REPUBLIC OF INDONESIA v.

VINZON

(Sec. 3, Art. XVI)

FACTS: 

Petitioner, Republic of Indonesia, entered into a Maintenance Agreement with

respondent James Vinzon, sole proprietor of Vinzon Trade and Services. The
agreement stated that respondent shall, for a consideration, maintain specified
equipment at the Embassy Main Building, Embassy Annex Building and the Wisma
Duta, the official residence of petitioner Ambassador Soeratmin. The agreement
shall be effective for a period of four years and will renew itself automatically unless
cancelled by either party by giving thirty days prior written notice from the date of
expiry.

Petitioners claim that prior to the date of expiration of the said agreement, they
informed respondent that the renewal of the agreement shall be at the discretion of
the incoming Chief of Administration, who allegedly found respondents work and
services unsatisfactory and not in compliance with the standards set in the
Agreement. Hence, the Indonesian Embassy terminated the agreement. Petitioners
claim that they had earlier verbally informed respondent of their decision to
terminate the agreement.

Respondent claims that the aforesaid termination was arbitrary and unlawful.
Hence, respondent filed a complaint in the (RTC) of Makati. Petitioners filed a
Motion to Dismiss, alleging that the Republic of Indonesia, as a foreign sovereign
State, has sovereign immunity from suit and cannot be sued as a party-defendant
in the Philippines. The said motion further alleged that Ambassador Soeratmin and
Minister Counsellor Kasim are diplomatic agents as defined under the Vienna
Convention on Diplomatic Relations and therefore enjoy diplomatic immunity.

Respondents alleged that the Ambassador and Minister Counsellor can be sued and
held liable in their private capacities for tortious acts done with malice and bad
faith. The trial court denied herein petitioners Motion to Dismiss. It likewise denied
the Motion for Reconsideration subsequently filed.

The trial courts denial of the Motion to Dismiss was brought up to the CA in a
petition for certiorari and prohibition alleging that the trial court gravely abused its
discretion in ruling that the Republic of Indonesia gave its consent to be sued and
voluntarily submitted itself to the laws and jurisdiction of Philippine courts and that
petitioners Ambassador and Minister Counsellor waived their immunity from suit.

The CA rendered its assailed decision denying the petition for lack of merit. It
denied herein petitioners MR.

ISSUE: Whether the CA erred in sustaining the trial court’s decision that petitioners
have waived their immunity from suit by using as its basis the abovementioned
provision in the Maintenance Agreement.

RULING:

NO. The rule that a State may not be sued without its consent is a necessary
consequence of the principles of independence and equality of States. As
enunciated in Sanders v. Veridiano II, the practical justification for the doctrine of
sovereign immunity is that there can be no legal right against the authority that
makes the law on which the right depends.

In the case of foreign States, all states are sovereign equals and cannot assert
jurisdiction over one another. A contrary attitude would unduly vex the peace of
nations.
The rules of International Law, however, are neither unyielding nor impervious to
change. The increasing need of sovereign States to enter into purely commercial
activities remotely connected with the discharge of their governmental functions
brought about a new concept of sovereign immunity. This concept, the restrictive
theory, holds that the immunity of the sovereign is recognized only with regard to
public acts or acts jure imperii, but not with regard to private acts or acts jure
gestionis.

Apropos the present case, the mere entering into a contract by a foreign State with
a private party cannot be construed as the ultimate test of whether or not it is an
act jure imperii or jure gestionis. Such act is only the start of the inquiry. Is the
foreign State engaged in the regular conduct of a business? If the foreign State is
not engaged regularly in a business or commercial activity, and in this case, it has
not been shown to be so engaged, 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.

Respondent concedes that the establishment of a diplomatic mission is a sovereign

function. On the other hand, he argues that the actual physical maintenance of the
premises of the diplomatic mission, such as the upkeep of its furnishings and
equipment, is no longer a sovereign function of the State.

There is no dispute that the establishment of a diplomatic mission is an act jure

imperii. The State may enter into contracts with private entities to maintain the
premises, furnishings and equipment of the embassy and the living quarters of its
agents and officials. It is therefore clear that petitioner Republic of Indonesia was
acting in pursuit of a sovereign activity when it entered into a contract with
respondent for the upkeep or maintenance of the air con units, generator sets,
electrical facilities, water heaters, and water motor pumps of the Indonesian
Embassy and the official residence of the Indonesian ambassador.

The Solicitor General submits that, the Maintenance Agreement was entered into by
the Republic of Indonesia in the discharge of its governmental functions. In such a
case, it cannot be deemed to have waived its immunity from suit. As to the
paragraph in the agreement relied upon by respondent, the Solicitor General states
that it was not a waiver of their immunity from suit but a mere stipulation that in
the event they do waive their immunity, Philippine laws shall govern the resolution
of any legal action arising out of the agreement and the proper court in Makati City
shall be the agreed venue thereof.

On the matter of whether or not petitioners Ambassador Soeratmin and Minister

Counsellor Kasim may be sued herein in their private capacities, Article 31 of the
Vienna Convention on Diplomatic Relations provides:

1. A diplomatic agent shall enjoy immunity from the criminal jurisdiction of the
receiving State. He shall also enjoy immunity from its civil and administrative
jurisdiction, except in the case of:

(a) a real action relating to private immovable property situated in the

territory of the receiving State, unless he holds it on behalf of the sending
State for the purposes of the mission;

(b) an action relating to succession in which the diplomatic agent is involved

as executor, administrator, heir or legatee as a private person and not on
behalf of the sending State;

(c) an action relating to any professional or commercial activity exercised by

the diplomatic agent in the receiving State outside his official functions.
The act of petitioners Ambassador Soeratmin and Minister Counsellor Kasim in
terminating the Maintenance Agreement is not covered by the exceptions provided
in the abovementioned provision.

