Doctrine of State Immunity

Can you file a case against the State?

As a general rule, the State cannot be sued. Exception, when the stated consented that it may be sued.

Relatively, Section 3, Article 16 of the 1987 Constitution provides that the state may not be sued without its consent.

Question: Is entitlement of immunity given by PFA a justiciable question or a political question?

Answer: As a general rule, it is a Political Question (PQ). Thus, the Court may not pass upon such issue. 

By way of exception, when there is grave abuse of discretion, the court may decide or pass upon the legality of the immunity. Hence, may be considered a Justiciable Question (JQ).

Likewise, it can be determined whether the entitlement of immunity is a PQ or a JQ depending who is entitled. Thus, if its is given to a State/Instrumentality, it is a PQ and it is conclusive upon the court. As in the case of The Holy See v. Rosario, the case should have dismissed the case upon the communication given by the Department of Foreign Affairs. However, if the entitlement to immunity is given to an Individual, then it is JQ. As in the case of Liang v. People, where the Supreme Court held that the DFA's determination is only preliminary which is not binding upon the court. Thus, the Court may have its own determination whether the Respondent is immune from suit.

Question: When is a suit considered against the state and when is not?

Answer: When a suit produces adverse consequences such as disbursement of public funds and loss of government property, the suit is considered against the state. Although it was filed against the officer of the State (Arigo v. Swift). The same cannot be considered against the person of the defendant who may claim the state immunity. Otherwise, it is not considered a suit against the State.

In the case of Arigo v. Swift, the Supreme Court had the occasion to answer whether the commanding officers of the US Navy's warship be sued for damages due to the ship's grounding on the Tubataha Reefs while performing official military duties. It held that they cannot be sued for damages considering that the satisfaction of judgment against the said official will eventually require remedial actions and appropriations of the US Government's Funds, the suit is deemed to be one against the US Government itself. Therefore, the Principle of State Immunity bars the Philippine Courts to exercise its jurisdiction over the persons of the Respondents Military Officers.

Question: Are International Organizations and Agencies immune from suit?

Answer: Yes. International Organizations are granted privileges and immunities to secure them legal and practical independence in fulfilling their duties.

However, to be considered as an international organization, it must be:

1. created by the agreement of a considerable number of states;
2. which is for a variety of international purposes, economic or social and mainly non-political (SEAFDEC v. NLRC)

Question: Can a government agency be sued?

Answer: It depends whether such government agency is an unincorporated i.e. no original charter or an incorporated i.e. has an original charter.

When the government agency is unincorporated. It must be determined whether it is performing its governmental function or proprietary function. When it is performing its governmental function, it is not suable. However, when it is performing its proprietary function, it is suable. 

On the other hand, when the government agency is incorporated. It is suable if its charter says so, regardless whether it is performing a governmental or proprietary function. Thus, if its charter says that it is not suable, then it is not suable. Hence, to determine whether an incorporated government agency is suable, consult its charter.

My Professor in Constitutional Law Reviewer then asked what if the Charter of an Incorporated Government Agency is silent on whether it is suable or not? Then, it must be first determined what function it is performing. When it is performing its governmental function, then it is not suable and when it is performing its proprietary function then it is suable. Hence, the rule on Unincorporated Agency applies.

In a cases decided by the Supreme Court, it held than a government agency managing an airport is suable even without its consent. Although, it has no original charter, or if has but is silent as to suability. The Court held that Managing Airport is a business whether revenues be not its prime objective but the promotion of travel and the convenience of the travelling public (ATO v. Spouses Ramos and CAA v. CA). It must be noted that Airports/Government Agencies Managing Airport is a business thus it is performing its proprietary function and not its governmental functions. 

Question: Is the rule on immunity of government agencies classifying the entity's personality whether incorporated or unincorporated applicable to foreign government agencies?

Answer: Yes. In the case of China Machinery and Equipment Corp. Group v. Judge, the Supreme Court held that Chinameg is a GOCC of Chinese Government without original charter. Thus, an unincorporated GOCC of China. The Court noted that the subject contract was executed in the Philippines thus it is performing proprietary function and not a governmental function. Hence, Chinameg is suable.

From this pronouncement, it may be inferred that the rule on the immunity of Philippine Government agencies is applicable to foreign government agencies.

Question: Does suability means outright liability?

