G.R. N . 185918. A 18, 2012.

LOCKHEED DETECTIVE AND WATCHMAN AGENCY, INC., pe i ione , . UNIVERSITY OF

THE PHILIPPINES, e ponden .

Administrati e Agencies; Uni ersit of the Philippines; Uni ersit of the Philippines (UP) is a juridical
personalit separate and distinct from the go ernment and has the capacit to sue and be sued; it cannot e ade
e ecution, and its funds ma be subject to garnishment or le ; ho e er, before e ecution ma be had, a claim for
pa ment of the judgment a ard must first be filed ith the Commission on Audit (COA). Thi Co find ha
he CA co ec l applied he NEA ca e. Like NEA, UP i a j idical pe onali epa a e and di inc f om he
go e nmen and ha he capaci o e and be ed. Th , al o like NEA, i canno e ade e ec ion, and i
f nd ma be bjec o ga ni hmen o le . Ho e e , befo e e ec ion ma be had, a claim fo pa men of he
j dgmen a a d m fi be filed i h he COA. Unde Common eal h Ac No. 327, a amended b Sec ion 26
of P.D. No. 1445, i i he COA hich ha p ima j i dic ion o e amine, a di and e le all deb and claim
of an o d e f om o o ing he Go e nmen o an of i bdi i ion , agencie and in men ali ie ,
incl ding go e nmen -

*F D .

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o ned o -con olled co po a ion and hei b idia ie . Wi h e pec o mone claim a i ing f om he
implemen a ion of Rep blic Ac No. 6758, hei allo ance o di allo ance i fo COA o decide, bjec onl o
he emed of appeal b pe i ion fo certiorari o hi Co .

PETITION fo e ie on ce io a i of he amended deci ion and e ol ion of he Co of Appeal .

The fac a e a ed in he opinion of he Co .
Sig i Re a, M eci & O g ia fo pe i ione .
U.P. Di i a Lega Office fo e ponden .

VILLARAMA, JR., J.:

Befo e i a pe i ion fo e ie on ce i a i nde R le 45 of he 1997 R le of Ci il P oced e,
a amended, a ailing he A g 20, 2008 Amended Deci ion1 and Decembe 23, 2008 Re ol ion2 of
he Co of Appeal (CA) in CA-G.R. SP No. 91281.
The an eceden fac of he ca e a e a follo :
Pe i ione Lockheed De ec i e and Wa chman Agenc , Inc. (Lockheed) en e ed in o a con ac fo
ec i e ice i h e ponden Uni e i of he Philippine (UP).
In 1998, e e al ec i g a d a igned o UP filed epa a e complain again Lockheed and
UP fo pa men of nde paid age , 25% o e ime pa , p emi m pa fo e da and pecial
holida , holida pa , e ice incen i e lea e pa , nigh hif diffe en ial , 13 h mon h pa , ef nd of
ca h bond, ef nd of ded c ion fo he M al Benefi Aid S em (MBAS), npaid age f om
Decembe 16-31, 1998, and a o ne fee .

_______________
1  R , pp. 47-50. Penned by Associate Justice Arcangelita M. Romilla-Lontok with Associate Justices Mariano C. Del
Castillo (now a member of this Court) and Romeo F. Barza concurring.
2 Id., at pp. 52-53.

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On Feb a 16, 2000, he Labo A bi e ende ed a deci ion a follo :

