel; it alleged that the action of the
FERNANDO A. FROILAN, plaintiff-appellee, Cabinet on August 25, 1950, restoring Froilan to his rights under his original
vs. contract with the Shipping Commission was null and void; that, in any event,
PAN ORIENTAL SHIPPING CO., defendant-appellant, Froilan had not complied with the conditions precedent imposed by the Cabinet
REPUBLIC OF THE PHILIPPINES, intervenor-appellee. for the restoration of his rights to the vessel under the original contract; that it
suffered damages in the amount of P22,764.59 for wrongful replevin in the
month of February, 1951, and the sum of P17,651.84 a month as damages
suffered for wrongful replevin from March 1, 1951; it alleged that it had incurred
necessary and useful expenses on the vessel amounting to P127,057.31 and
claimed the right to retain said vessel until its useful and necessary expenses had
been reimbursed (Rec. on App. pp. 8-53).
4. On November 10, 1951, after the leave of the lower court had been obtained,
the intervenor-appellee, Government of the Republic of the Philippines, filed a
complaint in intervention alleging that Froilan had failed to pay to the Shipping
Commission (which name was later changed to Shipping Administration) the
balance due on the purchase price of the vessel in question, the interest
thereon, and its advances on insurance premium totalling P162,142.95,
excluding the dry-docking expenses incurred on said vessel by the Pan Oriental
Shipping Co.; that intervenor was entitled to the possession of the said vessel
either under the terms of the original contract as supplemented by Froilan's
letter dated January 28, 1949, or in order that it may cause the extrajudicial sale
thereof under the Chattel Mortgage Law. It, therefore, prayed that Froilan be
ordered to deliver the vessel in question to its authorized representative, the
Board of Liquidators; that Froilan be declared to be without any rights on said
vessel and the amounts he paid thereon forfeited or alternately, that the said
vessel be delivered to the Board of Liquidators in order that the intervenor may
have its chattel mortgage extrajudicially foreclosed in accordance with the
provisions of the Chattel Mortgage Law; and that pending the hearing on the
merits, the said vessel be delivered to it (Rec. on App. pp. 54-66).
5. On November 29, 1951, the Pan Oriental Shipping Co. filed an answer to the
complaint in intervention alleging that the Government of the Republic of the
Philippines was obligated to deliver the vessel in question to it by virtue of a
contract of bare-boat charter with option to purchase executed on June 16,
1949, by the latter in favor of the former; it also alleged that it had made
necessary and useful expenses on the vessel and claimed the right of retention
of the vessel. It, therefore, prayed that, if the Republic of the Philippines
succeeded in obtaining possession of the said vessel, to comply with its
obligations of delivering to it (Pan Oriental Shipping co.) or causing its delivery by
recovering it from Froilan (Rec. on App. pp. 69-81).
6. On November 29, 1951, Froilan tendered to the Board of Liquidators, which
was liquidating the affairs of the Shipping Administration, a check in the amount
of P162,576.96 in payment of his obligation to the Shipping Administration for
the said vessel as claimed in the complaint in intervention of the Government of
the Republic of the Philippines. The Board of Liquidators issued an official report
therefor stating that it was a 'deposit pending the issuance of an order of the
Court of First Instance of Manila' (Rec. on App. pp. 92-93).
7. On December 7, 1951, the Government of the Republic of the Philippines
brought the matter of said payment and the circumstance surrounding it to the
attention of the lower court "in order that they may be taken into account by
this Honorable Court in connection with the questions that are not pending
before it for determination" (Rec. on App. pp. 82-86).
8. On February 3, 1952, the lower court held that the payment by Froilan of the
amount of P162,576.96 on November 29, 1951, to the Board of Liquidators
constituted a payment and a discharge of Froilan's obligation to the Government
of the Republic of the Philippines and ordered the dismissal of the latter's
complaint in intervention. In the same order, the lower court made it very clear
that said order did not pre-judge the question involved between Froilan and the
Oriental Shipping Co. which was also pending determination in said court (Rec.
on App. pp. 92-93). This order dismissing the complaint in intervention, but
reserving for future adjudication the controversy between Froilan and the Pan
Oriental Shipping Co. has already become final since neither the Government of
the Republic of the Philippines nor the Pan Oriental Shipping Co. had appealed
therefrom.
9. On May 10, 1952, the Government of the Republic of the Philippines filed a
motion to dismiss the counterclaim of the Pan Oriental Shipping Co. against it on
the ground that the purpose of said counterclaim was to compel the
Government of the Republic of the Philippines to deliver the vessel to it (Pan
Oriental Shipping Co.) in the event that the Government of the Republic of the
Philippines recovers the vessel in question from Froilan. In view, however, of the
order of the lower court dated February 3, holding that the payment made by
Froilan to the Board of Liquidators constituted full payment of Froilan's
obligation to the Shipping Administration, which order had already become final,
the claim of the Pan Oriental Shipping Co. against the Republic of the Philippines
was no longer feasible, said counterclaim was barred by prior judgment and
stated no cause of action. It was also alleged that movant was not subject to the
jurisdiction of the court in connection with the counterclaim. (Rec. on App. pp.
94-97). This motion was opposed by the Pan Oriental Shipping Co. in its written
opposition dated June 4, 1952 (Rec. on app. pp. 19-104).
 10. In an order dated July 1, 1952, the lower court dismissed the counterclaim of
the Pan Oriental Shipping Co. as prayed for by the Republic of the Philippines
(Rec. on App. pp. 104-106).
11. It if from this order of the lower court dismissing its counterclaim against the
Government of the Republic of the Philippines that Pan Oriental Shipping Co. has
perfected the present appeal (Rec. on App. p. 107).
The order of the Court of First Instance of Manila, dismissing the counterclaim of the
defendant Pan Oriental Shipping Co., from which the latter has appealed, reads as
follows:
This is a motion to dismiss the counterclaim interposed by the defendant in its
answer to the complaint in intervention.
"The counterclaim states as follows:
"COUNTERCLAIM
"As counterclaim against the intervenor Republic of the Philippines, the
defendant alleges:
"1. That the defendant reproduces herein all the pertinent allegations of the
foregoing answer to the complaint in intervention
"2. That, as shown by the allegations of the foregoing answer to the complaint in
intervention, the defendant Pan Oriental Shipping Company is entitled to the
possession of the vessel and the intervenor Republic of the Philippines is bound
under the contract of charter with option to purchase it entered into with the
defendant to deliver that possession to the defendant — whether it actually has
the said possession or it does not have that possession from the plaintiff
Fernando A. Froilan and deliver the same to the defendant;
"3. That, notwithstanding demand, the intervenor Republic of the Philippines has
not to date complied with its obligation of delivering or causing the delivery of
the vessel to the defendant Pan Oriental Shipping Company.1âwphïl.nêt
"RELIEF
"WHEREFORE, the defendant respectfully prays that judgment be rendered
ordering the intervenor Republic of the Philippines alternatively to deliver to the
defendants the possession of the said vessel, or to comply with its obligation to
the defendant or causing the delivery to the latter of the said vessel by
recovering the same from plaintiff, with costs.
"The defendant prays for such other remedy as the Court may
deem just and equitable in the premises."
The ground of the motion to dismiss are (a) That the cause of action is barred by
prior judgment; (b) That the counterclaim states no cause of action; and (c) That
this Honorable Court has no jurisdiction over the intervenor government of the
Republic of the Philippines in connection with the counterclaim of the defendant
Pan Oriental Shipping Co.
The intervenor contends that the complaint in intervention having been
dismissed and no appeal having been taken, the dismissal of said complaint is
tantamount to a judgment.
The complaint in intervention did not contain any claim whatsoever against the
defendant Pan Oriental Shipping Co.; hence, the counterclaim has no
foundation.
The question as to whether the Court has jurisdiction over the intervenor with
regard to the counterclaim, the Court is of the opinion that it has no jurisdiction
over said intervenor.
It appearing, therefore, that the grounds of the motion to dismiss are well taken,
the counterclaim of the defendant is dismissed, without pronouncement as to
costs.
The defendant's appeal is predicated upon the following assignments of error:
I. The lower court erred in dismissing the counterclaim on the ground of prior
judgment.
II. The lower court erred in dismissing the counterclaim on the ground that the
counterclaim had no foundation because made to a complaint in intervention
that contained no claim against the defendant.
 III. The lower court erred in dismissing the counterclaim on the ground of alleged
lack of jurisdiction over the intervenor Republic of the Philippines.
We agree with appellant's contention that its counterclaim is not barred by prior
judgment (order of February 8, 1952, dismissing the complaint in intervention), first,
because said counterclaim was filed on November 29, 1951, before the issuance of the
order invoked; and, secondly, because in said order of February 8, the court dismissed the
complaint in intervention, "without, of course, precluding the determination of the right
of the defendant in the instant case," and subject to the condition that the "release and
cancellation of the chattel mortgage does not, however, prejudge the question involved
between the plaintiff and the defendant which is still the subject of determination in this
case." It is to be noted that the first condition referred to the right of the defendant, as
distinguished from the second condition that expressly specified the controversy between
the plaintiff and the defendant. That the first condition reserved the right of the
defendant as against the intervenor, is clearly to be deduced from the fact that the order
of February 8 mentioned the circumstance that "the question of the expenses of
drydocking incurred by the defendant has been included in its counterclaim against the
plaintiff," apparently as one of the grounds for granting the motion to dismiss the
complaint in intervention.
The defendant's failure to appeal from the order of February 8 cannot, therefore, be held
as barring the defendant from proceeding with its counterclaim, since, as already stated,
said order preserved its right as against the intervenor. Indeed, the maintenance of said
right is in consonance with Rule 30, section 2, of the Rules of Court providing that "if a
counterclaim has been pleaded by a defendant prior to the service upon him of the
plaintiff's motion to dismiss, the action shall not be dismissed against the defendant's
objection unless the counterclaim can remain pending for independent adjudication by
the court."
The lower court also erred in holding that, as the intervenor had not made any claim
against the defendant, the latter's counterclaim had no foundation. The complaint in
intervention sought to recover possession of the vessel in question from the plaintiff, and
this claim is logically adverse to the position assumed by the defendant that it has a
better right to said possession than the plaintiff who alleges in his complaint that he is
entitled to recover the vessel from the defendant. At any rate a counterclaim should be
judged by its own allegations, and not by the averments of the adverse party. It should be
recalled that the defendant's theory is that the plaintiff had already lost his rights under
the contract with the Shipping Administration and that, on the other hand, the defendant
is relying on the charter contract executed in its favor by the intervenor which is bound to
protect the defendant in its possession of the vessel. In other words, the counterclaim
calls for specific performance on the part of the intervenor. As to whether this
counterclaim is meritorious is another question which is not now before us.
The other ground for dismissing the defendant's counterclaim is that the State is immune
from suit. This is untenable, because by filing its complaint in intervention the
Government in effect waived its right of nonsuability.
The immunity of the state from suits does not deprive it of the right to sue
private parties in its own courts. The state as plaintiff may avail itself of the
different forms of actions open to private litigants. In short, by taking the
initiative in an action against a private party, the state surrenders its privileged
position and comes down to the level of the defendant. The latter automatically
acquires, within certain limits, the right to set up whatever claims and other
defenses he might have against the state. The United States Supreme Court thus
explains:
"No direct suit can be maintained against the United States. But when
an action is brought by the United States to recover money in the hands
of a party who has a legal claim against them, it would be a very rigid
principle to deny to him the right of setting up such claim in a court of
justice, and turn him around to an application to Congress." (Sinco,
Philippine Political Law, Tenth Ed., pp. 36-37, citing U. S. vs. Ringgold, 8
Pet. 150, 8 L. ed. 899.)
It is however, contended for the intervenor that, if there was at all any waiver, it was in
favor of the plaintiff against whom the complaint in intervention was directed. This
contention is untenable. As already stated, the complaint in intervention was in a sense in
derogation of the defendant's claim over the possession of the vessel in question.
Wherefore, the appealed order is hereby reversed and set aside and the case remanded
to the lower court for further proceedings. So ordered, without costs.
Pablo, Padilla, Montemayor, Reyes, A., Jugo, Bautista Angelo, Concepcion, and Reyes,
J.B.L., JJ., concur.
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-61744 June 25, 1984
MUNICIPALITY OF SAN MIGUEL, BULACAN, petitioner,
vs.
HONORABLE OSCAR C. FERNANDEZ, in his capacity as the Presiding Judge, Branch IV,
Baliuag, Bulacan, The PROVINCIAL SHERIFF of Bulacan, MARGARITA D. VDA. DE IMPERIO,
ADORACION IMPERIO, RODOLFO IMPERIO, CONRADO IMPERIO, ERNESTO IMPERIO,
ALFREDO IMPERIO, CARLOS IMPERIO, JR., JUAN IMPERIO and SPOUSES MARCELO PINEDA
and LUCILA PONGCO, respondents.
Pascual C. Liatchko for petitioner.
The Solicitor General and Marcelo Pineda for respondents.
RELOVA, J.:
In Civil Case No. 604-B, entitled "Margarita D. Vda. de Imperio, et al. vs. Municipal
Government of San Miguel, Bulacan, et al.", the then Court of First Instance of Bulacan,
on April 28, 1978, rendered judgment holding herein petitioner municipality liable to
private respondents, as follows:
WHEREFORE, premises considered, judgment is hereby rendered in
favor of the plaintiffs and against the defendant Municipal Government
of San Miguel Bulacan, represented by Mayor Mar Marcelo G. Aure and
its Municipal Treasurer:
1. ordering the partial revocation of the Deed of Donation signed by the
deceased Carlos Imperio in favor of the Municipality of San Miguel
Bulacan, dated October 27, 1947 insofar as Lots Nos. 1, 2, 3, 4 and 5,
Block 11 of Subdivision Plan Psd-20831 are concerned, with an
aggregate total area of 4,646 square meters, which lots are among
those covered and described under TCT No. T-1831 of the Register of
Deeds of Bulacan in the name of the Municipal Government of San
Miguel Bulacan,
2. ordering the defendant to execute the corresponding Deed of
Reconveyance over the aforementioned five lots in favor of the
plaintiffs in the proportion of the undivided one-half (½) share in the
name of plaintiffs Margarita D. Vda. de Imperio, Adoracion, Rodolfo,
Conrado, Ernesto, Alfredo, Carlos, Jr. and Juan, all surnamed Imperio,
and the remaining undivided one-half (½) share in favor of plaintiffs
uses Marcelo E. Pineda and Lucila Pongco;
3. ordering the defendant municipality to pay to the plaintiffs in the
proportion mentioned in the immediately preceding paragraph the sum
of P64,440.00 corresponding to the rentals it has collected from the
occupants for their use and occupation of the premises from 1970 up
to and including 1975, plus interest thereon at the legal rate from
January 1970 until fully paid;
4. ordering the restoration of ownership and possession over the five
lots in question in favor of the plaintiffs in the same proportion
aforementioned;
5. ordering the defendant to pay the plaintiffs the sum of P3,000.00 for
attomey's fees; and to pay the cost of suit.
The counterclaim of the defendant is hereby ordered dismissed for lack
of evidence presented to substantiate the same.
SO ORDERED. (pp. 11-12, Rollo)
The foregoing judgment became final when herein petitioner's appeal was dismissed due
to its failure to file the record on appeal on time. The dismissal was affirmed by the then
Court of Appeals in CA-G.R. No. SP-12118 and by this Court in G.R. No. 59938. Thereafter,
herein private respondents moved for issuance of a writ of execution for the satisfaction
of the judgment. Respondent judge, on July 27, 1982, issued an order, to wit:
Considering that an entry of judgment had already been made on June
14, 1982 in G. R. No. L-59938 and;
 Considering further that there is no opposition to plaintiffs' motion for
execution dated July 23, 1983;
Let a writ of execution be so issued, as prayed for in the aforestated
motion. (p. 10, Rollo)
Petitioner, on July 30, 1982, filed a Motion to Quash the writ of execution on the ground
that the municipality's property or funds are all public funds exempt from execution. The
said motion to quash was, however, denied by the respondent judge in an order dated
August 23, 1982 and the alias writ of execution stands in full force and effect.
On September 13, 1982, respondent judge issued an order which in part, states:
It is clear and evident from the foregoing that defendant has more than
enough funds to meet its judgment obligation. Municipal Treasurer
Miguel C, Roura of San Miguel, Bulacan and Provincial Treasurer of
Bulacan Agustin O. Talavera are therefor hereby ordered to comply
with the money judgment rendered by Judge Agustin C. Bagasao
against said municipality. In like manner, the municipal authorities of
San Miguel, Bulacan are likewise ordered to desist from plaintiffs' legal
possession of the property already returned to plaintiffs by virtue of the
alias writ of execution.
Finally, defendants are hereby given an inextendible period of ten (10)
days from receipt of a copy of this order by the Office of the Provincial
Fiscal of Bulacan within which to submit their written compliance, (p.
24, Rollo)
When the treasurers (provincial and municipal) failed to comply with the order of
September 13, 1982, respondent judge issued an order for their arrest and that they will
be release only upon compliance thereof.
Hence, the present petition on the issue whether the funds of the Municipality of San
Miguel, Bulacan, in the hands of the provincial and municipal treasurers of Bulacan and
San Miguel, respectively, are public funds which are exempt from execution for the
satisfaction of the money judgment in Civil Case No. 604-B.
Well settled is the rule that public funds are not subject to levy and execution. The reason
for this was explained in the case of Municipality of Paoay vs. Manaois, 86 Phil. 629 "that
they are held in trust for the people, intended and used for the accomplishment of the
purposes for which municipal corporations are created, and that to subject said
properties and public funds to execution would materially impede, even defeat and in
some instances destroy said purpose." And, in Tantoco vs. Municipal Council of Iloilo, 49
Phil. 52, it was held that "it is the settled doctrine of the law that not only the public
property but also the taxes and public revenues of such corporations Cannot be seized
under execution against them, either in the treasury or when in transit to it. Judgments
rendered for taxes, and the proceeds of such judgments in the hands of officers of the
law, are not subject to execution unless so declared by statute." Thus, it is clear that all
the funds of petitioner municipality in the possession of the Municipal Treasurer of San
Miguel, as well as those in the possession of the Provincial Treasurer of Bulacan, are also
public funds and as such they are exempt from execution.
Besides, Presidential Decree No. 477, known as "The Decree on Local Fiscal
Administration", Section 2 (a), provides:
SEC. 2. Fundamental Principles. — Local government financial affairs,
transactions, and operations shall be governed by the fundamental
principles set forth hereunder:
(a) No money shall be paid out of the treasury except in pursuance of a
lawful appropriation or other specific statutory authority.
xxx xxx xxx
Otherwise stated, there must be a corresponding appropriation in the form of an
ordinance duly passed by the Sangguniang Bayan before any money of the municipality
may be paid out. In the case at bar, it has not been shown that the Sangguniang Bayan
has passed an ordinance to this effect.
Furthermore, Section 15, Rule 39 of the New Rules of Court, outlines the procedure for
the enforcement of money judgment:
(a) By levying on all the property of the debtor, whether real or
personal, not otherwise exempt from execution, or only on such part of
the property as is sufficient to satisfy the judgment and accruing cost, if
he has more than sufficient property for the purpose;
(b) By selling the property levied upon;
 (c) By paying the judgment-creditor so much of the proceeds as will
satisfy the judgment and accruing costs; and