The Solicitor General believes that said act may fall under subparagraph (c)
thereof, but said provision clearly applies only to a situation where the diplomatic
agent engages in any professional or commercial activity outside official functions,
which is not the case herein.

MOBIL PHILIPPINES EXPLORATION, INC. vs. CUSTOMS ARRASTRE

SERVICE and BUREAU of CUSTOMS

(Sec. 3, Art. XVI)

FACTS:

Mobil Philippines Exploration, Inc. (Mobil Phils.) is the consignee of four (4) cases of
rotary drill parts shipped from abroad. When the cases arrived at the Port of Manila,
they were discharged to Customs Arrastre Service. However, the Service delivered
to Mobil Phils. were only 3 cases.

The petitioners then filed a complaint against respondents to recover the value of
the undelivered case. However, the respondents invoke immunity from suit,
averring that it has no juridical personality. Petitioners contended that the Bureau
of Customs, as operator of Customs Arrastre Service, was discharging proprietary
functions, and therefore may be sued.

ISSUE: Whether or not the Bureau of Customs is immune from suit.

RULING:

Yes, the Bureau of Customs is immune from suit.

The fact that a non-corporate government entity performs a function proprietary in

nature does not necessarily result in its being suable. If said non-governmental
function is undertaken as an incident to its governmental function, there is no
waiver thereby of the sovereign immunity from suit extended to such government
entity.

The Bureau of Customs is part of the Department of Finance (Sec. 81, Rev. Adm.
Code), with no personality of its own apart from that of the national government.
Its primary function is governmental, that of assessing and collecting lawful
revenues from imported articles and all other tariff and customs duties, fees,
charges, fines and penalties (Sec. 602, R.A. 1937). To this function, Arrastre
Service is a necessary incident.

Therefore, although said Arrastre function may be deemed proprietary, it is a

necessary incident of the primary and governmental function of the Bureau of
Customs, so that engaging in the same does not necessarily render said Bureau
liable for suit. For otherwise, it could not perform its governmental function without
necessarily exposing itself to suit. Sovereign immunity, granted as to the end,
should not be denied as to the necessary means to that end.

Thus, the Bureau of Customs, acting as part of the machinery of the national
government in the operation of the Arrastre Service, pursuant to express legislative
mandate and as a necessary incident of its prime governmental function, is immune
from suit, there being no statute to the contrary.
Department of Transportation and Communications v. Abecina, G.R. No.
206484, 29 June 2016

Facts

The spouses Abecina are the registered owner of five parcels of land in Camarines
Norte.

In February 1993, the DOTC awarded Digitel a contract for the management,
operation, maintenance, and development of a Regional Telecommunications
Development Project (RTDP)  under the National Telephone Program, Phase I,
Tranche 1 (NTPI-1).4

The DOTC and Digitel subsequently entered into several Facilities Management
Agreements (FMA). The FMAs were later converted into Financial Lease
Agreements (FLA) in 1995.

Later on, the municipality of Jose Panganiban, Camarines Norte, donated a parcel of
land to the DOTC for the implementation of the RDTP in the municipality. However,
the municipality erroneously included portions of the respondents’ property in the
donation. Pursuant to the FLAs, Digitel constructed a telephone exchange on the
property which encroached on the properties of the respondent spouses.

Sometime in the mid-1990s, the spouses Abecina discovered Digitel’s occupation

over portions of their properties. They required Digitel to vacate their properties
and pay damages, but the latter refused, insisting that it was occupying the
property of the DOTC pursuant to their FLA.

On April 29, 2003, the respondent spouses sent a final demand letter to both the
DOTC and Digitel to vacate the premises and to pay unpaid rent/damages. Neither
the DOTC nor Digitel complied with the demand.

On September 3, 2003, the respondent spouses filed an accion

publiciana  complaint against the DOTC and Digitel for recovery of possession and
damages.

In its answer, the DOTC claimed immunity from suit and ownership over the subject
properties.7 Nevertheless, during the pre-trial conference, the DOTC admitted that
the Abecinas were the rightful owners of the properties and opted to rely instead on
state immunity from suit.8

On March 12, 2007, the respondent spouses and Digitel executed a Compromise
Agreement and entered into a Contract of Lease. The RTC rendered a partial
decision and approved the Compromise Agreement on March 22, 2007. 9

On May 20, 2009, the RTC rendered its decision against the DOTC. 10 It brushed
aside the defense of state immunity. Citing Ministerio v. Court of First
Instance11and Amigable v. Cuenca,12it held that government immunity from suit
could not be used as an instrument to perpetuate an injustice on a citizen. 13

On appeal the CA affirmed the RTC decision

Issue: WON the petitioners’ claim of state immunity valid – NO

Ruling

The doctrine of state immunity is not absolute. The State may waive its cloak of
immunity and the waiver may be made expressly or by implication.
Over the years, the State’s participation in economic and commercial activities
gradually expanded beyond its sovereign function as regulator and governor. The
evolution of the State’s activities and degree of participation in commerce
demanded a parallel evolution in the traditional rule of state immunity. Thus, it
became necessary to distinguish between the State’s sovereign and
governmental acts (jure imperii)  and its private, commercial, and
proprietary acts (jure gestionis).  Presently, state immunity restrictively
extends only to acts jure imperii  while acts jure gestionis  are considered
as a waiver of immunity.