WHEREFORE, p emi e con ide ed, e ponden Lockheed De ec i e and Wa chman Agenc , Inc. and UP a
job con ac o and p incipal, e pec i el , a e he eb decla ed o be olida il liable o complainan fo he
follo ing claim of he la e hich a e fo nd me i o io .
Unde paid age / ala ie , p emi m pa fo o k on e da and pecial holida , holida pa , 5 da e ice
incen i e lea e pa , 13 h mon h pa fo 1998, ef nd of ca h bond (ded c ed a P50.00 pe mon h f om Jan a
o Ma 1996, P100.00 pe mon h f om J ne 1996 and P200.00 f om No embe 1997), ef nd of ded c ion fo
M al Benefi Aid S em a he a e of P50.00 a mon h, and a o ne fee ; in he o al amo n of
P1,184,763.12 b oken do n a follo pe a ached comp a ion of he Comp a ion and [E] amina ion Uni of
hi Commi ion, hich comp a ion fo m pa of hi Deci ion:
1. JOSE SABALAS P77,983.62
2. TIRSO DOMASIAN 76,262.70
3. JUAN TAPEL 80,546.03
4. DINDO MURING 80,546.03
5. ALEXANDER ALLORDE 80,471.78
6. WILFREDO ESCOBAR 80,160.63
7. FERDINAND VELASQUEZ 78,595.53
8. ANTHONY GONZALES 76,869.97
9. SAMUEL ESCARIO 80,509.78
10. PEDRO FAILORINA 80,350.87
11. MATEO TANELA 70,590.58
12. JOB SABALAS 59,362.40
13. ANDRES DACANAYAN 77,403.73
14. EDDIE OLIVAR ____77,403.73
P1,077,057.38
pl 10% a o ne fee ___107,705.74
GRAND TOTAL AWARD P1,184,763.12
Thi d pa e ponden Uni e i of he Philippine i he eb decla ed o be liable o Thi d Pa
Complainan and c o claiman Lockheed De ec i e and Wa chman Agenc fo he npaid legi la ed
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ala inc ea e of he la e ec i g a d fo he ea 1996 o 1998, in he o al amo n of P13,066,794.14,

o of hich amo n he amo n d e complainan he e hall be paid.
The o he claim a e he eb DISMISSED fo lack of me i (nigh hif diffe en ial and 13 h mon h pa ) o fo
ha ing been paid in he co e of hi p oceeding ( ala ie fo Decembe 15-31, 1997 in he amo n of
P40,140.44).
The claim of E lindo Collado, Rogelio Banjao and Amo Banjao a e he eb DISMISSED a amicabl e led
fo and in con ide a ion of he amo n of P12,315.72, P12,271.77 and P12,819.33, e pec i el .
SO ORDERED. 3

Bo h Lockheed and UP appealed he Labo A bi e deci ion. B Deci ion4 da ed Ap il 12, 2002,
he NLRC modified he Labo A bi e deci ion. The NLRC held:
HEREFORE, :
1. C , 5
, .
2. T U P L
.
T F A
.
5
 SO ORDERED. 5

The complaining ec i g a d and UP filed hei e pec i e mo ion fo econ ide a ion. On
A g 14, 2002, ho e e , he NLRC denied aid mo ion .

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3 CA R , pp. 23-24.
4 Id., at pp. 22-38.
5 Id., at p. 37.

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A he pa ie did no appeal he NLRC deci ion, he ame became final and e ec o on Oc obe
26, 2002.6 A i of e ec ion a hen i ed b la e q a hed b he Labo A bi e on No embe
23, 2003 on mo ion of UP d e o di p e ega ding he amo n of he a a d. La e , ho e e , aid
o de q a hing he i a e e ed b he NLRC b Re ol ion da ed J ne 8, 2004, di po ing a
follo :
WHEREFORE, p emi e con ide ed, e g an hi in an appeal. The O de da ed 23 No embe 2003 i
he eb e e ed and e a ide. The Labo A bi e i di ec ed o i e a W i of E ec ion fo he a i fac ion of
he j dgmen a a d in fa o of Thi d-Pa complainan .
SO ORDERED. 8