(d) By delivering to the judgment-debtor the excess, if any, unless

otherwise, directed by judgment or order of the court.

The foregoing has not been followed in the case at bar.

ACCORDINGLY, the petition is granted and the order of respondent judge, dated July 27,
1982, granting issuance of a writ of execution; the alias writ of execution, dated July 27,
1982; and the order of respondent judge, dated September 13, 1982, directing the
Provincial Treasurer of Bulacan and the Municipal Treasurer of San Miguel, Bulacan to
comply with the money judgments, are SET ASIDE; and respondents are hereby enjoined
from implementing the writ of execution.

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila

THIRD DIVISION

G.R. Nos. 89898-99 October 1, 1990

MUNICIPALITY OF MAKATI, petitioner,

vs.
THE HONORABLE COURT OF APPEALS, HON. SALVADOR P. DE GUZMAN, JR., as Judge RTC of
Makati, Branch CXLII ADMIRAL FINANCE CREDITORS CONSORTIUM, INC., and SHERIFF
SILVINO R. PASTRANA, respondents.
Defante & Elegado for petitioner.
Roberto B. Lugue for private respondent Admiral Finance Creditors' Consortium, Inc.
RESOLUTION
CORTÉS, J.:
The present petition for review is an off-shoot of expropriation proceedings initiated by
petitioner Municipality of Makati against private respondent Admiral Finance Creditors
Consortium, Inc., Home Building System & Realty Corporation and one Arceli P. Jo,
involving a parcel of land and improvements thereon located at Mayapis St., San Antonio
Village, Makati and registered in the name of Arceli P. Jo under TCT No. S-5499.
It appears that the action for eminent domain was filed on May 20, 1986, docketed as
Civil Case No. 13699. Attached to petitioner's complaint was a certification that a bank
account (Account No. S/A 265-537154-3) had been opened with the PNB Buendia Branch
under petitioner's name containing the sum of P417,510.00, made pursuant to the
provisions of Pres. Decree No. 42. After due hearing where the parties presented their
respective appraisal reports regarding the value of the property, respondent RTC judge
rendered a decision on June 4, 1987, fixing the appraised value of the property at
P5,291,666.00, and ordering petitioner to pay this amount minus the advanced payment
of P338,160.00 which was earlier released to private respondent.
After this decision became final and executory, private respondent moved for the
issuance of a writ of execution. This motion was granted by respondent RTC judge. After
issuance of the writ of execution, a Notice of Garnishment dated January 14, 1988 was
served by respondent sheriff Silvino R. Pastrana upon the manager of the PNB Buendia
Branch. However, respondent sheriff was informed that a "hold code" was placed on the
account of petitioner. As a result of this, private respondent filed a motion dated January
27, 1988 praying that an order be issued directing the bank to deliver to respondent
sheriff the amount equivalent to the unpaid balance due under the RTC decision dated
June 4, 1987.
Petitioner filed a motion to lift the garnishment, on the ground that the manner of
payment of the expropriation amount should be done in installments which the
respondent RTC judge failed to state in his decision. Private respondent filed its
opposition to the motion.
Pending resolution of the above motions, petitioner filed on July 20, 1988 a
"Manifestation" informing the court that private respondent was no longer the true and
lawful owner of the subject property because a new title over the property had been
registered in the name of Philippine Savings Bank, Inc. (PSB) Respondent RTC judge issued
an order requiring PSB to make available the documents pertaining to its transactions
over the subject property, and the PNB Buendia Branch to reveal the amount in
petitioner's account which was garnished by respondent sheriff. In compliance with this
order, PSB filed a manifestation informing the court that it had consolidated its ownership
over the property as mortgagee/purchaser at an extrajudicial foreclosure sale held on
April 20, 1987. After several conferences, PSB and private respondent entered into a
compromise agreement whereby they agreed to divide between themselves the
compensation due from the expropriation proceedings.
Respondent trial judge subsequently issued an order dated September 8, 1988 which: (1)
approved the compromise agreement; (2) ordered PNB Buendia Branch to immediately
release to PSB the sum of P4,953,506.45 which corresponds to the balance of the
appraised value of the subject property under the RTC decision dated June 4, 1987, from
the garnished account of petitioner; and, (3) ordered PSB and private respondent to
execute the necessary deed of conveyance over the subject property in favor of
petitioner. Petitioner's motion to lift the garnishment was denied.
Petitioner filed a motion for reconsideration, which was duly opposed by private
respondent. On the other hand, for failure of the manager of the PNB Buendia Branch to
comply with the order dated September 8, 1988, private respondent filed two succeeding
motions to require the bank manager to show cause why he should not be held in
contempt of court. During the hearings conducted for the above motions, the general
manager of the PNB Buendia Branch, a Mr. Antonio Bautista, informed the court that he
was still waiting for proper authorization from the PNB head office enabling him to make
a disbursement for the amount so ordered. For its part, petitioner contended that its
funds at the PNB Buendia Branch could neither be garnished nor levied upon execution,
for to do so would result in the disbursement of public funds without the proper
appropriation required under the law, citing the case of Republic of the Philippines v.
Palacio [G.R. No. L-20322, May 29, 1968, 23 SCRA 899].
Respondent trial judge issued an order dated December 21, 1988 denying petitioner's
motion for reconsideration on the ground that the doctrine enunciated in Republic v.
Palacio did not apply to the case because petitioner's PNB Account No. S/A 265-537154-3
was an account specifically opened for the expropriation proceedings of the subject
property pursuant to Pres. Decree No. 42. Respondent RTC judge likewise declared Mr.
Antonio Bautista guilty of contempt of court for his inexcusable refusal to obey the order
dated September 8, 1988, and thus ordered his arrest and detention until his compliance
with the said order.
Petitioner and the bank manager of PNB Buendia Branch then filed separate petitions
for certiorari with the Court of Appeals, which were eventually consolidated. In a decision
promulgated on June 28, 1989, the Court of Appeals dismissed both petitions for lack of
merit, sustained the jurisdiction of respondent RTC judge over the funds contained in
petitioner's PNB Account No. 265-537154-3, and affirmed his authority to levy on such
funds.
Its motion for reconsideration having been denied by the Court of Appeals, petitioner
now files the present petition for review with prayer for preliminary injunction.
On November 20, 1989, the Court resolved to issue a temporary restraining order
enjoining respondent RTC judge, respondent sheriff, and their representatives, from
enforcing and/or carrying out the RTC order dated December 21, 1988 and the writ of
garnishment issued pursuant thereto. Private respondent then filed its comment to the
petition, while petitioner filed its reply.
Petitioner not only reiterates the arguments adduced in its petition before the Court of
Appeals, but also alleges for the first time that it has actually two accounts with the PNB
Buendia Branch, to wit:
xxx xxx xxx
(1) Account No. S/A 265-537154-3 — exclusively for the expropriation
of the subject property, with an outstanding balance of P99,743.94.
(2) Account No. S/A 263-530850-7 — for statutory obligations and
other purposes of the municipal government, with a balance of
P170,098,421.72, as of July 12, 1989.
xxx xxx xxx
[Petition, pp. 6-7; Rollo, pp. 11-12.]
Because the petitioner has belatedly alleged only in this Court the existence of two bank
accounts, it may fairly be asked whether the second account was opened only for the
purpose of undermining the legal basis of the assailed orders of respondent RTC judge
and the decision of the Court of Appeals, and strengthening its reliance on the doctrine
that public funds are exempted from garnishment or execution as enunciated in Republic
v. Palacio [supra.] At any rate, the Court will give petitioner the benefit of the doubt, and
proceed to resolve the principal issues presented based on the factual circumstances thus
alleged by petitioner.
Admitting that its PNB Account No. S/A 265-537154-3 was specifically opened for
expropriation proceedings it had initiated over the subject property, petitioner poses no
objection to the garnishment or the levy under execution of the funds deposited therein
amounting to P99,743.94. However, it is petitioner's main contention that inasmuch as
the assailed orders of respondent RTC judge involved the net amount of P4,965,506.45,
the funds garnished by respondent sheriff in excess of P99,743.94, which are public funds
earmarked for the municipal government's other statutory obligations, are exempted
from execution without the proper appropriation required under the law.
There is merit in this contention. The funds deposited in the second PNB Account No. S/A
263-530850-7 are public funds of the municipal government. In this jurisdiction, well-
settled is the rule that public funds are not subject to levy and execution, unless
otherwise provided for by statute [Republic v. Palacio, supra.; The Commissioner of Public
Highways v. San Diego, G.R. No. L-30098, February 18, 1970, 31 SCRA 616]. More
particularly, the properties of a municipality, whether real or personal, which are
necessary for public use cannot be attached and sold at execution sale to satisfy a money
judgment against the municipality. Municipal revenues derived from taxes, licenses and
market fees, and which are intended primarily and exclusively for the purpose of
financing the governmental activities and functions of the municipality, are exempt from
execution [See Viuda De Tan Toco v. The Municipal Council of Iloilo, 49 Phil. 52 (1926):
The Municipality of Paoay, Ilocos Norte v. Manaois, 86 Phil. 629 (1950); Municipality of
San Miguel, Bulacan v. Fernandez, G.R. No. 61744, June 25, 1984, 130 SCRA 56]. The
foregoing rule finds application in the case at bar. Absent a showing that the municipal
council of Makati has passed an ordinance appropriating from its public funds an amount
corresponding to the balance due under the RTC decision dated June 4, 1987, less the
sum of P99,743.94 deposited in Account No. S/A 265-537154-3, no levy under execution
may be validly effected on the public funds of petitioner deposited in Account No. S/A
263-530850-7.
Nevertheless, this is not to say that private respondent and PSB are left with no legal
recourse. Where a municipality fails or refuses, without justifiable reason, to effect
payment of a final money judgment rendered against it, the claimant may avail of the
remedy of mandamus in order to compel the enactment and approval of the necessary
appropriation ordinance, and the corresponding disbursement of municipal funds
therefor [See Viuda De Tan Toco v. The Municipal Council of Iloilo, supra; Baldivia v. Lota,
107 Phil. 1099 (1960); Yuviengco v. Gonzales, 108 Phil. 247 (1960)].
In the case at bar, the validity of the RTC decision dated June 4, 1987 is not disputed by
petitioner. No appeal was taken therefrom. For three years now, petitioner has enjoyed
possession and use of the subject property notwithstanding its inexcusable failure to
comply with its legal obligation to pay just compensation. Petitioner has benefited from
its possession of the property since the same has been the site of Makati West High
School since the school year 1986-1987. This Court will not condone petitioner's blatant
refusal to settle its legal obligation arising from expropriation proceedings it had in fact
initiated. It cannot be over-emphasized that, within the context of the State's inherent
power of eminent domain,
. . . [j]ust compensation means not only the correct determination of
the amount to be paid to the owner of the land but also the payment of
the land within a reasonable time from its taking. Without prompt
payment, compensation cannot be considered "just" for the property
owner is made to suffer the consequence of being immediately
deprived of his land while being made to wait for a decade or more
before actually receiving the amount necessary to cope with his loss
[Cosculluela v. The Honorable Court of Appeals, G.R. No. 77765, August
15, 1988, 164 SCRA 393, 400. See also Provincial Government of
Sorsogon v. Vda. de Villaroya, G.R. No. 64037, August 27, 1987, 153
SCRA 291].
The State's power of eminent domain should be exercised within the bounds of fair play
and justice. In the case at bar, considering that valuable property has been taken, the
compensation to be paid fixed and the municipality is in full possession and utilizing the
property for public purpose, for three (3) years, the Court finds that the municipality has
had more than reasonable time to pay full compensation.
WHEREFORE, the Court Resolved to ORDER petitioner Municipality of Makati to
immediately pay Philippine Savings Bank, Inc. and private respondent the amount of
P4,953,506.45. Petitioner is hereby required to submit to this Court a report of its
compliance with the foregoing order within a non-extendible period of SIXTY (60) DAYS
from the date of receipt of this resolution.
The order of respondent RTC judge dated December 21, 1988, which was rendered in
Civil Case No. 13699, is SET ASIDE and the temporary restraining order issued by the
Court on November 20, 1989 is MADE PERMANENT.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 206510 September 16, 2014
MOST REV. PEDRO D. ARIGO, Vicar Apostolic of Puerto Princesa D.D.; MOST REV.
DEOGRACIAS S. INIGUEZ, JR., Bishop-Emeritus of Caloocan, FRANCES Q. QUIMPO,
CLEMENTE G. BAUTISTA, JR., Kalikasan-PNE, MARIA CAROLINA P. ARAULLO, RENATO M.
REYES, JR., Bagong Alyansang Makabayan, HON. NERI JAVIER COLMENARES, Bayan Muna
Partylist, ROLAND G. SIMBULAN, PH.D., Junk VF A Movement, TERESITA R. PEREZ, PH.D.,
HON. RAYMOND V. PALATINO, Kabataan Party-list, PETER SJ. GONZALES, Pamalakaya,
GIOVANNI A. TAPANG, PH. D., Agham, ELMER C. LABOG, Kilusang Mayo Uno, JOAN MAY E.
SALVADOR, Gabriela, JOSE ENRIQUE A. AFRICA, THERESA A. CONCEPCION, MARY JOAN A.
GUAN, NESTOR T. BAGUINON, PH.D., A. EDSEL F. TUPAZ, Petitioners,
vs.
SCOTT H. SWIFT in his capacity as Commander of the US. 7th Fleet, MARK A. RICE in his
capacity as Commanding Officer of the USS Guardian, PRESIDENT BENIGNO S. AQUINO III in
his capacity as Commander-in-Chief of the Armed Forces of the Philippines, HON. ALBERT F.
DEL ROSARIO, Secretary, pepartment of Foreign Affair.s, HON. PAQUITO OCHOA, JR.,
Executiv~.:Secretary, Office of the President, . HON. VOLTAIRE T. GAZMIN, Secretary,
Department of National Defense, HON. RAMON JESUS P. P AJE, Secretary, Department of
Environment and Natural Resoz!rces, VICE ADMIRAL JOSE LUIS M. ALANO, Philippine Navy
Flag Officer in Command, Armed Forces of the Philippines, ADMIRAL RODOLFO D. ISO
RENA, Commandant, Philippine Coast Guard, COMMODORE ENRICO EFREN EVANGELISTA,
Philippine Coast Guard Palawan, MAJOR GEN. VIRGILIO 0. DOMINGO, Commandant of
Armed Forces of the Philippines Command and LT. GEN. TERRY G. ROBLING, US Marine
Corps Forces. Pacific and Balikatan 2013 Exercise Co-Director, Respondents.
DECISION
VILLARAMA, JR, J.:
Before us is a petition for the issuance of a Writ of Kalikasan with prayer for the issuance
of a Temporary Environmental Protection Order (TEPO) under Rule 7 of A.M. No. 09-6-8-
SC, otherwise known as the Rules of Procedure for Environmental Cases (Rules), involving
violations of environmental laws and regulations in relation to the grounding of the US
military ship USS Guardian over the Tubbataha Reefs.
Factual Background
The name "Tubbataha" came from the Samal (seafaring people of southern Philippines)
language which means "long reef exposed at low tide." Tubbataha is composed of two
huge coral atolls - the north atoll and the south atoll - and the Jessie Beazley Reef, a
smaller coral structure about 20 kilometers north of the atolls. The reefs of Tubbataha
and Jessie Beazley are considered part of Cagayancillo, a remote island municipality of
Palawan.1
In 1988, Tubbataha was declared a National Marine Park by virtue of Proclamation No.
306 issued by President Corazon C. Aquino on August 11, 1988. Located in the middle of
Central Sulu Sea, 150 kilometers southeast of Puerto Princesa City, Tubbataha lies at the
heart of the Coral Triangle, the global center of marine biodiversity.
In 1993, Tubbataha was inscribed by the United Nations Educational Scientific and
Cultural Organization (UNESCO) as a World Heritage Site. It was recognized as one of the
Philippines' oldest ecosystems, containing excellent examples of pristine reefs and a high
diversity of marine life. The 97,030-hectare protected marine park is also an important
habitat for internationally threatened and endangered marine species. UNESCO cited
Tubbataha's outstanding universal value as an important and significant natural habitat
for in situ conservation of biological diversity; an example representing significant on-
going ecological and biological processes; and an area of exceptional natural beauty and
aesthetic importance.2
On April 6, 2010, Congress passed Republic Act (R.A.) No. 10067,3 otherwise known as the
"Tubbataha Reefs Natural Park (TRNP) Act of 2009" "to ensure the protection and
conservation of the globally significant economic, biological, sociocultural, educational
and scientific values of the Tubbataha Reefs into perpetuity for the enjoyment of present
and future generations." Under the "no-take" policy, entry into the waters of TRNP is
strictly regulated and many human activities are prohibited and penalized or fined,
including fishing, gathering, destroying and disturbing the resources within the TRNP. The
law likewise created the Tubbataha Protected Area Management Board (TPAMB) which
shall be the sole policy-making and permit-granting body of the TRNP.
The USS Guardian is an Avenger-class mine countermeasures ship of the US Navy. In
December 2012, the US Embassy in the Philippines requested diplomatic clearance for
the said vessel "to enter and exit the territorial waters of the Philippines and to arrive at
the port of Subic Bay for the purpose of routine ship replenishment, maintenance, and
crew liberty."4 On January 6, 2013, the ship left Sasebo, Japan for Subic Bay, arriving on
January 13, 2013 after a brief stop for fuel in Okinawa, Japan.1âwphi1
On January 15, 2013, the USS Guardian departed Subic Bay for its next port of call in
Makassar, Indonesia. On January 17, 2013 at 2:20 a.m. while transiting the Sulu Sea, the
ship ran aground on the northwest side of South Shoal of the Tubbataha Reefs, about 80
miles east-southeast of Palawan. No cine was injured in the incident, and there have been
no reports of leaking fuel or oil.
On January 20, 2013, U.S. 7th Fleet Commander, Vice Admiral Scott Swift, expressed
regret for the incident in a press statement.5 Likewise, US Ambassador to the Philippines
Harry K. Thomas, Jr., in a meeting at the Department of Foreign Affairs (DFA) on February
4, "reiterated his regrets over the grounding incident and assured Foreign Affairs
Secretazy Albert F. del Rosario that the United States will provide appropriate
compensation for damage to the reef caused by the ship."6 By March 30, 2013, the US
Navy-led salvage team had finished removing the last piece of the grounded ship from the
coral reef.
On April 1 7, 2013, the above-named petitioners on their behalf and in representation of
their respective sector/organization and others, including minors or generations yet
unborn, filed the present petition agairtst Scott H. Swift in his capacity as Commander of
the US 7th Fleet, Mark A. Rice in his capacity as Commanding Officer of the USS Guardian
and Lt. Gen. Terry G. Robling, US Marine Corps Forces, Pacific and Balikatan 2013
Exercises Co-Director ("US respondents"); President Benigno S. Aquino III in his capacity
as Commander-in-Chief of the Armed Forces of the Philippines (AFP), DF A Secretary
Albert F. Del Rosario, Executive Secretary Paquito Ochoa, Jr., Secretary Voltaire T. Gazmin
(Department of National Defense), Secretary Jesus P. Paje (Department of Environment
and Natural Resources), Vice-Admiral Jose Luis M. Alano (Philippine Navy Flag Officer in
Command, AFP), Admiral Rodolfo D. Isorena (Philippine Coast Guard Commandant),
