DOCTRINE OF STATE IMMUNITY

Reviewer by Cha Villamer

I. STATE IMMUNITY FROM SUIT

CRUZ,2024:

The constitution declares, rather superfluously, that "the State may not be sued
without its consent." This provision is merely a recognition of the sovereign character
of the State and an express affirmation of the unwritten rule insulating it from the
jurisdiction of courts of justice.

Accordingly, it has been recognized that the "rule that a state may not be sued without
its consent is one of the generally accepted principles of international law that we have
adopted as part of the law of our land under article 2, section 2.

Explanation in simple terms:

This rule is in place because the government is considered "sovereign," meaning it

has a special status that protects it from being judged by courts unless it
chooses to allow it. The Constitution says that you can't sue the government unless
it agrees.
This rule isn't new; it's based on the idea that the government has a special status that
protects it from being taken to court without its permission. This principle is also
recognized in international law, which the Philippines has accepted as part of its own
laws under Article 2, Section 2 of the Constitution.
“The Philippines renounces war as an instrument of national policy, adopts the
generally accepted principles of international law as part of the law of the land,
and adheres to the policy of peace, equality, justice, freedom, cooperation, and
amity with all nations.”
BASIS:
It is obvious that indiscriminate suits against the state will result in the impairment of its
dignity, besides being a challenge to its supposed infallibility.

Explanation in simple terms:

“that if people could sue the government whenever they wanted, it would harm the
government's reputation and respect. It would also question the idea that the
government is always right or cannot make mistakes.”

Justice Holmes (p.50):

The doctrine of non-suability is based not on any formal conception or
obsolete theory, but on the logical and practical ground that there can be no legal
right against the authority which makes the law on which the right depends.
Another justification is the practical consideration that the demands and inconveniences
of litigation will divert the time and resources of the State from the more pressing
matters demanding its attention to the prejudice of the public welfare.
Simple Explanation:
Justice Holmes believed that the government can't be sued because it's logical:
the government makes the laws, so you can't have legal rights against it. Also,
lawsuits would waste government time and resources, distracting from more important
public issues.

It is usually applied within a domestic context, meaning a government cannot be sued

by its own citizens or entities without its express consent.

Does it apply to other states as well acc. from holmes?

YES. You can't sue the government which also applies to foreign countries when
someone tries to sue them in another country's courts. This is because all countries
are considered equal and one country can't have power over another. If one
country tried to do that, it could cause problems and disrupt peace between nations. Par
in parem non habet imperium (unduly vex the peace of nations.)

NOTE:
A foreign country isn't always immune from being sued in another country. If the
foreign country does business or makes contracts that are commercial or private
in nature, it can be sued in the host country. However, if the contracts are related
to its government functions, the country may still be immune. Whether it can be
sued depends on the nature of the contracts it entered into.

DOCTRINE OF STATE IMMUNITY VS DOCTRINE OF NON SUABILITY:

● Scope: The doctrine of state immunity is primarily an international law

principle, while the doctrine of non-suability is usually applied domestically.
● Application: State immunity concerns the relationship between sovereign
states, whereas non-suability concerns the relationship between a
government and its citizens.

In summary, while both doctrines protect the state from legal action without its
consent, they operate in different legal contexts—international versus domestic.

QUESTION:
Is there a difference between doctrine of non-suability and state immunity?
They are related concepts but not exactly the same.

Justice: Why?

Because both of them say that a state can't be sued without its consent. The only
difference is that the DSI is a generally accepted principle of international law.
Meanwhile the DNS is a doctrine that is applied inside the state or locally wherein
its citizens can't sue its government.
Justice: Why can't they sue their government?

Because it will interfere with the supposed function of the government in different
pressing issues.

QUESTION:
Is there a restrictive application of the doctrine?
YES. The application of the doctrine (DSI) from suit has been restricted to
SOVEREIGN or GOV. Activities (JURE/JUS IMPERII). It cannot be extended to
commercial, private and proprietary acts (JURE/JUS GESTIONIS).