The DOTC encroached on the respondents’ properties when it constructed the local
telephone exchange in Daet, Camarines Norte. The exchange was part of the RTDP
pursuant to the National Telephone Program. We have no doubt that when the
DOTC constructed the encroaching structures and subsequently entered into the
FLA with Digitel for their maintenance, it was carrying out a sovereign function.
Therefore, we agree with the DOTC’s contention that these are acts jure
imperii that fall within the cloak of state immunity.

However, as the respondents repeatedly pointed out, this Court has long
established in Ministerio v CFI,  Amigable v. Cuenca,  the 2010 case Heirs of
Pidacan v. ATO,  and more recently in Vigilar v. Aquino that the doctrine of state
immunity cannot serve as an instrument for perpetrating an injustice to a citizen.

The Constitution identifies the limitations to the awesome and near-limitless powers
of the State. Chief among these limitations are the principles that no person
shall be deprived of life, liberty, or property without due process of law
and that private property shall not be taken for public use without just
compensation. These limitations are enshrined in no less than the Bill of Rights
that guarantees the citizen protection from abuse by the State.

KHOSROW MINUCHER vs. COURT OF APPEALS and ARTHUR SCALZO, G.R.

No. 142396, February 11, 2003

(Sec. 3, Art. XVI)

FACTS:

Khosrow Minucher was an Iranian National who came to the Philippines to study
and later became a refugee of the United Nations after the Iranian government he
was working for was deposed. 

On the other hand, Arthur Arthur Scalzo was a special agent of the United States
Drug Enforcement Administration. He conducts surveillance operations on
suspected drug dealers in the Philippines and believes to be the source of prohibited
drugs shipped to the US and make the actual arrest.

Khosrow Minucher and one Abbas Torabian were charged for violation of Section 4
of Republic Act No. 6425, otherwise also known as the "Dangerous Drugs Act of
1972," before the Regional Trial Court, Branch 151, of Pasig City, such criminal
charge was followed by a buy-bust operation conducted by the Philippine police
narcotic agents where Scalzo was a witness for the prosecution. They were
acquitted later on.

On 03 August 1988, Minucher filed Civil Case No. 88-45691 before the Regional
Trial Court (RTC), Branch 19, of Manila for damages on account of what he claimed
to have been trumped-up charges of drug trafficking made by Arthur Scalzo. In his
complaint, he said that during the buy-bust operation wherein he was arrested
without any warrant, some of his valuable were missing. He averred that his arrest
as a heroine trafficker was well publicized and that when he got arrested, he was
not given any food or water for 3 days.

Scalzo, in his defense, asserted his diplomatic immunity as evidenced a Diplomatic

Note. He contended that it was recognized by the US Government pursuant to the
Vienna Convention on Diplomatic Relations and the Philippine government itself
thru its Executive Department and Department of Foreign Affairs.

The trial court decided in favor of Minucher citing that even if Scalzo was a
diplomatic agent he should be still liable of the crime since he committed it outside
his official duties.

On appeal, the Court of Appeals reversed the trial court’s decision and sustained

Scalzo’s defense that he was sufficiently clothed with Diplomatic immunity during
his term of duty and thereby immune from the criminal and civil jurisdiction of the
“Receiving State” pursuant to the terms of the Vienna Convention.

ISSUE: Whether or not Arthur Scalzo is indeed entitled to diplomatic immunity

from civil suit conformably with the Vienna Convention on Diplomatic Relations.

RULING: Yes, Arthur Scalzo is indeed entitled to diplomatic immunity.

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.

In the instant case, the official exchanges of communication between agencies of

the government of the two countries, certifications from officials of both the
Philippine Department of Foreign Affairs and the United States Embassy, as well as
the participation of members of the Philippine Narcotics Command in the "buy-bust
operation" conducted at the residence of Minucher at the behest of Scalzo, may be
inadequate to support the "diplomatic status" of the latter but they give enough
indication that 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. The job description of Scalzo has tasked him to conduct
surveillance on suspected drug suppliers and, after having ascertained the target,
to inform local law enforcers who would then be expected to make the arrest. In
conducting surveillance activities on Minucher, later acting as the poseur-buyer
during the buy-bust operation, and then becoming a principal witness in the
criminal case against Minucher, Scalzo hardly can be said to have acted beyond the
scope of his official function or duties.

All told, 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 on the drug traffic,
is entitled to the defense of state immunity from suit.

Philippine Agila Satellite, Inc. v. Lichauco, G.R. No. 142362, 03 May 2006

FACTS
EPG Construction Co. v. Vigilar, G.R. No. 131544, 16 March 2001

FACTS:

-In 1983, the Ministry of Human Settlement (MHS), through the BLISS
Development Corporation, intiated a housing project on a government property
along the east bank of Manggahan Floodway in Pasig.

-The MHS entered into a Memorandum of Agreement (MOA) with Ministry of Public
Works and Highways (MPWH) where the latter undertook to develop the housing
site and construct thereon 145 housing units. By virtue of the MOA, MPWH forged
individual contracts with petitioners EPG, Ciper, Septa, Phil. Plumbing, Home
Construction, World Builders, Glass World, Performance Builders, and De Leon
Araneta Construction for the construction of the housing units Under the contracts,
the scope of construction and funding covered only around "2/3 of each housing
unit".

-E.P.G. agreed to undertake and perform "additional constructions" for the

completion of the housing units despite the fact that there was only a verbal
promise, and not a written contract, by the MPWH Undersecretary Aber Canlas that
additional funds will be available and forthcoming unpaid balance for the additional
constructions amounted to P5,918,315.63.

-Upon a demand letter from the petitioners, on November 14, 1988, DPWH Asst.
Secretary Madamba opined that payment of petitioners' money claims should be
based on quantum meruit (what one has earned) and should be forwarded to the
Commission on Audit (COA).