Answer: No. Suability does not mean outright liability. Even though an agency is suable, its liability must be determined under the applicable law and established facts. Considering that suability only pertains whether the state may be sued upon its consent. Simply stated, when you can sue a government agency, you must prove its liability.

Question: Can the Prseident waive the state immunity?

Answer: No. The President cannot waive state immunity. It can only be given by the Legislative Department. It must be noted that waiver of sovereignty must be construed/strictissimmi juris against the waiver. 

There are two kinds of waiver: (1) Express Consent and (2) Implied Waiver

1. Express Consent - Suit against the Philippine Government

In the case of Republic v. Feliciano, the Supreme Court held that the Republic cannot be sued pursuant to the Doctrine of Non-suability of the State. In this case, the complaint filed by the Respondent is directed against the Republic of the Philippines as represented by the Land Authority which a government agency created by R.A. 3844. Thus, a suit against the state is not permitted except upon showing that it consented to be sued either expressly or impliedly. However, there is no showing that there was consent considering that the proclamation which states "subject to private rights if any there be" is not a legislative act. It must be noted that the consent to be sued must emanate from statutory authority. Since, waiver of State Immunity can only be made by an act of legislative body.

Express Consent may be done through a (1) General Law or (2) Special Law.

An example of a general law which provides an express consent to sue the state is Act No. 3083 in relation with Commonwealth Act No. 327, as amended by Section 49 and 50 of P.D. 1445.

This law is limited to Money claims arising from contracts. Thus, Act No. 3083 cannot be used as a basis when:

1. Not claiming money against the government
2. Claiming money not arising from a contract.

Question: What is the procedure in collecting money claims?

Answer: File a claim before the the Commission on Audit (COA)

Question: What happens if the complainant already had a RTC's final decision validating his/her claim against a government agency?

Answer: The Complainant still has to file a claim before the COA because it has to first adjudicate the private respondent's claim before the sxecution should proceed (UP v. Dizon). Considering that Act No 3083 provides that money claims  against the government should be filed before the COA and nowhere else. 

In the case of UP v. Dizon, the Court held that UP funds could not be validly made as the subject of the writ of execution or garnishment. Considering that the execution of monetary judgment against UP was within the primary jurisdiction of COA. Thus, it is of no moment whether a final and executory decision already validated the claim against UP. Hence, the claimant has no alternative but to seek first the approval of the COA for its monetary claim. Worthy to note, RTC had no authority to direct the immediate withdrawal of any portion of the garnished funds from the depositary banks of UP. Its order of allowing the withdrawal of the garnished amount is void for being ultra vires.

Meanwhile, in the case of  Taisei Shimizu Joint Venture v. COA, et.al, the Supreme Court held that there are two (2) main types of money claims which the COA may be confronted from: (1) Money claims originally filed with the COA which are limited to liquidated claims and (2) those arising from a final and executory judgment of a court or arbitral tribunal. However, the manner of enforcement or satisfaction thereof is not within the Court's power.It must still be pursued in accordance with the rules and procedures laid down in PD 1445 and other relevant laws. Thus, it may be brought before the COA during the execution stage. Finally, the Supreme Court maintained that the COA's audit review power  is limited in determining th esource of public funds from which the final and executory award may be satisfied.

There are three instances might happen after filing a claim before the COA, either: (1) the  COA grants the claim; (2) the COA denies it; or (3) the COA did not act upon the claim.

Thus, if the COA grants the claim, the claimant must submit the favorable decision to teh Department of Budget Management (DBM) for the inclusion in the next budget proposal for Congress consideration in the General Appropriations Act in the next year's appropriation. (Sabi nga ng Prof ko, maghintay ka ng 1 year). This is pursuant to the rule that no single cent or money shall be paid by the National Treasury without proper appropriation from the Congress. Thus, even there is already a grant of favorable decision of the COA, the National Treasury cannot be immediatly mandated to pay the claim. The remedy is to submit the said favorable validated claim by COA to DBM in order to include the claim in Congress' consideration for teh next year's GAA.

Question: What is the claimant's remedy if the DBM or the Congress refuses to include the claim?

Answer: File a mandamus case before the court to direct the said departments to include the COA-granted claim in the next GAA. This is an excveption to the rule that the law making is discretionary which cannot be subjected to mandamus. Considering that GAA is a law and cannot be compelled. Thus, the ONLY exception is when the COA validated/granted the claim which makes the law making a ministerial function. Hence, mandamus lies.