Commodore Enrico Efren Evangelista (Philippine Coast Guard-Palawan), and Major
General Virgilio 0. Domingo (AFP Commandant), collectively the "Philippine respondents."
The Petition
Petitioners claim that the grounding, salvaging and post-salvaging operations of the USS
Guardian cause and continue to cause environmental damage of such magnitude as to
affect the provinces of Palawan, Antique, Aklan, Guimaras, Iloilo, Negros Occidental,
Negros Oriental, Zamboanga del Norte, Basilan, Sulu, and Tawi-Tawi, which events violate
their constitutional rights to a balanced and healthful ecology. They also seek a directive
from this Court for the institution of civil, administrative and criminal suits for acts
committed in violation of environmental laws and regulations in connection with the
grounding incident.
Specifically, petitioners cite the following violations committed by US respondents under
R.A. No. 10067: unauthorized entry (Section 19); non-payment of conservation fees
(Section 21 ); obstruction of law enforcement officer (Section 30); damages to the reef
(Section 20); and destroying and disturbing resources (Section 26[g]). Furthermore,
petitioners assail certain provisions of the Visiting Forces Agreement (VFA) which they
want this Court to nullify for being unconstitutional.
The numerous reliefs sought in this case are set forth in the final prayer of the petition, to
wit: WHEREFORE, in view of the foregoing, Petitioners respectfully pray that the
Honorable Court: 1. Immediately issue upon the filing of this petition a Temporary
Environmental Protection Order (TEPO) and/or a Writ of Kalikasan, which shall, in
particular,
a. Order Respondents and any person acting on their behalf, to cease and desist
all operations over the Guardian grounding incident;
b. Initially demarcating the metes and bounds of the damaged area as well as an
additional buffer zone;
c. Order Respondents to stop all port calls and war games under 'Balikatan'
because of the absence of clear guidelines, duties, and liability schemes for
breaches of those duties, and require Respondents to assume responsibility for
prior and future environmental damage in general, and environmental damage
under the Visiting Forces Agreement in particular.
d. Temporarily define and describe allowable activities of ecotourism, diving,
recreation, and limited commercial activities by fisherfolk and indigenous
communities near or around the TRNP but away from the damaged site and an
additional buffer zone;
2. After summary hearing, issue a Resolution extending the TEPO until further
orders of the Court;
3. After due proceedings, render a Decision which shall include, without
limitation:
a. Order Respondents Secretary of Foreign Affairs, following the dispositive
portion of Nicolas v. Romulo, "to forthwith negotiate with the United States
representatives for the appropriate agreement on [environmental guidelines and
environmental accountability] under Philippine authorities as provided in Art. V[]
of the VFA ... "
b. Direct Respondents and appropriate agencies to commence administrative,
civil, and criminal proceedings against erring officers and individuals to the full
extent of the law, and to make such proceedings public;
c. Declare that Philippine authorities may exercise primary and exclusive criminal
jurisdiction over erring U.S. personnel under the circumstances of this case;
d. Require Respondents to pay just and reasonable compensation in the
settlement of all meritorious claims for damages caused to the Tubbataha Reef
on terms and conditions no less severe than those applicable to other States,
and damages for personal injury or death, if such had been the case;
e. Direct Respondents to cooperate in providing for the attendance of witnesses
and in the collection and production of evidence, including seizure and delivery
of objects connected with the offenses related to the grounding of the Guardian;
f. Require the authorities of the Philippines and the United States to notify each
other of the disposition of all cases, wherever heard, related to the grounding of
the Guardian;
g. Restrain Respondents from proceeding with any purported restoration, repair,
salvage or post salvage plan or plans, including cleanup plans covering the
damaged area of the Tubbataha Reef absent a just settlement approved by the
Honorable Court;
h. Require Respondents to engage in stakeholder and LOU consultations in
accordance with the Local Government Code and R.A. 10067;
i. Require Respondent US officials and their representatives to place a deposit to
the TRNP Trust Fund defined under Section 17 of RA 10067 as a bona .fide
gesture towards full reparations;
j. Direct Respondents to undertake measures to rehabilitate the areas affected
by the grounding of the Guardian in light of Respondents' experience in the Port
Royale grounding in 2009, among other similar grounding incidents;
k. Require Respondents to regularly publish on a quarterly basis and in the name
of transparency and accountability such environmental damage assessment,
valuation, and valuation methods, in all stages of negotiation;
l. Convene a multisectoral technical working group to provide scientific and
technical support to the TPAMB;
m. Order the Department of Foreign Affairs, Department of National Defense,
and the Department of Environment and Natural Resources to review the
Visiting Forces Agreement and the Mutual Defense Treaty to consider whether
their provisions allow for the exercise of erga omnes rights to a balanced and
healthful ecology and for damages which follow from any violation of those
rights;
n. Narrowly tailor the provisions of the Visiting Forces Agreement for purposes
of protecting the damaged areas of TRNP;
o. Declare the grant of immunity found in Article V ("Criminal Jurisdiction") and
Article VI of the Visiting Forces Agreement unconstitutional for violating equal
protection and/or for violating the preemptory norm of nondiscrimination
incorporated as part of the law of the land under Section 2, Article II, of the
Philippine Constitution;
p. Allow for continuing discovery measures;
q. Supervise marine wildlife rehabilitation in the Tubbataha Reefs in all other
respects; and
4. Provide just and equitable environmental rehabilitation measures and such
other reliefs as are just and equitable under the premises.7 (Underscoring
supplied.)
Since only the Philippine respondents filed their comment8 to the petition, petitioners
also filed a motion for early resolution and motion to proceed ex parte against the US
respondents.9
Respondents' Consolidated Comment
In their consolidated comment with opposition to the application for a TEPO and ocular
inspection and production orders, respondents assert that: ( 1) the grounds relied upon
for the issuance of a TEPO or writ of Kalikasan have become fait accompli as the salvage
operations on the USS Guardian were already completed; (2) the petition is defective in
form and substance; (3) the petition improperly raises issues involving the VFA between
the Republic of the Philippines and the United States of America; and ( 4) the
determination of the extent of responsibility of the US Government as regards the
damage to the Tubbataha Reefs rests exdusively with the executive branch.
The Court's Ruling
As a preliminary matter, there is no dispute on the legal standing of petitioners to file the
present petition.
Locus standi is "a right of appearance in a court of justice on a given
question."10 Specifically, it is "a party's personal and substantial interest in a case where
he has sustained or will sustain direct injury as a result" of the act being challenged, and
"calls for more than just a generalized grievance."11 However, the rule on standing is a
procedural matter which this Court has relaxed for non-traditional plaintiffs like ordinary
citizens, taxpayers and legislators when the public interest so requires, such as when the
subject matter of the controversy is of transcendental importance, of overreaching
significance to society, or of paramount public interest.12
In the landmark case of Oposa v. Factoran, Jr.,13 we recognized the "public right" of
citizens to "a balanced and healthful ecology which, for the first time in our constitutional
history, is solemnly incorporated in the fundamental law." We declared that the right to a
balanced and healthful ecology need not be written in the Constitution for it is assumed,
like other civil and polittcal rights guaranteed in the Bill of Rights, to exist from the
inception of mankind and it is an issue of transcendental importance with
intergenerational implications.1âwphi1 Such right carries with it the correlative duty to
refrain from impairing the environment.14
On the novel element in the class suit filed by the petitioners minors in Oposa, this Court
ruled that not only do ordinary citizens have legal standing to sue for the enforcement of
environmental rights, they can do so in representation of their own and future
generations. Thus:
Petitioners minors assert that they represent their generation as well as generations yet
unborn. We find no difficulty in ruling that they can, for themselves, for others of their
generation and for the succeeding generations, file a class suit. Their personality to sue in
behalf of the succeeding generations can only be based on the concept of
intergenerational responsibility insofar as the right to a balanced and healthful ecology is
concerned. Such a right, as hereinafter expounded, considers the "rhythm and harmony
of nature." Nature means the created world in its entirety. Such rhythm and harmony
indispensably include, inter alia, the judicious disposition, utilization, management,
renewal and conservation of the country's forest, mineral, land, waters, fisheries, wildlife,
off-shore areas and other natural resources to the end that their exploration,
development and utilization be equitably accessible to the present a:: well as future
generations. Needless to say, every generation has a responsibility to the next to preserve
that rhythm and harmony for the full 1:njoyment of a balanced and healthful ecology. Put
a little differently, the minors' assertion of their right to a sound environment constitutes,
at the same time, the performance of their obligation to ensure the protection of that
right for the generations to come.15 (Emphasis supplied.)
The liberalization of standing first enunciated in Oposa, insofar as it refers to minors and
generations yet unborn, is now enshrined in the Rules which allows the filing of a citizen
suit in environmental cases. The provision on citizen suits in the Rules "collapses the
traditional rule on personal and direct interest, on the principle that humans are stewards
of nature."16
Having settled the issue of locus standi, we shall address the more fundamental question
of whether this Court has jurisdiction over the US respondents who did not submit any
pleading or manifestation in this case.
The immunity of the State from suit, known also as the doctrine of sovereign immunity or
non-suability of the State,17is expressly provided in Article XVI of the 1987 Constitution
which states:
Section 3. The State may not be sued without its consent.
In United States of America v. Judge Guinto,18 we discussed the principle of state
immunity from suit, as follows:
The rule that a state may not be sued without its consent, now · expressed in Article XVI,
Section 3, of the 1987 Constitution, is one of the generally accepted principles of
international law that we have adopted as part of the law of our land under Article II,
Section 2. x x x.
Even without such affirmation, we would still be bound by the generally accepted
principles of international law under the doctrine of incorporation. Under this doctrine, as
accepted by the majority of states, such principles are deemed incorporated in the law of
every civilized state as a condition and consequence of its membership in the society of
nations. Upon its admission to such society, the state is automatically obligated to comply
with these principles in its relations with other states.
As applied to the local state, the doctrine of state immunity is based on the justification
given by Justice Holmes that ''there can be no legal right against the authority which
makes the law on which the right depends." [Kawanakoa v. Polybank, 205 U.S. 349] There
are other practical reasons for the enforcement of the doctrine. In the case of the foreign
state sought to be impleaded in the local jurisdiction, the added inhibition is expressed in
the maxim par in parem, non habet imperium. All states are sovereign equals and cannot
assert jurisdiction over one another. A contrary disposition would, in the language of a
celebrated case, "unduly vex the peace of nations." [De Haber v. Queen of Portugal, 17 Q.
B. 171]
While the doctrine appears to prohibit only suits against the state without its consent, it is
also applicable to complaints filed against officials of the state for acts allegedly
performed by them in the discharge of their duties. The rule is that if the judgment
against such officials will require the state itself to perform an affirmative act to satisfy
the same,. such as the appropriation of the amount needed to pay the damages awarded
against them, the suit must be regarded as against the state itself although it has not
been formally impleaded. [Garcia v. Chief of Staff, 16 SCRA 120] In such a situation, the
state may move to dismiss the comp.taint on the ground that it has been filed without its
consent.19 (Emphasis supplied.)
Under the American Constitution, the doctrine is expressed in the Eleventh Amendment
which reads:
The Judicial power of the United States shall not be construed to extend to any suit in law
or equity, commenced or prosecuted against one of the United States by Citizens of
another State, or by Citizens or Subjects of any Foreign State.
In the case of Minucher v. Court of Appeals,20 we further expounded on the immunity of
foreign states from the jurisdiction of local courts, as follows:
The precept that a State cannot be sued in the courts of a foreign state is a long-standing
rule of customary international law then closely identified with the personal immunity of
a foreign sovereign from suit and, with the emergence of democratic states, made to
attach not just to the person of the head of state, or his representative, but also distinctly
to the state itself in its sovereign capacity. If the acts giving rise to a suit arc those of a
foreign government done by its foreign agent, although not necessarily a diplomatic
personage, but acting in his official capacity, the complaint could be barred by the
immunity of the foreign sovereign from suit without its consent. Suing a representative of
a state is believed to be, in effect, suing the state itself. The proscription is not accorded
for the benefit of an individual but for the State, in whose service he is, under the maxim -
par in parem, non habet imperium -that all states are soverr~ign equals and cannot assert
jurisdiction over one another. The implication, in broad terms, is that if the judgment
against an official would rec 1uire the state itself to perform an affirmative act to satisfy
the award, such as the appropriation of the amount needed to pay the damages decreed
against him, the suit must be regarded as being against the state itself, although it has not
been formally impleaded.21 (Emphasis supplied.)
In the same case we also mentioned that in the case of diplomatic immunity, the privilege
is not an immunity from the observance of the law of the territorial sovereign or from
ensuing legal liability; it is, rather, an immunity from the exercise of territorial
jurisdiction.22
In United States of America v. Judge Guinto,23 one of the consolidated cases therein
involved a Filipino employed at Clark Air Base who was arrested following a buy-bust
operation conducted by two officers of the US Air Force, and was eventually dismissed
from his employment when he was charged in court for violation of R.A. No. 6425. In a
complaint for damages filed by the said employee against the military officers, the latter
moved to dismiss the case on the ground that the suit was against the US Government
which had not given its consent. The RTC denied the motion but on a petition for
certiorari and prohibition filed before this Court, we reversed the RTC and dismissed the
complaint. We held that petitioners US military officers were acting in the exercise of
their official functions when they conducted the buy-bust operation against the
complainant and thereafter testified against him at his trial. It follows that for discharging
their duties as agents of the United States, they cannot be directly impleaded for acts
imputable to their principal, which has not given its consent to be sued.
This traditional rule of State immunity which exempts a State from being sued in the
courts of another State without the former's consent or waiver has evolved into a
restrictive doctrine which distinguishes sovereign and governmental acts (Jure imperil")
from private, commercial and proprietary acts (Jure gestionis). Under the restrictive rule
of State immunity, State immunity extends only to acts Jure imperii. The restrictive
application of State immunity is proper only when the proceedings arise out of
commercial transactions of the foreign sovereign, its commercial activities or economic
affairs.24
In Shauf v. Court of Appeals,25 we discussed the limitations of the State immunity
principle, thus:
It is a different matter where the public official is made to account in his capacity as such
for acts contrary to law and injurious to the rights of plaintiff. As was clearly set forth by
JustiGe Zaldivar in Director of the Bureau of Telecommunications, et al. vs. Aligaen, etc.,
et al. : "Inasmuch as the State authorizes only legal acts by its officers, unauthorized acts
of government officials or officers are not acts of the State, and an action against the
officials or officers by one whose rights have been invaded or violated by such acts, for
the protection of his rights, is not a suit against the State within the rule of immunity of
the State from suit. In the same tenor, it has been said that an action at law or suit in
equity against a State officer or the director of a State department on the ground that,
while claiming to act for the State, he violates or invades the personal and property rights
of the plaintiff, under an unconstitutional act or under an assumption of authority which
he does not have, is not a suit against the State within the constitutional provision that
the State may not be sued without its consent." The rationale for this ruling is that the
doctrine of state immunity cannot be used as an instrument for perpetrating an injustice.
xxxx
The aforecited authorities are clear on the matter. They state that the doctrine of
immunity from suit will not apply and may not be invoked where the public official is
being sued in his private and personal capacity as an ordinary citizen. The cloak of
protection afforded the officers and agents of the government is removed the moment
they are sued in their individual capacity. This situation usually arises where the public
official acts without authority or in excess of the powers vested in him. It is a well-settled
principle of law that a public official may be liable in his personal private capacity for
whatever damage he may have caused by his act done with malice and in bad faith, or
beyond the scope of his authority or jurisdiction.26 (Emphasis supplied.) In this case, the
US respondents were sued in their official capacity as commanding officers of the US
Navy who had control and supervision over the USS Guardian and its crew. The alleged
act or omission resulting in the unfortunate grounding of the USS Guardian on the TRNP
was committed while they we:re performing official military duties. Considering that the
satisfaction of a judgment against said officials will require remedial actions and
appropriation of funds by the US government, the suit is deemed to be one against the
US itself. The principle of State immunity therefore bars the exercise of jurisdiction by this
Court over the persons of respondents Swift, Rice and Robling.
Insofar as the internal waters and territorial sea is concerned, the Coastal State exercises
sovereignty, subject to the UNCLOS and other rules of international law. Such sovereignty
extends to the air space over the territorial sea as well as to its bed and subsoil. 32
In the case of warships,33 as pointed out by Justice Carpio, they continue to enjoy
sovereign immunity subject to the following exceptions:

During the deliberations, Senior Associate Justice Antonio T. Carpio took the position that Article 30
the conduct of the US in this case, when its warship entered a restricted area in violation Non-compliance by warships with the laws and regulations of the coastal State
of R.A. No. 10067 and caused damage to the TRNP reef system, brings the matter within
the ambit of Article 31 of the United Nations Convention on the Law of the Sea (UNCLOS). If any warship does not comply with the laws and regulations of the coastal State
He explained that while historically, warships enjoy sovereign immunity from suit as concerning passage through the territorial sea and disregards any request for compliance
extensions of their flag State, Art. 31 of the UNCLOS creates an exception to this rule in therewith which is made to it, the coastal State may require it to leave the territorial sea
cases where they fail to comply with the rules and regulations of the coastal State immediately.
regarding passage through the latter's internal waters and the territorial sea.
Article 31
According to Justice Carpio, although the US to date has not ratified the UNCLOS, as a Responsibility of the flag State for damage caused by a warship
matter of long-standing policy the US considers itself bound by customary international
rules on the "traditional uses of the oceans" as codified in UNCLOS, as can be gleaned
or other government ship operated for non-commercial purposes
from previous declarations by former Presidents Reagan and Clinton, and the US judiciary
in the case of United States v. Royal Caribbean Cruise Lines, Ltd.27
The flag State shall bear international responsibility for any loss or damage to the coastal
State resulting from the non-compliance by a warship or other government ship operated
The international law of the sea is generally defined as "a body of treaty rules arid
for non-commercial purposes with the laws and regulations of the coastal State
customary norms governing the uses of the sea, the exploitation of its resources, and the
concerning passage through the territorial sea or with the provisions of this Convention
exercise of jurisdiction over maritime regimes. It is a branch of public international law,
or other rules of international law.
regulating the relations of states with respect to the uses of the oceans."28 The UNCLOS is
a multilateral treaty which was opened for signature on December 10, 1982 at Montego
Article 32
Bay, Jamaica. It was ratified by the Philippines in 1984 but came into force on November
Immunities of warships and other government ships operated for non-commercial
16, 1994 upon the submission of the 60th ratification.
purposes
The UNCLOS is a product of international negotiation that seeks to balance State
With such exceptions as are contained in subsection A and in articles 30 and 31, nothing
sovereignty (mare clausum) and the principle of freedom of the high seas (mare
in this Convention affects the immunities of warships and other government ships
liberum).29 The freedom to use the world's marine waters is one of the oldest customary
operated for non-commercial purposes. (Emphasis supplied.) A foreign warship's
principles of international law.30 The UNCLOS gives to the coastal State sovereign rights in
unauthorized entry into our internal waters with resulting damage to marine resources is
varying degrees over the different zones of the sea which are: 1) internal waters, 2)
one situation in which the above provisions may apply. But what if the offending warship
territorial sea, 3) contiguous zone, 4) exclusive economic zone, and 5) the high seas. It
is a non-party to the UNCLOS, as in this case, the US?
also gives coastal States more or less jurisdiction over foreign vessels depending on where
the vessel is located.31
An overwhelming majority - over 80% -- of nation states are now members of UNCLOS,
but despite this the US, the world's leading maritime power, has not ratified it.
While the Reagan administration was instrumental in UNCLOS' negotiation and drafting,
the U.S. delegation ultimately voted against and refrained from signing it due to concerns
over deep seabed mining technology transfer provisions contained in Part XI. In a
remarkable, multilateral effort to induce U.S. membership, the bulk of UNCLOS member
states cooperated over the succeeding decade to revise the objection.able provisions.
The revisions satisfied the Clinton administration, which signed the revised Part XI
implementing agreement in 1994. In the fall of 1994, President Clinton transmitted
UNCLOS and the Part XI implementing agreement to the Senate requesting its advice and
consent. Despite consistent support from President Clinton, each of his successors, and
an ideologically diverse array of stakeholders, the Senate has since withheld the consent
required for the President to internationally bind the United States to UNCLOS.
While UNCLOS cleared the Senate Foreign Relations Committee (SFRC) during the 108th
and 110th Congresses, its progress continues to be hamstrung by significant pockets of
political ambivalence over U.S. participation in international institutions. Most recently,
111 th Congress SFRC Chairman Senator John Kerry included "voting out" UNCLOS for full
Senate consideration among his highest priorities. This did not occur, and no Senate
action has been taken on UNCLOS by the 112th Congress.34
Justice Carpio invited our attention to the policy statement given by President Reagan on
March 10, 1983 that the US will "recognize the rights of the other , states in the waters
off their coasts, as reflected in the convention [UNCLOS], so long as the rights and
freedom of the United States and others under international law are recognized by such
coastal states", and President Clinton's reiteration of the US policy "to act in a manner
consistent with its [UNCLOS] provisions relating to traditional uses of the oceans and to
encourage other countries to do likewise." Since Article 31 relates to the "traditional uses
of the oceans," and "if under its policy, the US 'recognize[s] the rights of the other states
in the waters off their coasts,"' Justice Carpio postulates that "there is more reason to
expect it to recognize the rights of other states in their internal waters, such as the Sulu
Sea in this case."
As to the non-ratification by the US, Justice Carpio emphasizes that "the US' refusal to join
the UN CLOS was centered on its disagreement with UN CLOS' regime of deep seabed
mining (Part XI) which considers the oceans and deep seabed commonly owned by
mankind," pointing out that such "has nothing to do with its [the US'] acceptance of
customary international rules on navigation."
It may be mentioned that even the US Navy Judge Advocate General's Corps publicly
endorses the ratification of the UNCLOS, as shown by the following statement posted on
its official website:
The Convention is in the national interest of the United States because it establishes
stable maritime zones, including a maximum outer limit for territorial seas; codifies
innocent passage, transit passage, and archipelagic sea lanes passage rights; works
against "jurisdictiomtl creep" by preventing coastal nations from expanding their own
maritime zones; and reaffirms sovereign immunity of warships, auxiliaries anJ
government aircraft.
xxxx
Economically, accession to the Convention would support our national interests by
enhancing the ability of the US to assert its sovereign rights over the resources of one of
the largest continental shelves in the world. Further, it is the Law of the Sea Convention
that first established the concept of a maritime Exclusive Economic Zone out to 200
nautical miles, and recognized the rights of coastal states to conserve and manage the
natural resources in this Zone.35
We fully concur with Justice Carpio's view that non-membership in the UNCLOS does not
mean that the US will disregard the rights of the Philippines as a Coastal State over its
internal waters and territorial sea. We thus expect the US to bear "international
responsibility" under Art. 31 in connection with the USS Guardian grounding which
adversely affected the Tubbataha reefs. Indeed, it is difficult to imagine that our long-
time ally and trading partner, which has been actively supporting the country's efforts to
preserve our vital marine resources, would shirk from its obligation to compensate the
damage caused by its warship while transiting our internal waters. Much less can we
comprehend a Government exercising leadership in international affairs, unwilling to
comply with the UNCLOS directive for all nations to cooperate in the global task to
protect and preserve the marine environment as provided in Article 197, viz:
Article 197
Cooperation on a global or regional basis
States shall cooperate on a global basis and, as appropriate, on a regional basis, directly
or through competent international organizations, in formulating and elaborating
international rules, standards and recommended practices and procedures consistent
with this Convention, for the protection and preservation of the marine environment,
taking into account characteristic regional features.
In fine, the relevance of UNCLOS provisions to the present controversy is beyond dispute.
Although the said treaty upholds the immunity of warships from the jurisdiction of
Coastal States while navigating the.latter's territorial sea, the flag States shall be required
to leave the territorial '::;ea immediately if they flout the laws and regulations of the
Coastal State, and they will be liable for damages caused by their warships or any other
government vessel operated for non-commercial purposes under Article 31.
Petitioners argue that there is a waiver of immunity from suit found in the VFA. Likewise,
they invoke federal statutes in the US under which agencies of the US have statutorily
waived their immunity to any action. Even under the common law tort claims, petitioners
asseverate that the US respondents are liable for negligence, trespass and nuisance.
We are not persuaded.
The VFA is an agreement which defines the treatment of United States troops and
personnel visiting the Philippines to promote "common security interests" between the
US and the Philippines in the region. It provides for the guidelines to govern such visits of
military personnel, and further defines the rights of the United States and the Philippine
government in the matter of criminal jurisdiction, movement of vessel and aircraft,
importation and exportation of equipment, materials and supplies.36 The invocation of US
federal tort laws and even common law is thus improper considering that it is the VF A
which governs disputes involving US military ships and crew navigating Philippine waters
in pursuance of the objectives of the agreement.
As it is, the waiver of State immunity under the VF A pertains only to criminal jurisdiction
and not to special civil actions such as the present petition for issuance of a writ of
Kalikasan. In fact, it can be inferred from Section 17, Rule 7 of the Rules that a criminal
case against a person charged with a violation of an environmental law is to be filed
separately:
SEC. 17. Institution of separate actions.-The filing of a petition for the issuance of the writ
of kalikasan shall not preclude the filing of separate civil, criminal or administrative
actions.
In any case, it is our considered view that a ruling on the application or non-application of
criminal jurisdiction provisions of the VF A to US personnel who may be found responsible
for the grounding of the USS Guardian, would be premature and beyond the province of a
petition for a writ of Kalikasan. We also find it unnecessary at this point to determine
whether such waiver of State immunity is indeed absolute. In the same vein, we cannot
grant damages which have resulted from the violation of environmental laws. The Rules
allows the recovery of damages, including the collection of administrative fines under R.A.
No. 10067, in a separate civil suit or that deemed instituted with the criminal action
charging the same violation of an environmental law.37
Section 15, Rule 7 enumerates the reliefs which may be granted in a petition for issuance
of a writ of Kalikasan, to wit:
SEC. 15. Judgment.-Within sixty (60) days from the time the petition is submitted for
decision, the court shall render judgment granting or denying the privilege of the writ of
kalikasan.
The reliefs that may be granted under the writ are the following:
(a) Directing respondent to permanently cease and desist from committing acts
or neglecting the performance of a duty in violation of environmental laws
resulting in environmental destruction or damage;
(b) Directing the respondent public official, govemment agency, private person
or entity to protect, preserve, rehabilitate or restore the environment;
(c) Directing the respondent public official, government agency, private person
or entity to monitor strict compliance with the decision and orders of the court;
(d) Directing the respondent public official, government agency, or private
person or entity to make periodic reports on the execution of the final judgment;
and
(e) Such other reliefs which relate to the right of the people to a balanced and
healthful ecology or to the protection, preservation, rehabilitation or restoration
of the environment, except the award of damages to individual petitioners.
(Emphasis supplied.)
We agree with respondents (Philippine officials) in asserting that this petition has become
moot in the sense that the salvage operation sought to be enjoined or restrained had
already been accomplished when petitioners sought recourse from this Court. But insofar
as the directives to Philippine respondents to protect and rehabilitate the coral reef stn
icture and marine habitat adversely affected by the grounding incident are concerned,
petitioners are entitled to these reliefs notwithstanding the completion of the removal of
the USS Guardian from the coral reef. However, we are mindful of the fact that the US
and Philippine governments both expressed readiness to negotiate and discuss the
matter of compensation for the damage caused by the USS Guardian. The US Embassy
has also declared it is closely coordinating with local scientists and experts in assessing
the extent of the damage and appropriate methods of rehabilitation.
Exploring avenues for settlement of environmental cases is not proscribed by the Rules.
As can be gleaned from the following provisions, mediation and settlement are available
for the consideration of the parties, and which dispute resolution methods are
encouraged by the court, to wit:
RULE3
xxxx
SEC. 3. Referral to mediation.-At the start of the pre-trial conference, the court shall
inquire from the parties if they have settled the dispute; otherwise, the court shall
immediately refer the parties or their counsel, if authorized by their clients, to the
Philippine Mediation Center (PMC) unit for purposes of mediation. If not available, the
court shall refer the case to the clerk of court or legal researcher for mediation.
Mediation must be conducted within a non-extendible period of thirty (30) days from
receipt of notice of referral to mediation.
The mediation report must be submitted within ten (10) days from the expiration of the
30-day period.
SEC. 4. Preliminary conference.-If mediation fails, the court will schedule the continuance
of the pre-trial. Before the scheduled date of continuance, the court may refer the case
to the branch clerk of court for a preliminary conference for the following purposes:
(a) To assist the parties in reaching a settlement;
xxxx
SEC. 5. Pre-trial conference; consent decree.-The judge shall put the parties and their
counsels under oath, and they shall remain under oath in all pre-trial conferences.
The judge shall exert best efforts to persuade the parties to arrive at a settlement of the
dispute. The judge may issue a consent decree approving the agreement between the
parties in accordance with law, morals, public order and public policy to protect the right
of the people to a balanced and healthful ecology.
xxxx
SEC. 10. Efforts to settle.- The court shall endeavor to make the parties to agree to
compromise or settle in accordance with law at any stage of the proceedings before
rendition of judgment. (Underscoring supplied.)
The Court takes judicial notice of a similar incident in 2009 when a guided-missile cruiser,
the USS Port Royal, ran aground about half a mile off the Honolulu Airport Reef Runway
and remained stuck for four days. After spending $6.5 million restoring the coral reef, the
US government was reported to have paid the State of Hawaii $8.5 million in settlement
over coral reef damage caused by the grounding.38
To underscore that the US government is prepared to pay appropriate compensation for
the damage caused by the USS Guardian grounding, the US Embassy in the Philippines
has announced the formation of a US interdisciplinary scientific team which will "initiate
discussions with the Government of the Philippines to review coral reef rehabilitation
options in Tubbataha, based on assessments by Philippine-based marine scientists." The
US team intends to "help assess damage and remediation options, in coordination with
the Tubbataha Management Office, appropriate Philippine government entities, non-
governmental organizations, and scientific experts from Philippine universities." 39
A rehabilitation or restoration program to be implemented at the cost of the violator is
also a major relief that may be obtained under a judgment rendered in a citizens' suit
under the Rules, viz:
RULES
SECTION 1. Reliefs in a citizen suit.-If warranted, the court may grant to the plaintiff
proper reliefs which shall include the protection, preservation or rehabilitation of the
environment and the payment of attorney's fees, costs of suit and other litigation
expenses. It may also require the violator to submit a program of rehabilitation or
restoration of the environment, the costs of which shall be borne by the violator, or to
contribute to a special trust fund for that purpose subject to the control of the
court.1âwphi1
In the light of the foregoing, the Court defers to the Executive Branch on the matter of
compensation and rehabilitation measures through diplomatic channels. Resolution of
these issues impinges on our relations with another State in the context of common
security interests under the VFA. It is settled that "[t]he conduct of the foreign relations
of our government is committed by the Constitution to the executive and legislative-"the
political" --departments of the government, and the propriety of what may be done in the
exercise of this political power is not subject to judicial inquiry or decision."40
On the other hand, we cannot grant the additional reliefs prayed for in the petition to
order a review of the VFA and to nullify certain immunity provisions thereof.