-In a Letter of the Undersecretary of Budget and Management dated December 20,
1994, the amount of P5,819,316.00 was then released for the payment of the
petitioners' money claims under Advise of Allotment No. A4-1303-04-41-303.

-In an indorsement dated December 27, 1995, the COA referred anew the money
claims to the DPWH In a letter dated August 26, 1996, Secretary Gregorio Vigilar
denied the subject money claims. Petitioners then filed before the RTC, a Petition
for Mandamus to order the respondent to pay petitioners their money claims plus
damages and attorney's fees. However, the RTC denied the petition.

-Hence, this petition where the core issue for resolution focuses on the right of
petitioners-contractors to compensation for a public works housing project.

ISSUE: Whether or not the State is immune from suit

RULING: No.

Under the given circumstances, respondent may not validly invoke the Royal
Prerogative of Dishonesty and conveniently hide under the State's cloak of
invincibility against suit, considering that this principle yields to certain settled
exceptions. True enough, the rule, in any case, is not absolute for it does not say
that the state may not be sued under any circumstance.

The Honorable Supreme Court – as the staunch guardian of the citizens' rights and
welfare — cannot sanction an injustice so patent on its face, and allow itself to be
an instrument in the perpetration thereof. Justice and equity sternly demand that
the State's cloak of invincibility against suit be shred in this particular instance, and
that petitioners-contractors be duly compensated — on the basis of quantum meruit
— for construction done on the public works housing project.

Mendoza v. National Police Commission, G.R. No. 139658, 21 June 2005

(Sec. 6, Art. XVI)

FACTS

This case stemmed from the complaint for illegal arrest, illegal detention, physical
injuries, and robbery filed by Conti against PO3 Mendoza (petitioner), and PO2
Ramos, both were members of the PNP. This was when they forcibly arrested
Conti and at gunpoint brought the victim to the Office of the District Special
Operations Unit. That while inside said Office, PO2 RAMOS ordered the victim to
remove his gold necklace, then forced him to swallow it, but when the victim
resisted, PO2 RAMOS struck him with the butt of the gun and subsequently inserted
the barrel of the gun to the mouth of the victim. Thereafter, both the PO3 Mendoza
and PO2 Ramos mauled the victim, thereby inflicting multiple injuries on the face of
Conti. Furthermore, they placed the victim inside a detention cell and took his
money amounting to P970, including three (3) pieces of jewelry: gold necklace,
wristwatch, and gold bracelet.

The PNP Southern Police District Office then administratively charged petitioner and
PO2 Ramos with grave misconduct.

PO3 Mendoza and PO2 Ramos denied the charge against them.

The PNP Regional Director then rendered a Decision finding the two policemen
guilty as charged and ordering their dismissal from the service.

Claiming that they were denied due process, the two police officers filed an appeal
to the Regional Appellate Board (RAB). – rendered a decision affirming the Decision
of the PNP Regional Director.

Thereafter, petitioner filed with the RTC a Petition for Certiorari for Special Civil
Action, and alleged that he was denied due process and prayed that the RAB
Decision be annulled.

RAB, through OSG then filed a motion to dismiss the petition, contending that
petitioner failed to exhaust all administrative remedies (before seeking judicial
intervention, he should have first appealed the RAB Decision to the Secretary of the
DILG, then to the CSC); and that contrary to petitioner's claim, he was accorded
due process during the administrative proceedings before the RAB.

RTC denied the motion, holding that "as an exception to the rule on non-exhaustion
of administrative remedies, a party may go directly to the court where x x x the
controverted acts were allegedly performed without or in excess of jurisdiction for
utter disregard of due process."

On appeal by RAB, CA granted the petition and dismissed Special Civil Action filed
with the RTC.

ISSUE: WON petitioner should have first exhaust all administrative remedies.

RULING: Yes.

Section 45 of "The Department of the Interior and Local Government Act of 1990",
provides that the Decision of the PNP Regional Director imposing upon a PNP
member the administrative penalty of dismissal from the service is appealable to
the RAB. From the RAB Decision, the aggrieved party may then appeal to the
Secretary of the DILG.

In this case, petitioner did not interpose an appeal to the DILG Secretary. And in
the event that the Secretary renders an unfavorable decision, petitioner may still
elevate his case to the CSC.
Section 6, Article XVI of the Constitution provides that the State shall establish and
maintain one police force which shall be civilian in character. Consequently, the PNP
falls under the civil service pursuant to Section 2(1), Article IX-B, also of the
Constitution, which states:

"Section 2. (1). The civil service embraces all branches, subdivisions,

instrumentalities and agencies of the Government, including government-
owned or controlled corporations with original charters."

Petitioner's failure to exhaust all administrative remedies is fatal to his cause. It is

elementary that where, as here, a remedy is available within the administrative
machinery, this should first be resorted to.

THUS, the SC finds that the CA, in its assailed decision, did not commit a reversable
error in dismissing the Special Civil Action filed with RTC.

Defensor-Santiago v. Commission on Elections, G.R. No. 127325, 19 March

1997

(Sec. 2, Art. XVII)

FACTS:

Private respondent Atty. Jesus S. Delfin filed with public respondent Commission on
Elections (COMELEC) a Petition to Amend the Constitution and to Lift Term Limits of
Elective Officials, by People's Initiative. The COMELEC then, upon its approval, set
the time and dates for signature gathering all over the country, caused the
necessary publication of the said petition in papers of general circulation, and
instructed local election registrars to assist petitioners and volunteers in
establishing signing stations.

