Salvador vs.

Laurel
GR No. 92013 (July 25, 1990)

Facts:
The Roponggi property is one of four properties in Japan acquired by the Philippine Government under
the Reparation Agreement entered into with Japan. The property was acquired under the heading
“Government Sector” for the Chancery of the Philippine Embassy but was later transferred to Nampaida
since the building needed major repairs. Due to lack of funds, the Roppongi property has remained
underdeveloped since.

Later, Pres. Aquino created a committee to study the disposition/ utilization of the government
properties in Japan. She issued EO 296 entitling non-Filipino citizens to avail of separations’ capital
goods and services in the event of sale, lease, or disposition. Amidst opposition, the executive branch of
the government pushed for the sale of the reparation properties, starting with Roppongi, which has
twice been set for bidding at a minimum floor price of USD225M. The first was a failed bidding while the
second has been postponed and later restrained by the SC.

Respondents submit that the Roppongi property is not governed by the Civil Code but by the laws of
Japan where it is located, relying upon the rule of lex situs to determine the law applicable.

Issues:
1. W/N the Roppongi lot in Japan is of public dominion and can be alienated by the government
2. W/N the President has the authority to alienate the Roppongi property
3. W/N there exists a conflict of laws
4. W/N the EO is unconstitutional

Held:
1. Yes, it is of public dominion. The respondents failed to show that the property has become
patrimonial. The fact that the site has not been used for a long time for actual embassy service
does not automatically convert it to patrimonial use. Any such conversion happens only if the
property is withdrawn from public use. A property continues to be part of the public domain,
not available for private appropriation or ownership, until there is a formal declaration on the
part of the government to withdraw it from being such.

Being of public domain, the properties are outside of the commerce of men and therefore
cannot be alienated. The EO does not declare that the properties have lost their public
character, but merely intended the properties to be made available also to foreigners and not
just to Filipinos alone in case of sale, lease, or other disposition. Neither does the CARP Law re-
classify the properties to patrimonial because it merely state that sources of funds may be from
proceeds of government property abroad.

2. No. There has to be a law or a formal declaration to withdraw the Roppongi property from
public domain in order to make it alienable and legislative authority allowing the sale. The
president’s approval to sell the Roppongi property was premature. Her approval does not have
the force and effect of law since she had lost her legislative powers when the Congress
convened.
3. No. A conflict of law arises only when (a) there is a dispute over the title or ownership of an
immovable, such that the capacity to take and transfer, formalities of conveyance, essential
 validity and effect of the transfer, or the effect of a conveyance, are to be determined; and (b) a
foreign law on land ownership and its conveyance is asserted to conflict with a domestic law on
the same matters.

Both elements do not exist in the case. The issues are not concerned with the validity of the
ownership or title. There is no question that the property belongs to the Philippines. The issue is
the authority of the government officials to validly dispose of property belonging to the state
and the validity of the procedures adopted to effect the sale which should be governed by our
own laws. Lex situs does not apply.

4. The SC did not resolve or pass upon the issue of the EO’s constitutionality.