Association of Medical Clinics for Overseas Workers Inc. v. GCC-approved

Medical Centers Association Inc.:

The Supreme Court emphasized that while sovereign immunity—protection from being
sued—is a key principle for states, it isn't absolute. The court clarified that
sovereign immunity only applies to public acts (jus imperii) and not to
commercial activities (jus gestionis). This means a foreign government can be sued
for commercial transactions just like a private individual.

The court noted that even though foreign governments are protected from being
sued for their official acts, this doesn't mean their agents are exempt from
following local laws. In this case, the court found that there was no evidence showing
that international custom protects foreign agents from complying with Philippine laws.
Thus, they couldn't determine if such a custom existed.

CONT. Cruz,2024:

In the context of the applicability of the principle of state immunity to a state in relation to
claims filed against it by its citizens, or inhabitants, or in connection with the action of its
government within its territory, not all acts jure imperii may exempt a state from suit as in
the case of its exercise of its power of eminent domain, when done without payment of
just compensation.

Simple Explanation:
State immunity means a country usually can’t be sued in another country’s courts.
However, there are exceptions. For example, if a government takes property from its
citizens without fair payment (known as eminent domain), it might not be protected by
immunity and could be sued, even if this action is considered part of its government
functions.

LIMITATIONS OF STATE IMMUNITY:

● Not all acts of jure imperii may exempt a state from suit, as in the case of
its exercise of its power of eminent domain, when done without payment of
just compensation.
Explanation:
When a state uses its power to take private property for public use (called eminent
domain), it must pay the owner a fair amount, known as just compensation. Normally,
states are immune from being sued for actions they take as a government (called jure
imperii acts). However, if the State takes someone's property without paying for it,
this failure to pay can allow the property owner to sue the state, even though the
state usually can't be sued for its government actions.
● Not any agency of foreign state may properly invoke the latter's sovereign
immunity to ward off suits against it.
Explanation:
Not all government-related organizations or agencies of a foreign country can claim
sovereign immunity to avoid being sued. Only certain agencies that perform essential
government functions can properly claim sovereign immunity. So kahit na hire ka ng
bansa mo to work sa ibang state, unless proven na immune ka, you’re not covered by
the doctrine. There must be an original charter.
● NO ORIGINAL CHARTER (special law that grants immunity to a certain org
or company), NO IMMUNITY.
APPLICATION:
1. It’s important to determine only certain agencies that perform essential
government functions can properly claim sovereign immunity, that the claim
if proved will be a DIRECT LIABILITY of the State and not merely of the officer
impleaded. The action can be dismissed as a suit against the state UNLESS
its immunity had been previously waived.
2. There are many instances when a public officer may be sued in his official
capacity WITHOUT the necessity of first obtaining the consent of the State to be
sued.
3. A public officer may require to do a duty required by law;
4. Restrain him from doing an act that is unconstitutional or illegal;
5. To recover him taxes unlawfully assessed or collected.
6. Suing for Property: If you sue a government official just to get back property
that they are holding in their official capacity, this is not considered suing the
government itself. In this case, you don’t need permission (or a waiver of
immunity) to file the lawsuit.
7. Suing for Damages:If you sue a government official just to get back property
that they are holding in their official capacity, this is not considered suing the
government itself. In this case, you don’t need permission (or a waiver of
immunity) to file the lawsuit.
8. Any injury caused by a public officer is his own personal liability and it cannot be
imputed to the State.

WAIVER OF IMMUNITY
“Royal prerogative of dishonesty” - it refers to the idea that the state can get away
with wrongdoing because of its special legal status.
FORMS OF CONSENT

1. EXPRESSED Consent - can be obtained by general law or special law.

 2. IMPLIED Consent - when the State itself commences litigation or when it
enters into a contract.

The GENERAL LAW for the standing consent of the State TO BE SUED is ACT NO.
3083:

“The Government of the Philippine Islands hereby consents and submits to be

sued upon any moneyed claim involving liability arising from contract, express or
implied, which could serve as a basis of civil action between private parties.”