Senator Miriam Defensor Santiago et. al filed then this special civil action against
Delfin Petition Also Raul Roco, filed with the COMELEC a motion to dismiss the
Delfin petition, it being untenable due to the foregoing. Santiago argues among
others that the People’s Initiative is limited to amendment to the Constitution NOT
a revision thereof. The extension or the lifting of the term limits of those in power
(particularly the President) constitutes revision and is therefore beyond the power
of people’s initiative. The respondents argued that the petition filed by Roco is
pending under the COMELEC hence the Supreme Court cannot take cognizance of
it.

ISSUE:

1. Whether or not the proposed Delfin petition constitutes amendment to the

constitution or does it constitute a revision

2. Whether or not RA 6735 was intended to include initiative on amendments to

the constitution and if so whether the act, as worded, adequately covers such
initiative.

HELD:

1. The Delfin proposal does not involve a mere amendment to, but a revision of,
the Constitution because, in the words of Fr. Joaquin Bernas, S.J., 18 it
would involve a change from a political philosophy that rejects unlimited
tenure to one that accepts unlimited tenure; and although the change might
appear to be an isolated one, it can affect other provisions, such as, on
 synchronization of elections and on the State policy of guaranteeing equal
access to opportunities for public service and prohibiting political dynasties. A
revision cannot be done by initiative which, by express provision of
Section 2 of Article XVII of the Constitution, is limited to
amendments. The prohibition against re-election of the President and the
limits provided for all other national and local elective officials are based on
the philosophy of governance, "to open up the political arena to as many as
there are Filipinos qualified to handle the demands of leadership, to break
the concentration of political and economic powers in the hands of a few, and
to promote effective proper empowerment for participation in policy and
decision-making for the common good"; hence, to remove the term limits is
to negate and nullify the noble vision of the 1987 Constitution.

2. R.A. NO. 6735 intended to include the system of initiative on amendments to

the constitution, but is, unfortunately, inadequate to cover that system.

Section 2 of Article XVII of the Constitution provides:

“Sec. 2. Amendments to this Constitution may likewise be directly

proposed by the people through initiative upon a petition of at least
twelve per centum of the total number of registered voters, of which
every legislative district must be represented by at least three per
centum of the registered voters therein. No amendment under this
section shall be authorized within five years following the
ratification of this Constitution nor oftener than once every five
years thereafter.

The Congress shall provide for the implementation of the exercise of

this right.”

This provision is not self-executory. In his book, Joaquin Bernas, a member of the
1986 Constitutional Commission, stated: “Without implementing legislation Section
2 cannot operate. Thus, although this mode of amending the Constitution is a mode
of amendment which bypasses congressional action, in the last analysis it still is
dependent on congressional action.”

Bluntly stated, the right of the people to directly propose amendments to the
Constitution through the system of initiative would remain entombed in
the cold niche of the Constitution until Congress provides for its
implementation. Stated otherwise, while the Constitution has recognized or
granted that right, the people cannot exercise it if Congress, for whatever
reason, does not provide for its implementation.

Lambino v. Commission on Elections, G.R. No. 174153, 25 October 2006

(Sec. 2, Art. XVII)

FACTS OF THE CASE:

On 25 August 2006, Lambino et al filed a petition with the COMELEC to hold a

plebiscite that will ratify their initiative petition to change the 1987 Constitution
under Section 5(b) and (c)2 and Section 73 of Republic Act No. 6735 or the
Initiative and Referendum Act.
The Lambino Group alleged that their petition had the support of 6,327,952
individuals constituting at least twelve per centum (12%) of all registered voters,
with each legislative district represented by at least three per centum (3%) of its
registered voters. The Lambino Group also claimed that COMELEC election
registrars had verified the signatures of the 6.3 million individuals.

The Lambino Group’s initiative petition changes the 1987 Constitution by modifying
Sections 1-7 of Article VI (Legislative Department)4 and Sections 1-4 of Article VII
(Executive Department) and by adding Article XVIII entitled “Transitory Provisions.”
These proposed changes will shift the present Bicameral-Presidential system to a
Unicameral-Parliamentary form of government.

On 30 August 2006, the Lambino Group filed an Amended Petition with the
COMELEC indicating modifications in the proposed Article XVIII (Transitory
Provisions) of their initiative.

The COMELEC denied the petition citing Santiago v. COMELEC declaring RA 6735
inadequate to implement the initiative clause on proposals to amend the
Constitution.

ISSUES:

1. Whether the Lambino Group’s initiative petition complies with Section 2, Article
XVII of the Constitution on amendments to the Constitution through a people’s
initiative;

2. Whether this Court should revisit its ruling in Santiago declaring RA 6735
“incomplete, inadequate or wanting in essential terms and conditions” to implement
the initiative clause on proposals to amend the Constitution; and

RULING:

1.       The Initiative Petition Does Not Comply with Section 2, Article XVII of the
Constitution on Direct Proposal by the People

Section 2, Article XVII of the Constitution is the governing constitutional provision

that allows a people’s initiative to propose amendments to the Constitution. This
section states:

Sec. 2. Amendments to this Constitution may likewise be directly proposed by the

people through initiative upon a petition of at least twelve per centum of the total
number of registered voters of which every legislative district must be represented
by at least three per centum of the registered voters therein. x x x x (Emphasis
supplied)

The framers of the Constitution intended that the “draft of the proposed
constitutional amendment” should be “ready and shown” to the people “before”
they sign such proposal. The framers plainly stated that “before they sign there is
already a draft shown to them.” The framers also “envisioned” that the people
should sign on the proposal itself because the proponents must “prepare that
proposal and pass it around for signature.”