UP mo ed o econ ide he NLRC e ol ion. On Decembe 28, 2004, he NLRC pheld i

e ol ion b i h modifica ion ha he a i fac ion of he j dgmen a a d in fa o of Lockheed ill
be onl again he f nd of UP hich a e no iden ified a p blic f nd .
The NLRC o de and e ol ion ha ing become final, Lockheed filed a mo ion fo he i ance of
an alia i of e ec ion. The ame a g an ed on Ma 23, 2005.
On J l 25, 2005, a No ice of Ga ni hmen 10 a i ed o Philippine Na ional Bank (PNB) UP
Diliman B anch fo he a i fac ion of he a a d of P12,142,522.69 (incl i e of e ec ion fee).
In a le e 11 da ed A g 9, 2005, PNB info med UP ha i ha ecei ed an o de of elea e da ed
A g 8, 2005 i ed b he Labo A bi e di ec ing PNB UP Diliman B anch o

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6  Id., at p. 44, citing NLRC records, p. 868.
7  Id., at pp. 39-56.
8  Id., at p. 55.
9  Id., at pp. 57-64.
10 Id., at p. 65.
11 Id., at p. 74.

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elea e o he NLRC Ca hie , h o gh he a igned NLRC She iff Ma L. Lago, he j dgmen

a a d/amo n of P12,142,522.69. PNB like i e eminded UP ha he bank onl ha 10 o king da
f om eceip of he o de o deli e he ga ni hed f nd and nle i ecei e a no ice f om UP o he
NLRC befo e he e pi of he 10-da pe iod ega ding he i ance of a co o de o i of
inj nc ion di cha ging o enjoining he implemen a ion and e ec ion of he No ice of Ga ni hmen
and W i of E ec ion, he bank hall be con ained o ca e he elea e of he ga ni hed f nd in
fa o of he NLRC.
On A g 16, 2005, UP filed an U gen Mo ion o Q a h Ga ni hmen .12 UP con ended ha he
f nd being bjec ed o ga ni hmen a PNB a e go e nmen /p blic f nd . A ce ified b he
Uni e i Acco n an , he bjec f nd a e co e ed b Sa ing Acco n No. 275-529999-8, nde
he name of UP S em T Receip , ea ma ked fo S den G a an Depo i , Schola hip F nd,
S den F nd, P blica ion , Re ea ch G an , and Mi cellaneo T Acco n . UP a g ed ha a
p blic f nd , he bjec PNB acco n canno be di b ed e cep p an o an app op ia ion
eq i ed b la . The Labo A bi e , ho e e , di mi ed he gen mo ion fo lack of me i on A g
30, 2005.13
On Sep embe 2, 2005, he amo n of P12,062,398.71 a i hd a n b he he iff f om UP PNB
14
acco n .
On Sep embe 12, 2005, UP filed a pe i ion fo ce i a ibefo e he CA ba ed on he follo ing
g o nd :
I.
The concep of olida liabili b an indi ec emplo e no i h anding, e ponden NLRC g a el ab ed
i di c e ion in a manne amo n ing o lack o e ce of j i dic ion b mi ing ch

12 I ., . 66-73.
13 I ., . 79-81.
14 I ., . 10.

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concep oj if he ga ni hmen b
he e ec ing She iff of p blic/go e nmen f nd belonging o UP.
II.
Re ponden NLRC and A bi e LORA ac ed i ho j i dic ion o g a el ab ed hei di c e ion in a
manne amo n ing o lack o e ce of j i dic ion hen, b mean of an Alia W i of E ec ion again
pe i ione UP, he a ho i ed e ponden She iff o ga ni h UP p blic f nd . Simila l , e ponden LORA
g a el ab ed he di c e ion hen he e ol ed pe i ione Mo ion o Q a h No ice of Ga ni hmen add e ed
o, and in ended fo , he NLRC, and hen he nila e all and a bi a il di ega ded an official Ce ifica ion
ha he f nd ga ni hed a e p blic/go e nmen f nd , and he eb allo ed e ponden She iff o i hd a he
ame f om PNB.
III.
Re ponden g a el ab ed hei di c e ion in a manne amo n ing o lack o e ce of j i dic ion hen
he , de pi e p io kno ledge, effec ed he e ec ion ha ca ed pa al a ion and di loca ion o pe i ione
go e nmen al f nc ion .15

On Ma ch 12, 2008, he CA ende ed a deci ion16di mi ing UP pe i ion fo ce i a i.