1. An express waiver can be provided for in a treaty like VFA, BUT NOT applicable
only to suits covered by the same and may not be invoked as general consent for
all suits.
2. 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.
3. The doctrine of sovereign immunity was not an instrument for perpetrating any
injustice on a citizen.
4.

MINUCHER V CA, G.R. NO. 142396

ISSUE/S:
a. Whether or not the doctrine of conclusiveness of judgment, following the decision
rendered by this Court in G.R. No. 97765, should have precluded the Court of
Appeals from resolving the appeal to it in an entirely different manner, and
b. Whether or not Arthur Scalzo is indeed entitled to diplomatic immunity.

RULING/S:
 a. NO. Because G.R. No. 97765 has not resolved that point with finality. That’s why
CA reversed the trial court’s ruling because Scalzo presented new evidence
where the CA could base their judgements.
b. YES. The Philippine government has given its imprimatur, if not consent, to the
activities within Philippine territory of agent Scalzo of the United States Drug
Enforcement Agency.

This Court is constrained to rule that respondent Arthur Scalzo, an agent of the
United States Drug Enforcement Agency allowed by the Philippine government to
conduct activities in the country to help contain the problem of drug traffic, is
entitled to the defense of state immunity from suit.

Facts:
1. An Iranian national, Khosrow Minucher and one Abbas Torabian, violated the

Section 4 of Republic Act No. 6425, otherwise also known as the "Dangerous

Drugs Act of 1972,"

2. The Iranian nationals were acquitted by using heroin, a prohibited drug,

which was said to have been seized. The narcotic agents were accompanied by

private respondent Arthur Scalzo who would, in due time, become one of the

principal witnesses for the prosecution.

3. The Iranian said that he just came to study in the Philippines and was later

on appointed as Labor Attache for Iranian Embassies in Japan and

Philippines.

4. The plaintiff met the defendant thru Jose Inigo and during their interactions, the

plaintiff sold caviars and other iranian things to the defendant. Later on, the

defendant was invited to have dinner outside and visitation in the plaintiff's house

wherein he met Abbas inside the bedroom, playing chess with Minucher. Their
 main topics were about politics, caviar and Iranian products; Murich also asked if

Szalzo could get him a visa for his wife and Abbas’ wife which the latter agreed.

5. The plaintiff is aware of Scalzo’s work as a special agent for the United

States under Drug Enforcement Administration, Department of Justice of

US.

6. In the last visit, Scalzo, together with 30-40 Filipino armed men and 6 US

Americans, arrested him. According to the plaintiff, he was not told why he was

being arrested. His arrest as a heroin trafficker was publicized around the world.

7. After being arrested, Minucher was seeking damages because he claimed

that Arthur Scalzo falsely accused him of drug trafficking.

8. The Manila RTC then reviewed the case and provided a detailed account of the

facts and circumstances related to Minucher’s claims and the overall situation.

9. Scalzo denied the complaint and filed for its dismissal, but it was denied by

the court. The case wasn’t really finished nor gave its finality. After almost

2 years, Scalzo filed a motion to dismiss the complaint on the ground that,

being a special agent of the United States Drug Enforcement

Administration, he was entitled to diplomatic immunity. He presented valid

evidence about his claim, which granted him the immunity which the CA

used as a basis for the final judgment which reversed the TC’s ruling for

Scalzo.

Notes:
The reason why Scalzo was given diplomatic immunity is because a foreign agent,

operating within a territory, can be cloaked with immunity from suit but only as

long as it can be established that he is acting within the directives of the sending

state. The consent of the host state is an indispensable requirement of basic courtesy

between the two sovereigns. The Philippine government approved the activities

upon Scalzo’s arrival until his departure.

What is the Doctrine of Conclusiveness of Judgment?

The doctrine of conclusiveness of judgment, or res judicata, means that once a

court makes a final decision on a case, that decision is binding and cannot be

re-litigated. For this doctrine to apply, several conditions must be met:

1. Finality of Judgment: The previous court's decision must be final and not

subject to further appeal.