However, when the COA denies the claim, the claimant's remedy is to file a certiorari before the Supreme Court within 30 days from the receipt of the denial, alleging grave abuse of discretion as a ground thereof.

Likewise, when the COA did not act (inaction) as when the claim is still unresolved after 60 days from the date of its submission for resolution, the claimant may treat it as a denial and file a certiorari case before the Supreme Court.

As to Special Law, it may authorize a particular person to prove his specified claim against the State or authorize a particular suit. Such as Articles 2180 and 2189 of the New Civi Code. Article 2189 provides claim against Province, Cities or Municipalities for the death or physical injuries sustained due to defective condition of roads. However, it must be noted that this article does not warrant claim against Barangay or Region. Further, the defective condition of roads must produce death or pgysical injuries and not damage to properties only.

Thus, in the case of Manile v. Teotico, Article 2189 of the New Civil Code governs the liability considering the action is based upon the alleged defective condition of a road. It was held that for the liability to attached, it is not necessary to establish that the defective roads or streets belong to the province, city or municipality from which the responsibility is exacted. It only requires that the province, city, or municipality have either "control" or "supervision" over the street or road. Thus, even though P.Burgos Avenue is a national highway, this would not detract from the control or supervision of the City of Manila.

Question: How to claim?

Answer: As a general rule, File a civil case where the law specifically says so. In the absence thereof, then file it before the regular courts i.e. Regional Trial Court being the court of general jurisdiction.

2. Implied Waiver

The State may impliedly give its consent to be sued by (1) entering into a business contract or (2) commencing a suit.

The first mode of implied consent is useful only to a suit against a foreign government. Thus, it cannot be used against the Foreign Government. Considering that Philippine Government already waived its immunity from suit pursuant to Act No. 3083. Regardless whether proprietary or governmental so long as the claimant has a contract with the government. However, in restrictive doctrine of state immunity, the foreign/philippine  government entered into a contract with a private contractor is only suable when the contract eneter into in is proprietary and not a governmental one i.e. refers/relates to the exercise of the sovereign/governmental functions.

Thus, in the case of USA v. Ruiz, USA may invoke its immunity from suit. Considering that maintaing a dock for a navy is considered a governmental function. The project is an integral part of the naval base which is devoted to the defense of the US and PH. Hence, a function of the government.

The second mode pertains to the suit initiated by the government against a  private individual who only needs to defend himself. Thus, this kind of waiver is only applicable to a suit against a private person. here, the state descended to the level of an ordinary citizen by initiating a suit against a private person. Thereby, opening itself for a possible counterclaim. 

In the case of Froilan v. Pan Oriental, the government impliedly allowed itslef to be sued when it filed a complaint-in-intervention to assert a claim for affirmative relief. Thus, taking this initiative against a private party, the state surrendered its privileged position and came down to the level of dependant. It must be noted that the State Immunity does not deprive the State its right to sue private parties in its own courts.

Question: Does consent to be sued include consent to execution?

Answer: No. Consent to be sued does not include consent to execution.

The execution will require another waive because the power of the court ends when the judgment is rendered. The State may give consent to execution through an appropriation statute passed by the Congress.

In the case of Municipality of San Miguel v. Fernandez, the Supreme Court held that the funds of the Municipality cannot be the subject of execution. Since public funds cannot be levied or subjected to execution. Thus , the funds of Municipality of San Miguel are exempt from execution. There must be a corresponding approriation through an ordinance duly passed by the Sangguniang Bayan before any money may be paid out.

Meanwhile, in the case of Municipality of Makati v. CA, the Supreme Court held that the bank account for expropriation is not exempted from garnishment but only the account intended for statutory obligations. Absence of an ordinance passed by the Municipal Council of Makati appropriating its funds in the amount which corresponds to the balance due pursuant to RTC's decision, no levy under execution may be validly effected on the public funds deposited on the said account.

However, the claimant may avail the remedy of mandamus when the municipality fails or refuses, without justifiable cause, to effect the payment of a final money judgment rendered against it. The purpose of which is to compel the enactment and approval of the necessary appropriation ordinace and the correspondings disbursement of municipal funds.

REFERENCE: Atty. Enan Flores' Lecture ☺