Ci ing Re b ic . COCOFED,1 hich define p blic f nd a mone belonging o he S a e o o
an poli ical bdi i ion of he S a e, mo e pecificall a e , c om , d ie and mone ai ed b
ope a ion of la fo he ppo of he go e nmen o he di cha ge of i obliga ion , he appella e
co led ha he f nd o gh o be ga ni hed do no eem o fall i hin he a ed defini ion.
On econ ide a ion, ho e e , he CA i ed he a ailed Amended Deci ion. I held ha i ho
depa ing f om i finding ha he f nd co e ed in he a ing acco n o gh o be ga ni hed do
no fall i hin he cla ifica ion of p blic

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15 Id.
16 Id., at pp. 122-134.
17 G.R. Nos. 147062-64, December 14, 2001, 372 SCRA 462, 481.

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f nd , i econ ide he di mi al of he pe i ion in ligh of he ling in he ca e of Na i a

1
E ec ifica i Ad i i a i . M ae hich manda e ha all mone claim again he
go e nmen m fi be filed i h he Commi ion on A di (COA).
Lockheed mo ed o econ ide he amended deci ion b he ame a denied in he a ailed CA
Re ol ion da ed Decembe 23, 2008. The CA ci ed Ma i a I e a i a Ai A h i .C f
A ea 1 hich held ha UP ank i h MIAA, a go e nmen in men ali e e ci ing co po a e
po e b no o gani ed a a ock o non- ock co po a ion. While aid co po a ion a e go e nmen
in men ali ie , he a e loo el called go e nmen co po a e en i ie b no go e nmen -o ned
and con olled co po a ion in he ic en e.
Hence hi pe i ion b Lockheed ai ing he follo ing a g men :
1. RESPONDENT UP IS A GOVERNMENT ENTIT ITH A SEPARATE AND DISTINCT PERSONALIT FROM
THE NATIONAL GOVERNMENT AND HAS ITS O N CHARTER GRANTING IT THE RIGHT TO SUE AND BE
SUED. IT THEREFORE CANNOT AVAIL OF THE IMMUNIT FROM SUIT OF THE GOVERNMENT. NOT
HAVING IMMUNIT FROM SUIT, RESPONDENT UP CAN BE HELD LIABLE AND E ECUTION CAN THUS
ENSUE.
2. MOREOVER, IF THE COURT LENDS IT ASSENT TO THE INVOCATION OF THE DOCTRINE OF STATE
IMMUNIT , THIS ILL RESULT IN GRAVE INJUSTICE.
3. FURTHERMORE, THE PROTESTATIONS OF THE RESPONDENT ARE TOO LATE IN THE DA , AS THE

_______________
18 G.R. No. 154200, June 24, 2007, 528 SCRA 79, 90-91.
19 G.R. No. 155650, July 20, 2006, 495 SCRA 591, 618-619.

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EXECUTION PROCEEDINGS HAVE ALREADY BEEN TERMINATED.20

Lockheed con end ha UP ha i o n epa a e and di inc j idical en i f om he na ional