As held in BAYAN (Bagong Alyansang Makabayan) v. Exec. Sec. Zamora, 41 the VFA was
duly concurred in by the Philippine Senate and has been recognized as a treaty by the
United States as attested and certified by the duly authorized representative of the
Republic of the Philippines
United States government. The VF A being a valid and binding agreement, the parties are
SUPREME COURT
required as a matter of international law to abide by its terms and provisions.42 The
Manila
present petition under the Rules is not the proper remedy to assail the constitutionality of
its provisions. WHEREFORE, the petition for the issuance of the privilege of the Writ of
Kalikasan is hereby DENIED. THIRD DIVISION

No pronouncement as to costs.

SO ORDERED. G.R. No. 74135 May 28, 1992

M. H. WYLIE and CAPT. JAMES WILLIAMS, petitioners,

vs.
AURORA I. RARANG and THE HONORABLE INTERMEDIATE APPELLATE COURT, respondents.

GUTIERREZ, JR., J.:

The pivotal issue in this petition centers on the extent of the "immunity from suit" of the
officials of a United States Naval Base inside Philippine territory.

In February, 1978, petitioner M. H. Wylie was the assistant administrative officer while
petitioner Capt. James Williams was the commanding officer of the U. S. Naval Base in
Subic Bay, Olongapo City. Private respondent Aurora I. Rarang was an employee in the
office of the Provost Marshal assigned as merchandise control guard.

M. H. Wylie, in his capacity as assistant administrative officer of the U.S. Naval Station
supervised the publication of the "Plan of the Day" (POD) which was 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." On February 3, 1978, the POD
published, under the "NAVSTA ACTION LINE INQUIRY" the following:
 Question: I have observed that Merchandise Control
inspector/inspectress are (sic) consuming for their own benefit things
they have confiscated from Base Personnel. The observation is even
more aggravated by consuming such confiscated items as cigarettes
and food stuffs PUBLICLY. This is not to mention "Auring" who is in
herself, a disgrace to her division and to the Office of the Provost
Marshal. In lieu of this observation, may I therefore, ask if the head of
the Merchandise Control Division is aware of this malpractice?
Answer: Merchandise Control Guards and all other personnel are
prohibited from appropriating confiscated items for their own
consumption or use. Two locked containers are installed at the Main
Gate area for deposit of confiscated items and the OPM evidence
custodian controls access to these containers.
1. Defendants M. H. Wylie and Capt. James Williams acted in the
performance of their official functions as officers of the United States
Navy and are, therefore, immune from suit;
2. The United States Naval Base is an instrumentality of the US
government which cannot be sued without its consent; and
3. This Court has no jurisdiction over the subject matter as well as the
parties in this case. (Record on Appeal, pp. 133-134)
The motion was, however, denied.
In their answer, the defendants reiterated the lack of jurisdiction of the court over the
case.