2. Valid Jurisdiction: The court that made the decision must have had proper

authority over the case and the people involved.

3. Judgment on the Merits: The court's decision must be based on the actual

facts and legal arguments of the case, not just a procedural issue.

4. Identity of Parties, Subject Matter, and Causes of Action: The parties

involved, the issues at hand, and the legal claims must be the same in both

cases.

REP. V. VILLASOR, 54 SCRA 84, G.R. NO. L-30671

Certiorari - a court process to seek judicial review of a decision of a lower court or

government agency. Certiorari comes from the name of an English prerogative writ,
issued by a superior court to direct that the record of the lower court be sent to the
superior court for review.

Writ of execution - is a court order that puts in force a judgment of possession and
directs law enforcement personnel to begin the transfer of assets, money, or
property as the result of a legal judgment.

ISSUE/S:
1. Whether or not Judge Guillermo P. Villasor’s order declaring Alias Writ of

Execution against AFP’s funds is valid.

RULINGS:

1. NO. Public funds cannot be the object of a garnishment proceeding even if

the consent to be sued had been previously granted and the state liability

adjudged.

NOTE:

When the government allows itself to be sued, the legal process only goes as far as the court's decision.

The court cannot order the seizure of government funds or property to pay off the judgment because

public money must be spent according to the law. This ensures that government functions and services

aren't disrupted by diverting funds meant for specific purposes. Even if the money is intended for

government employees, it can't be taken by their creditors because it's still considered government

property until it's officially paid out. Allowing such seizures would indirectly go against the rule that the

government can't be sued without its permission.

You can sue the government BUT with consent and there’s limitation as well.

FACTS:

1. Judge Guillermo P. Villasor declared a final decision in favor of the respondents

P.K. Kiener Cp., Ltd., Gavino Unchuan, and International Construction

Corporation against the Philippines.

 2. This decision was questioned by the petitioners (RPh) since this decision

was directly against the funds of the Armed Forces of the Philippines, a

part of the public government.

3. On the strength of the afore-mentioned Alias Writ of Execution, the Provincial

Sheriff of Rizal (respondent herein) served notices of garnishment with

several Banks (issue), specially on the "monies due the Armed Forces of the

Philippines in the form of deposits sufficient to cover the amount mentioned in the

said Writ of Execution"; the Philippine Veterans Bank received the same notice of

garnishment.

4. The funds of the Armed Forces of the Philippines on deposit with the

Banks, particularly, with the Philippine Veterans Bank and the Philippine

National Bank [or] their branches are public funds duly appropriated and

allocated for the payment of pensions of retirees, pay and allowances of

military and civilian personnel and for maintenance and operations of the

Armed Forces of the Philippines.

PEOPLE V. GOZO G.R. NO. L-36409

ISSUE:

1. Whether or not the Municipal Ordinance No. 14 valid and its jurisdiction

applicable to Loreza Gozo’s construction of her house within the naval

base leased to the American armed forces.

RULING:
 1. YES. Within the limits of its territory, whatever statutory powers are vested upon it

may be validly exercised. Any residual authority and therein conferred, whether

expressly or impliedly, belongs to the national government, not to an alien

country.

FACTS:

1. The appellant, Loreta Gozo, bought a house and lot located inside the

United States Naval Reservation within the territorial jurisdiction of

Olongapo City.

2. She demolished the house and built another one in its place, without a building

permit from the City Mayor of Olongapo City, because she was told by one

Ernesto Evalle, an assistant in the City Mayor's office, as well as by her

neighbors in the area, that such building permit was not necessary for the

construction of the house.

3. After due investigation, Loreta Gozo was charged with violation of

Municipal Ordinance No. 14, S. of 1964 with the City Fiscal's Office.