These essential elements are present only if the full text of the proposed
amendments is first shown to the people who express their assent by signing such
complete proposal in a petition. Thus, an amendment is “directly proposed by the
people through initiative upon a petition” only if the people sign on a petition that
contains the full text of the proposed amendments.
There is no presumption that the proponents observed the constitutional
requirements in gathering the signatures. The proponents bear the burden of
proving that they complied with the constitutional requirements in gathering the
signatures – that the petition contained, or incorporated by attachment, the full
text of the proposed amendments.

The Lambino Group did not attach to their present petition with this Court a copy of
the paper that the people signed as their initiative petition. The Lambino Group
submitted to this Court a copy of a signature sheet after the oral arguments of 26
September 2006 when they filed their Memorandum on 11 October 2006.

2.       A Revisit of Santiago v. COMELEC is Not Necessary

The present petition warrants dismissal for failure to comply with the basic
requirements of Section 2, Article XVII of the Constitution on the conduct and scope
of a people’s initiative to amend the Constitution. There is no need to revisit this
Court’s ruling in Santiago declaring RA 6735 “incomplete, inadequate or wanting in
essential terms and conditions” to cover the system of initiative to amend the
Constitution. An affirmation or reversal of Santiago will not change the outcome of
the present petition. Thus, this Court must decline to revisit Santiago which
effectively ruled that RA 6735 does not comply with the requirements of the
Constitution to implement the initiative clause on amendments to the Constitution.

The essence of amendments “directly proposed by the people through initiative

upon a petition” is that the entire proposal on its face is a petition by the people.
This means two essential elements must be present. First, the people must author
and thus sign the entire proposal. No agent or representative can sign on their
behalf. Second, as an initiative upon a petition, the proposal must be embodied in a
petition.

BAYAN VS ZAMORA

(Sec. 25, Art. XVIII)

FACTS:

The United States panel met with the Philippine panel to discussed, among others,
the possible elements of the Visiting Forces Agreement (VFA). This resulted to a
series of conferences and negotiations which culminated on January 12 and 13,
1998. Thereafter, President Fidel Ramos approved the VFA, which was respectively
signed by Secretary Siazon and United States Ambassador Thomas Hubbard.

Pres. Joseph Estrada ratified the VFA on October 5, 1998 and on May 27, 1999, the
senate approved it by (2/3) votes.

Petitioners, among others, assert that Sec. 25, Art XVIII of the 1987 Constitution is
applicable. Following the argument of the petitioner, under the provision cited, the
“foreign military bases, troops, or facilities” may be allowed in the Philippines unless
the following conditions are sufficiently met: a) it must be a treaty; b) it must be
duly concurred in by the senate, ratified by a majority of the votes cast in a
national referendum held for that purpose if so required by congress, and c)
recognized as such by the other contracting state.
Respondents, on the other hand, argue that Section 21 Article VII is applicable that
what is requires for such treaty to be valid and effective is the concurrence in by at
least two-thirds of all the members of the senate.

ISSUE: WON the VFA is governed by the provisions of Section 21, Art VII or of
Section 25, Article XVIII of the Constitution.

HELD:

Section 25, Art XVIII, not section 21, Art. VII, applies, as the VFA involves the
presence of foreign military troops in the Philippines.

The Constitution contains two provisions requiring the concurrence of the Senate on
treaties or international agreements. Section 21, Article VII deals with treaties or
international agreements in general, in which case, the concurrence of at least two-
thirds (2/3) of all the Members of the Senate is required to make the treaty valid
and binding to the Philippines. This provision lays down the general rule on treaties.
All treaties, regardless of subject matter, coverage, or designation or appellation,
requires the concurrence of the Senate to be valid and effective. In contrast,
Section 25, Article XVIII is a special provision that applies to treaties which involve
the presence of foreign military bases, troops or facilities in the Philippines. Under
this provision, the concurrence of the Senate is only one of the requisites to render
compliance with the constitutional requirements and to consider the agreement
binding on the Philippines. Sec 25 further requires that “foreign military bases,
troops, or facilities” may be allowed in the Philippines only by virtue of a treaty duly
concurred in by the Senate, ratified by a majority of the votes cast in a national
referendum held for that purpose if so required by Congress, and recognized as
such by the other contracting state.

This Court is of the firm view that the phrase "recognized as a treaty" means that
the other contracting party accepts or acknowledges the agreement as a treaty. To
require the other contracting state, the United States of America in this case, to
submit the VFA to the United States Senate for concurrence pursuant to its
Constitution, is to accord strict meaning to the phrase. It is inconsequential whether
the United States treats the VFA only as an executive agreement because, under
international law, an executive agreement is as binding as a treaty. To be sure, as
long as the VFA possesses the elements of an agreement under international law,
the said agreement is to be taken equally as a treaty.

A treaty, as defined by the Vienna Convention on the Law of Treaties, is "an

international instrument concluded between States in written form and governed by
international law, whether embodied in a single instrument or in two or more
related instruments, and whatever its particular designation." Thus, in international
law, there is no difference between treaties and executive agreements in their
binding effect upon states concerned, as long as the negotiating functionaries have
remained within their powers. International law continues to make no distinction
between treaties and executive agreements: they are equally binding obligations
upon nations.

Also, the ratification, by the President, of the VFA and the concurrence of the
Senate should be taken as a clear an unequivocal expression of our nation’s
consent to be bound by said treaty, with the concomitant duty to uphold the
obligations and responsibilities embodied thereunder. With the ratification of the
VFA, which is equivalent to final acceptance, and with the exchange of notes
between the Philippines and the United States of America, it now becomes
obligatory and incumbent on our part, under the principles of international law, to
be bound by the terms of the agreement. 
BATAAN SHIPYARD & ENGINEERING CO., INC. (BASECO) VS. PCGG

(Sec. 26, Art. XVIII)

FACTS

Challenged in this special civil action of certiorari and prohibition by a private

corporation known as the Bataan Shipyard and Engineering Co., Inc. are: (1)
Executive Orders Numbered 1 and 2, promulgated by President Corazon C. Aquino
on February 28, 1986 and March 12, 1986, respectively, and (2) the sequestration,
takeover, and other orders issued, and acts done, in accordance with said executive
orders by the Presidential Commission on Good Government and/or its
Commissioners and agents, affecting said corporation.