Merchandise Control Guards are permitted to eat their meals at their

In its decision, the trial court ruled that the acts of defendants M. H. Wylie and Cpt. James
worksite due to heavy workload. Complaints regarding merchandise
Williams were not official acts of the government of the United States of America in the
control guards procedure or actions may be made directly at the Office
operation and control of the Base but personal and tortious acts which are exceptions to
of the Provost Marshal for immediate and necessary action. Specific
the general rule that a sovereign country cannot be sued in the court of another country
dates and time along with details of suspected violations would be most
without its consent. In short, the trial court ruled that the acts and omissions of the two
appreciated. Telephone 4-3430/4-3234 for further information or to
US officials were not imputable against the US government but were done in the
report noted or suspected irregularities. Exhibits E & E-1. (Rollo, pp. 11-
individual and personal capacities of the said officials. The trial court dismissed the suit
12)
against the US Naval Base. The dispositive portion of the decision reads as follows:

The private respondent was the only one who was named "Auring" in the Office of the
WHEREFORE, judgment is hereby rendered in favor of the plaintiff and
Provost Marshal. That the private respondent was the same "Auring" referred to in the
against the defendants jointly and severally, as follows:
POD was conclusively proven when on February 7, 1978, petitioner M. H. Wylie wrote her
a letter of apology for the "inadvertent" publication. The private respondent then
1) Ordering defendants M. H. Wylie and Capt. James Williams to pay
commenced an action for damages in the Court of First Instance of Zambales (now
the plaintiff Aurora Rarang the sum of one hundred thousand
Regional Trial Court) against
(P100,000.00) pesos by way of moral and exemplary damages;
M. H. Wylie, Capt. James Williams and the U. S. Naval Base. She alleged 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; and 2) Ordering defendants M. H. Wylie and Capt. James Williams to pay
that the libel was published and circulated in the English language and read by almost all the plaintiff the sum of thirty thousand (P30,000.00) pesos by way of
the U. S. Naval Base personnel. She prayed that she be awarded P300,000.00 as moral attorney's fees and expenses of litigation; and
damages; exemplary damages which the court may find proper; and P50,000.00 as
attorney's fees. 3) To pay the costs of this suit.

In response to the complaint, the defendants filed a motion to dismiss anchored on three Counterclaims are dismissed.
grounds:
 Likewise, the suit against the U.S. Naval Base is ordered dismissed.
(Record on Appeal, p. 154)
On appeal, the petitioners reiterated their stance that they are immune from suit since
the subject publication was made in their official capacities as officers of the U. S. Navy.
They also maintained that they did not intentionally and maliciously cause the questioned
publication.
The private respondent, not satisfied with the amount of damages awarded to her, also
appealed the trial court's decision.
Acting on these appeals, the Intermediate Appellate Court, now Court of Appeals,
modified the trial court's decision, to wit:
WHEREFORE, the judgment of the court below is modified so that the
defendants are ordered to pay the plaintiff, jointly and severally, the
sum of P175,000.00 as moral damages and the sum of P60,000.00 as
exemplary damages. The rest of the judgment appealed from is hereby
affirmed in toto. Costs against the defendants-appellants. (Rollo, p. 44)
The appellate court denied a motion for reconsideration filed by the petitioners.
Hence, this petition.
In a resolution dated March 9, 1987, we gave due course to the petition.
The petitioners persist that they made the questioned publication in the performance of
their official functions as administrative assistant, in the case of M. H. Wylie, and
commanding officer, in the case of Capt. James Williams of the US Navy assigned to the U.
S. Naval Station, Subic Bay, Olongapo City and were, therefore, immune from suit for their
official actions.
In the case of United States of America v. Guinto (182 SCRA 644 [1990]), we discussed the
principle of the state immunity from suit as follows:
The rule that a state may not be sued without its consent, now
expressed in Article XVI, Section 3, of the 1987 Constitution, is one of
the generally accepted principles of international law that we have
adopted as part of the law of our land under Article II, Section 2.
xxx xxx xxx
Even without such affirmation, we would still be bound by the generally
accepted principles of international law under the doctrine of
incorporation. Under this doctrine, as accepted by the majority of
states, such principles are deemed incorporated in the law of every
civilized state as a condition and consequence of its membership in the
society of nations. Upon its admission to such society, the state is
automatically obligated to comply with these principles in its relations
with other states.
As applied to the local state, the doctrine of state immunity is based on
the justification given by Justice Holmes that "there can be no legal
right against the authority which makes the law on which the right
depends." (Kawanakoa v. Polybank, 205 U.S. 349) There are other
practical reasons for the enforcement of the doctrine. In the case of the
foreign state sought to be impleaded in the local jurisdiction, the added
inhibition is expressed in the maxim par in parem, non habet imperium.
All states are sovereign equals and cannot assert jurisdiction over one
another. A contrary disposition would, in the language of a celebrated
case, "unduly vex the peace of nations." (Da Haber v. Queen of
Portugal, 17 Q. B. 171)
While the doctrine appears to prohibit only suits against the state
without its consent, it is also applicable to complaints filed against
officials of the state for acts allegedly performed by them in the
discharge of their duties. The rule is that if the judgment against such
officials will require the state itself to perform an affirmative act to
satisfy the same, such as the appropriation of the amount needed to
pay the damages awarded against them, the suit must be regarded as
against the state itself although it has not been formally impleaded.
(Garcia v. Chief of Staff, 16 SCRA 120) In such a situation, the state may
move to dismiss the complaint on the ground that it has been filed
without its consent.
The doctrine is sometimes derisively called "the royal prerogative of
dishonesty" because of the privilege it grants the state to defeat any
legitimate claim against it by simply invoking its non-suability. That is
hardly fair, at least in democratic societies, for the state is not an
unfeeling tyrant unmoved by the valid claims of its citizens. In fact, the
 doctrine is not absolute and does not say the state may not be sued
under any circumstance. On the contrary, the rule says that the state
may not be sued without its consent, which clearly imports that it may
be sued if it consents.
The consent of the state to be sued may be manifested expressly or
impliedly. Express consent may be embodied in a general law or a
special law. Consent is implied when the state enters into a contract it
itself commences litigation.
xxx xxx xxx
The above rules are subject to qualification. Express consent is effected
only by the will of the legislature through the medium of a duly enacted
statute. (Republic v. Purisima, 78 SCRA 470) We have held that not all
contracts entered into by the government will operate as a waiver of its
non-suability; distinction must be made between its sovereign and
proprietary acts. (United States of America v. Ruiz, 136 SCRA 487) As for
the filing of a complaint by the government, suability will result only
where the government is claiming affirmative relief from the
defendant. (Lim v. Brownell, 107 Phil. 345) (at pp. 652-655)
In the same case we had opportunity to discuss extensively the nature and extent of
immunity from suit of United States personnel who are assigned and stationed in
Philippine territory, to wit:
In the case of the United States of America, the customary rule of
international law on state immunity is expressed with more specificity
in the RP-US Bases Treaty. Article III thereof provides as follows:
It is mutually agreed that the United States shall have
the rights, power and authority within the bases
which are necessary for the establishment, use,
operation and defense thereof or appropriate for the
control thereof and all the rights, power and
authority within the limits of the territorial waters
and air space adjacent to, or in the vicinity of, the
bases which are necessary to provide access to them
or appropriate for their control.
The petitioners also rely heavily on Baer v. Tizon, (57 SCRA 1) along with
several other decisions, to support their position that they are not
suable in the cases below, the United States not having waived its
sovereign immunity from suit. It is emphasized that in Baer, the Court
held:
The invocation of the doctrine of immunity from suit
of a foreign state without its consent is appropriate.
More specifically, insofar as alien armed forces is
concerned, the starting point is Raquiza v. Bradford, a
1945 decision. In dismissing a habeas corpus petition
for the release of petitioners confined by American
army authorities, Justice Hilado, speaking for the
Court, cited Coleman v. Tennessee, where it was
explicitly declared: "It is well settled that a foreign
army, permitted 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." Two years later,
in Tubb and Tedrow v. Griess, this Court relied on the
ruling in Raquiza v. Bradford and cited in support
thereof excerpts from the works of the following
authoritative writers: Vattel, Wheaton, Hall,
Lawrence, Oppenheim, Westlake, Hyde, and McNair
and Lauterpacht. Accuracy demands the clarification
that after the conclusion of the Philippine-American
Military Bases Agreement, the treaty provisions
should control on such matter, the assumption being
that there was a manifestation of the submission to
jurisdiction on the part of the foreign power
whenever appropriate. More to the point is Syquia
v. Almeda Lopez, where plaintiffs as lessors sued the
Commanding General of the United States Army in
the Philippines, seeking the restoration to them of the
apartment buildings they owned leased to the United
States armed forces station in the Manila area. A
motion to dismiss on the ground of non-suability was
filed and upheld by respondent Judge. The matter
was taken to this Court in a mandamus proceeding. It
failed. It was the ruling that respondent Judge acted
correctly considering that the "action must be
 considered as one against the U.S. Government." The
opinion of Justice Montemayor continued: "It is clear
that the courts of the Philippines including the
Municipal Court of Manila have no jurisdiction over
the present case for unlawful detainer. The question
of lack of jurisdiction was raised and interposed at the
very beginning of the action. The U.S. Government
has not given its consent to the filing of this suit
which is essentially against her, though not in name.
Moreover, this is not only a case of a citizen filing a
suit against his own Government without the latter's
consent but it is of a citizen filing an action against a
foreign government without said government's
consent, which renders more obvious the lack of
jurisdiction of the courts of his country. The principles
of law behind this rule are so elementary and of such
general acceptance that we deem it unnecessary to
cite authorities in support thereof."
xxx xxx xxx
It bears stressing at this point that the above observations do not
confer on the United States of America a blanket immunity for all acts
done by it or its agents in the Philippines. Neither may the other
petitioners claim that they are also insulated from suit in this country
merely because they have acted as agents of the United States in the
discharge of their official functions.
There is no question that the United States of America, like any other
state, will be deemed to have impliedly waived its non-suability if it has
entered into a contract in its proprietary or private capacity. It is only
when the contract involves its sovereign or governmental capacity that
no such waiver may be implied. This was our ruling in United States of
America v. Ruiz, (136 SCRA 487) where the transaction in question dealt
with the improvement of the wharves in the naval installation at Subic
Bay. As this was a clearly governmental function, we held that the
contract did not operate to divest the United States of its sovereign
immunity from suit. In the words of Justice Vicente Abad Santos:
The traditional rule of immunity excepts a State from
being sued in the courts of another State without its
consent or waiver. This rule is a necessary
consequence of the principles of independence and
equality of States. However, the rules of International
Law are not petrified; they are constantly developing
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 imperii. The restrictive
application of State immunity is now the rule in the
United States, the United Kingdom and other states in
Western Europe.
xxx xxx xxx
The restrictive application of State immunity is proper
only when the proceedings arise out of commercial
transactions of the foreign sovereign, its commercial
activities or economic affairs. Stated differently, a
State may be said to have 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. It does not apply where 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 other petitioners in the cases before us all aver they have acted in
the discharge of their official functions as officers or agents of the
United States. However, this is a matter of evidence. The charges
against them may not be summarily dismissed on their mere assertion
that their acts are imputable to the United States of America, which has
not given its consent to be sued. In fact, the defendants are sought to
 be held answerable for personal torts in which the United States itself is
not involved. If found liable, they and they alone must satisfy the
judgment. (At pp. 655-658)
In the light of these precedents, we proceed to resolve the present case.
The POD was published under the direction and authority of the commanding officer, U.S.
Naval Station Subic Bay. The administrative assistant, among his other duties, is tasked to
prepare and distribute the POD. On February 3, 1978, when the questioned article was
published in the POD, petitioner Capt. James Williams was the commanding officer while
petitioner M.H. Wylie was the administrative assistant of the US Naval Station at Subic
bay.
The NAVSTA ACTION LINE INQUIRY is a regular feature of the POD. It is a telephone
answering device in the office of the Administrative Assistant. The Action Line is intended
to provide personnel access to the Commanding Officer on matters they feel should be
brought to his attention for correction or investigation. The matter of inquiry may be
phoned in or mailed to the POD. (TSN, September 9, 1980, pp. 12-13, Jerry Poblon)
According to
M. H. Wylie, the action line naming "Auring" was received about three (3) weeks prior to
its being published in the POD on February 3, 1978. It was forwarded to Rarang's office of
employment, the Provost Marshal, for comment. The Provost Marshal office's
response ". . . included a short note stating that if the article was published, to remove the
name." (Exhibit 8-A, p. 5) The Provost Marshal's response was then forwarded to the
executive officer and to the commanding officer for approval. The approval of the
Commanding officer was forwarded to the office of the Administrative Assistant for
inclusion in the POD. A certain Mrs. Dologmodin, a clerk typist in the office of the
Administrative Assistant prepared the smooth copy of the POD. Finally, M. H. Wylie, the
administrative assistant signed the smooth copy of the POD but failed to notice the
reference to "Auring" in the action line inquiry. (Exh. 8-A, pp. 4-5, Questions Nos. 14-15).
There is no question, therefore, that the two (2) petitioners actively participated in
screening the features and articles in the POD as part of their official functions. Under the
rule that U.S. officials in the performance of their official functions are immune from suit,
then it should follow that the petitioners may not be held liable for the questioned
publication.
It is to be noted, however, that the petitioners were sued in their personal capacities for
their alleged tortious acts in publishing a libelous article.
The question, therefore, arises –– are American naval officers who commit a crime or
tortious act while discharging official functions still covered by the principle of state
immunity from suit? Pursuing the question further, does the grant of rights, power, and
authority to the United States under the RP-US Bases Treaty cover immunity of its officers
from crimes and torts? Our answer is No.
Killing a person in cold blood while on patrol duty, running over a child while driving with
reckless imprudence on an official trip, or slandering a person during office hours could
not possibly be covered by the immunity agreement. Our laws and, we presume, those of
the United States do not allow the commission of crimes in the name of official duty.
The case of Chavez v. Sandiganbayan, 193 SCRA 282 [1991] gives the law on immunity
from suit of public officials:
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.
xxx xxx xxx
Moreover, the petitioner's argument that the immunity proviso under
Section 4(a) of Executive Order No. 1 also extends to him is not well-
taken. A mere invocation of the immunity clause does not ipso
facto result in the charges being automatically dropped.
In the case of Presidential Commission on Good Government
v. Peña (159 SCRA 556 [1988] then Chief Justice Claudio Teehankee,
added a clarification of the immunity accorded PCGG officials under
Section 4(a) of Executive Order No. 1 as follows:
With respect to the qualifications expressed by Mr.
Justice Feliciano in his separate opinion, I just wish to
point out two things: First, the main opinion does not
claim absolute immunity for the members of the
Commission. The cited section of Executive Order No.
1 provides the Commission's members immunity
from suit thus: "No civil action shall lie against the
Commission or any member thereof for anything
done or omitted in the discharge of the task
 contemplated by this order." No absolute immunity
like that sought by Mr. Marcos in his Constitution for
himself and his subordinates is herein involved. It is
understood that the immunity granted the members
of the Commission by virtue of the unimaginable
magnitude of its task to recover the plundered wealth
and the State's exercise of police power was
immunity from liability for damages in the official
discharge of the task granted the members of the
Commission much in the same manner that judges
are immune from suit in the official discharge of the
functions of their office.
. . . (at pp. 581-582)
xxx xxx xxx
Immunity from suit cannot institutionalize irresponsibility and non-
accountability nor grant a privileged status not claimed by any other
official of the Republic. (id., at page 586)
Where the petitioner exceeds his authority as Solicitor General, acts in
bad faith, or, as contended by the private respondent, "maliciously
conspir(es) with the PCGG commissioners in persecuting respondent
Enrile by filing against him an evidently baseless suit in derogation of
the latter's constitutional rights and liberties" (Rollo, p. 417), there can
be no question that a complaint for damages does not confer a license
to persecute or recklessly injure another. The actions governed by
Articles 19, 20, 21, and 32 of the Civil Code on Human Relations may be
taken against public officers or private citizens alike. . . . (pp. 289-291)
We apply the same ruling to this case.
The subject article in the US Newsletter POD dated February 3, 1978 mentions a certain
"Auring" as ". . a disgrace to her division and to the Office of the Provost Marshal." The
same article explicitly implies that Auring was consuming and appropriating for herself
confiscated items like cigarettes and foodstuffs. There is no question that the Auring
alluded to in the Article was the private respondent as she was the only Auring in the
Office of the Provost Marshal. Moreover, as a result of this article, the private respondent
was investigated by her supervisor. Before the article came out, the private respondent
had been the recipient of commendations by her superiors for honesty in the
performance of her duties.
It may be argued that Captain James Williams as commanding officer of the naval base is
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.
This may be true as a general rule. In this particular case, however, the records show that
the offensive publication was sent to the commanding officer for approval and he
approved it. The factual findings of the two courts below are based on the records. The
petitioners have shown no convincing reasons why our usual respect for the findings of
the trial court and the respondent court should be withheld in this particular case and
why their decisions should be reversed.
Article 2176 of the Civil Code prescribes a civil liability for damages caused by a person's
act or omission constituting fault or negligence, to wit:
Art. 2176. 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, if there is no pre-existing contractual relation
between the parties, is called a quasi-delict and is governed by the
provisions of this Chapter.
"Fault" or "negligence" in this Article covers not only acts "not punishable by law" but also
acts criminal in character, whether intentional or voluntary or negligent." (Andamo v.
Intermediate Appellate Court, 191 SCRA 195 [1990]).
Moreover, Article 2219(7) of the Civil Code provides that moral damages may be
recovered in case of libel, slander or any other form of defamation. In effect, the
offended party in these cases is given the right to receive from the guilty party moral
damages for injury to his feelings and reputation in addition to punitive or exemplary
damages. (Occena v. Icamina, 181 SCRA 328 [1990]). In another case, Heirs of Basilisa
Justiva v. Gustilo, 7 SCRA 72 [1963], we ruled that the allegation of forgery of documents
could be a defamation, which in the light of Article 2219(7) of the Civil Code could by
analogy be ground for payment of moral damages, considering the wounded feelings and
besmirched reputation of the defendants.
Indeed the imputation of theft contained in the POD dated February 3, 1978 is a
defamation against the character and reputation of the private respondent. Petitioner
Wylie himself admitted that the Office of the Provost Marshal explicitly recommended
the deletion of the name Auring if the article were published. The petitioners, however,
were negligent because under their direction they issued the publication without deleting
the name "Auring." Such act or omission is ultra vires and cannot be part of official duty. It
was a tortious act which ridiculed the private respondent. As a result of the petitioners'
act, the private respondent, according to the record, suffered besmirched reputation,
serious anxiety, wounded feelings and social humiliation, specially 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.

