Ruiz vs Cabahug (G.R. No. L-9990) Constitutional Law

ENRIQUE J. L. RUIZ and JOSE V. HERRERA, in their behalf and as minority stockholders of the Allied Technologists, Inc., plaintiffs-appellants,

vs.

HON. SOTERO B. CABAHUG, Secretary of National Defense, Col. NICOLAS JIMENEZ, Head of the Engineer Group, Office of the Secretary of National Defense, THE FINANCE OFFICER of the Department of National Defense, the AUDITOR of the Department of the National Defense, PABLO D. PANLILIO and ALLIED TECHNOLOGISTS INC., defendants-appellees.

Ponente:

LABRADOR, J.

Action:

Appeal from a judgment of the Court of First Instance of Manila dismissing plaintiffs' amended complaint

Facts:

On July 31, 1950 Hon. Sotero B. Cabahug (Secretary of National Defense) accepted the bid of the Allied Technologists, Inc., to furnish the architectural and engineering services in the construction of the Veterans Hospital at a price of P302,700. The plans, specifications, sketches and detailed drawings and other architectural requirements submitted by the Allied Technologists through its architects, Enrique J. L. Ruiz, Jose V Herrera and Pablo D. Panlilio were approved by the United States Veterans Administration in Washington, D.C. When the officials of the Department of National Defense paid the Allied Technologists the contract price for the architectural engineering service, they retained 15 per cent of the sum due, for the reason that Mr. Panlilio has asserted that he is the sole and only architect of the Veterans Hospital to the exclusion of his fellow architects Ruiz and Herrera, an assertion aided and abetted by Col. Nicolas Jimenez. This action deprived Mr. Ruiz and Mr. Herrera monetary value of their professional services and damaged their professional prestige and standing.

Issues:

Whether or not the government can be sued for withholding the 15% of the sum and depriving the plaintiffs of their share.

Ruling:

The order of dismissal is hereby reversed and set aside, and the case is remanded to the court a quo for further proceedings. With costs against the defendants-appellees.

Ratio Decidendi:

The case is a not a suit against the government, which could not be sued without its consent. It was found that the government has already allotted the full amount for the contract price; it was the defendant-officials which were responsible for the allegation. This was to be directed to the officials alone, where they are compelled to act in accordance with the rights established by Ruiz and Herrera or to desist from paying and recognizing the rights and interests in the funds retained and the credit for the job finished. The order of dismissal was reversed and set aside and the case was remanded to the court a quo for further proceedings with cost against the defendants.