THE HOLY SEE vs.
ROSARIO
FATCS:
 Lot 5-A is registered under the
name of the petitioner THE HOLY
SEE.
 This lot is contiguous to lots 5-B
and 5-D registered in the name of
PRC.
 3 lots were sold to Licup who
assigned his rights to SSEI.
 Due to the refusal of the
squatters to vacate, a dispute
arose as to who has the
responsibility of eviction and
clearing the land.
 Petitioner proposed that SSEI
undertake the eviction otherwise
the money will be returned.
 The earnest money was returned
and the property was sold to
TROPICANA.
 SSEI filed a suit for annulment of
sale and for damages.
 Petitioner moved to dismissed for
lack of jurisdiction based on
immunity from suit.
 It was denied on the ground that
the petitioner shed off its
sovereign immunity by entering
into business contract in
question.
ISSUE:
 WHETHER OR NOT THE HOLY SEE
PROPERLY INVOKE SOVEREIGN
IMMUNITY FROM SUIT?
RULLING:
 YES! There are 2 concepts of
sovereign immunity. One is the
classical theory and the other is
restrictive theory.
 According to the restrictive
theory, immunity is recognized
only with regard to public acts but
not with regard to private acts.
 But the mere entering into a
contract by a foreign state with a
private party, cannot be the
ultimate test. The question is
whether it is engaged in the regular
business or trade.
 If the act is in pursuit of a sovereign
activity,
 Lot 5-A was acquired as a donation
for the site of its mission.
 The subsequent disposal was made
because it would be impossible for
the petitioner to use it for the
purpose of donation because of the
squatters living thereon. The
petitioner did not sell it for profit.
 Under Vienna Convention on
Diplomatic Relations, a diplomatic
envoy is immune from suit over real
action relating to private immovable
property.
 Moreover, the DFA certified that is a
duly certified diplomatic missionary
hence exempt from local jurisdiction
and entitled to all rights, immunities,
and privileges of a diplomatic
missionary or embassy in this court.