go e nmen and ha i o n cha e . Th , i can be ed and be held liable. Mo eo e , E ec i e
O de No. 714 en i led Fi cal Con ol and Managemen of he F nd of UP ecogni e ha a an
in i ion of highe lea ning, UP ha al a g an ed f ll managemen and con ol of i affai
incl ding i financial affai . 21 The efo e, i canno hield i elf f om i p i a e con ac al
liabili ie b impl in oking he p blic cha ac e of i f nd . Lockheed al o ci e e e al ca e
he ein i a led ha f nd of p blic co po a ion hich can e and be ed e e no e emp
f om ga ni hmen .
Lockheed like i e a g e ha he ling in he NEA and MIAA ca e a e inapplicable. I
con end ha UP i no imila l i a ed i h NEA beca e he j i dic ion of COA o e he
acco n of UP i onl on a po -a di ba i . A o he MIAA ca e, he liabili of MIAA pe ain o
he eal e a e a e impo ed b he Ci of Pa a aq e hile he obliga ion of UP in hi ca e
in ol e a p i a e con ac al obliga ion. Lockheed al o a g e ha he decla a ion
in MIAA pecificall ci ing UP a me e bi e dic .
Lockheed mo eo e bmi ha UP canno in oke a e imm ni o j if and pe pe a e an
inj ice. UP i elf admi ed i liabili and h i ho ld no be allo ed o enege on i con ac al
obliga ion . Lockheed con end ha hi migh c ea e a ino p eceden ha o ld likel affec he
ela ion hip be een he p blic and p i a e ec o .
La , Lockheed con end ha UP canno an mo e eek he q a hal of he i of e ec ion and
no ice of ga ni hmen a he a e al ead fai acc i.
 _______________
20 R , p. 17.
21 Id., at pp. 24-25.

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Fo i pa , UP con end ha i did no in oke he doc ine of a e imm ni f om i in he

p oceeding a and in fac , i did no objec o being ed befo e he labo depa men . I
main ain , ho e e , ha abili doe no nece a il mean liabili . UP a g e ha he CA
co ec l applied he NEA ling hen i held ha all mone claim m be filed i h he COA.
A o alleged inj ice ha ma e l fo in oca ion of a e imm ni f om i , UP ei e a e
ha i con en ed o be ed and e en pa icipa ed in he p oceeding belo . Lockheed canno no
claim ha in oca ion of a e imm ni , hich UP did no in oke in he fi place, can e l in
inj ice.
On he fai acc i a g men , UP a g e ha Lockheed canno a h i hand f om liabili fo
he con mma ed ga ni hmen and e ec ion of UP f nd in he amo n of P12,062,398.71. UP
ci e ha damage a done o UP and he beneficia ie of he f nd hen aid f nd , hich e e
ea ma ked fo pecific ed ca ional p po e , e e mi applied, fo in ance, o an e fo he
e ec ion fee of P120,123.98 nila e all ip la ed b he he iff. Lockheed, being he pa hich
p oc ed he illegal ga ni hmen , ho ld be held p ima il liable. The me e fac ha he CA e a ide
he i of ga ni hmen confi m he liabili of Lockheed o eimb e and indemnif in acco dance
i h la .
The pe i ion ha no me i .
We ag ee i h UP ha he e a no poin fo Lockheed in di c ing he doc ine of a e
imm ni f om i a hi a ne e an i e in hi ca e. Clea l , UP con en ed o be ed hen i
pa icipa ed in he p oceeding belo . Wha UP q e ion i he ha ga ni hmen of i f nd in i
PNB acco n .
Thi Co find ha he CA co ec l applied he NEAca e. Like NEA, UP i a j idical
pe onali epa a e and di inc f om he go e nmen and ha he capaci o e and
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be ed. Th , al o like NEA, i canno e ade e ec ion, and i f nd ma be bjec o ga ni hmen

o le . Ho e e , befo e e ec ion ma be had, a claim fo pa men of he j dgmen a a d m fi
22
be filed i h he COA. Unde Common eal h Ac No. 327, a amended b Sec ion 26 of P.D. No.
1445,23 i i he COA hich ha p ima j i dic ion o e amine, a di and e le all deb and
claim of an o d e f om o o ing he Go e nmen o an of i bdi i ion , agencie and
in men ali ie , incl ding go e nmen -o ned o con olled co po a ion and hei b idia ie .
Wi h e pec o mone claim a i ing f om he implemen a ion of Rep blic Ac No. 6758,24 hei
allo ance o di allo ance i fo COA o