The sequestration order which, in the view of the petitioner corporation, initiated all
its misery was issued on April 14, 1986 by Commissioner Mary Concepcion
Bautista.

On the strength of the above sequestration order, Mr. Jose M. Balde, acting for the
PCGG, addressed a letter dated April 18, 1986 to the President and other officers of
petitioner firm, reiterating an earlier request for the production of certain
documents such as Stock Transfer Book and other Legal documents (Articles of
Incorporation, By-Laws, etc.)

Orders were also issued in connection with the sequestration and takeover, such as
termination of Contract for Security Services and abortion of contract for
Improvement of Wharf at Engineer Island; Change of Mode of Payment of Entry
Charges; Operation of Sesiman Rock Quarry, Mariveles, Bataa; disposal of scrap,
etc.; and the provisional takeover by the PCGG of BASECO, “the Philippine
Dockyard Corporation and all their affiliated companies.”

While BASECO concedes that “sequestration without resorting to judicial action,

might be made within the context of Executive Orders Nos. 1 and 2 before March
25, 1986 when the Freedom Constitution was promulgated, under the principle that
the law promulgated by the ruler under a revolutionary regime is the law of the
land, it ceased to be acceptable when the same ruler opted to promulgate the
Freedom Constitution on March 25, 1986 wherein under Section I of the same,y
Article IV (Bill of Rights) of the 1973 Constitution was adopted providing, among
others, that “No person shall be deprived of life, liberty and property without due
process of law.” (Const., Art. IV, Sec. 1).”

It declares that its objection to the constitutionality of the Executive Orders “as well
as the Sequestration Order * * and Takeover Order * * issued purportedly under
the authority of said Executive Orders, rests on four fundamental considerations:
First, no notice and hearing was accorded * * (it) before its properties and business
were taken over; Second, the PCGG is not a court, but a purely investigative
agency and therefore not competent to act as prosecutor and judge in the same
cause; Third, there is nothing in the issuances which envisions any proceeding,
process or remedy by which petitioner may expeditiously challenge the validity of
the takeover after the same has been effected; and Fourthly, being directed against
specified persons, and in disregard of the constitutional presumption of innocence
and general rules and procedures, they constitute a Bill of Attainder.”

It argues that the order to produce corporate records from 1973 to 1986, which it
has apparently already complied with, was issued without court authority and
infringed its constitutional right against self-incrimination, and unreasonable search
and seizure.
BASECO further contends that the PCGG had unduly interfered with its right of
dominion and management of its business affairs.

ISSUE: WON the sequestration order dated April 14, 1986, and all other orders
subsequently issued and acts done on the basis thereof, inclusive of the takeover
order of July 14, 1986 and the termination of the services of the BASECO
executives are valid.

HELD:

Yes. The petition cannot succeed. The writs of certiorari and prohibition prayed for
will not be issued. Other evidence submitted to the Court by the Solicitor General
proves that President Marcos not only exercised control over BASECO, but also that
he actually owns well-nigh one hundred percent of its outstanding stock.

Executive Orders Not a Bill of Attainder –

In the first place, nothing in the executive orders can be reasonably construed as a
determination or declaration of guilt. On the contrary, the executive orders,
inclusive of Executive Order No. 14, make it perfectly clear that any judgment of
guilt in the amassing or acquisition of “ill-gotten wealth” is to be handed down by a
judicial tribunal, in this case, the Sandiganbayan, upon complaint filed and
prosecuted by the PCGG. In the second place, no punishment is inflicted by the
executive orders, as the merest glance at their provisions will immediately make
apparent. In no sense, therefore, may the executive orders be regarded as a bill of
attainder.

No Violation of Right against Self-Incrimination and Unreasonable Searches and

Seizures –

It is elementary that the right against self-incrimination has no application to

juridical persons. While an individual may lawfully refuse to answer incriminating
questions unless protected by an immunity statute, it does not follow that a
corporation, vested with special privileges and franchises, may refuse to show its
hand when charged with an abuse of such privileges. * *

Scope and Extent of Powers of the PCGG –

PCGG cannot exercise acts of dominion over property sequestered, frozen or

provisionally taken over. AS already earlier stressed with no little insistence, the act
of sequestration; freezing or provisional takeover of property does not import or
bring about a divestment of title over said property; does not make the PCGG the
owner thereof.

The PCGG may thus exercise only powers of administration over the property or
business sequestered or provisionally taken over, much like a court-appointed
receiver, such as to bring and defend actions in its own name; receive rents; collect
debts due; pay outstanding debts; and generally do such other acts and things as
may be necessary to fulfill its mission as conservator and administrator.

Powers over Business Enterprises Taken Over by Marcos or Entities or Persons

Close to him; Limitations Thereon –

Now, in the special instance of a business enterprise shown by evidence to have

been “taken over by the government of the Marcos Administration or by entities or
persons close to former President Marcos,” the PCGG is given power and authority,
as already adverted to, to “provisionally take (it) over in the public interest or to
prevent * * (its) disposal or dissipation;” and since the term is obviously employed
in reference to going concerns, or business enterprises in operation, something
more than mere physical custody is connoted; the PCGG may in this case exercise
some measure of control in the operation, running, or management of the business
itself. But even in this special situation, the intrusion into management should be
restricted to the minimum degree necessary to accomplish the legislative will, which
is “to prevent the disposal or dissipation” of the business enterprise.