WHEREFORE, the petition is hereby DISMISSED. The questioned decision and resolution
of the then Intermediate Appellate Court, now Court of Appeals, are AFFIRMED.

Bidin, Davide, Jr. and Romero, JJ., concur.

Feliciano, J., took no part.

Republic of the Philippines

SUPREME COURT
Manila

EN BANC
G.R. Nos. 171947-48 February 15, 2011
METROPOLITAN MANILA DEVELOPMENT AUTHORITY, DEPARTMENT OF ENVIRONMENT
AND NATURAL RESOURCES, DEPARTMENT OF EDUCATION, CULTURE AND
SPORTS,1 DEPARTMENT OF HEALTH, DEPARTMENT OF AGRICULTURE, DEPARTMENT OF
PUBLIC WORKS AND HIGHWAYS, DEPARTMENT OF BUDGET AND MANAGEMENT,
PHILIPPINE COAST GUARD, PHILIPPINE NATIONAL POLICE MARITIME GROUP, and
DEPARTMENT OF THE INTERIOR AND LOCAL GOVERNMENT, Petitioners,
vs.
CONCERNED RESIDENTS OF MANILA BAY, represented and joined by DIVINA V. ILAS,
SABINIANO ALBARRACIN, MANUEL SANTOS, JR., DINAH DELA PEÑA, PAUL DENNIS
QUINTERO, MA. VICTORIA LLENOS, DONNA CALOZA, FATIMA QUITAIN, VENICE SEGARRA,
FRITZIE TANGKIA, SARAH JOELLE LINTAG, HANNIBAL AUGUSTUS BOBIS, FELIMON
SANTIAGUEL, and JAIME AGUSTIN R. OPOSA,Respondents.
RESOLUTION
VELASCO, JR., J.:
On December 18, 2008, this Court rendered a Decision in G.R. Nos. 171947-48 ordering
petitioners to clean up, rehabilitate and preserve Manila Bay in their different capacities.
The fallo reads:
WHEREFORE, the petition is DENIED. The September 28, 2005 Decision of the CA in CA-
G.R. CV No. 76528 and SP No. 74944 and the September 13, 2002 Decision of the RTC in
Civil Case No. 1851-99 are AFFIRMED but with MODIFICATIONS in view of subsequent
developments or supervening events in the case. The fallo of the RTC Decision shall now
read:
WHEREFORE, judgment is hereby rendered ordering the abovenamed defendant-
government agencies to clean up, rehabilitate, and preserve Manila Bay, and restore and
maintain its waters to SB level (Class B sea waters per Water Classification Tables under
DENR Administrative Order No. 34 [1990]) to make them fit for swimming, skin-diving,
and other forms of contact recreation.
In particular:
(1) Pursuant to Sec. 4 of EO 192, assigning the DENR as the primary agency
responsible for the conservation, management, development, and proper use of
the country’s environment and natural resources, and Sec. 19 of RA 9275,
designating the DENR as the primary government agency responsible for its
enforcement and implementation, the DENR is directed to fully implement its
Operational Plan for the Manila Bay Coastal Strategy for the rehabilitation,
restoration, and conservation of the Manila Bay at the earliest possible time. It is
ordered to call regular coordination meetings with concerned government
departments and agencies to ensure the successful implementation of the
aforesaid plan of action in accordance with its indicated completion schedules.
(2) Pursuant to Title XII (Local Government) of the Administrative Code of 1987
and Sec. 25 of the Local Government Code of 1991, the DILG, in exercising the
President’s power of general supervision and its duty to promulgate guidelines in
establishing waste management programs under Sec. 43 of the Philippine
Environment Code (PD 1152), shall direct all LGUs in Metro Manila, Rizal,
Laguna, Cavite, Bulacan, Pampanga, and Bataan to inspect all factories,
commercial establishments, and private homes along the banks of the major
river systems in their respective areas of jurisdiction, such as but not limited to
the Pasig-Marikina-San Juan Rivers, the NCR (Parañaque-Zapote, Las Piñas)
Rivers, the Navotas-Malabon-Tullahan-Tenejeros Rivers, the Meycauayan-
Marilao-Obando (Bulacan) Rivers, the Talisay (Bataan) River, the Imus (Cavite)
River, the Laguna De Bay, and other minor rivers and waterways that eventually
discharge water into the Manila Bay; and the lands abutting the bay, to
determine whether they have wastewater treatment facilities or hygienic septic
tanks as prescribed by existing laws, ordinances, and rules and regulations. If
none be found, these LGUs shall be ordered to require non-complying
establishments and homes to set up said facilities or septic tanks within a
reasonable time to prevent industrial wastes, sewage water, and human wastes
from flowing into these rivers, waterways, esteros, and the Manila Bay, under
pain of closure or imposition of fines and other sanctions.
(3) As mandated by Sec. 8 of RA 9275, the MWSS is directed to provide, install,
operate, and maintain the necessary adequate waste water treatment facilities
in Metro Manila, Rizal, and Cavite where needed at the earliest possible time.
(4) Pursuant to RA 9275, the LWUA, through the local water districts and in
coordination with the DENR, is ordered to provide, install, operate, and maintain
sewerage and sanitation facilities and the efficient and safe collection,
treatment, and disposal of sewage in the provinces of Laguna, Cavite, Bulacan,
Pampanga, and Bataan where needed at the earliest possible time.
(5) Pursuant to Sec. 65 of RA 8550, the DA, through the BFAR, is ordered to
improve and restore the marine life of the Manila Bay. It is also directed to assist
the LGUs in Metro Manila, Rizal, Cavite, Laguna, Bulacan, Pampanga, and Bataan
in developing, using recognized methods, the fisheries and aquatic resources in
the Manila Bay.
(6) The PCG, pursuant to Secs. 4 and 6 of PD 979, and the PNP Maritime Group,
in accordance with Sec. 124 of RA 8550, in coordination with each other, shall
apprehend violators of PD 979, RA 8550, and other existing laws and regulations
designed to prevent marine pollution in the Manila Bay.
(7) Pursuant to Secs. 2 and 6-c of EO 513 and the International Convention for
the Prevention of Pollution from Ships, the PPA is ordered to immediately adopt
such measures to prevent the discharge and dumping of solid and liquid wastes
and other ship-generated wastes into the Manila Bay waters from vessels
docked at ports and apprehend the violators.
(8) The MMDA, as the lead agency and implementor of programs and projects
for flood control projects and drainage services in Metro Manila, in coordination
with the DPWH, DILG, affected LGUs, PNP Maritime Group, Housing and Urban
Development Coordinating Council (HUDCC), and other agencies, shall dismantle
and remove all structures, constructions, and other encroachments established
or built in violation of RA 7279, and other applicable laws along the Pasig-
Marikina-San Juan Rivers, the NCR (Parañaque-Zapote, Las Piñas) Rivers, the
Navotas-Malabon-Tullahan-Tenejeros Rivers, and connecting waterways and
esteros in Metro Manila. The DPWH, as the principal implementor of programs
and projects for flood control services in the rest of the country more
particularly in Bulacan, Bataan, Pampanga, Cavite, and Laguna, in coordination
with the DILG, affected LGUs, PNP Maritime Group, HUDCC, and other
concerned government agencies, shall remove and demolish all structures,
constructions, and other encroachments built in breach of RA 7279 and other
applicable laws along the Meycauayan-Marilao-Obando (Bulacan) Rivers, the
Talisay (Bataan) River, the Imus (Cavite) River, the Laguna De Bay, and other
rivers, connecting waterways, and esteros that discharge wastewater into the
Manila Bay.
In addition, the MMDA is ordered to establish, operate, and maintain a sanitary
landfill, as prescribed by RA 9003, within a period of one (1) year from finality of
this Decision. On matters within its territorial jurisdiction and in connection with
the discharge of its duties on the maintenance of sanitary landfills and like
undertakings, it is also ordered to cause the apprehension and filing of the
appropriate criminal cases against violators of the respective penal provisions of
RA 9003, Sec. 27 of RA 9275 (the Clean Water Act), and other existing laws on
pollution.
(9) The DOH shall, as directed by Art. 76 of PD 1067 and Sec. 8 of RA 9275,
within one (1) year from finality of this Decision, determine if all licensed septic
and sludge companies have the proper facilities for the treatment and disposal
of fecal sludge and sewage coming from septic tanks. The DOH shall give the
companies, if found to be non-complying, a reasonable time within which to set
up the necessary facilities under pain of cancellation of its environmental
sanitation clearance.
(10) Pursuant to Sec. 53 of PD 1152, Sec. 118 of RA 8550, and Sec. 56 of RA
9003, the DepEd shall integrate lessons on pollution prevention, waste
management, environmental protection, and like subjects in the school curricula
of all levels to inculcate in the minds and hearts of students and, through them,
their parents and friends, the importance of their duty toward achieving and
maintaining a balanced and healthful ecosystem in the Manila Bay and the entire
Philippine archipelago.
(11) The DBM shall consider incorporating an adequate budget in the General
Appropriations Act of 2010 and succeeding years to cover the expenses relating
to the cleanup, restoration, and preservation of the water quality of the Manila
Bay, in line with the country’s development objective to attain economic growth
in a manner consistent with the protection, preservation, and revival of our
marine waters.
(12) The heads of petitioners-agencies MMDA, DENR, DepEd, DOH, DA, DPWH,
DBM, PCG, PNP Maritime Group, DILG, and also of MWSS, LWUA, and PPA, in
line with the principle of "continuing mandamus," shall, from finality of this
Decision, each submit to the Court a quarterly progressive report of the activities
undertaken in accordance with this Decision.
SO ORDERED.
The government agencies did not file any motion for reconsideration and the Decision
became final in January 2009.
The case is now in the execution phase of the final and executory December 18, 2008
Decision. The Manila Bay Advisory Committee was created to receive and evaluate the
quarterly progressive reports on the activities undertaken by the agencies in accordance
with said decision and to monitor the execution phase.
In the absence of specific completion periods, the Committee recommended that time
frames be set for the agencies to perform their assigned tasks. This may be viewed as an
encroachment over the powers and functions of the Executive Branch headed by the
President of the Philippines.
This view is misplaced.
The issuance of subsequent resolutions by the Court is simply an exercise of judicial
power under Art. VIII of the Constitution, because the execution of the Decision is but an
integral part of the adjudicative function of the Court. None of the agencies ever
questioned the power of the Court to implement the December 18, 2008 Decision nor
has any of them raised the alleged encroachment by the Court over executive functions.
While additional activities are required of the agencies like submission of plans of action,
data or status reports, these directives are but part and parcel of the execution stage of a
final decision under Rule 39 of the Rules of Court. Section 47 of Rule 39 reads:
Section 47. Effect of judgments or final orders.––The effect of a judgment or final order
rendered by a court of the Philippines, having jurisdiction to pronounce the judgment or
final order, may be as follows:
xxxx
(c) In any other litigation between the same parties of their successors in interest, that
only is deemed to have been adjudged in a former judgment or final order which appears
upon its face to have been so adjudged, or which was actually and necessarily included
therein or necessary thereto. (Emphasis supplied.)
It is clear that the final judgment includes not only what appears upon its face to have
been so adjudged but also those matters "actually and necessarily included therein or
necessary thereto." Certainly, any activity that is needed to fully implement a final
judgment is necessarily encompassed by said judgment.
Moreover, the submission of periodic reports is sanctioned by Secs. 7 and 8, Rule 8 of the
Rules of Procedure for Environmental cases:
Sec. 7. Judgment.––If warranted, the court shall grant the privilege of the writ of
continuing mandamus requiring respondent to perform an act or series of acts until the
judgment is fully satisfied and to grant such other reliefs as may be warranted resulting
from the wrongful or illegal acts of the respondent. The court shall require the
respondent to submit periodic reports detailing the progress and execution of the
judgment, and the court may, by itself or through a commissioner or the appropriate
government agency, evaluate and monitor compliance. The petitioner may submit its
comments or observations on the execution of the judgment.
Sec. 8. Return of the writ.––The periodic reports submitted by the respondent detailing
compliance with the judgment shall be contained in partial returns of the writ. Upon full
satisfaction of the judgment, a final return of the writ shall be made to the court by the
respondent. If the court finds that the judgment has been fully implemented, the
satisfaction of judgment shall be entered in the court docket. (Emphasis supplied.)
With the final and executory judgment in MMDA, the writ of continuing mandamus
issued in MMDA means that until petitioner-agencies have shown full compliance with
the Court’s orders, the Court exercises continuing jurisdiction over them until full
execution of the judgment.
There being no encroachment over executive functions to speak of, We shall now
proceed to the recommendation of the Manila Bay Advisory Committee.
