Doctrine of State Immunity - Constitutional Law

ARTICLE XVI, Section 3 of the Constitution – The state may not be sued without its consent

·     “A sovereign is exempt from suit, not because of any formal conception or obsolete theory, but on the logical and practical ground that there can be no legal right as against the authority that makes the law on which the right depends.” (Kawanakoa v. Polybank)

·     Two theories of State immunity

Ø Classical/absolute theory – A sovereign cannot, without its consent, be made a respondent in the courts of another sovereign (Holy see V. Rosario)

Ø Restrictive Theory

v 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 (JUSMAG v. NLRC)

v But not all contracts are deemed to be implied consent to be sued. The immunity of the sovereign is recognized only with regard to public acts or acta jure imperii of a state, but not with regards to private acts or acta jure gestionis. (Holy see V. Rosario)

·     How can a state be sued? (By Waiver of Immunity)

The consent of the state to be sued may be made either

Ø Expressly – May be manifested through a general law (ex. Act. 3083) or a special law (ex. art. 2189 of the Civil Code).

v The express consent of the State to be sued must be embodied in a duly enacted statute and may not be given by a mere counsel of the government. (Republic v. Purisima)

Ø Impliedly – when the state itself commences litigation or when it enters into a contract. (and when the state itself files a complaint.)

v Examples where the SC impliedly waived their immunity

§  Supreme court reversed the trial courts dismissal on the ground of state immunity of a complaint for damages filed by the plaintiff whose property was constructed by the Gov’t without his knowledge or consent. SC declared “The doctrine of sovereign immunity was not an instrument for perpetrating any injustice on a citizen. (De los Santos v. Intermediate Appellate Court)

§  In Froilan v. Pan Oriental Shipping Co. The Supreme Court held that the government impliedly allowed itself to be sued when it filed a complaint in intervention for the purpose of asserting claim for affirmative relief against the plaintiff to the recovery of the vessel.

§  Plaintiff sued the government for the revocation of a donation on the ground of failure to comply with the stipulated conditions. Defendant moved to dismiss for lack of consent to be sued. SC held “Here, the alleged failure to abide by the conditions under which a donation was given should not prove an insuperable obstacle to a civil action, the consent likewise being presumed. This conclusion is strengthened by the fact that while a donation partakes of a contract, there is no money claim, and therefore reliance on Commonwealth Act No. 327 would be futile.” (Santiago v. Republic)

·     A money claim against the government must first be filed with the COA, which must act upon it within 60 days. Rejection of the claim will authorize the claimant to elevate the matter to the Supreme Court on certiorari and in effect sue the State with its consent. (Commonwealth Act No. 327, as amended by P.D No. 1445) (Cannot be used against foreign entities. Phil. Congress cannot waive other countries immunity)

·     Suits against Government Agencies

Ø Incorporated Government Agency – has a charter of its own that invests it with a separate juridical personality. (i.e. UP and SSS)

v Suable if their charter said so regardless of the functions it is performing be it acts jure imperii of a state or acts or acts jure gestionis. (Bermoy v. Phil. Normal College, Arcega V. CA, Central Bank v. CFI of Bulacan, and NPC and PNR V. Intermediate Appellate Court)

Ø Unincorporated Government Agency – has no separate juridical personality but is merged in the general machinery of the Government (DOJ)

v It is necessary to determine the nature of the functions in which the agency is engaged. They are suable if they are proprietary and not suable if they are governmental.

v Non suability of the State is available to the agency even if it shown that it is engaged not only in Gov’t function but also, as a sideline, or incidentally, in proprietary enterprises.

§  In Bureau of Printing v. Bureau of printing employee’s association SC held that “The additional work it executes for private parties is merely incidental to its function”

§  In Mobil Phil. Exploration V. Customs Arrastre Services SC Held: “Although said arrastre function may be deemed proprietary, it is necessary incident of the primary and gov’t function of the BOC, so that engaging in the same does not necessarily render the BOC liable to suit. Sovereign immunity, granted as to the end, should not be denied as to the necessary means to that end”

v Examples of cases where SC ruled that the unincorporated Government agency is suable are Air Transportation Office v. Ramos, National Airport Corp. v. Teodoro.

·     SUABILITY OF THE STATE VS LIABILITY OF THE STATE

Ø SUABILITY – Is only a matter of the state waiving its immunity from suit. Or the result of the express or implied consent of the State to be sued.

Ø LIABILITY – Is a matter of the applicable law and the circumstances of its case. Determined after hearing the basis of the relevant laws, the established facts

Ø Liability is not ceded by the mere fact that the state has allowed itself to be sued. (La union v. Firme)

Ø Municipal Government are suable because their charters grant them the competence to sue and be sued.

Ø Celebration of Town Fiesta is considered as a proprietary function (Torio v. Fontanilla)

·     Can you Garnish government funds deposited in banks or levy government property and sell them on public action to satisfy judgement against the state?

Ø Where property of a municipal or other public corporations is sought to be subjected to execution to satisfy judgements recovered against such corporations, the question as to whether such property is leviable or not is to be determined by the usage and purpose for which it is held (Viuda de Tan Toco V. Municipal council of Iloilo)

Ø In UP v. Dizon, the SC stated that an award against the petitioner for moral and actual damages would require an appropriation by Congress considering that “such monetary liabilities were not covered by the ‘appropriations earmarked for said project,’’