Voting of Sequestered Stock; Conditions Therefor –

So, too, it is within the parameters of these conditions and circumstances that the
PCGG may properly exercise the prerogative to vote sequestered stock of
corporations, granted to it by the President of the Philippines through a
Memorandum dated June 26, 1986. In the case at bar, there was adequate
justification to vote the incumbent directors out of office and elect others in their
stead because the evidence showed prima facie that the former were just tools of
President Marcos and were no longer owners of any stock in the firm, if they ever
were at all.

No Sufficient Showing of Other Irregularities –

As to the other irregularities complained of by BASECO, i.e., the cancellation or

revision, and the execution of certain contracts, inclusive of the termination of the
employment of some of its executives, this Court cannot, in the present state of the
evidence on record, pass upon them. It is not necessary to do so. The issues arising
therefrom may and will be left for initial determination in the appropriate action.

WHEREFORE, the petition is dismissed. The temporary restraining order issued on

October 14, 1986 is lifted.

Republic v. Sandiganbayan

(Sec. 26, Art. XVIII)

FACTS:

PCGG, on the basis of prima facie evidence, issued an order sequestering Philippine
Integrated Meat Corporation (PIMECO). This is pursuant to the case filed by the
Republic of the Philippines, through the PCGG against former President Marcos and
his cronies for the alleged illegal acquisition of PIMECO, together with their assets,
shares of stock, effects, evidence and records. One of the respondent Sabido filed
his answer on the complaint denying that he was a close business associate of
Ferdinand E. Marcos and that he has not, directly or indirectly, singly or collectively
with his co-defendants, participated in the plunder of the National Treasury and the
other acts stated in the complaint. In this case Sabido claims and strongly objected
to the projected turnover as there was allegedly no basis for such turnover and that
such.

ISSUE: WON the projected transfer of management of PIMECO to MPCP is

unwarranted and was effected or done by petitioner beyond the scope of the
powers vested upon it by law.

HELD:

YES. We find that the projected transfer of management of PIMECO to MPCP is

unwarranted and was effected or done by petitioner beyond the scope of the
powers vested upon it by law. Such turnover made by the PCGG is equivalent to the
performance of an act of ownership which PCGG cannot exercise.

PCGG should be reminded of its mandated task that insofar as sequestered assets
are concerned, the fact remains that it is merely a conservator and not the owner
who exercises power of dominion over the sequestered property. Its power to
sequester ill-gotten wealth is akin to the provisional remedy of preliminary
attachment which is always subject to the control of the respondent
Sandiganbayan.

DE LEON V. ESGUERRA

(Sec. 27, Art. XVIII)

FACTS:

Alfredo M. De Leon was elected Barangay Captain together with the other
petitioners as Barangay Councilmen of Barangay Dolores, Municipality of Taytay,
Province of Rizal in a Barangay election held under Batas Pambansa Blg. 222,
otherwise known as Barangay Election Act of 1982.

On February 9, 1987, they received a Memorandum antedated December 1, 1986

but signed by respondent OIC Governor Benjamin Esguerra on February 8, 1987
designating respondent Florentino G. Magno as Barangay Captain of Barangay
Dolores and the other respondents as members of Barangay Council of the same
Barangay and Municipality.

Petitioners then prayed to the Supreme Court that the subject Memoranda of
February 8, 1987 be declared null and void and that respondents be prohibited by
taking over their positions of Barangay Captain and Barangay Councilmen.

They alleged that pursuant to Section 3 of the Barangay Election Act of 1982 (BP
Blg. 222), their terms of office shall be six years which shall commence on June 7,
1988 and shall continue until their successors shall have elected and shall have
qualified. It was also their position that with the ratification of the 1987 Philippine
Constitution, respondent OIC Governor no longer has the authority to replace them
and to designate their successors.

On the other hand, respondents contend that the terms of office of elective and
appointive officials were abolished and that petitioners continued in office by virtue
of Sec. 2, Art. 3 of the Provisional Constitution and not because their term of six
years had not yet expired; and that the provision in the Barangay Election Act fixing
the term of office of Barangay officials to six years must be deemed to have been
repealed for being inconsistent with Sec. 2, Art. 3 of the Provisional Constitution.

ISSUE: WON the designation of respondents to replace petitioners was validly

made during the one-year period which ended upon the recent ratification of the
1987 Constitution on February 25, 1987.

RULING:

NO. The Supreme Court declared that the memorandum issued by the respondent
has no legal force and effect. It has been held that by the virtue of the 1987
Constitution which is deemed ratified under Article XVIII Sec. 27 that it shall take
effect after a plebiscite and shall deemed supersede all previous Constitutions.

The 1987 Constitution was ratified in a plebiscite on February 2, 1987. By that date
therefore, the provisional constitution must be deemed to have been superseded.
Effectivity of the Constitution is also immediately upon its ratification.

Having become inoperative, respondent could no longer rely on Sec 2, Art 3,

thereof to designate respondents to the elective positions occupied by petitioners.
Relevantly, Sec 8, Art 1 of the 1987 Constitution further provides in part:
 "Sec. 8. The term of office of elective local officials, except barangay officials,
which shall be determined by law, shall be three years x x x."

Until the term of office of barangay officials has been determined by law, therefore,
the term of office of 6 years provided for in the Barangay Election Act of 1982
should still govern.

Therefore, upon declaration of Memoranda with no legal force and effect, hence,
the writ of prohibition enjoining respondents from proceeding with the take-over is
as well granted.