4. The City Court of Olongapo City found her guilty of violating Municipal Ordinance

No. 14, Series of 1964 and sentenced her to an imprisonment of one month as

well as to pay the costs. The Court of Instance of Zambales, on appeal, found

her guilty on the above facts of violating such municipal ordinance but would

sentence her merely to pay a fine of P200.00 and to demolish the house thus

erected.

5. The appellant elevated the case to the Court of Appeals questioning the

jurisdiction and validity of the ordinance on constitutional ground or at the

 very least its applicability to her in view of the location of her dwelling

within the naval base.

6. There was no support in law for the stand taken by the appellant. She tried to

cite some cases that could help her alleviate her situation but these cases

such as People v. Fajardo, contending that they have the same situation.

But this case was different from her because former Mayor Fajardo filed a written

request with the incumbent municipal mayor for a permit to construct a building

adjacent to their gasoline station on a parcel of land registered in Fajardo's

name, located along the national highway and separated from the public plaza by

a creek. However this was denied for it will destroy the beauty of the public plaza.

defendants reiterated their request for a building permit ..., but again the request

was turned down by the mayor. Whereupon, appellants proceeded with the

construction of the building without a permit, because they needed a place of

residence very badly, their former house having been destroyed by a typhoon

and hitherto they had been living on leased property.

7. This passage is saying that the appellant (the person challenging the law)

cannot rely on the Fajardo case to support her argument because the

Fajardo case was specific to its own circumstances, and the appellant is

misinterpreting it. In the Fajardo case, the law was applied in an unfair way,

which is why the conviction was overturned. However, in the appellant's

case, the situation is different, and the ordinance (local law) was applied

correctly.
 8. The court points out that the appellant was convicted twice for violating the

ordinance—first by the City Court and then by the Court of First Instance—which

clearly shows that the ordinance applies to her situation. Therefore, her

conviction for violating the ordinance was valid

9. In People v. Acierto, Justice Tuason emphasized that the Philippines only

allows the U.S. to exercise jurisdiction in certain cases as a courtesy, but

this does not mean the Philippines has given up its sovereignty over those

areas. The U.S. has preferential but not exclusive jurisdiction, and the

Philippines retains the right to govern.

10. The court concludes that even though the Philippines might allow the U.S. to

exercise some control over the bases, those areas are still under Philippine

sovereignty. The foreign bases are not considered foreign territory, and the

Philippine government’s power is only slightly limited, not eliminated.

In essence, the presence of foreign military bases does not strip the Philippines

of its sovereignty or its ability to govern those areas.

11. Within the limits of its territory, whatever statutory powers are vested upon

it may be validly exercised. Any residual authority and therein conferred,

whether expressly or impliedly, belongs to the national government, not to

an alien country.

SOVEREIGN OR DIPLOMATIC IMMUNITY MAY BE INVOKED IN A FOREIGN SUIT

HOLY SEE V ROSARIO, ET AL., G.R. NO. 101949

ISSUE: Is the Holy See entitled to sovereign immunity?

RULING: YES. The mere entering into a contract by a foreign state with a private party

cannot be the ultimate test [as to whether it is acting jure imperii or jure gestionis]. The

logical question is whether the foreign state is engaged in the activity in the regular

course of business. If not, the particular act or transaction must then be tested by its

nature. If the act is in pursuit of a sovereign activity, or an incident thereof, then it is an

act jure imperii, especially when it is not undertaken for gain or profit. In the case at the

bench, the Holy See did not buy and sell the lot in the ordinary course of a real

estate business. Lot 5-A was in fact donated to it for constructing the official

place of residence of the Papal Nuncio [which is necessary for the creation and

maintenance of its diplomatic mission]. In subsequently selling the lot, no profit

was intended. Moreover, the privilege of sovereign immunity in this case was

sufficiently established by the Certification of the DFA. Where the plea of

immunity is recognized and affirmed by the executive branch, it is the duty of the

courts to accept this claim so as not to embarrass the executive arm of the

government in conducting the country’s foreign relations. Even if the State

consented to be sued and its liability adjudged, its public funds may not be disbursed by

judicial order. There must be a corresponding law of appropriation.