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22 An Act Fixing the Time Within Which the Auditor General Shall Render His Decisions and Prescribing the Manner of
Appeal Therefrom.
23 Ordaining And Instituting A Government Auditing Code of the Philippines. Section 26 thereof provides:
Sec i 26. Ge e a j i dic i . The authority and powers of the Commission shall extend to and comprehend all
matters relating to auditing procedures, systems and controls, the keeping of the general accounts of the Government, the
preservation of vouchers pertaining thereto for a period of ten years, the examination and inspection of the books, records, and
papers relating to those accounts; and the audit and settlement of the accounts of all persons respecting funds or property
received or held by them in an accountable capacity, as well as the examination, audit, and settlement of all debts and claims
of any sort due from or owing to the Government or any of its subdivisions, agencies and instrumentalities. The said
jurisdiction extends to all government-owned or controlled corporations, including their subsidiaries, and other self-governing
boards, commissions, or agencies of the Government, and as herein prescribed, including nongovernmental entities subsidized
by the government, those funded by donations through the government, those required to pay levies or government share, and
those for which the government has put up a counterpart fund or those partly funded by the government.
24 Compensation and Position Classification Act of 1989.

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decide, bjec onl o he emed of appeal b pe i ion fo ce i a i o hi Co .25

We canno b c ibe o Lockheed a g men ha NEA i no imila l i a ed i h UP beca e
he COA j i dic ion o e he la e i onl on po -a di ba i . A eading of he pe inen
Common eal h Ac p o i ion clea l ho ha i doe no make an di inc ion a o hich of he
go e nmen bdi i ion , agencie and in men ali ie , incl ding go e nmen -o ned o con olled
co po a ion and hei b idia ie ho e deb ho ld be filed befo e he COA.
A o he fai acc i a g men of Lockheed, con a o i claim ha he e i no hing ha can
be done ince he f nd of UP had al ead been ga ni hed, ince he ga ni hmen a e oneo l
ca ied o and did no go h o gh he p ope p oced e ( he filing of a claim i h he COA), UP i
en i led o eimb emen of he ga ni hed f nd pl in e e of 6% e a , o be comp ed f om
he ime of j dicial demand o be eckoned f om he ime UP filed a pe i ion fo ce i a i befo e he
CA hich occ ed igh af e he i hd a al of he ga ni hed f nd f om PNB.
WHEREFORE, he pe i ion fo e ie on ce i a i i DENIED fo lack of me i . Pe i ione
Lockheed De ec i e and Wa chman Agenc , Inc. i o de ed o REIMBURSE e ponden Uni e i of
he Philippine he amo n of P12,062,398.71 pl in e e of 6% e a , o be comp ed f om
Sep embe 12, 2005 p o he finali of hi Deci ion, and 12% in e e on he en i e amo n f om
da e of finali of hi Deci ion n il f ll paid.
No p ono ncemen a o co .

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25 Na i a E ec ifica i Ad i i ai . M a e ,  a note 18, at pp. 89-91.

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SO ORDERED.

Le a d -De Ca (Ac i g Chai e ), Pe a a,**Be a i and Re e ,*** JJ., conc .

Pe i i de ied.

No es. A Uni e i of he Philippine (UP) S den Regen i a p blic office ; a p blic office i
he igh , a ho i , and d c ea ed and confe ed b la , b hich fo a gi en pe iod, ei he fi ed
b la o end ing a he plea e of he c ea ing po e , an indi id al i in e ed i h ome po ion
of he o e eign f nc ion of he go e nmen , o be e e ci ed b him fo he benefi of he p blic.
(Se a a . Sa diga ba a , 542 SCRA 224 [2008])
 The admini a ion of he Uni e i of he Philippine (UP) i a o e eign f nc ion in line ih
A icle XIV of he Con i ion. (Id.)

o0o