Several problems were encountered by the Manila Bay Advisory Committee.2 An
evaluation of the quarterly progressive reports has shown that (1) there are voluminous
quarterly progressive reports that are being submitted; (2) petitioner-agencies do not
have a uniform manner of reporting their cleanup, rehabilitation and preservation
activities; (3) as yet no definite deadlines have been set by petitioner DENR as to
petitioner-agencies’ timeframe for their respective duties; (4) as of June 2010 there has
been a change in leadership in both the national and local levels; and (5) some agencies
have encountered difficulties in complying with the Court’s directives.
In order to implement the afore-quoted Decision, certain directives have to be issued by
the Court to address the said concerns.
Acting on the recommendation of the Manila Bay Advisory Committee, the Court hereby
resolves to ORDER the following:
(1) The Department of Environment and Natural Resources (DENR), as lead agency in the
Philippine Clean Water Act of 2004, shall submit to the Court on or before June 30, 2011
the updated Operational Plan for the Manila Bay Coastal Strategy.
The DENR is ordered to submit summarized data on the overall quality of Manila Bay
waters for all four quarters of 2010 on or before June 30, 2011.
The DENR is further ordered to submit the names and addresses of persons and
companies in Metro Manila, Rizal, Laguna, Cavite, Bulacan, Pampanga and Bataan that
generate toxic and hazardous waste on or before September 30, 2011.
(2) On or before June 30, 2011, the Department of the Interior and Local Government
(DILG) shall order the Mayors of all cities in Metro Manila; the Governors of Rizal, Laguna,
Cavite, Bulacan, Pampanga and Bataan; and the Mayors of all the cities and towns in said
provinces to inspect all factories, commercial establishments and private homes along the
banks of the major river systems––such as but not limited to the Pasig-Marikina-San Juan
Rivers, the National Capital Region (Paranaque-Zapote, Las Pinas) Rivers, the Navotas-
Malabon-Tullahan-Tenejeros Rivers, the Meycauayan-Marilao-Obando (Bulacan) Rivers,
the Talisay (Bataan) River, the Imus (Cavite) River, and the Laguna De Bay––and other
minor rivers and waterways within their jurisdiction that eventually discharge water into
the Manila Bay and the lands abutting it, to determine if they have wastewater treatment
facilities and/or hygienic septic tanks, as prescribed by existing laws, ordinances, rules and
regulations. Said local government unit (LGU) officials are given up to September 30, 2011
to finish the inspection of said establishments and houses.
In case of non-compliance, the LGU officials shall take appropriate action to ensure
compliance by non-complying factories, commercial establishments and private homes
with said law, rules and regulations requiring the construction or installment of
wastewater treatment facilities or hygienic septic tanks.
The aforementioned governors and mayors shall submit to the DILG on or before
December 31, 2011 their respective compliance reports which will contain the names and
addresses or offices of the owners of all the non-complying factories, commercial
establishments and private homes, copy furnished the concerned environmental agency,
be it the local DENR office or the Laguna Lake Development Authority.
The DILG is required to submit a five-year plan of action that will contain measures
intended to ensure compliance of all non-complying factories, commercial
establishments, and private homes.
On or before June 30, 2011, the DILG and the mayors of all cities in Metro Manila shall
consider providing land for the wastewater facilities of the Metropolitan Waterworks and
Sewerage System (MWSS) or its concessionaires (Maynilad and Manila Water, Inc.) within
their respective jurisdictions.
(3) The MWSS shall submit to the Court on or before June 30, 2011 the list of areas in
Metro Manila, Rizal and Cavite that do not have the necessary wastewater treatment
facilities. Within the same period, the concessionaires of the MWSS shall submit their
plans and projects for the construction of wastewater treatment facilities in all the
aforesaid areas and the completion period for said facilities, which shall not go beyond
2037.
On or before June 30, 2011, the MWSS is further required to have its two concessionaires
submit a report on the amount collected as sewerage fees in their respective areas of
operation as of December 31, 2010.
(4) The Local Water Utilities Administration is ordered to submit on or before September
30, 2011 its plan to provide, install, operate and maintain sewerage and sanitation
facilities in said cities and towns and the completion period for said works, which shall be
fully implemented by December 31, 2020.
(5) The Department of Agriculture (DA), through the Bureau of Fisheries and Aquatic
Resources, shall submit to the Court on or before June 30, 2011 a report on areas in
Manila Bay where marine life has to be restored or improved and the assistance it has
extended to the LGUs in Metro Manila, Rizal, Cavite, Laguna, Bulacan, Pampanga and
Bataan in developing the fisheries and aquatic resources in Manila Bay. The report shall
contain monitoring data on the marine life in said areas. Within the same period, it shall
submit its five-year plan to restore and improve the marine life in Manila Bay, its future
activities to assist the aforementioned LGUs for that purpose, and the completion period
for said undertakings.
The DA shall submit to the Court on or before September 30, 2011 the baseline data as of
September 30, 2010 on the pollution loading into the Manila Bay system from agricultural
and livestock sources.
(6) The Philippine Ports Authority (PPA) shall incorporate in its quarterly reports the list of
violators it has apprehended and the status of their cases. The PPA is further ordered to
include in its report the names, make and capacity of the ships that dock in PPA ports.
The PPA shall submit to the Court on or before June 30, 2011 the measures it intends to
undertake to implement its compliance with paragraph 7 of the dispositive portion of the On or before June 30, 2011, the MMDA shall submit a report of the location of open and
MMDA Decision and the completion dates of such measures. controlled dumps in Metro Manila whose operations are illegal after February 21,
2006,3 pursuant to Secs. 36 and 37 of RA 9003, and its plan for the closure of these open
The PPA should include in its report the activities of its concessionaire that collects and and controlled dumps to be accomplished not later than December 31, 2012. Also, on or
disposes of the solid and liquid wastes and other ship-generated wastes, which shall state before June 30, 2011, the DENR Secretary, as Chairperson of the National Solid Waste
the names, make and capacity of the ships serviced by it since August 2003 up to the Management Commission (NSWMC), shall submit a report on the location of all open and
present date, the dates the ships docked at PPA ports, the number of days the ship was at controlled dumps in Rizal, Cavite, Laguna, Bulacan, Pampanga and Bataan.
sea with the corresponding number of passengers and crew per trip, the volume of solid,
liquid and other wastes collected from said ships, the treatment undertaken and the On or before June 30, 2011, the DENR Secretary, in his capacity as NSWMC Chairperson,
disposal site for said wastes. shall submit a report on whether or not the following landfills strictly comply with Secs.
41 and 42 of RA 9003 on the establishment and operation of sanitary landfills, to wit:
(7) The Philippine National Police (PNP) Maritime Group shall submit on or before June
30, 2011 its five-year plan of action on the measures and activities it intends to undertake National Capital Region
to apprehend the violators of Republic Act No. (RA) 8550 or the Philippine Fisheries Code
of 1998 and other pertinent laws, ordinances and regulations to prevent marine pollution 1. Navotas SLF (PhilEco), Brgy. Tanza (New Site), Navotas City
in Manila Bay and to ensure the successful prosecution of violators.
2. Payatas Controlled Dumpsite, Barangay Payatas, Quezon City
The Philippine Coast Guard shall likewise submit on or before June 30, 2011 its five-year
plan of action on the measures and activities they intend to undertake to apprehend the Region III
violators of Presidential Decree No. 979 or the Marine Pollution Decree of 1976 and RA
9993 or the Philippine Coast Guard Law of 2009 and other pertinent laws and regulations
3. Sitio Coral, Brgy. Matictic, Norzagaray, Bulacan
to prevent marine pollution in Manila Bay and to ensure the successful prosecution of
violators.
4. Sitio Tiakad, Brgy. San Mateo, Norzagaray, Bulacan
(8) The Metropolitan Manila Development Authority (MMDA) shall submit to the Court on
5. Brgy. Minuyan, San Jose del Monte City, Bulacan
or before June 30, 2011 the names and addresses of the informal settlers in Metro Manila
who, as of December 31, 2010, own and occupy houses, structures, constructions and
other encroachments established or built along the Pasig-Marikina-San Juan Rivers, the 6. Brgy. Mapalad, Santa Rosa, Nueva Ecija
NCR (Parañaque-Zapote, Las Piñas) Rivers, the Navotas-Malabon-Tullahan-Tenejeros
Rivers, and connecting waterways and esteros, in violation of RA 7279 and other 7. Sub-zone Kalangitan, Clark Capas, Tarlac Special Economic Zone
applicable laws. On or before June 30, 2011, the MMDA shall submit its plan for the
removal of said informal settlers and the demolition of the aforesaid houses, structures, Region IV-A
constructions and encroachments, as well as the completion dates for said activities,
which shall be fully implemented not later than December 31, 2015. 8. Kalayaan (Longos), Laguna

The MMDA is ordered to submit a status report, within thirty (30) days from receipt of 9. Brgy. Sto. Nino, San Pablo City, Laguna
this Resolution, on the establishment of a sanitary landfill facility for Metro Manila in
compliance with the standards under RA 9003 or the Ecological Solid Waste Management 10. Brgy. San Antonio (Pilotage SLF), San Pedro, Laguna
Act.
11. Morong, Rizal
 12. Sitio Lukutan, Brgy. San Isidro, Rodriguez (Montalban), Rizal (ISWIMS)
13. Brgy. Pintong Bukawe, San Mateo, Rizal (SMSLFDC)
On or before June 30, 2011, the MMDA and the seventeen (17) LGUs in Metro Manila are
ordered to jointly submit a report on the average amount of garbage collected monthly
per district in all the cities in Metro Manila from January 2009 up to December 31, 2010
vis-à-vis the average amount of garbage disposed monthly in landfills and dumpsites. In
its quarterly report for the last quarter of 2010 and thereafter, MMDA shall report on the
apprehensions for violations of the penal provisions of RA 9003, RA 9275 and other laws
on pollution for the said period.
On or before June 30, 2011, the DPWH and the LGUs in Rizal, Laguna, Cavite, Bulacan,
Pampanga, and Bataan shall submit the names and addresses of the informal settlers in
their respective areas who, as of September 30, 2010, own or occupy houses, structures,
constructions, and other encroachments built along the Meycauayan-Marilao-Obando
(Bulacan) Rivers, the Talisay (Bataan) River, the Imus (Cavite) River, the Laguna de Bay,
and other rivers, connecting waterways and esteros that discharge wastewater into the
Manila Bay, in breach of RA 7279 and other applicable laws. On or before June 30, 2011,
the DPWH and the aforesaid LGUs shall jointly submit their plan for the removal of said
informal settlers and the demolition of the aforesaid structures, constructions and
encroachments, as well as the completion dates for such activities which shall be
implemented not later than December 31, 2012.
(10) The Department of Education (DepEd) shall submit to the Court on or before May 31,
2011 a report on the specific subjects on pollution prevention, waste management,
environmental protection, environmental laws and the like that it has integrated into the
school curricula in all levels for the school year 2011-2012.
On or before June 30, 2011, the DepEd shall also submit its plan of action to ensure
compliance of all the schools under its supervision with respect to the integration of the
aforementioned subjects in the school curricula which shall be fully implemented by June
30, 2012.
(11) All the agencies are required to submit their quarterly reports electronically using the
forms below. The agencies may add other key performance indicators that they have
identified.
SO ORDERED.
PRESBITERO J. VELASCO, JR.
Associate Justice

(9) The Department of Health (DOH) shall submit to the Court on or before June 30, 2011
the names and addresses of the owners of septic and sludge companies including those
that do not have the proper facilities for the treatment and disposal of fecal sludge and
sewage coming from septic tanks.

The DOH shall implement rules and regulations on Environmental Sanitation Clearances
and shall require companies to procure a license to operate from the DOH.

The DOH and DENR-Environmental Management Bureau shall develop a toxic and
hazardous waste management system by June 30, 2011 which will implement segregation
of hospital/toxic/hazardous wastes and prevent mixing with municipal solid waste.

On or before June 30, 2011, the DOH shall submit a plan of action to ensure that the said
companies have proper disposal facilities and the completion dates of
compliance.1avvphi1