FACTS:

The petition arose from a controversy over a parcel of land, Lot 5-A, located in the

Municipality of Paranaque. Said Lot 5-A is contiguous to Lots 5-B and 5-D registered in

the name of Philippine Realty Corp. The three lots were sold to Licup through an agent.

Later, Licup assigned his rights to the sale to respondent Starbright Enterprises

(Starbright). In view of the refusal of the squatters to vacate said lots, a dispute arose as
to who of the parties has the responsibility of evicting and clearing the land of squatters.

Thereafter, the Holy See (a foreign state exercising sovereignty over the Vatican City31)

through its Ambassador, the Papal Nuncio, sold Lot 5-A to a third person (Tropicana

Corp.). Lot 5-A was previously acquired by the Holy See by donation from the

Archdiocese of Manila for constructing thereon the official place of residence of the

Papal Nuncio. In subsequently selling the lot, no profit was intended. The Holy See

merely wanted to dispose of the same because the squatters living thereon made it

almost impossible for them to use it. Starbright filed a complaint against the Holy See

who pled sovereign/diplomatic immunity. Starbright insists that the doctrine of non

suability does not apply for the Holy See has divested itself of such cloak when, of its

own free will, it entered into a commercial transaction for the sale of a parcel of land

located in the Phils. The trial court upheld Starbright. Hence this petition. Meanwhile,

the DFA moved to intervene in behalf of the Holy See, and officially certified that the

Embassy of the Holy See is a duly accredited diplomatic mission to the Republic of the

Phils exempt from local jurisdiction and entitled to all the rights, privileges and

immunities of a diplomatic mission or embassy in this country.

Exceptions to the Doctrine of State Immunity

REPUBLIC OF THE PHILIPPINES (PRESIDENTIAL COMMISSION ON GOOD

GOVERNMENT) v. SANDIGANBAYAN, BIENVENIDO R. TANTOCO, JR. and

DOMINADOR R. SANTIAGO 204 SCRA 212 November 21, 1991

ISSUE:

Is the PCGG immune from suit?

RULING:

NO. PCGG’s contention has no application to a judicial proceeding it has itself

initiated. By filing suit, PCGG brings itself within the operation and scope of all the rules

governing civil actions, including the rights and duties under the rules of discovery.

Otherwise, the absurd would have to be conceded, that while the parties it has

impleaded as defendants may be required to "disgorge all the facts" within their

knowledge and in their possession, it may not itself be subject to a like compulsion. It is

axiomatic that in filing an action, the State divests itself of its sovereign character

and shed its immunity from suit descending to the level of ordinary litigant.

The PCGG cannot claim a superior or preferred status to the State, even while

assuming to represent or act for the State. [Express] consent of the State to be

sued must emanate from statutory authority.

FACTS:

Pursuant to EO 14 of Pres. Aquino, the PCGG filed an action against private

respondents. On motion of private respondents, Sandiganbayan ordered to allow

amended interrogatories to the PCGG. PCGG refuses to answer the

interrogatories and now seeks to nullify the Order contending, among others, that

none of its members may be “required to testify or produce evidence in any

judicial . . proceeding concerning matters within its official cognizance”,

suggesting an appeal to the Doctrine of non-suability of the State.

The PCGG filed a case to recover assets and damages for the Philippine

government. The defendants responded with legal motions instead of directly

answering the case. There was a series of legal exchanges between the PCGG
and the defendants, including requests for more details and documents. The

court made some decisions that the PCGG disagreed with, leading to further legal

actions and appeals.

When is a suit against the State

PROFESSIONAL VIDEO V. TESDA, G.R. No. 155504, June 26, 2009

ISSUE:

Whether or not the doctrine of immunity from suit can be fully extended to TESDA?

RULING:

NO. TESDA, as a government agency, cannot be sued without the state's consent due

to the principle of state immunity. This rule, rooted in the 1987 Constitution and

international law, protects the state and its agencies from lawsuits in another state’s

courts. The principle is based on the idea that a sovereign state cannot be legally

challenged by its citizens, as it creates the laws. Allowing such suits would disrupt

public service and government functions. The immunity applies to suits against the

state, its agencies, or officials where the government would bear the liability. In this

case, a writ of attachment was issued against TESDA, a government agency with its

own charter, reinforcing its immunity from such actions.

FACTS:

● Professional Video, Inc. (PROVI) entered into a contract with the Technical

Education and Skills Development Authority (TESDA) for PVC identification

cards.
 ● TESDA, a government instrumentality under Republic Act No. 7796,

conducted two failed public biddings for the project.

● TESDA then negotiated a contract with PROVI on December 29, 1999, for

P39,475,000.

● An addendum to the contract was made on August 24, 2000, detailing

additional deliverables.

● PROVI claimed it delivered the items, but TESDA only paid P3,739,500, leaving

a balance of P35,735,500.

● PROVI sent demand letters, but the amount remained unpaid.

● PROVI filed a complaint for a sum of money with damages and a writ of

preliminary attachment/garnishment against TESDA in the RTC of Pasig City.

● The RTC granted the writ, but TESDA's motion to discharge it was denied.

● TESDA filed a petition for certiorari with the Court of Appeals (CA), which nullified

the RTC's orders, citing state immunity and the public nature of TESDA's funds.

● PROVI's motion for reconsideration was denied, leading to the present

petition before the Supreme Court.

HEIRS OF MATEO PIDACAN V. ATO, 629 SCRA 451 (2010)

ISSUE:

WHETHER OR NOT THE STATE CAN BE SUED IN THEIR EXERCISE OF ITS

POWER OF EMINENT DOMAIN.

RULING: YES. The court decided that the evidence shows that the government’s

action, specifically the Air Transportation Office (ATO) converting the property into an

airport in 1948, was a valid exercise of eminent domain. Therefore, the case involves

eminent domain, which implies that while the state has the right to take the property,

there may be legal grounds for the affected party to sue, especially if fair compensation

was not provided.

FACTS:

● The case involves a legal battle between the heirs of Mateo Pidacan and

Romana Eigo and the Air Transportation Office (ATO) over the payment for

the use of their property as an airport since 1948.

● The Pidacan spouses acquired a parcel of land in San Jose, Occidental Mindoro

in 1935.

● In 1948, the ATO used a portion of the property as an airport.

● After the death of the Pidacan spouses, the ATO constructed a perimeter fence

and a new terminal building on the property.

● The heirs demanded payment from the ATO, but they were told that

payment could not be made because the property was still in their parents'

name.

● The heirs filed a petition for the issuance of another owner's duplicate of the land

title.

● In 1988, a new title was issued in their favor.

● However, the ATO still refused to pay them, claiming that the property had been

sold to its predecessor for a low price per square meter.

● The heirs filed a complaint against the ATO for payment of the value of the

property and rentals for its use and occupation.

● The ATO filed a complaint for expropriation, which was dismissed.

● The trial court initially ordered the ATO to pay rentals and the value of the

land.

● The Court of Appeals reversed this decision and remanded the case to the trial

court to determine just compensation based on the market value prevailing in

1948.

● After further proceedings, the trial court rendered a new judgment,

expropriating the occupied area and ordering the ATO to pay the value of

the land and monthly rentals.

● The ATO appealed again, and the Court of Appeals reversed the trial court's

ruling, remanding the case for the determination of just compensation based on

the market value in 1948.

● The heirs filed a petition for review, arguing that there was no taking of the

property in 1948 and that the valuation should be based on the present

value.

● The Supreme Court held that there was a taking of the property in 1948 when the

ATO converted it into an airport, depriving the heirs of its beneficial use and

enjoyment.
AIR TRANSPORTATION OFFICE(ATO) V. RAMOS G.R. No. 159402. February 23,

2011

ISSUE:

Whether or not ATO could be sued without the state’s consent.

RULING:

SC dismissed the petition for lack of merit.

The immunity of the State from suit, known also as the doctrine of sovereign immunity

or non-

suability of the State, is expressly provided in Article XVI of the 1987 Constitution, viz:

Section 3. The State may not be sued without its consent. In our view, the CA thereby

correctly appreciated the juridical character of the ATO as an agency of the Government

not performing a purely governmental or sovereign function, but was instead involved in

the management and maintenance of the Loakan Airport, an activity that was not the

exclusive prerogative of the State in its sovereign capacity. Hence, the ATO had no

claim to the State’s immunity from suit. We uphold the CA’s aforequoted holding. We

further observe the doctrine of sovereign immunity cannot be successfully invoked to

defeat a valid claim for compensation arising from the taking without just compensation

and without the proper expropriation proceedings being first resorted to of the plaintiffs’

property.

FACTS:

● The case involves the Air Transportation Office (ATO) and the spouses
David and Elisea Ramos.
● The Ramoses discovered that a portion of their land was being used as part of
the runway and running shoulder of the Loakan Airport operated by the ATO.
● After negotiations, the Ramoses agreed to convey the affected portion to
the ATO in exchange for payment.
● However, the ATO failed to pay despite repeated demands.
● The Ramoses filed an action for collection against the ATO in the Regional
Trial Court (RTC).
● The ATO invoked the issuance of Proclamation No. 1358, which reserved certain
parcels of land for the use of the Loakan Airport, as an affirmative defense.
● The ATO argued that the RTC had no jurisdiction to entertain the action
without the State's consent.
● The RTC denied the ATO's motion for a preliminary hearing of the affirmative
defense.
● The ATO's motion for reconsideration was also denied.
● The ATO filed a special civil action for certiorari in the Court of Appeals (CA) to
challenge the RTC's orders.
● The CA dismissed the petition, finding no grave abuse of discretion.
● The RTC rendered a decision in favor of the Ramoses, ordering the ATO to pay
them the value of the appropriated land, damages, and attorney's fees.
● The ATO appealed to the CA.
● The CA affirmed the RTC's decision with modifications.
● The ATO filed a petition for review on certiorari before the Supreme Court.
● The main issue presented for resolution was whether the ATO could be sued
without the State's consent.
● The Supreme Court ruled that the ATO could be sued without the State's
consent.
● The Court held that the ATO, as an agency of the State engaged in an enterprise
that is not the State's exclusive prerogative, does not enjoy sovereign immunity
from suit.
HEIRS OF GAMBOA V. TEVES, 682 SCRA 397 (2012)

ISSUE: Whether the term capital in Section 11, Art. 12 of the Constitution refers to the

total common shares only of PLDT, a PUBLIC UTILITY.

RULING: NO. The case involves the interpretation of "capital" in Section 11, Article XII

of the 1987 Philippine Constitution, which limits foreign ownership in public utility

corporations to 40%.

FACTS:

● The case involves the interpretation of "capital" in Section 11, Article XII of

the 1987 Philippine Constitution, which limits foreign ownership in public

utility corporations to 40%.

● Petitioners, Heirs of Wilson P. Gamboa, challenged the sale of shares in the

Philippine Long Distance Telephone Company (PLDT) to foreign investors.

● They argued that "capital" should refer exclusively to voting shares.

● Respondents included Finance Secretary Margarito B. Teves, Finance

Undersecretary John P. Sevilla, and Commissioner Ricardo Abcede of the

Presidential Commission on Good Government (PCGG), among others.

● The case was filed in 2007.

● On June 28, 2011, the Supreme Court ruled that "capital" refers solely to voting

shares.
● This decision was challenged through motions for reconsideration by

various respondents, including the Philippine Stock Exchange (PSE) and

PLDT officials.

● The ruling should be applied prospectively, allowing public utilities time to comply

with the nationality requirement before the start of any administrative case or

investigation.

● PLDT and its foreign stockholders are indispensable parties in resolving

the legal issue on the definition of "capital."